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Five steps to bring back American manufacturing jobs

Many proclaim that American manufacturing is gone, never to return. The numbers certainly are frightening. Yet other signs point to a possible resurgence. Manufacturing executive Carol Ptak argues that significant numbers of good manufacturing jobs can and will return if America takes the following five steps.

5. Learn from success

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Even during these very dark times there are American manufacturing companies in a variety of industries that are not only surviving but thriving. These companies stripped out the common non-sense of prevailing practices and got on with the business of providing what the customer wants, when they want it, at a price that is competitive.

Take Le Tourneau Technologies – an American icon that supplied 70 percent of all Allied earth moving equipment in World War II. In more recent years, instead of falling into the trap of outsourcing a capital-intensive division of the company that made steel, the company leveraged its ability to supply this key raw material closer to home and significantly reduced the time it took to build its steel-intensive product.

Instead of following common practice, the company protected its supply chain and was able to sell highly specialized steel on the open market for even more profit. Overall company revenues and profits skyrocketed.

Similarly, Oregon Freeze Dry, the largest diversified freeze dryer in the world, recently realized a 13 times revenue increase while only increasing inventory by two times. Tube Forgings of America completely rethought its operational approach. It reduced inventory and increased serviceability to customers and as a result has been very successful during the recent economic crisis, according to management. There are a number of other examples of companies that adjusted to market demands and changed their operations to better respond to the customer.

Each company spent time thinking, and then it developed and implemented a unique competitive advantage supported by sensible metrics. There are many stories like this if other manufacturers are willing to listen and learn.

Carol Ptak is currently a founding partner with the Demand Driven Institute. She has authored seven books focused on manufacturing competitiveness and was most recently a visiting professor and distinguished executive in residence at Pacific Lutheran University. Previously, Ms. Ptak was vice president and global industry executive for manufacturing and distribution industries at PeopleSoft. Ptak is also a past president of APICS (the Association for Operations Management).

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Mark Sappenfield
Editor

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