Daily Archives: December 12, 2011

Space Shuttle Update (47)

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SPACE WATCH· NASA TV· Boeing: Slide show · Book (pdf)

USS Intrepid Aircraft Carrier at Enterprise Title Transfer
NASA – USS Intrepid aircraft carrier which is home to the Intrepid Sea, Air & Space Museum is seen in the late afternoon on Sunday, Dec. 11, 2011 in New York City. Earlier in the afternoon NASA transferred title and ownership of the space shuttle Enterprise to the museum. The transfer is the first step toward Intrepid receiving Enterprise in the spring of 2012. Image Credit: NASA/Bill Ingalls

Ride on the Middeck
On June 18, 1983, Sally Ride made history, becoming the first American woman to go space. In this image, Ride stands on Challenger’s middeck, wearing light blue flight coveralls and communications headset, as she floats alongside the middeck airlock hatch.

Floating Free
Astronaut Bruce McCandless II, STS 41-B mission specialist, participates in a historical spacewalk. He is pictured a few meters away from the cabin of the Earth-orbiting Space Shuttle Challenger. This spacewalk represented the first use of a nitrogen-propelled, hand-controlled device called the Manned Maneuvering Unit (MMU), which allows for much greater mobility than that afforded previous space walkers who had to use restrictive tethers.

Foggy Rollout
The Space Shuttle Challenger, atop a mobile launch platform, slowly moves through the Florida fog to Launch Pad 39A in preparation for its first liftoff on the STS-6 mission. The fully assembled Shuttle, weighting 12,000 pounds less than predecessor Columbia, completed the trip to the pad in just over six hours on Nov. 30, 1982.

Discovery’s Maiden Voyage
Space Shuttle Discovery soars away from Launch Pad 39A at the Kennedy Space Center, beginning its maiden voyage and a storied spaceflight career that spanned more than 26 years. The on-time liftoff occurred at 8:42 A.M. EDT. Aug. 30, 1984

2012 Industrials Industry Perspective

FUTURE WATCH

Strategy& [www.strategyand.pwc.com] – We would like to offer our thoughts on the current business environment for industrial companies, what the future holds, and the best course forward.

Where We Stand
Call it the age of uncertainty-this post-Great Recession environment when a weak recovery and any number of troubling signs globally cast shadows on relatively strong recent profit results. The future for industrial companies is a somewhat confusing blend.

On the plus side, industrial revenues (unadjusted for inflation) in the first nine months of 2011 topped levels last seen in the peak year of 2008, and earnings in this period were up 25 percent compared to January through September 2010. Average net profit margins at industrial firms are relatively robust again: about 6 percent now, a 6 percent improvement over last year. Emerging economies drove most of this growth, as real GDP gains in developed nations slowed to a meager 1.5 percent in 2011. In addition, the Dow Jones Industrials Index was down only 5.7 percent compared to an 11.4 percent drop in the overall stock market during that period.

The bad news, though, is that there is bad news-and it can’t be easily ignored. For one thing, consumers and companies are still hesitant to spend their money-the Purchasing Managers Index tumbled in the first nine months of 2011, to 51 from 61-and unemployment remains stubbornly high. Concerns persist that a second global recession-a double dip-is increasingly possible. Perhaps even more disconcerting, no matter what happens in the developed economies, GDP growth is already slowing in the most important emerging nations.

Given this uneven blend of trends and forecasts, it’s little surprise that industrial companies have been conservative strategically. This can be seen, for example, in the pace of mergers and acquisitions. Although at the end of 2010, industrial outfits were relatively flush-cash on hand surpassed 14 percent of revenue compared to an average of about 9.5 percent during much of the past decade-the popularity of M&A has flagged recently. In the first nine months of 2011, the number of deals fell by at least 25 percent.

Instead of acquisitions, most successful industrial companies have been content to cut costs, prune their product and business unit portfolios, deleverage, and hoard cash. While that approach has perhaps put these companies in a position to navigate uncertainty, it is nonetheless a questionable tactic. Simply put, if industrial firms sit on the sidelines with their cash for too long, they may end up under-investing in their businesses and innovation-and minimizing their growth prospects.

Over the next few years, we believe, industrial companies should view the glass as mostly half-full. They should have enough cash on hand to weather a crisis or two, but more important, they should use this time to put their money to work, particularly when many of their rivals will likely be reluctant to make bold moves. In other words, this is a perfect moment for smart industrial companies to invest in developing the capabilities, assets, and strategic intelligence that allow them to achieve and sustain competitive advantage and that prepare them to take a leading position in their industrial sectors when opportunities for growth emerge.

