FPDA/ISD Summit Update

Managing the Forces of Change - that was the title of Tim Underhill's keynote address at this year's Summit. Keeping in mind that industrial users are demanding innovative and efficient products and systems, both component manufacturers and distributors are faced with the need to meet these demands.

Underhill was clear to point out that vendors and distributors alike need to document and report the savings and efficiencies that they supply to their customers. This gives a competitive advantage to the vendor.

Of course, competing on a commodity level is based on price. But, Underhill illustrated a pyramid of solution levels that vendors supply. At the bottom is transactinal solutions, meaning commodity and pricing. The next level are application solutions where vendors seek and deliver innovations to meet the customers' needs.

Moving up to the next level is the business objectives solutions level. Here, the vendor partners with the user to meet their overall business goals and objectives by innovating and providing such products. At the top of the pyramid is the strategic/competitive advantage level where the vendor has input to where the customer can create a competitive advantage in their field.

This is a very interesting perspective on industry as it exists today and is very helpful advice to component manufacturers and distributors. According to Professor Theodore Leavitt, "there is no such thing as a commodity." He challenges manufacturers to differentiate their products to offer their customers a competitive advantage. This is what I understood Underhill to recommend.