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by Eric Marks, Contributing Editor   | Abstract: | The doom-and-gloom reports on U.S. manufacturing can be countered if domestic companies seek out and exploit their competitive advantages. |
Given the purportedly dire straits of the manufacturing industry in the U.S, what is one to do? Hang it up? Whine about U.S. manufacturing policy, or the lack thereof? As I'm writing this, it's the Fourth of July weekend, and I'm wondering what Paul Revere would have said about U.S. manufacturing if he had made his famous ride today. "U.S. manufacturing is in trouble! China, global economy, NAFTA! Outsourcing is coming! Outsourcing is coming!" However, there are ways in which U.S. manufacturers can compete, thrive, and win in the global marketplace. First, U.S. manufacturers must find their sweet spot. What is the sweet spot for U.S. manufacturing? It is the location in the global manufacturing value chain where U.S. manufacturing processes are relatively close to research and development and design: upstream in the process, where innovation occurs. You might ask why the U.S. manufacturing sweet spot is located there. The closer manufacturing processes are to innovation processes, the higher the margins and the skills requirements. These are two critical requirements for manufacturing today in America -- the ability to support our higher labor wage requirements, including health care costs, as well as leverage our highly skilled work force. That is only possible if we focus our manufacturing efforts where these factors are positives rather than negatives. [Click to continue] |