A Capabilities Strategy
We define capabilities as the three to six distinctive strengths your company has (or should develop) to set it apart from competitors. Each capability is built on a combination of processes, tools, knowledge, skills, talent, and organization.

The following capabilities stand out as the most essential for industrial companies to develop and align:

  • Agile Product Development and Strong-Form Product Management
    Product life cycles are decreasing as the pressure of competition and technology breakthroughs drive frequent product upgrades, if not entirely new offerings.
  • Cost Fitness
    Through top-down, across-the-board budget cuts of, say, 5 percent or more a year, operational expenses may be trimmed to the bone, but to what end?

Supply Chains
Decades of relentless focus on cost cutting have left industrial supply chains vulnerable to disruptions like the earthquake.

Information Technology
In the industrial sector, IT has typically been viewed as a cost to be managed and minimized. But that’s not viable anymore.

Digitization Strategies
Rapid advances in new digital technologies offer industrial companies a wide swath of tools that can be used to take advantage of new opportunities ranging from improving equipment productivity to customer data management and analysis.

Winning the Talent War
Despite high unemployment rates in developed countries, the supply of skilled workers who can engineer, design, sell, and service industrial products is meager at best.

Developing the BRIC Markets
The BRIC economies may be slowing a bit, with less than 7 percent GDP growth forecast through the end of 2012, but for many industrial companies they represent the best opportunities for growth.

We would welcome the opportunity to hear your thoughts about the year ahead. ™¦

related>

Euro Crisis Pits Germany and US in Tactical Fight

By Nicholas Kulish – At the heart of the debate is the question of how far governments must bend to the power of markets. Mr. Obama sees retaining the stability of markets and the confidence of investors as a primary goal of government and a prerequisite for achieving any major changes in public policy. Mrs. Merkel views the financial industry with profound skepticism and argues, in almost moralistic fashion, that real change is impossible unless lenders and borrowers pay a high price for their mistakes.

It will be difficult to know for weeks, or maybe even months, which approach is right. But it is clear that the stakes are high, with the health of the world economy, the European Union and perhaps Mr. Obama’s presidential hopes hanging in the balance. more> http://twurl.nl/ikutue

Europe’s Fiscal Pact May Solve Next Crisis, Not This One: View

Editorial – In concentrating on long-term fiscal reform and not the crisis at hand, the Dec. 8-9 European Union summit asked the wrong questions — then failed to answer even those.

The agreement also tells countries to write a “golden rule” into their basic law. Structural deficits — after adjusting for the business cycle — are not to exceed 0.5 percent of GDP. This, too, will need spelling out before it can be given legal force: Structural deficits cannot be measured; they have to be estimated using an economic model.

The golden rule is a bad idea anyway. To make room for fiscal stimulus in future recessions, countries would have to run big budget surpluses the rest of the time. This is too severe, and unrealistically so: Law or no law, it is unlikely to stick. more> http://twurl.nl/q72dt7

The Bomb Buried In Obamacare Explodes Today-Hallelujah!

By Rick Ungar – The provision of the law, called the medical loss ratio, requires health insurance companies to spend 80% of the consumers’ premium dollars they collect–85% for large group insurers–on actual medical care rather than overhead, marketing expenses and profit.

Today (12/2/11), the Department of Health & Human Services issues the rules of what insurer expenditures will–and will not–qualify as a medical expense for purposes of meeting the requirement. Selling me a health insurance policy is simply not the same as providing me with the medical care I am entitled to under the policy.

We are already seeing the parent companies who own these insurance operations fleeing into other types of investments. They know what we should all know – we are now on an inescapable path to a single-payer system for most Americans and thank goodness for it. more> http://twurl.nl/4pqqry

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CONGRESS WATCH Congressman Hanna on CNBC, YouTube [VIDEO 9:01] Related articles Updates from Congressman Richard Hanna (blogs.strategygroup.net)

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CONGRESS WATCH Rep. Scott Tipton Weekly Update December 9, 2011, YouTube [VIDEO 3:06] Rep. Scott Tipton Questions Jon Corzine During Agriculture Committee Hearing, YouTube [VIDEO 5:32] Tipton wants revised PILT rules, Peter Roper, Pueblo Chieftain Beltway Blog — Bennet, Tipton … Continue reading