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Simplify first, automate second

Simplify first, automate second

Alexander M. Cutler, Executive Vice President, Chief Operating Officer-Controls, Eaton Corp., Cleveland, OH
Cutler assumed his current position in 1993. He has worked his way up the management ladder at Eaton, serving in a series of management positions that ranged from Executive Vice President-Operations through Plant Manager of Eaton's Atlanta Assembly Plant. Cutler joined Cutler-Hammer in 1975 as a financial analyst and became Business Group Controller in 1977. After the acquisition of Cutler-Hammer by Eaton in 1979, he was made a division controller. Cutler holds a B.A. from Yale University and an M.B.A. from Dartmouth College.

People remain the key to success in business, says Cutler. And there's a particular need for design engineers who can work well as part of a team.

Design News: How important is it for a company to produce engineered products, as opposed to commodity products?
Cutler:
Businesses can do well doing either, but it's a very important decision to make. At Eaton, and at Cutler-Hammer, we have organized our business and our business philosophy around trying to provide higher value products and solve complex customer problems. We believe we can bring some differentiation, some competitive edge, to our customers through highly engineered products.

Q: How much of your company's design engineering and manufacturing work will move offshore to serve foreign markets and reduce costs?
A:
We really don't see a big movement offshore. Today North America is the best place to manufacture in the developed nations. Given the improvements in quality and productivity here in the U.S., and the relative value of the dollar, the U.S. is an extremely competitive place to make products. We have had design capabilities in our subsidiaries for some time, but our major design centers are in Pittsburgh and Milwaukee, and we don't see that changing.

Q:What technical trends do you see developing in the markets served by your new company?
A: One is miniaturization. In every industrial control and power distribution product line that we sell, there's continued pressure to make products smaller. Another is the integration of electronics into virtually all products. A third is the surging growth in industrial communications. Smart devices and decentralized control lead to peer-to-peer control, and a real need for standardization in this area. Power distribution system coordination, and the growth in the use of vacuum-interrupting technology, are also important trends.

Q: How much contact with customers should design engineers have?
A:
In our opinion, anybody who is stuck in the lab is stuck. We feel very strongly that you must be in the marketplace, that our design engineers must have the opportunity to exchange ideas directly with our customers and understand their problems. That's really how you get the creative juices running, and it's how you ensure that you're solving the problem your customer really needs solved. We think that meeting with the customer is just absolutely mandatory.

Q: What does your company look for in its engineers?
A:
We want bright people who are highly motivated, who are hungry and creative, and who like spending time with customers. A design engineer must have a good appreciation of what's important in the business. That means they've got to understand the customer interface, they've got to understand the primacy of the customer's requirements, they've obviously got to be someone who's very creative and has the engineering skills to integrate those needs and come up with a solid solution. And we want people who work well in teams. That is something we look for very strongly.

Q: When will we see "Lights-Out' factories built?
A:
You won't see them built at Cutler-Hammer. I am not an advocate of lights-out factories because of the central implication that there'll be no people. Simplification should always come before automation. Every time we think we understand the pace of change, we find out we're wrong, that it actually comes faster, and it puts a tremendous premium on speed and flexibility. We've really tried to form our strategies around thinking about technology as something used to help make our associates more productive and more flexible-but not to replace them.

Q: How flat can a big company like yours become and still remain efficient?
A:
We talk about this question a lot. How much supervision is really necessary? Organizations can keep getting flatter the more self-reliant the people in the company are. The challenge is: When an organization gets really flat, how do you get some sense of coordination or collective direction? And that's where the communication challenge comes in. The traditional manager has to move from being a manager to being a facilitator, a coach, a communicator, whatever word you want to use.

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