British man charged with hacking the Fed

A U.K. man with an alleged penchant for targeting the U.S. government has been charged with hacking into the Federal Reserve.

Prosecutors say the man, Lauri Love, snuck into servers used by the Federal Reserve Bank of New York, where he stole and posted publicly names and private contact information.

Love has previously been charged with hacking an alphabet soup of federal agencies. He's accused of going after NASA, the Army, Health and Human Services, the Energy Department and the Environmental Protection Agency, as well as the Missile Defense Agency, U.S. Sentencing Commission and Regional Computer Forensics Laboratory.

Last year, prosecutors in New Jersey said his attacks "resulted in millions of dollars in damages to the government victims."

The U.S. Attorney's Office for the Southern District of New York said Love's several screen names include "Smedley Butler." Butler was a highly decorated but controversial major general in the Marines who, after he retired, wrote the 1935 book "War Is a Racket," which criticizes war profiteering and the U.S. military.

Related: Why retailers aren't protecting you from hackers

Love hacked the Fed information by exploiting a database vulnerability, according to court documents filed by the U.S. Attorney's office.

The charges -- computer hacking and aggravated identity theft -- carry a maximum sentence of 12 years in prison, prosecutors said.

Love is not in custody on these charges. He was arrested in the U.K. in October on charges of hacking other government agencies, but the U.S. Attorney's office said it didn't know if he was held by British authorities. Efforts to reach British authorities to determine Love's status weren't immediately successful.

 

Tracking a cyber criminal

The U.S. Attorney's office said it had no information on any legal representation or possible extradition. 

ISO 55000: Leading the Change

The ISO 55000 Asset Management Standard has been released. The discipline of asset management is a buzz. Will this standard take on the same significance as past standards, like ISO 9000? Will regulators, investors, insurers, and owners begin to require ISO 55000 compliance?

Consider the desire to avoid incidents such as:

-Freedom Industries and the 48,000-gallon tanks leaking MCHM and PPH into the water source for 300,000 West Virginians

-BP and the death of 11 people and the 206 million gallons of oil that leaked into the GOM over a period of three months.

ISO 55000 is the first international standard that establishes requirements for the governance of a risk-based asset management system. It is designed to extract and optimize the value assets deliver in achieving organizational goals.

We will spend some time over the next few blog posts talking about what the standard requires and how to implement it. It starts with leadership. Leaders are required to demonstrate active and visible support, guidance, and resources.

The ISO 55000 overview states, “Top management should create the vision and values that guide policy, practice and actively promote these values inside and outside the organization.” (2.5.3.3)

Clause 5 of the ISO 55001 Requirements describes three requirements of leadership.

1 - “demonstrate leadership and commitment with respect to the asset management system” (5.1)

2 – “establish an asset management policy” (5.2)

3 – “responsibilities and authorities for relevant roles are assigned and communicated” (5.3)

ISO 50000 requires changes in policy, processes and people. This is a large scale change that can only be achieved through active and visible sponsorship by senior leaders.

US Consumer Spending Barely Gains in July

Results are much weaker than analysts' average expectations.

WASHINGTON – U.S. consumer spending ground to a near halt in July along with growth in personal income, Commerce Department data released Friday showed.

Spending, which drives two-thirds of the U.S. economy, edged up only 0.1% last month and marked a sharp slowdown from the revised 0.6% increase in June.

Personal income also rose 0.1% in July, slowing from June growth of 0.3%.

The month-on-month spending figure was much weaker than the 0.3% rise expected on average by analysts. The income reading matched expectations.

Copyright Agence France-Presse, 2013

Boeing Predicts China Will Triple Aircraft Fleet by 2032

China's strong economic growth combined with better access to air travel prompted the aerospace company to increase its forecast.

BEIJING – U.S. aviation giant Boeing said Thursday it expects China's commercial aircraft fleet to triple in size over the next two decades as the country's strong economic growth boosts air traffic.

China will need 5,580 new airplanes worth $780 billion by 2032, 16% of the world total, the Seattle-based company said at a briefing in Beijing.

The figures mark an increase from the company's forecast last year, when it said China would add 5,260 new airplanes to its fleet by 2031.

