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What happened to the art of manufacturing?

We've all heard the arguments about the loss of business to overseas competition, caused by everything from unfair trade practices abetted by foreign governments to lack of US capital investment and curtailed R&D investment.

It has become popular to point fingers at the shortcomings of US corporate managers and their lack of insight concerning the problems they face. Particular criticism has been leveled at them for taking a myopic view of company finances. As a result, management experts have taken up the cause of educating managers in theories labeled X, Y, and Z, and searches have been made to locate companies displaying excellence in running their businesses.

Some troubled industries saw fit to petition the government for trade relief, which has done little but stir up a hot debate over the respective values of free trade versus protectionism. Generally, little relief has been granted. Instead, a new flurry of activity has been spawned, best described as, "If you can't beat 'em, join 'em." Mergers, marketing agreements, and joint ventures between US and foreign companies with similar or competing lines of products is the new way to skirt the problem of overseas competition.

Robert B Reich, writing in the November 26, 1984, issue of The New Republic, raises a flag of caution regarding this approach. He says that, typically, the US partners supply the initial basic R&D, but the complex production techniques are done by the overseas partner, such as in Japan. This is followed by relatively simple assembly operations performed by US workers, and marketing, distribution, and sales through the US branch of the enterprise.

This all works fine; both partners make money. The problem, however, is that the real expertise--that of adding value to the product--is not done here. Instead, overseas workers develop the collective capacity to transform ideas quickly into world-class goods. Reich contends that such experience in making products generates more social wealth than does inventing them or assembling and selling them, and is the key to gaining the competitive edge in the world market.

Now we are hearing, "What happened to the art of manufacturing?" Robert H Hayes (coauthor of the famous 1980 Harvard Business Review article, "Managing our way to economic decline," with the late William J Abernathy) has collaborated with Stanford Professor Steven C Wheelright, on a book Restoring our competitive edge: competing through manufacturing (John Wiley & Sons, Inc, New York). The thrust of the book is that, in order for US manufacturer to close the gap with overseas competitors, managers must look at manufacturing as a key component of corporate strategy. "The secret weapon of international competition is not superior product designs, marketing ingenuity, or financial strategy, but manufacturing superiority--the ability to make it better."

On a recent trip to Japan, we saw a lot of advanced manufacturing technology applied in metalworking industries that, historically, have been among the least progressive in the US. The technology exists, we invented most of it here. It's up to management to turn their manufacturing engineers loose and let them do their stuff. It's time to stop looking at manufacturing as part of the problem, when it is really the solution.
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Copyright 1985 Gale, Cengage Learning. All rights reserved.

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Title Annotation:how to gain the competitive edge in the world market?
Author:Green, Dick
Publication:Tooling & Production
Article Type:editorial
Date:Jan 1, 1985
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