What it Means to be Progressive

The following commentary kicked off a ceremony honoring the winners of Managing Automation's Progressive Manufacturing Awards at the Ritz-Carlton, New Orleans on March 17, 2005. As he was struggling with monumental personal and political issues, an American president once said, "The best steel goes through the hottest fire." Two years ago, as the manufacturing industry was struggling to escape the searing effects of the last recession -- a period that exacerbated long-term structural forces reshaping manufacturing -- the editors of Managing Automation decided to engage in an exercise to try to forge a new way for manufacturers to move forward to a better future. Disturbed by forces in the industry that we felt focused too much on the negative -- declining employment, declining share of GDP, declining production rates and utilization and such counter-productive behavior as China-bashing -- the editorial team started with the premise that manufacturing did indeed have a future, and a bright one at that. To model our exercise, we set our sights on the year 2013 and asked ourselves the question: what will manufacturing look like in that year? What will be the most important business models, what core competencies would manufacturers need to embrace to bring those models to life and where would competitive advantage be found? Over months of work, certain realities became clear to us. We distilled them into three over-riding trends: globalization of capital, raw materials, IP, labor, markets and customers; resulting changing rules of competition; and the pervasiveness of technology at all levels of the manufacturing enterprise. Based on these trends, and by observing what MA readers themselves were doing to cope with them, we began to see that the way that manufacturing could get to the year 2013 was partly a function of what they had done so well before by investing in technology as well as operational improvements like lean manufacturing to continually improve productivity. But we became convinced that productivity growth alone would not be sufficient. The structural trends inflicted by globalization would require a much more rigorous and soul-searching examination of how to proceed. We knew that manufacturing was -- and is -- at an historic inflection point in its glorious history due to the long-term trends and the recent emergence of new technologies that offer so much promise and opportunity. Moreover, we became equally convinced that incrementalism would not enable manufacturers to seize upon their convergence. Instead, we posited the idea of the Progressive Manufacturer -- that companies need to adopt transformational business thinking tightly coupled with an aggressive adoption and application of advanced technologies to succeed. In short, a Progressive Manufacturer is one that pursues competitive advantage by a tight marriage between business and technology, with the customer at the center of the business model. But we also knew that that one statement, elegant as it is, was not sufficient to bring the concept to life. And so again, using the powers of observation granted to those who are by their nature called to the journalistic craft, we identified what we describe as the six Disciplines of Progressive Manufacturers, a set of practices that, in sum, we believe will enable manufacturers to forge ahead. They are:

• Business Model Mastery: The notion that manufacturers, regardless of the current state of their business, should take a deep dive into the often murky waters of corporate identity, and decide what their business could and should be like in 10 years time. And answer the gut-level question of what competencies they will need to sustain that business model.
• Innovation Mastery: The idea that maximizing creativity by harnessing the intellectual capital of all constituencies within the business will lead to breakthrough advances in product ideas, design and development, the organization of work, and the delivery of products and services to customers.
• Customer Mastery: The concept that creating value for customers is the primary business objective, an objective that, when accomplished well, feeds all aspects of the business. It is the idea to truly understand and anticipate the needs of customers, understand the customer's customer and their markets by mastering proper information about them and using that information pervasively in all aspects of the business.
• Supply Chain Mastery: Perhaps better thought of as an operational network, it is the idea that mastering all operations relating to serving customers -- demand, supply, production, fulfillment, service -- in a holistic and integrated fashion is central to superb operational performance. It is the combination of continual business process improvement coupled with the smart application of the right technologies, all directed to getting the right product to the customer in the fastest way possible.
• Data & Integration Mastery: It is no secret that manufacturers, just like companies in other industries, have over the years built monuments of disparate, unconnected platforms, data bases, applications and systems of every color and shape. But in order to operate efficiently and effectively in a global market demanding real time response, accuracy and efficient operation, manufacturers must get their information houses in order by rationalizing their systems, demanding and embracing standards, and integrating their enterprises throughout and beyond -- just as MA suggested in its first issue 19 years ago.
• Training & Education Mastery: This discipline, perhaps the heart of the whole matter, calls for manufacturers to not only train and educate their people continually in the use of technologies applied to create the business value so necessary to establishing the conditions for success but also to help an industry shape a new personality -- and one to which the next generation of worker, manager and executive will be attracted. In the final analysis, the industry is simply a collection of the people in it, and we all must do better in enabling the next generation to arrive.