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Technology Report - Articles
Technology Report - Issue 4

MMA IT Report In this issue:

  1. AT&T Survey Shows Many Michigan Businesses Still Lack Continuity Plan
  2. FIRST Robotics Competition Boosts Future Workforce
  3. Report: America’s Economic Power is Waning
  4. Huge Virus Threatens Microsoft
  5. Education and Technology are Safeguards to Job Security in Auto Industry
  6. Small Businesses Encouraged to Protect Intellectual Property
  7. GM Set to Unleash $3 Billion in IT Deals
  8. Companies Use Online Magazines to Woo Customers

1. AT&T Survey Shows Many Michigan Businesses Still Lack Continuity Plan

AT&T Corp. and the International Association of Emergency Managers released a report 1/3 showing that almost one-third of Michigan businesses do not have business continuity plans in place.

Although nearly a quarter of companies surveyed have experienced a disaster in the past, 40 percent still feel that contingency planning is not a priority for their business.

“Disaster Planning in the Private Sector: A Look at the State of Business Continuity in the U.S.” surveyed 100 senior technology executives with direct business-planning responsibilities in Michigan. The 2003 blackout placed renewed emphasis on contingency planning, when businesses ranging from banks to supermarkets to auto plants were down for days. The costs are real; losses were estimated at $220 million by the Detroit Regional Chamber and University of Michigan’s Institute of Labor and Industrial Relations.

Of the companies with continuity plans, 49 percent report testing them in the last year and more then half of those in the last six months (26 percent overall). Both figures are below the national averages. The consensus of business continuity experts is that plans should be tested at least every six months. Almost a fifth, (19 percent) have never tested their plans, which is considerably above the national average.

Updating the plan is also critical, and Michigan companies seem to understand that; 76 percent made revisions in the past year, and 51 percent in the past six months. This is about the same as the national average. None say that their plans have never been revised.

Recognizing the increasing importance of their networks to their day-to-day operations, 80 percent have implemented such Internet security precautions as firewalls, intrusion detection, hacker protection and password authentication or plan to do so in the near future. Educating employees in security issues is a key part of network protection, and 88 percent of Michigan companies who include cyber security as part of their business continuity plan have made it part of their program, even more than the 80 percent who have developed defined corporate security policies.

For more information on the survey, visit the AT&T Web site.

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2. FIRST Robotics Competition Boosts Future Workforce

One organization, For Inspiration and Recognition of Science and Technology (FIRST), strives to create a world where our future workforce dreams of becoming science and technology heroes. FIRST will further this goal through three regional robotics competitions to be held in Michigan this spring.

The competitions are:

  • The Great Lakes Regional to be held at Eastern Michigan University in Ypsilanti from March 9-11;
  • The Detroit Regional to be held at Wayne State University in Detroit from March 16-18; and
  • The West Michigan Regional to be held at Grand Valley State University in Allendale from March 30-April 1.

FIRST is a multinational, non-profit organization that aspires to transform culture and make science, math, engineering and technology as cool for kids today as sports are.

The organization is seeking volunteers to help run the competitions in the state. For more information, see the FIRST Web site.

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3. Report: America’s Economic Power is Waning

All advance societies now depend so completely on technology that their economic might is often measured by their number of scientists and engineers. According to a report by a Harvard University economist, America’s economic power is waning.

The report by Richard Freeman states that in 1975 the U.S. graduated more engineering and scientific PhDs than Europe and more than three times as many as all of Asia. Currently the European Union graduates about 50 percent more and Asia is slightly ahead of us. China has reached about half of the U.S. total and is expected to overtake us by 2010. Among engineers with bachelor’s degrees, the gaps are already huge. In 2001 China graduated 220,000 engineers and the U.S. graduated only 60,000.

Freeman also documented that U.S. scientists and engineers aren’t well paid, considering their skills and the time required to earn their degrees — especially PhDs. Compared to other elite students like MBA recipients, lawyers and doctors, scientists and engineers were the poorest paid.

Although this scenario seems bleak, it’s important to note that the U.S. still dominates global research and development. In 2000 the U.S. accounted for 44 percent of the laboratories doing research and development among members of the Organization for Economic Cooperation and Development. The U.S. market share dropped by only 1.0 percent from 1981, despite the increase in other countries’ scientists and engineers and a decline in U.S. defense research and development.