"Thanks to strong economic growth and increased access to air travel, we project China traffic to grow at nearly 7% each year," said Randy Tinseth, vice president of marketing for Boeing's commercial airplane division.

The company expects worldwide traffic growth to average 5% a year over the period.

China's air travel is booming. A total of 319 million air passenger trips were recorded in the country in 2012, up 8.9% from the previous year, official figures show.

The Boeing (IW 500/14) statement projected that China will have a total of 6,450 commercial aircraft by 2032, up from 2,100 last year.

Tourism within China and intra-Asia travel will help spur strong demand for single-aisle airplanes, with total deliveries in that segment reaching 3,900 through 2032, it said.

Long-haul international traffic to and from China is predicted to grow 7.2% annually, leading to a demand for an additional 1,440 new fuel-efficient wide bodies, it added.

"To compete in the long-haul international market, our Chinese customers are focused on growing their international networks, increasing their capacity and building resources," said Tinseth.

"These trends will shape market demand for airplanes that have high efficiency, low operating costs, environmentally progressive technologies and a great passenger experience."

Copyright Agence France-Presse, 2013

Ford Says Sales in Asia to Exceed 1 Million This Year

Key to that growth is China, where Ford's sales were up 51% in the first nine months of the year.

DETROIT - Ford is catching up to its competitors in key Asian markets and expects to sell more than one million vehicles there for the first time this year, a senior executive said Wednesday.

Key to that growth is China, where Ford's sales were up 51% in the first nine months of the year to 647,849 vehicles, said David Schoch, Ford's group vice president for the Asia Pacific region.

"We're gaining a lot of traction with the new products we've brought into China," Schoch told reporters in Detroit.

The second largest U.S. automaker expects to double its market share in China to nearly 5% by the end of this year from 2.5% in 2012, he said.

"We expect Ford Asia Pacific to be a major contributor to Ford profits by the middle of the decade," added Schoch.

Schoch acknowledged that Ford (IW 500/8) was "slow" to enter the Asian market and the current plan to expand in China wasn't put in place until four years ago.

Prior to that, Ford was distracted by a lengthy period of serious financial problems and major reorganization.

Rival General Motors (IW 500/5) was much faster to move into the Asian market and is expected to sell more than three million vehicles in China alone this year.

Ford is currently building manufacturing hubs in China, India and Thailand and recently relocated its regional headquarters to Shanghai.

While those plants will boost Ford's regional capacity of 1.9 million units -- which vastly exceeds current sales -- the automaker is also moving ahead with the construction of six new regional assembly plants, including four in China.

That will bring total capacity to 2.9 million vehicles by 2015.

"When you're in these emerging markets, you have to think long-term," Schock said.

"We have very aggressive growth targets."

Ford is also expanding the number of models it sells and will soon be introducing the Fiesta, the Mondeo and the Transit Van to the region.

The automaker expects that China -- and the region -- will play an increasingly important role in the global auto industry.

Annual vehicle sales are expected to hit 32 million in China by the end of the decade -- more than in the United States and Europe combined, Schoch said.

Meanwhile, sales in the Asia Pacific region are expected to make up 46 percent of global sales in 2020, up from 41 percent in 2013. Ford also forecasts that global auto sales will rise to 109 million in 2020 from 82 million in 2013.

In addition to China, Ford's Asia Pacific region includes India, Vietnam, Indonesia, Thailand, Myanmar and the Philippines.

Copyright Agence France-Presse, 2013

Operational Consolidation -- Three Factors to Consider

Look first for best-in-class support-of-mission organizations in the target geographies.

Jason Piatt, president, Praestar Technology Corp.

During the Great Recession, operations executives learned to do more with less -- far more with far less. Positions were redefined, tasks were consolidated and organizational learning was improved. In general, those who survived -- and more importantly, thrived -- during the upturn learned to better manage and improve processes. As a result, there is a new trend to consolidate operations, thus further extracting profitability from improved efficiencies.

As operations executives look to consolidate operations, they must consider a multitude of factors. Usually these decisions include at least two facilities and the selection of the best for consolidation, but sometimes an additional choice is added: geography that is not currently occupied by any of the company’s facilities.

