Peter Navarro, CNBC contributor, economist, author, business professor

We are excited to have internationally recognized Peter Navarro on our dream team of strategists. Here's a preview to his highly anticipated session, Managing Through the Downturn: The Perils and Promise of the 2009 Economy:

SGS: The classic response to a business cycle like this is to have the CFO slash every conceivable cost out of the budget to reduce the hit to margins. Is that the right thing to do?

PN: I have written extensively about strategies designed to manage around business cycle movements in key turning points like recessions. As a rule, the smartest companies engage in countercyclical behavior. Rather than decreased advertising, for example, they increase advertising to build brand and increase market share. Smart companies also use recessions to "cherry pick" from a deeper talent pool to staff at lower costs. Most companies won't be able to "crosscut" their way out of this recession.

SGS: In your experience, what's the one tool that most CEOs realize that they don't have, and wish they did, when they face this type of challenge?

PN: The ability to have seen it coming. Much of my teaching and public speaking life is dedicated to training corporate executives how to do their own economic forecasting on a daily and weekly basis so they are never caught by surprise by recessionary downturns. The two things that CEOs really need right now is a high level of economic and financial market literacy and large cash reserves. If you find yourself with large inventories and in a cash squeeze, your company simply doesn't know how to manage the business cycle very well. That's a task you need to learn. We'll be discussing that in San Diego.

SGS: We don't want to steal your thunder and share your predictions for 2009 here-we'll save that for San Diego. But we're curious if you have ever seen an economic situation quite like this one in the years you've been doing economic forecasts.

PN: The current economic situation is both unprecedented and historically significant-as significant as the Great Depression. There are so many variables that no economic forecaster can accurately predict (except by accident) how long the current travails will last. What worries me the most is not the short-term cyclical drop in the economy, which we call "recession," but rather the possibility of a long-term secular downshifting of the economy due to the loss of our manufacturing base.

 

 

Jared Smith, 3x SGS participant

When he attended his first Signage and Graphics Summit in January, 2006, Jared Smith's six-year-old environmental and vehicle graphics company, bluemedia, was entering an exciting period of growth. By mid-2007, revenues would jump by 50%, its workforce would grow by 30%, and the company would more than double the size of its 8,000-square-foot production facility.

Today, bluemedia serves more than 3,000 local, national and international clients from its Tempe, Arizona base. And as Jared makes plans to attend his 4^th SGS event, we asked him how his annual trip to the Summit has contributed to that success.

SGS: You have attended every Signage and Graphics Summit, and brought other members of your executive team each year. What is it about the Summit that warrants such a high priority from your company?  

JS: This is the only avenue to discuss our trade with qualified peers who do real volumes, with real vendors, real clients and run real organizations. This Summit is geared towards principals who understand budgets, forecasts, H/R issues, scheduling software, job flow, lean manufacturing-all the critical issues in my business.

Those items are also the exact topics covered in the sessions, and while the provided content is near dead on, without one wasted session, the dialogue in the hallways is almost as valuable. We have picked up vendors and clients to the tune of hundreds of thousands of dollars in the past few Summits alone, and I think that also points to the strength of the attendees. These are guys like me who work it, grind it and live it every day.

Think about the value of being able to write down just two issues that you could use some help on in your business. Bring those questions to the Summit, and bounce them off a few newfound friends in the industry. You'll come back home a lot closer to the solution you need, with two years of trial and error skipped. You can't find that at any trade show I know of.

SGS: You once said that before the first Summit, you weren't sure your company was "big" enough to participate-though it has grown a great deal since then. Is the Summit just for the biggest companies in the industry?  

JS: Selfishly, I would love to say yes, but the answer is no. We had 17 employees when we first attended and now have over 50. In the first year we sat in the audience and took notes. We now are much more involved and that is due to the fact that we have something to offer others now that we may not have had at first. We're still a small company, and we still have a lot to learn. This Summit is definitely not for someone who owns a plotter in their garage. But for those who are serious about perfecting their craft, this is a place you need to be regardless of size.

 SGS: This year's conference will be focusing on lean manufacturing strategies and sustainability. Timely topics for bluemedia?  

JS: Absolutely. This marketplace demands that you run your operation as efficiently as possible today-lean manufacturing, 6 Sigma, automated job flow, automated finishing equipment, etc. To win at this game, you cannot act or perform like an amateur. Those topics are what is needed today, for sure.

 

Darren Dolcemascolo, senior partner and co-founder, EMS Consulting Group

We are excited to have Darren Dolcemascolo speaking at this year's Summit. Dolcemascolo is an internationally recognized lecturer, author, and consultant on lean manufacturing principles.

Here's a preview to his session, Lean Manufacturing in a Lean Economy:

SGS: Why should a company prioritize becoming leaner and more efficient today? Don't many executives tend to back-burner new initiatives like this in uncertain economic times?

