In uncertain economic times, many countries are looking to manufacturing to provide useful growth and employment. Barack Obama and David Cameron in the US and UK are both long-time converts to the "pro-manufacturing" argument. Narendra Modi, India’s new-ish prime minister, has espoused a "Make in India" programme to give his country a lift. In Nigeria, Goodluck Jonathan has instituted the "Nigerian Industrial Revolution Plan" to do much the same. A key to all this interest is that the "manufacturing" most nations are interested in is different to the sort of production operations that dominated in the past. Old-style manufacturing in the shape of big, inflexible, polluting factories is not what these countries have in mind. More important are small, nimble companies applying new technologies and business methods. These can be applied to suit the requirements of customers both at home and thousands of kilometres away. A set of new themes are important. They include: “tailoring” goods to meet individual needs; blending different technologies to create new products with outstanding properties; using the power of the internet plus other digital techniques to provided new capabilities; combining production with services; and running factories so as to have a minimal negative impact on the environment. Uniting the old and the new elements is one unchanging characteristic. Manufacturing is at heart very simple: it's about adding value to the world’s limited stock of materials to make useful things. Perhaps this is why the topic remains fascinating, several thousand years after manufacturing in its earliest forms started up. In the light of this interest, it seemed a good time for the Vienna-based United Nations Industrial Development Organisation to organise a five-day training workshop to explore some of the themes. Unido
Detroit and the state of Michigan have been in the headlines a lot over the past few years - mainly as a result of a welter of grim economic news including the city's slide into bankruptcy. But more recently have come some signs of a significant improvement in the fortunes of the region, driven partly by indications of greater optimism and investments by local manufacturers including the big car companies. Among the Michigan manufacturers that have been hiring more workers and expanding production is Fullerton Tool, whose chief executive Patrick Curry is pictured here. Cheered by receiving positive news about their fortunes from Mr Curry and other local business people, I made a speech at an event in Detroit on September 17 examining the health of Michigan-based manufacturing. The event was organized by the Detroit Manufacturing Renaissance Council, an offshoot of the Chicago Manufacturing Renaissance Council. In the chair was William Jones, chief executive of Focus: Hope, a Detroit community development and human rights group. For background, read this good article by William Hemphill on the manufacturing renaissance movement in the US. YOU CAN DOWNLOAD MY PRESENTATION HERE Detroit Manufacturing Renaissance Council seminar on future for US & Michigan manufacturing, Detroit Read about details of an earlier talk in Chicago at a previous meeting organized by the Chicago manufacturing renaissance council.
Manufacturing Renaissance Councils: Models for Success? By Thomas Hemphill Americans generally agree that they want their nation to remain the global leader in manufacturing. According to Leadership Wanted: U.S. Public Opinions on Manufacturing, a 2012 national survey, 90% of respondents rated manufacturing as “important” or “very important” for their economic prosperity and America’s standard of living. This survey reinforces the importance of the manufacturing sector to the good health of the American economy. While continuing to expand its productivity over the last two years, the U.S. manufacturing sector has only modestly expanded its employment base. Since December 2011, the Bureau of Labor Statistics has reported an increase of 231,000 manufacturing jobs, for a total of 12,028,000 employed in the sector. Yet the need to develop a long-term, stable supply of next-generation employees for advanced manufacturing industries is a challenge that needs to be undertaken now—not later. With an anticipated surge in retirements from an aging workforce over the next few years, the demand for high-skilled workers will be needed for replacement and continued expansion. There has also been a recent groundswell of business, government, labor, and academic support for the creation of a U.S. manufacturing strategy.... Read full article
