The U.S.A. has always been the leader in product innovation but not very adept at converting basic R&D into viable commercial products. An exception is software design and marketing, where the U.S.A. maintains three quarters of the world’s software market with an excellent information network.

The 1980s and early 1990s were typified in U.S.A. by significant downsizing, where companies tried to achieve lean manufacturing machines capable of producing products of superior quality (as good as Japanese).

Reengineering became a key word for change in the way managers thought about their manufacturing processes, though the results were far from revolutionary. Often external consultants were brought in to propose management strategies that were not followed up after their departure.

The late 1990s, however, saw a dramatic shift in U.S. productivity, building on innovation in the philosophy of product design. This combined with the economic (mostly financial) problems that came about in Japan resulted in an unprecedented manufacturing boom in the U.S.A. Hewlett- Packard (HP) was a typical U.S. company capturing a large share of the world’s color ink-jet printers and scanners.

HP went from no printer manufacturing in 1984 to nearly $8 billion in sales in the mid-1990s. A primary factor in this success was HP’s strategic flexibility.

It is important, however, to note that although the U.S.A. currently has a quarter of the world gross domestic product (GDP), the European Economic Community (EEC) is now the world’s largest market, with the U.S.A. in second place. U.S. manufacturing companies are partially responsible for this drop, primarily because of their short-term vision and concentration on domestic markets.

Despite the economic good times, most still continue to emphasize the objective of quarterly profits by maximizing the utilization of their current capacity (technological and workforce). The following selective objectives are representative of the current (not-so-competitive) state of the U.S. manufacturing industry:

Customer responsiveness: Deliver what is ordered, in contrast to working with customers to provide solutions that fit their current product’s lifecycle requirements and furthermore anticipate their future requirements.

Manufacturing process responsiveness: Dependence on hard tooling, fixed capacity and processes that lag product needs, in contrast to having a reconfigurable and scalable manufacturing plant that implements cost effective processes that lead product needs and can react to rapidly changing customer requirements.

One must not confuse automated machines with truly autonomous systems that have closed-loop processing capability for self-diagnosis and error recovery. Variable capacity must be seen as a strategic weapon to be used for competitiveness and not something to be simply solved by outsourcing or leasing equipment based on the latest received orders.

Human resource responsiveness: Encouragement of company loyalty in exchange for lifetime employment promise, in contrast to hiring of ‘‘knowledge individuals’’ who plan their own careers and expect to be supported in their continuing education efforts.

The current U.S. workforce is in a high state of flux, where a company’s equity is constantly evaluated by the knowledge and skills of its employees as opposed to only by the value of their capital. In the future, companies will be forced invest not only in capacity and technology but also in training that will increase the value of their employees, without a fear of possible greater turnover.

Global market responsiveness: Dependence on local companies run by locals but that are led by business strategies developed in the U.S.A., in contrast to operating globally (including distributed R&D efforts) and aiming to achieve high world market share.  Globalization requires understanding of local markets and cultures for rapid responsiveness with no particular loyalty to any domestic politics.

Related post

No comments:

Post a Comment

free counters