How To Make Manufacturing Succeed

A machine shop owner turned to me for reassurance that U.S. manufacturing would remain strong.

I didn’t know what to tell him. I do have confidence in U.S. manufacturing—plenty of confidence. However, that is not what he really wanted. He was concerned about his own fortunes. The problem was, the specialty machining business he had built up was so much more specific than “manufacturing.” U.S. manufacturing could do well or poorly, and it wouldn’t necessarily affect whether he and his particular customers continue to thrive.

As it happens, U.S. manufacturing is doing well. The United States is the world’s leading manufacturer. More goods are being made here than ever before. The share of people in manufacturing is down, but the reasons for this are too rarely explained. Other industries can only expand by adding people, but manufacturing can also expand through productivity—and the sustained productivity growth of U.S. manufacturing has been a modern wonder.

However, manufacturing is changing. Where and whether to make certain products keeps on shifting. These shifts wreak more effects on individual companies than any fluctuations in manufacturing overall. The only solution—not a perfect one—is for a company to keep changing in ways that try to keep up with the shifts.

In fact, there are really just four ingredients in the formula for manufacturing success, and two of them relate to change. That formula is: (1) A valuable product (2) gets better all the time, and (3) that product is made through an efficient process that (4) also gets better all the time.

These four ingredients mix development with production. Part of success in manufacturing is making the right product, and part of developing the right product is knowing what can be made. Far from an isolated pursuit, “manufacturing” actually works best when the same current of innovation flows through this entire stream.

U.S. manufacturing will keep advancing. As it does, manufacturers will increasingly become specialists fishing in various well-integrated streams such as this. The organization or supply chain that can get all four of the above ingredients right is likely to thrive. When it does, its success will contribute to the overall success of manufacturing—not the other way around.