The increase of other nations’ technical talent is not a threat to the U.S. in and of itself. The true threat comes when another country uses new technologies to erode America’s advantage in weaponry, such as the possible case with China, or if another country skews their economic policies to attract an unnatural share of strategic industries, such as electronics, biotechnology and aerospace, among others. Again this is an issue with China as well as some other Asian countries and in Europe.

Freeman says that what’s crucial is sustaining our technological vitality. That may come in the form of bolstering our own educational agenda or recruiting talent from other countries. Regardless of lower pay, we must fuel ambition by emphasizing the bigger payoff that comes with successfully commercializing technology. In the end, that is how everyone will win.

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4. Huge Virus Threatens Microsoft

Security experts are scrambling to confront a potentially massive virus threat to Microsoft Windows PCs.

According to a report from the Financial Times 1/3, the latest vulnerability involves a flaw which allows hackers to infect computers using programs inserted inside of image files. Unwitting victims can infect their computers simply by viewing a web page, e-mail or instant message that includes a contaminated image.

The threat was discovered last week but mushroomed over the weekend when hackers published the source code they used to exploit the flaw.

According to experts, any version of Windows is vulnerable, including every Windows system shipped since 1990.

Microsoft said a security patch would be available for the problem on 1/10 after it passed rigorous testing procedures.

However, the SANS Institute, a computer security group, has released a patch for the vulnerability until Microsoft’s fix is available. It is available on the SANS Web site.

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5. Education and Technology are Safeguards to Job Security in Auto Industry

Some of the newest generation of white-collar workers — those with the brightest future in the auto industry — are building automotive careers and moving to Michigan to work, proving metro Detroit is still a key hub for auto development and production that attracts talent; this according to a Detroit Free Press article.

“The auto industry of the future will be a younger and more educated workforce,” said David Cole, chairman of the Center for Automotive Research in Ann Arbor. “High-paying jobs for educated workers are not going away.”

Job security comes from working in a part of the industry that is the wave of the future, like alternative fuel vehicles said one Ford Motor Co. worker.

With Michigan’s dominance in the automotive sector, it’s apparent that some form of an auto industry will be here for the foreseeable future, the challenge for the next 20 or 30 years is to provide technology to sustain the industry.

In the new Ford Dundee plant, everyone is required to have advanced education or training. The plant is more automated than older plants. Employees build engines mostly by operating computerized machines, not through pure physical labor.

“The auto industry of the future will employ fewer people,” said Cole. “As factories become more efficient, the companies will be able to make more cars and trucks with fewer employees. The employees who remain need higher levels of education.”

Factory workers of the future will need advanced education to meet the requirements, Cole added. Knowledge and skills, not muscle, will set them apart.

“Michigan’s workforce must become more educated to keep up with the changing demands,” said Patrick Anderson of the Anderson Economic Group in East Lansing.

“The state needs to raise high school standards so more students are prepared to attend two-and four-year colleges,” Anderson said. “Math and science programs need to be stressed and expanded so students have stronger technical skills.”

According to Anderson, despite the overall economic woes in southeast Michigan, jobs based on technical skills and expertise show promise and pay high wages and the auto industry is the cornerstone of the technology industry.

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6. Small Businesses Encouraged to Protect Intellectual Property

The U.S. Patent and Trademark Office (USPTO) has launched an educational campaign geared toward small businesses that encourages them to protect their intellectual property. USPTO is offering print materials intended to help small businesses protect their company’s name or brand, conferences and seminars specifically designed for small businesses and a new Web site: StopFakes.gov.

The Web site offers information on patents and copyrights to help small businesses understand the difference between these valuable tools and how to get started with them.

Also in a move to help protect small businesses’ intellectual property, the National Chamber Foundation (NCF) has launched an ongoing initiative aimed at raising awareness about counterfeiting and piracy, a problem that costs U.S. companies $250 billion annually and the economy 750,000 jobs.

