Learning to Change Opportunities to Improve the Performance of Smaller Manufacturers (1993) / Chapter Skim
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1 INTRODUCTION
1 INTRODUCTION
Pages 15-28
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From page 15... ...
The manufacturing sector continues to generate four and a half times as many secondary jobs as Me retail sector and almost Tree times as many secondary jobs as Me personal and business service sector Maker and Lee, 1992~. In 1990, 18.3 million workers were employed in manufacturing, representing 20.4 percent of the domestic private sector work force (see Table 1~.
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From page 16... ...
It is not necessarily identical with a company or enterprise, which may consist of one or more establishments. Manufacturing companies with fewer employees (particularly those with less than 100 employees)
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Although smaller companies are not major exporters of manufactured goods, dopey nevertheless participate in the export activity of larger American businesses as vital links in the value-added chain that supplies large manufacturers. Because they represent as much as 60 percent of final goods production costs, We components, subassemblies, and parts provided by smaller firms determine to a significant extent the eventual cost competitiveness and quality of America's exports Industrial Technology Institute, 1991~.
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From page 18... ...
For instance, 57 percent of automotive assemblers and suppliers cluster in three different regions: the Great Lakes; eastern Pennsylvania and New York, Delaware, and New Jersey; and southern California. Textiles manufacturing also clusters in the broad region around New York City including eastern Pennsylvania and in southern California, and also has a big presence in southern Florida.
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The concept of the atypical smaller manufacturers holds no relevance because, at a minimum, one must consider the enormous range of product and market sectors, effects of geographic location, worker demographics, company maturity (years in business) , age of equipment, and company ownership.
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Modernization Several recent studies have determined that smaller manufacturing companies lag larger firms in modernizing their production equipment, information systems, and skills (Industrial Technology Institute, 1990; U.S. General Accounting Office, 1991; U.S.
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For those with fewer than 50 employees the adoption rates for programmable automation tools was 50 percent to 150 percent greater for defense-related manufacturers. It is important to note that the authors attribute these differences to the strength of the support network in defense manufacturing, including specific Pentagon programs to encourage manufacturing investments, the relationships between prime contractors and their suppliers, and Me learning opportunities created by cooperation among defense contractors, suppliers, and customers (Kelley and Watkins, 1992~.
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From page 22... ...
Mature firms, in contrast, usually need help making changes: changes in production equipment and practices Mat no longer are competitive, changes in the management structure and organization of the work place, changes in Weir relationships with customers and suppliers, and changes in their capabilities to accommodate increased demands from customers for closer tolerances and improved design capabilities, for example- and increased pressure from competitors in cost, quality, and timeliness. Not only are the types of problems often different in younger Man in more mature manufacturers but also the ability to attract Me resources needed to cope with problems can be quite different.
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From page 23... ...
Insufficient communication skills lead to misunderstood directions and inability to read instructions to operate machinery and perform jobs. Some cultural backgrounds mitigate against new ways of organizing production, assigning responsibility for work, accepting direction from female supervisors, or suggesting better ways of accomplishing tasks.
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GLOBAL COMPETITION: CHALLENGES CONFRONTING AMERICAN MANIlFACTURERS This diversity of manufacturers greatly affects the operational conditions and resources available to improve Heir manufacturing competitiveness. Manufacturing firms large and small face massive change and adjustments as Hey move from a stable, fault-tolerant environment of long production runs to a volatile world in which production runs are short, product characteristics constantly changing, and defect-free on-time production at decreasing prices is a condition for survival.
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From page 25... ...
Today advanced manufacturing technology is an international commodity, available to all.6 Increased customization of products, greater competition for ever smaller market niches, and shortened product life cycles have significant consequences for manufacturers. The demand for many different products designed and produced to unique customer specifications means the manufacturer must contend with many short production runs.
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From page 26... ...
selecting technologies appropriate to the capabilities of the organizational structure and culture of He company. RESPONDING TO THE CHALLENGES The degree of improvement in productivity and He adoption of competitive manufacturing practices and new technologies vary widely across American manufacturing firms.
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A recent survey found that among manufacturers with 500 or more employees, 93.7 percent reported use of at least one advanced manufacturing technology, compared with 60.9 percent for those with under 100 employees.~° When durable goods factories with less than 50 employees were examined, more than 85 percent had not introduced a single programmable machine tool Industrial Technology Institute, 1989~. In an unpublished 1989 survey of 150 job shops in and around New York City conducted by the New York Industrial Technology Assistance Corporation, 70 percent had not even begun to use computers in any aspect of their businesses.
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From page 28... ...
Technology deployment proposals were solicited in one of four activities: manufacturing extension services, extension enabling services, alternative deployment pilot projects, and technology access services. Additional proposals relevant to industrial extension were sought for the Defense Dual Use Assistance Extension Program ~J.S.
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