Manufacturing Future 

Myths about Manufacturing

There are many widespread beliefs about the root causes of manufacturing's problems. In each, there is just enough truth to lend credence to what are generally fallacies. These include:

1. Trading with foreign countries is a game not played on a "level playing field." Government subsidies, regulations that discriminate against U.S. products, dumping products in U.S. markets below cost, absence of safety and environmental laws, and interlocking foreign corporate structures blocking competition and trade are cited. Each American firm must ask itself, "If these obstacles were removed, would our products be competitive?" In too many cases, the answer is, unfortunately, "No."

2. Other American groups are the culprits. Labor unions want "business as usual" when the life of the firm is threatened. The financial community makes capital too expensive and insists on short-term profits. High salaries of executives are challenged although heroes in entertainment and sports siphon off millions. Government is antagonistic, not supportive, and regulations in safety, health, welfare, and environmental controls are too restrictive and burdensome. The educational system doesn't develop people with the knowledge and skills needed. The legal system is out of control; stratospheric awards for questionable claims can destroy a healthy company overnight. Insurance costs are prohibitive. Although "jobs" are a national goal, employers are a necessary evil. But what voice tells industry's story to the public and seeks balance?

3. Manufacturing decline is not important; the future lies in service and high-tech telecommunications. A "post-industrial" economy is supposed to be "replacing sunset industries just as manufacturing replaced agriculture". Of course, agriculture's output didn't decline, enormous increases in productivity made American farmers competitive with low-wage farmers everywhere. Service activities produce no real wealth, they just redistribute what is generated by agriculture, extractive industries, and manufacturing. Salaries are generally lower and productivity is poor in spite of enormous investments in electronic hardware and software. This myth of inevitability may be the worst of all if it discourages efforts to restore manufacturing health.

Within manufacturing there are gems of "conventional wisdom" (which is a real oxymoron). A small sample of these includes:

1. Better control requires more sophisticated systems

2. There is some right amount of inventory in every company

3. Input to plants must be increased before output can be

4. Inevitably, more variety means higher costs

5. The worst wastes are idle people and machines

6. Inventory cushions are needed; problems are inevitable

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