August 2008 Edition

shop talk

The main ingredient

Forget ‘Lean’ and other phrases — it’s the people, stupid!

By Steve Rose

Lean manufacturing, Six Sigma, and other industry improvement methods may have their place in manufacturing but we are missing the main ingredient to keep engineering and manufacturing strong — the people!

We all wonder about the "send it to China" business model. Design and market a product in the U.S.A. and have it made real cheap in the Far East. Sell it for a great profit, all without any labor problems.

This business plan may work well for athletic shoes and electronics, but engineered products often have a different experience.

Many American companies have shopped for lower costs in low-wage countries. They take all of their prints and production techniques and give them to a low-wage manufacturer. This low-wage manufacturer may also have little respect for intellectual property. So, while our fine American corporations are passing knowledge through the front door, they should not be surprised that this knowledge is also being passed through the back door.

Giving all of our knowledge away in search of short-term profits seems like a losing proposition.

While setting up a low-cost shop, you may also be training your competition to make your products. The strategy of sourcing low-cost suppliers may end up providing low-cost competitors with all of your knowledge and none of your scruples. We can only guess how many unique products now have unauthorized copies sold back in the home markets.

Saving in production costs is a prime factor in outsourcing to low-cost countries. Another factor is the lack of skilled labor here at home. We still have a low unemployment rate. Anyone who wants a job can get one with enough motivation. As often stated, manufacturing industries are having a problem attracting employees (see cover story on page 56). Companies are complaining that the school systems are not providing the right type of education to meet industry’s needs.

It’s no wonder that companies want to outsource. It is easier than dealing with our homegrown problems.

This is not a situation where schools can take the blame. This is a societal issue that must be addressed by parents, educators and industry working together. It is part of our continued development as a nation and society that we have productive people to keep things moving.

I recently heard about a program in Germany that starts children into engineering in kindergarten. You might say this is social engineering, but Germany knows it is pre-eminent in manufacturing and wants to stay that way.

What are we doing in the U.S.A. with our kids? Extolling the "virtues" of sports stars and entertainers. Being a sports star and making millions may be a dream for many kids, but come on, we need to deal in reality.

One of the growing challenges of globalization is transportation costs. As we see the cost of oil rise, we will add cost to transport these "cheap" goods.

We know that in a global market capital is going to seek the lowest labor costs. Having said that, giving all of our knowledge away in search of short-term profits seems like a losing proposition. What I would recommend is, instead of training the Chinese, why not train our American workers and keep our engineering industry strong? Makes sense to me — build it in the U.S.A.

Steve Rose is a professional trainer and president of RTSI, Solon, OH. Rosaleen Rose offers Internet website development. They can be reached by phone at 440.542.3066; e-mail srose@rosetraining.com ; or on the web at www.rosetraining.com.

Copyright Rose Training Systems Inc., 2008

What do you think?
Will the information in this article increase efficiency or save time, money, or effort? Let us know by e-mail from our website at www.ToolingandProduction.com or e-mail the editor at dseeds@nelsonpub.com.