This might mean an area of the United States where the firm doesn’t currently operate or a country external to central operations where advantages might be had. Given recent shifts in workforce economics in Third World countries, doing so purely for wage-rate savings is futile. However, if this alternative allows for market penetration or market-share gains, then it should be considered.

Expansion to historically low-cost countries should be pursued only for revenue-enhancing reasons. Profitability likely will not be enhanced simply by moving operations to low-cost countries, since “total cost of acquisition” should be considered. This, by most measures, will actually increase in these off-shoring scenarios.

The three factors to consider in consolidation are:

Total Cost of Operations for the Facility Lifetime

Consider the total cost of operations, including utilities, taxes (net, after short-term economic-development incentives are exhausted) and other facility-related costs. The ability to expand the physical plant as well as improve internal infrastructure within existing facilities should be considered.

Workforce Options

Operations managers must consider the tenure and talent pipeline of both blue- and white-collar staff at the facilities being evaluated for consolidation. While the availability of a ready-to-work labor force should be considered, operations management also should examine available workforce development firms (for-profit and not-for-profit) that can assist in ramping up additional staff to handle increased capacity needs.

Beyond staff capabilities, staff flexibility should also be considered. Relationships with organized labor bargaining units should be evaluated, as should existing contractual responsibilities.

Support-of-Mission Organizational Presence

Oftentimes, operations management views local and regional economic- and industrial- development organizations as necessary evils. The manufacturing firms support these organizations out of a sense of civic duty. However, some of these entities have evolved in the changing economic climate to embrace their role as supporters of the operational mission.

Recently, supply chain localization projects have netted significant results for organizations that otherwise might find advantage in relocation. Despite higher labor rates, unions and other cost-prohibitive structures (such as environmental protection requirements), some areas (such as the northeastern United States) have become more attractive to manufacturing firms for consolidating operations because the manufacturing ecosystem has been developed and matured. This has been done largely by partnerships between regional economic development organizations and their respective “anchor” large footprint manufacturing firms.

This creates an ecosystem in which suppliers localize their operations to the anchor manufacturers and in turn find other (and sometimes larger) customer bases within close proximity. This ecosystem structure, where available, typically is a decisive factor in site selection and operational consolidation.

When considering consolidation of operations, first look for best-in-class support of mission (SoM) organizations in the target geographies. Then, consider workforce and facility costs to optimize performance. Only in cases of market expansion should operations executives consider labor rate, as it yields unsustainable competitive advantage.

Jason Piatt is president of Praestar Technology Corp., a provider of consulting and training services to manufacturers in the Mid-Atlantic region specializing in lean, Six Sigma & strategy formation.

January Employment 'Little Changed' -- Rut-Roh

When you see the phrase “little changed” in an employment situation report from the federal government, you know there is also little to celebrate.

With 10.2 million unemployed and 2.6 million who are “marginally attached” to the workforce (not in the labor force and had not looked for a job in the past month), the gain of 113,000 jobs in January reported by the U.S. Bureau of Labor Statistics will do little to spark the economy in a way that will boost consumer confidence and spending. That figure was well below the average employment growth of 194,000 per month in 2013.

But despite the weak overall numbers, manufacturers were hiring in January, a sign that forecasts of moderate growth in the sector for 2014 may still be on track. Here are the numbers:

21,000 – Number of manufacturing jobs added in January

7,000 – Average number of manufacturing jobs gained per month in 2013

34,000 – Number of jobs added to U.S. payrolls in revised figures for November and December

40.7 – Number of hours in the average manufacturing workweek, a decline in January of 0.2 hours

3.4 – Average factory overtime hours per employee, a decline of 0.1 hours in January

$811.90 – Average weekly earnings for a manufacturing employee, about a 2% rise from January 2013

12,075,000 – Number of people employed in manufacturing, a gain of 195,000 from January 2013

Concludes Chad Moutray, chief economist for the National Association of Manufacturers: “[T]he manufacturing sector began the new year with strong momentum from the second half of last year. Manufacturers have noted a pickup in demand and production over the past six months, which have led to increase in hiring overall. In general, manufacturers have reflected cautious optimism for 2014, and the 15,000 additional workers added each month since July highlights much of this positivity.”