4 essential solutions to bring manufacturing back
Posted by Bert Maes on April 12, 2010
About 25 manufacturing professionals and specialists are currently contributing to the LinkedIn discussion: “Can we bring the manufacturing back home? If so: how? If not: why?”
What are they telling us?
Most people seem to agree that loss of our manufacturing is the single biggest threat to our economy. Service is not creating wealth. Only agriculture, mining (with oil and gas production) and manufacturing are, according to Sam Durbin.
Many contributors argue as well that we can’t fully count on government to solve our problems, as they tend to be too busy trying to figure how to win their next election. We tend to ask them to impose import duties, tariffs or taxes and even manipulate currencies. Penalizing might discourage people from buying goods outside the country and it might encourage companies to build and grow here. Or it might not…
Frank Stanbach and Sam Durbin both take an interesting broader view: history shows that the Chinese are not the problem. Jobs and industry always move to the cheapest and easiest manufacturing market. In the 60s and 70s Japan and afterwards Korea and Taiwan started producing ‘junk’ products in large quantities, but they got better with higher quality products and the local standards of living raised, resulting in higher costs of production. Now India and China are the biggest and best at this game. But for how long?
The discussion presents some individual- and company-level solutions to strengthen our home manufacturing base:
- As a consumer, we have to look in the mirror. We demand less expensive products. So we make our own companies suffer. At the individual level, we are responsible. If we’re going to try and turn around the manufacturing industry, we better support our ‘local’ economy and we better become more informed about the local goods and the companies we are doing business with, whether they have the same environmental, safety and labor standards.
- We should create better innovative processes. We just have to be better, faster and cheaper than our competitors. But the costs involved in manufacturing here are holding us back. Labor laws, environmental and safety conditions, taxes and health care, all add significant costs and some costs are forcing us to turn to the world’s low cost producers.
To drastically lower our costs we must look at all aspects of our manufacturing processes, including setup and overhead costs, timing and efficiency, modern technologies and materials, without forgetting the highest quality. It will take teamwork with inspirational leadership inside a company and collaboration in an alliance of firms to create processes that reduce costs and improve efficiency to make us more competitive and to bring back manufacturing.
- Being more innovative means having better people. The source of better skills and better productivity is better education and better training. Our greatest resources for innovation are many young, independent, highly-skilled hands-on thinkers and creators. We can’t keep and grow our manufacturing if we can’t attract younger generations to our industry and if we keep forcing many of our schools to close their metal shops, Lowell Kenney stated.
Key is the investment and involvement of companies into local technical schools. We must help our young people get interested in ‘making things’, in becoming leaders in manufacturing.
- Today’s decisions are virtually always based on costs, based on greediness, based on short term gains and profits. Instead of huge management bonuses, some people in the discussion suggest that we should turn that money back into the company based on longer term goals, through investments in new training and new technologies to improve quality, accuracy, and automation. The principle is simple: If your labor costs get too expensive, then automate…
“To be the industrial and innovative leader, we have to pay the costs of new technologies and the corresponding training,” Lindsey Wack concludes.
Add to: Facebook | Digg | Del.icio.us | Stumbleupon | Reddit | Blinklist | Twitter | Technorati | Yahoo Buzz | Newsvine