High-tech influence on manufacturing continuing.

This isn't your father's manufacturing industry. The days of the punch-card time clock being the most high-tech machine in the factory are long extinct. As the decade steams to its midway point in 2005, manufacturers will increase their reliance upon software programs to analyze data and performance, initiate adjustments and monitor daily operations. Additionally, with the economy appearing to be improving, manufacturers will likely spend more on information technology in the coming year, industry watchers say.

Pamela Welden, the director of the Employee Training Institute at the College of the Canyons, described the variety of ways in which manufacturers have and will continue to rely upon technology.

"There are so many ways that software is now entering the daily routine of manufacturers. From entering data online through Excel to secretaries learning how to update the web site to the manufacturing trainees that we help to learn to use software, it goes up the production line, all the way to upper management," Welden said. "Software is being used for materials resource planning, done through sophisticated software to reduce the costs of inventory and to really control the inventory. I absolutely see this trend increasing in 2005; the technology wave is upon us again."

Chocolates a la Carte, a Valencia-based chocolate manufacturer has reaped the benefits of new customized manufacturing software. By expanding its software capabilities, the company has been able to tighten up their operations to stem the wasting of resources.

"We're trying to get computer literacy down the manufacturing chain. It enables employees to be more proactive and to do their job duties without going to a supervisor or a customer service liaison. It's also helped us figure out where we're wasting resources. Whether it's time or lacking materials, we're able to see where things are getting stopped," Jim Badberg, director of information technology at Chocolates a la Carte, said.

Badberg sees his company only increasing its reliance upon new software in the coming year.

"I see this trend increasing in 2005. We just did a big expansion in 2004, where we increased the role that business software plays. We'll be building on that in 2005, not only from a production routine standpoint but from manufacturing costs. We'll be collecting more data about manufacturing times and raw material costs," Badherg said.

Abdiel Sanchez, chief financial officer of 4Service Inc., an Encino-based IT services and disaster recovery company, does a good deal of business with manufacturers and believes 2005 will see an increased amount of tech spending.

"We work with some manufacturers and in the last couple of years they've been holding back. But recently we've seen them investing in new operating systems and some are investing in new enterprise resource packages. I see them going back to investing in technology, where in years past they hadn't been investing in that type of business," Sanchez said.

IT spending increases

This trend seems to not be exclusive to the Valley, as a recent report issued by Massachusetts-based research firm, International Data Corporation, showed a recent increase in manufacturers' IT spending. The research firm reported that American manufacturers spent $77.1 billion on IT in 2004, a five percent increase over 2003 and a "marked improvement" over recent years that saw stagnant and even lower spending.

Chuck Swick, the president of Burbank-based Pacific Wire, a manufacturer of custom steel wire products, finds the IDC's findings accurate.

"I think companies are going to spend more on IT in the coming year. The economy seems to be improving and as it improves more and more companies are willing to invest in IT. In 2005, we're going to continue to use computer technology and will update when new programs are available. It makes us more efficient," Swick said.

Mike Newman, business development manager for Cal Net Technology Group, a Northridge-based computer and network services company, stressed the growing need for manufacturers to implement information technology and customized business software.

"It's just a trend that will continue. The more manufacturing-tailored the software is, the better it will be for their business. It can lead to big dollar savings for manufacturers," Newman said. "ERP software is often used in manufacturing to manage the entire business, from production to distribution. The trend is to use software and IT to make things better, to plan better, to reorder better, to have customer service representatives to check on the status of the orders. It's extending the functionality of your business."