China Plants Are More Integrated With Suppliers and Customers than U.S. Plants; This Was Particularly True For Joint Venture and Foreign Enterprise Plants.

DUBLIN, Ireland -- Research and Markets (http://www.researchandmarkets.com/reports/c43361) has announced the addition of "China's Manufacturing Challenge 2005: U.S. China Comparison White Paper" to their offering.

China's Manufacturing Challenge 2005: A U.S./China Comparison White Paper is a 51 page in-depth analysis comparing manufacturing performance data from the MPI/IndustryWeek US Benchmarking Survey and first-ever China Benchmarking Survey. You'll find out:

-- How U.S. plants stack up against facilities in China.

-- If the U.S. and other Western manufacturers should take greater advantage of China's growing capabilities.

-- If there are investment opportunities in China that could make the U.S. and other Western manufacturers more competitive.

-- How and where China manufacturers continue to improve, and possibly strengthen, their advantage over global competitors.

Data from both countries are compared in these vital performance areas: Human Resources, Operations, Supply-Chain, Capacity & Equipment, Information Technology, and Manufacturing Today.

Human Resources:

While workforce practices in China plants won't remind anyone of Detroit or San Jose, China's manufacturers are getting there Co quickly:

-- China plants are adopting many Western human-resource (HR) processes and practices (with a few notable exceptions) to get greater productivity from their employees and to more effectively compete with plants around the globe.

-- China plants with foreign equity ownership structures (joint ventures and foreign enterprise facilities) have embraced cutting-edge HR practices with particular enthusiasm.

-- Disparities in HR practices remain in China, where facilities range from large "factory cities" that employ tens of thousands to labor-intensive state-run facilities to Western-managed plants that function and produce product at world-class levels.

-- Communist China is still a difficult place to instill empowerment in workforces, and until that occurs, peak human performance Co comparable to U.S. achievements Co will not be attained.

Operations:

Advantageous cost structures and the relative youth of China plants are creating a decisive competitive advantage, but many of these plants have not grasped the need for improvement:

-- U.S. plants with a well-defined, thoroughly implemented improvement methodology Co such as Lean Manufacturing, Six Sigma, or others Co outperform U.S. plants that do not follow a methodology. This generally is not true among China Study plants, where improvement approaches are primarily based on Total Quality Management and where ownership structures influence the ability to leverage improvement programs.

-- China plants are not adopting Lean methodologies at the same rate as their U.S. competitors, and therefore miss significant improvement opportunities compared to U.S. plants, particularly regarding inventory management.

-- Even without Lean and other improvement tools, China's manufacturers still recorded many performances comparable to or better than their U.S. counterparts, in part due to more attractive cost structures.

-- A surprisingly large percentage of China's manufacturers are focused on quality and innovation Co not low cost.

-- Plants in both nations were extremely optimistic regarding revenue projections for the past year, and even more optimistic when looking ahead through 2005.

-- Although China's manufacturers often beat their U.S. competitors on price, they generally do so while maintaining strong gross margins and not, as many believe, by dumping products to gain market share.

-- China's manufacturers face an interesting dilemma: When the world is beating a path to your door, is it really necessary to invest time and money into an improvement program?

Supply Chain:

Supply-chain integration exists in both countries, but U.S. plants are grappling with material and component cost increases and, unlike China plants, are pushing them on to their customers:

-- China plants are more integrated with suppliers and customers Co more so than U.S. plants Co and this was particularly true for joint venture and foreign enterprise plants, many of which may be captive suppliers for parent companies.

-- U.S. plants had less control over the costs they paid for materials and components in the past year than did China plants, but U.S. plants are more likely to pass cost increases on to their customers.

-- China's manufacturers are more likely to retain functions for which they have cost advantages (e.g., production, assembly), but are more likely than U.S. plants to outsource support-related services (e.g., customer service, purchasing).

Capacity and Equipment:

The pace of manufacturing growth in China is fueling massive capital investments and supporting output levels significantly higher than those found in U.S. plants:

-- China Study plants had much higher outputs (production volume as a percentage of designed plant capacity) than did U.S. Census plants.

-- China plants of all types are investing in equipment and planning for additional capital investments at a pace that far outstrips that of U.S. Census plants.

-- New equipment appearing across the China manufacturing landscape may be contributing to lower machine availability when compared to U.S. facilities (i.e., very new or very old equipment tends to be less reliable).

Information Technologies:

China plants are grabbing at new information technologies, far more so than U.S. plants, and appear to be getting profitable returns from their much higher investment levels:

-- China Study manufacturers are outspending U.S. plants on information technologies, and plan to outspend them in the future as well.

-- China plants are more likely to leverage technology investments into increased profits. This probably reflects the relative youth of China's manufacturing base, as new facilities across the country make intelligent use of new, well-selected IT.

-- Plants in China are more likely to use information technologies than their U.S. peers, and are more likely to be early adopters of newer information technologies (e.g., customer relationship management systems) than their U.S. counterparts. U.S. plants are higher adopters of technologies that have been around for years (e.g., electronic data interchange).

Key Topics Covered Include:

-- Plant Profiles

-- Human Resources

-- Operations

-- Supply Chain

-- Capacity and Equipment

-- Information Technology

-- Exports and Imports

-- Preparing For Change

For more information visit http://www.researchandmarkets.com/reports/c43361