These three words, “Made in China,” don’t have to foreshadow the downsizing or closing of plants, as they did in the past, but rather the reshoring of critical manufacturing. In fact, “Made in China” must be embraced as a wake-up call to our industries, our businesses, and our economy. We have a race to win, and our motto is just two words: “Beat China!”
What comes to mind when you read “Made in China?” Stories of tainted food. . . lead paint in toys. . . inexpensive, often cheaply made items. . . intellectual property theft? Many people I meet in conference sessions, workshops, and my consulting work in American plants share experience-based horror stories about products from China that continue to reinforce examples of low quality.
Another common and not-so-good opinion of the words “Made In China” is that they’re associated with manufacturing-job loss here in the United States. Look around your local retail outlets. You’ll see countless Chinese products, including many once labeled as “Made in The USA.” Ouch!
History seems to be repeating itself. Many of us can remember the 1960s, when the words “Made in Japan” were associated with ever-growing numbers of cheap, poorly made products arriving on our shores, including toys, games, cars, transistor radios and motorcycles, among others. Today, “Made in China” represents another wave of offshore competition for America’s businesses. Yet, here we sit, apparently complacent as ever, resisting change once again. All the while, our industries are being threatened, ravaged, even killed off. Isn’t it about time for us to wake up?
SOME RECENT RANKINGS
While the United States was listed as the most productive nation in the world in 2018, Singapore moved ahead by a single point, in the “2019 Global Competitiveness Report” of 141 economies. Expanding the list a bit more, third is Hong Kong SAR, fourth is the Netherlands, Switzerland is fifth, Japan sixth, and Germany is seventh. China ranked 28th in the that 2019 report.
Bear in mind, however, that Singapore, with a gross domestic product (GDP) smaller than that of North Carolina, is not about to eclipse the United States as a global powerhouse. Likewise, China, with a population of 1.4 billion people recorded a GDP of $14.43 trillion in the 2019 report; while the Unites States GDP with a population of 327 million recorded a $21.43 trillion GDP: the largest in the world.
The “2019 Global Competitiveness Report” summarized the U.S. ranking this way: “. . . The United States remains one of the most competitive economies in the world. It is still an innovation powerhouse, ranking 2nd on the Innovation (Ecosystem) capability pillar and 1st in terms of Business Dynamism, boasting the second-largest market, and home to one of the most dynamic financial systems in the world.”
By comparison, the Global Competitiveness Index of “Innovation Ecosystem” including two metrics place U.S. “Business Dynamism” at number 1 (vs. China at 36), and our “Innovation Capability” second only to Germany (vs. China at 24).
Since our country’s beginnings, we have demonstrated to the world that we are innovators, a manufacturing powerhouse. Though markets may shrink, or unique products turn into commodities, we’re usually capable of rebounding, as strong as or stronger than ever. Our work ethic and use of advanced technology have always made our manufacturing operations competitive—and a strong manufacturing base is key in sustaining our economy and standard of living.
Manufacturing, in conjunction with agriculture and mining, lies at the beginning of the economic food chain as one of the largest sources of original wealth. This is where the money trail starts. Each of these sectors takes raw materials and converts them into salable goods. From these three fundamental sources of wealth, people, businesses, and organizations prosper—including real estate, investments, food service, higher-educational institutions, retail sales, power-generation and distribution, and more. We simply cannot afford to let our manufacturing shrink.
HOW THEY CAN COMPETE
How can China, a relative newcomer to the global manufactured-products marketplace, successfully compete if its only advantage is low-cost labor? It can’t. Instead, it must have something else: Very clear expectations for its workers, supervisors, and managers. These are often standard work methods or best-practice procedures, i.e., instructions, training, and accountability to follow the procedures. Translation? “Do it right the first time, every time, and you can have employment here.”
We took the same approach during World War II, when we trained inexperienced housewives to build bombers, combat vehicles, tanks, and other munitions. It was called “Training Within Industry” (TWI). From 1946 to 1952 (when the Allies occupied Japan), we taught TWI methods to Japanese workers, supervisors, and managers. To this very day, the top Japanese automakers use TWI in their plants around the world, even here in the United States.
Unfortunately, most U.S. businesses abandoned these proven methods when our troops came home and re-entered the workforce. Nearly all working women returned to being housewives and, for the most part, we settled back into a pre-war mindset. But, we were the only remaining industrial power in the world, so the world was our marketplace. But quality of workmanship for us, evidently became optional.
GETTING BACK IN THE RACE
Nowadays, we often let individual workers and supervisors do their own thing. We allow non-standard work. We facilitate variation from crew to crew in the name of productivity improvement along the lines of, “I don’t care how you get it done. Just get it done.”
Why do we often fail to hold ourselves accountable in doing it right the first time? Because we choose to. We don’t want to upset someone who is getting the job done, maybe taking a bit longer than others because he or she is not following a published procedure. We permit human variation to creep into most things that we do on our plant floors and in our maintenance shops. This situation essentially reflects the independent spirit we inherited from the hearty folks who first settled this melting pot we call home. Nice to have, but not when it comes to reliable plant equipment and processes.
By the same token, though, we CAN CHOOSE to compete with China. Regardless of our positions, from chief executive to technician, we can choose to compete in markets that are important to us. While it’s too late for textiles and apparel—and, perhaps, for the commodity-furniture segment—we still dominate in some markets, and are a very competitive front-runner in others. We can’t afford to lose those capabilities.
In addition, we can regain some markets currently supplied by China. It’s not just about low labor costs, but rather the total cost of manufacturing and distribution. An 8-, 10- or 12-week shipping schedule from China is inefficient and costly. Higher inventories, in-transit damage and defects are expensive.
So how does the U.S. compete? We need to exploit a number of our strengths. See the following list:
♦ Advanced manufacturing technology (but it must be reliable, first time, every time).
♦ Market proximity (but we must deliver on time).
♦ Workmanship (but we must attract and retain a skilled, competent workforce).
♦ Productivity (but we have to do our very best, first time, every time).
♦ Widespread electric power and utilities (but they, too, must be reliable).
♦ Responsiveness (but we must listen to our customers and have the agility to respond to market changes quickly).
♦ Capitalism (but we must drive waste, fraud and abuse from the system at all levels).
A COLLECTIVE REALITY CHECK
We know how to compete in almost any market in the world today. “Do it right the first time” has to be our mantra, credo, and maxim—not to mention our competitive edge.
We must learn to practice what every motorsports race team does: Know your competition, pursue 100% reliability of the critical assets and we’ll win or lose together. Run-to-failure and fast repairs are not competitive strategies in manufacturing, transportation, facilities and utilities.
Finally, we KNOW how to make our equipment and processes reliable. It’s up to each of us to see it, believe it, talk it, walk it, teach it, and do it. We are, after all, in a big race—a very tough and critical one, at that—where failure is not an option. And, it’s ours to win.TRR
ABOUT THE AUTHOR
Bob Williamson is a long-time contributor to the people-side of the world-class-maintenance and manufacturing body of knowledge across dozens of industry types. His background in maintenance, machine and tool design, and teaching has positioned his work with over 500 companies and plants, facilities, and equipment-oriented organizations. Contact him directly at 512-800-6031 or [email protected].
Tags: reliability, availability, maintenance, RAM, asset management, training and qualification, vocational education,Global Competitiveness Report, Global Competitiveness Index