Inditex has become the world’s largest fashion retailer. But how long can its dizzying expansion last? By Tobias Buck, Financial Times, June 18, 2014 A few weeks from now, young women all over the world will decide that what they really want to wear this summer is a long, flowing trenchcoat with a buckle belt and soft shoulders. They don’t know it yet. But Manuel Ruyman Santos knows, and Inditex knows, and €17bn in sales says they will be right once again. For the moment, the trenchcoat is a prototype, hanging on a clothes rack at Inditex´s sprawling headquarters in Arteixo, northern Spain. But Mr Ruyman Santos, one of the designers of the new garment, is confident it will be a success. Soft trenchcoats have sold well in recent months, so he knows the new creation will tap into a broader trend. For Inditex, the biggest fashion retailer in the world, the success or failure of one trenchcoat is of marginal importance. It is just one of 18,000 individual designs made every year for its chain of Zara shops alone. Add in the group’s seven other brands – from upmarket Massimo Dutti to casual Pull & Bear – and the number rises to more than 30,000. The new coat is nothing but a tiny thread in a much bigger story – but one that illustrates how a small family-owned clothes manufacturer on the edge of Spain turned into one of the most striking corporate success stories of recent years. The rise of Inditex holds valuable lessons.... Read full article
By Peter Marsh, Financial Times, May 19, 2014 The future is far from rosy for many manufacturers in Europe but Roberto Gavazzi, chief executive of Boffi, a top Italian maker of upmarket kitchen and bathroom units, is upbeat “I am very confident that the current difficult markets are getting better for the best brands,” he declares. Underlying this sentiment is Gavazzi’s belief that Boffi – like many other European manufacturers of a similar mould – has built up strengths not just in product creation but in using service and design skills to offer customers something special that would be hard to obtain from rival businesses. “Consumers are even more selective – they want to choose only those products that have a real added value,” he says. “So [they choose] not only design and function, as is normal for our collections, kitchens and bathrooms, but now they want increasingly to buy something that gives them a very special mood or atmosphere. Here, I think we can do well.” Read full article
By Peter Marsh, May 9 2014 It is high noon in one of the world's longest running business battles. In beginning their competing efforts to acquire the prize of Alstom's electricity generation arm, Siemens and General Electric have entered the final bout of a marathon heavy-weight contest to determine the identity of the global leader in power equipment. The German and US engineering giants have been sparring for well over a century for pole position in what could be termed the 'war of the wheels'. We live in an age dominated by passage of invisible globules of information passed silently over the internet. But the the global economy would come to a standstill without the spinning turbine machines central to the creation of electricity. Siemens and GE - set up within 30 years of each other during the 19th century's great burst of technology innovation - both attached great importance from early on to building up leadership in power generation machines. They were helped in this by the invention in 1884 of the steam turbine by the UK engineer Sir Charles Parsons. In what is now an immense global industry - supplying products and services worth about $150bn a year - Alstom has in the past decade occupied the number three position behind the German and US leaders by dint of its acquisition in 2000 of the power generation division of the Swiss-Swedish ABB. But it has been obvious for some time that the French company's position has been slipping as a result of missteps in both technology development and in global market penetration, while its big two competitors have been moving further ahead. As Siemens and GE start what will be a politically charged
By Peter Marsh, March 26 2014 Moshen Sohi has come a long way from the time – as a six-year-old in his native Tehran – he became fascinated by pictures of Caterpillar bulldozers and decided he wanted to be a mechanical engineer. Since those formative days, Mr Sohi has forged a career in manufacturing largely in the US, but has ended up in the quiet south German town of Weinheim where he is chief executive of Freudenberg, a family-owned business making everything from aerospace seals to mops. Holding forth in the company’s airy headquarters, Mr Sohi says he has been fortunate to experience a lot of different ways of running businesses, from the divergent styles of some of the big US companies that he worked for, to the time after joining Freudenberg in 2003 when he helped to run a big Japanese joint venture. Read full article
By Peter Marsh, April 15 2014 As a purveyor of subsea drones, blast doors and 3D printing machines for making replicas of human skulls, Raphaël Gorgé could be a James Bond villain in the making. But if Mr Gorgé has any threatening aspects to his personality, he disguises them masterfully as he describes his efforts to build up his collection of exotic high-tech businesses into a global force. Indeed, the chief executive and part owner of Groupe Gorgé is the personification of calm reasonableness, displaying a pleasant sense of humour as he explains what induced him 10 years ago to abandon a career in finance to join his father Jean-Pierre in an industrial company the latter had started in 1990. “My dad had achieved some progress but I felt with my background I could help steer the business in a new direction,” he says. “Finance is a great field: if you do well, everyone thinks you’re smart, and if you fail it’s because someone else [running the business being supported] has been stupid. I thought an industrial job would be more challenging and satisfying." Read full article