DD: Some executives tend to put improvement initiatives like lean on the back-burner when times get tough because they are not viewed as critical, but others, who have a longer term view, seize the opportunity to make improvements when the economy is bad. Lean can help companies navigate a bad economy in three ways:

1. Lean implementation results in a shorter lead-time and lower inventory; this frees up of cash (through inventory reduction) and faster response time to the customer.
2. Lean thinking results in greater productivity-the ability to produce more value with the same or fewer resources, driving down production costs.
3. Lean thinking improves quality. Better quality results in greater customer satisfaction and efficiency.

Each of these key benefits enables a company to grow during tough times while simultaneously freeing up cash and driving costs down.

SGS: What's the most common reason businesses don't get the results they expect from a lean program?

DD: The most common reason lean initiatives fail is company leadership teams not understanding what lean is. Many times, management views lean as a project that someone in the organization can be tasked with implementing. In reality, lean is a culture change that requires active leadership and all-employee involvement. If the leadership team of an organization is committed to lean and actively involved in the initiative, success is inevitable. Company leadership must communicate a lean vision to all employees, teach them the lean principles, and get them involved.

SGS: You've worked with a few companies in the sign industry. Did you notice anything about their operations that lend themselves to lean manufacturing principles?

DD: Yes, two things in particular: Sign companies have a complex pre-production process that affects delivery time to the customer, and they have a job-shop production environment. Lean isn't just about eliminating waste. It also brings value to the customer by giving them the products they want when they want them, and not on a schedule dictated by manufacturing. This has two ramifications for sign companies:

1. They must focus on reducing the time from when the customer places the order, to the point when production of the job begins. Many times, the pre-production processes take so much of the promised lead time that little time is left to actually produce the product.
2. In the production area, sign companies must focus on creating flexible manufacturing capabilities that will allow them to move resources where they need to be to produce what customers want on demand and with the least amount of waste.

 

 

Rock LaManna, CEO, president, LaManna Alliance

In his session, Is It Time to Buy or Sell? The ABCs of M&A, M&A expert Rock LaManna will cover the factors that any company thinking of buying, selling, or merging should keep in mind. Here's a preview of this highly anticipated session.

SGS: I imagine that M&A activity tends to dry up in economic periods like this one, with sellers holding out for better prices and buyers afraid to commit their capital. Is this the right response to the current conditions?

RL: Well, it has been one response. The overall global economic condition is a "wake-up call" to the realists and the true business leaders. I like to be optimistic, and I strongly believe owners should dig deep and identify the true reasons they want to hunt or allow themselves to be hunted. This means being personal about their passion to change. It takes courage to buy or sell a company. The M & A analytical process is very important; however, dreams and success begin within. A lot of people start down a path toward a merger or acquisition without understanding their own motivations, or assuming they know the logic behind how this game is played. Understand, reflect, and document your plan and your expected outcome. The wisdom to create this vision is part of the journey, no matter what the current economic conditions.

SGS: What's the one thing you find that buyers wish they had spent more time doing prior to committing to an acquisition?

RL: This is an interesting question. We have asked our peers this many times. My view in 20 years of personal involvement in M & A activity is that positive communication and positive attitude of the professionals involved in the success of the transaction will strongly commit to the success of the new company.

SGS: Take a look at professional sports. What are teams thinking when they make a trade one of the best athletes in their sport? Is the team that acquires the player looking to win or change their status in the league? What about the team that let the player go-do they want better ROI, cost savings, new talent, better chemistry, or what? Both teams look at less tangible factors in the decision whether to trade or not-whether the players have good leadership qualities, play hurt, are team players, whether they produce under pressure, and so on. The return is a risk with potential upside, short term and long term, and both teams have to feel they are going to benefit.

RL: Business transactions are similar. They are not only about the capital, ROI, customer list, location, or executive payout. The deal cannot be a one-sided transaction or it will not happen with true long-term success. It takes a team effort to implement the new vision and change for the better. Positive communication is a must. In my experience, most buyers wish they had an excellent and open relationship with the seller for many years after the purchase.

SGS: In your experience, what do the majority of successful mergers have in common?

RL: LEADERSHIP! Successful mergers are all characterized by a virtue of will, a vision, and the desire, discipline and courage to lead. Leaders listen to their conscience; it will guide them with integrity and conviction. Strong leaders cultivate only the best in themselves, inspiring and demanding excellence of themselves and their organizations.

 

 

Dr. Chris Laszlo, sustainability expert

Can sustainability give your company an edge? Absolutely, says SGS 2009 opening keynoter Dr. Chris Laszlo, author of the new book Sustainable Value: How the World's Leading Companies Are Doing Well by Doing Good.