The initiative advocates for stronger penalties, increased enforcement and the disruption of counterfeiting networks. In addition, the initiative coordinates education efforts aimed at the media, business owners and policymakers and conducts specific programs in priority countries like China and Brazil to stop the spread of illegal activity.

For more information, see the U.S. Chamber of Commerce Web site.

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7. GM Set to Unleash $3 Billion in IT Deals

General Motors Corp. will announce this month which companies will win more than 40 information technology contracts worth $3 billion annually.

According to Bharat Desai, CEO of Troy-based Syntel Inc., a GM-approved subcontractor, GM plans to use three prime contractors and roughly 20 subcontractors.

Syntel expects GM will become a top 10 customer and it will hire additional employees because of the new business.

CrainTech reported that others in the Detroit area expect to gain as well.

Compuware Corp. anticipates landing as much as $400 million a year in new business as a subcontractor for GM. On the high end, Compuware could see revenue of $2 billion during the proposed, five-year contract term, said company chairman and CEO Peter Karmanos Jr. during a November investor’s conference.

Farmington Hills-based Covansys Corp., an existing GM subcontractor, is looking forward to additional GM work and hiring additional employees because of it.

“We have an advantage of already working in several areas,” said Siva Velu, executive vice president of the east commercial business for Covansys. “What we’re hoping is that this will provide an opening into many other divisions.”

IBM Corp. has had 500 of their 1,700 Southeast Michigan employees working to win as much of the business as possible. Frank Roney, manager of IBM’s global GM account, told Automotive News that it would use local subcontractors to help fulfill the contracts it wins.

EDS’ 10-year contract to provide information technology services to GM expires in June. GM invited vendors to bid on the business in 2004.

CEO of EDS, Michael Jordan said the company is offering new services to the automaker to try and hold on to as much of the GM business as possible, such as new virtualization services and products. He said it’s likely that there will be some lost jobs as the company loses its exclusive status.

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8. Companies Use Online Magazines to Woo Customers

According to an Associated Press article, more and more companies are shifting their Web presence to be more magazine-style than advertising blitz.

The move toward informing and entertaining the consumer instead of bombarding the consumer with product promotion and coupons is an effort to win more loyalty.

“It’s a major trend and it’s a moving trend,” said Gary Stibel, a marketing analyst who heads the New England Consulting Group. “This has been going on for years; the major advertisers are just understanding better how to execute. Most companies are still doing very poorly because they are far too blatant in promotion of their own brands.”

One such site is Procter & Gamble Co.’s (P&G’s) Home Made Simple Web site. The site promises “simple solutions for easy living,” offering tips on dinners, decorating, cleaning and organizing a home, as well as downloadable music, amusing family anecdotes from comedian Rajiv Satyal and a continuous scroll of fun factoids. Eventually, you get to the promotions — discounts, coupons and other come-ons for P&G’s products.

“Our strategy is not to be all about the brand — it’s really about her (the consumer) and the stuff she wants to know about,” said Maurice Coffey, marketing director for Home Made Simple.

Since its launch about five years ago, P&G’s Home Made Simple site has grown from 300,000 subscribers for its free monthly e-mail newsletter to a projected 10 million in 2006. It’s among seven sites linked from the Cincinnati-based company’s main site that combines information aimed at the target markets for its varied consumer products.

Other approaches focus on entertainment. Coca-Cola Co.’s CokeMusic site has let participants hear new music, create their own music mixes and go virtual clubbing, while Anheuser-Busch Inc.’s Budweiser site has new music and movie trailers as well as humorous beer commercials.

Interactive games and competitions are also drawing cards, such as Dr. Pepper’s site to play the “Throw For Dough” football game.

American Express Co. made a big splash in 2004 with two “webisodes” — online video stories about five minutes long with comedian Jerry Seinfeld and his pal, Superman. The company’s site received 3 million visitors “in a fairly short time,” company spokeswoman Judy Tenzer said.

View these innovative sites and others:

American Express: My Life, My Card
Anheuser-Busch Inc.: Budweiser
Burger King: Subservient Chicken
Coca-Cola Co.: CokeMusic
Dr. Pepper
Nestlé
Proctor & Gamble: Home Made Simple

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Posted on Friday, January 06, 2006 (Archive on Monday, January 01, 0001)
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