Why manufacturing matters

Indeed, every nation's success as a global manufacturer requires the development and use of manufacturing. At the end of the third quarter in , manufacturing accounted for International competitiveness depends on the timely implementation of new and improved manufacturing processes. Although global integration of product markets and advances in reverse engineering techniques have improved the ability of competitors to determine the components of new products, the ability to clone successful products still depends on competitors' ability to make those components.

Excellence in developing and implementing manufacturing processes that provide unique production capabilities with cost and quality advantages can be the determinant of market success and the key to future U. Any manufacturing system can be decomposed into a series of unit processes that impart both physical shape and structure to the product.

Unit processes are intimately linked to one another; the output of one process becomes the input for the next process. The quality of the final product depends not only on the capability of each unit process but also on the proper sequencing of unit processes. Continuous improvement of the manufacturing system involves creation of an understanding of each process by itself, as well as of the influence of each unit process on subsequent unit processes. The United States has tended to invest most heavily in the invention of new products.

Other nations have invested more heavily in process technologies. Japanese companies invest at the inverse ratio i. The Japanese have graphically demonstrated that the greatest benefits accrue to those who can cost-effectively manufacture new product technologies. Some believe that the U. It is time to reverse this trend and to emphasize improvements in the most promising manufacturing processes, so that.

Since manufacturing is important to a nation's well-being and it is recognized that creation of the product is dependent upon each unit manufacturing process, both individually and together with other processes as a whole, sufficient resources should be provided to educate the manufacturing work force and to develop and improve key manufacturing processes.

The alternative will lead to the decline of the United States as a manufacturing nation. This report primarily deals with the latter case.

DoC Department of Commerce. Dertouzos, M. Share this email on LinkedIn. Share this email on Twitter. Share this email on Facebook. Share this email. McKinsey Classics November Why manufacturing matters. In both cases, the innovation is in the manufacturing. The tighter integration of innovation and production may also present opportunities to bring design closer to end users, as advanced manufacturing technologies make it possible to produce higher-value goods at lower volume.

If firms need to keep production closely connected to their front-end innovative activities in order to bring new products and processes to the market, it is that something we can do in the United States? The advances we see emerging in areas like energy, life sciences, transportation, environment, communication, construction, and security promise to transform our economy and society.

But it may well be that only those countries that can build powerful links between laboratory research and new manufacturing will be able to derive full benefit from their innovative capabilities.

New manufacturing may not mean a larger manufacturing sector with large numbers of added jobs, but it certainly would mean radical change in the technologies and business models we have now. The case for optimism about a renewal of American production capabilities has two legs. First, the strong performance of manufacturing in some other advanced industrial countries suggests that manufacturing and blue-collar work are not doomed in high-wage environments.

In Germany, where wages and social benefits for manufacturing jobs are higher than they are in the United States, the fraction of the workforce employed in manufacturing is about twice as high as it is here.

Germany has a manufacturing trade surplus—even in its trade with China. New manufacturing is possible in countries with educated populations and high living standards. But realizing such possibilities in the United States will take a major transformation of aging industrial structures that are often less efficient than the large new plants and industrial complexes of Asia.

The second leg of the case for optimism is that radically new manufacturing technologies do appear to be within reach. The demand for new, cleaner energy sources, to name just one example, promises huge markets for technologies that can be manufactured cheaply enough to compete with fossil fuels.

Some have called it a new industrial revolution that will have an impact comparable to that of the factory, new power sources, and new technologies in the 19th century. In addition to three-dimensional additive printing, there are strong new possibilities in biofabrication and nanomaterials. But for these ideas to be translated into advanced manufacturing and robust industries, we will require new policies—built on an understanding of why manufacturing really matters.

Suzanne Berger is a professor of political science at MIT who has studied politics and globalization. The firm worked with UK weather forecasters to create a model that was better at making short term predictions than existing systems.