By Dave Lawrence
Milacron's Plastics Machinery
Injection/Extrusion and Mold Technologies
The American manufacturing industry is growing, and it has been for well over a year. Despite the hard knocks of the last couple years, manufacturing is leading a dramatic resurgence. In fact, according to the latest Manufacturing ISM Report On Business issued by the Institute of Supply Management, activity in the manufacturing sector has been expanding for 21 consecutive months, as of April 2011. It’s one of the few industries demonstrating consistent growth.
Current optimism notwithstanding, recent struggles serve as a harsh reminder that continuous improvement is the only way to succeed over the long term. Manufacturers would be wise to keep in mind the lessons of the recent hard times to avoid repeating similar mistakes in the future.
Public opinion about manufacturing’s importance remains high. A recent survey focusing on the American public’s opinion on the industry and its future, conducted by Deloitte, shows a nation that believes manufacturing is a core component of our economic well-being, with over 78% of those surveyed saying it is "very important to our prosperity." While perceptions of manufacturing jobs are improving, only 30% of respondents to the Deloitte poll said they would encourage their children to pursue a manufacturing career.
Clearly, long-term growth is not without its obstacles which must be addressed by manufacturing leadership. Here is a prescription for success:
Management and employees must recognize the need to face adversity head on and overcome it while laying the foundation for future success. Manufacturers should never underestimate the importance of having a well-respected, experienced leadership team and devoted, competent employees.
Companies must embrace renewed commitment to continuous improvement in products, services, and technologies to help them survive and thrive. Maintaining and enhancing brand reputation are additionally important by emphasizing its history of innovation and "firsts," which helped reinforce its longstanding solid reputation to customers and business partners.
Beyond specific company attributes that support recovery, there are philosophical lessons to be learned. Most notably, American manufacturers must recognize that, while the US still has major competitive advantages over many overseas companies, that window is closing quickly. Among the American advantages is the ability to partner with other domestic companies. Despite lower upfront prices, sourcing from cheaper overseas companies often has many unexpected costs in terms of quality, delivery, and efficiency.
The tremendous amount of capacity created by the recession enables speed to market and immediate customer service with parts and technical support that overseas competitors can’t match. A customer’s biggest cost, after all, is downtime.
There are still many other hurdles that have to be cleared on the way to sustainable growth. Some of them, manufacturers can influence; some of them, they can’t.
One of the primary obstacles that manufacturers face today is the current difficulty of obtaining capital. Uncertainty in government policies is another. In election years, many manufacturers feel they must wait and see the results before making big decisions.
Because many of these obstacles lie outside of manufacturers’ control, it’s important to recognize and capitalize on financial opportunities when they present themselves, such as research and development tax credits or increased access to capital.
The challenge of recruiting, training, and retaining a talented workforce is one area where manufacturers can have an immediate impact, both collectively and individually. There is an urgent need for manufacturers to advocate technology education and attract future generations of advanced thinkers trained and fluent in automation and technologies critical to our success.
At the same time, public perception of the American manufacturing industry must be changed. Manufacturing jobs must be represented to the next generation for what they really are – good-paying, family-supporting careers involving advanced technologies.
Energy-efficient manufacturing solutions must be found by devoting more resources toward earth-friendly technologies and retrofitting upgraded technology into existing machines. Not long ago in our industry, hydraulic machines were the best available. Now, all-electric versions offer big gains in energy efficiency and precision, significantly reducing operations costs while helping manufacturers become less dependent on oil.
Finally, collective support is needed. One of the ways is by rallying partnership among American manufacturers through the "Helping You Make it in America" awareness campaign, an effort focusing on the challenges and opportunities faced by our country’s vital manufacturing sector.
With today’s tight resources, lean operations and challenging demands, our country’s manufacturers need more support than ever from their supply partners. Manufacturers must work closely with customers not only to develop new technologies that meet emerging needs, but also to maximize the value of investments they’ve already made – streamlining processes, increasing equipment utilization, reducing costs, and optimizing performance. ME
This article was first published in the July 2011 edition of Manufacturing Engineering magazine. Click here for PDF.