Laszlo consults with Fortune 500 companies on sustainability and social responsibility initiatives that create business value and competitive strength. He'll share case studies and best practices in his keynote session, Sustainability for Competitive Advantage. Here's a preview:

  SGS: Why should executives in the signage and graphics industry be particularly attentive to sustainability?

CL: Signage companies face continued customer demands for products that are lower cost and better performing. Increasingly, environmental factors such as lower material intensity, waste minimization, and energy efficiency are ways these companies can reduce their costs. But cost reduction, tighter regulation and social responsibility are only the tip of the iceberg. Signage and graphics leaders will find greater business benefits from meeting new customer expectations for greener products that don't require any tradeoffs in either price or quality. The key is innovation. Sustainability provides a lens through which to rethink not only product design but also supply chain relationships.

SGS: We're in the midst of very uncertain times. Why should SGS attendees consider sustainability during an economic downturn?

CL: The conventional wisdom is that sustainability is a "nice to have" and not a "need to have" during tough economic times. But on the contrary, there may be no better time to reorient your strategies along these lines. As has been made very clear in the financial sector, companies risk complete annihilation today if their reputation and confidence evaporates. The sub-prime mess has illustrated the huge costs of not accounting for the risks of unsustainable business practices. The clients' definition of where business value comes from is shifting rapidly. As always, you gain a competitive advantage by being able to create stakeholder value better than others, and health and social concerns are becoming increasingly important in the final buying decision.

SGS: Can you realistically be green and profitable at the same time?

CL: Wal-Mart, GE, DuPont and Toyota are proof that large companies can be green and profitable at the same time. Fairmount Minerals, Green Mountain Coffee Roaster, Interface and many other smaller companies are demonstrating that "green is green," no matter what sector or size. These companies, and hundreds more like them, are looking to their vendors to not just conform to sustainability initiatives, but to lead the way through innovation. That's why this topic is so critical for the attendees of The Signage and Graphics Summit. Being green isn't about meeting environmental targets for their own sake. It's about advancing your existing business priorities.

 

 

Dr. M. Nisa Khan, LED technology consultant

Electronic message centers, or LEDs, are steadily pervading the sign industry. But are they green? And will zone regulation challenges threaten their growth?

We asked LED expert and Signs of the Times columnist Dr. M. Nisa Khan to deliver an up-to-the-minute report on the marketing, technological and legislative issues surrounding LEDs when SGS convenes in January. Here's a preview to her session, What's Next in Electronic Message Centers:

  SGS: As someone relatively new to the graphics industries, but having an extensive financial and technical background, what has been your impression of the Summit the past two years?

MNK: I have attended many technical and business conferences, but SGS has been a unique meeting for me. It brings together many "hands-on" executives who share their successes and challenges and find great opportunities to partner when they find common goals. The relaxed yet business-oriented atmosphere allows everyone to enjoy being together and still gives a boost to their businesses. At the very least, I have noticed everyone took away better understanding of the industry direction toward more electronic digital signage utilization.

SGS: You've now become much more involved with the sign industry through your participation on International Sign Association technical committees. What do you see as major challenges specifically facing the sign industry?

MNK: New, important issues affecting the sign industry are energy efficiency, sustainability and utilization of advanced electronic digital technologies. Until now, the sign industry was fairly well protected from power and safety constraints; but, in the wake of energy savings, environmental safety and sustainability, efficient and clean technologies are likely to be the winners for the signage industry.

While there is a lot of information in the media supporting the energy efficiency and mercury-less (hence deemed safe) features of LEDs, the sign industry and the regulatory bodies are only beginning to address these issues and calling various industry experts for contribution. I think these efforts will lead to further penetration of LEDs in signage and reduce energy consumption. But, it will require faster collaboration among various agencies than we have seen in the past.

SGS: You're aware that the Dept. of Energy recently completed a study on energy savings with regard to solid-state lighting. What do you see happening with LEDs in the sign industry, both in terms of electronic message centers and for illuminating channel letters, etc.?

MNK: Last month the DOE offered a study of the LED niche markets to develop further understanding of the energy savings and various other motivating factors that will help adopt LEDs as a lighting source. This study is encouraging, but it leaves out the key challenges the SSL industry needs to resolve before it can serve as the dominant technology for channel letter and cabinet sign illumination.

The biggest challenge for LED vendors is repeatability with respect to light output, color quality and longevity. The big performance differences among vendors offering LED illumination sources for signage will make many sign-makers reluctant to switch to an LED solution. Further, the environmental and safety issues of LEDs, while under investigation by only a few, may be important for us to consider.

For outdoor EMCs, LEDs are already chosen over LCDs or other technologies for most applications because of their high brightness and durability. These being commercial products, handling is limited to fewer people and therefore safety issues may be more controllable. I believe the EMC market will grow nicely with improved LED technologies.