Tag Archive: Industry Week

Manufacturing is on the Move

August 17th, 2019

 

Reshoring was at record levels in 2018! Manufacturers are starting to return as they see the total costs of offshoring combined with the rising costs in China and improved competitiveness of the U.S.

According to an Industry Week article by Harry Moser, almost 1400 companies announced the return of 145,000 jobs in the last year. This trend was starting to occur prior to the tariffs. Now, the tariffs are expediting the return. Manufacturers are also realizing they can gain a competitive edge with rapid customization close to their customer base.

Additionally, even in commodity products, companies are reevaluating how to remain competitive and diversified. Hasbro is the latest company to look at diversifying away from China. According to Industry Week, Hasbro, the largest toy maker globally, said that it planned to move from 75% to 50% production in China by the end of 2020. They are looking at Vietnam and India.

There is a transformation occurring. Executives are more concerned about relying on any one source of production (China), and are diversifying. Intel is reviewing its global supply chain.  And, there are rumblings that Apple and Amazon are working on a plan B.

What Should We Consider and/or What Impacts Could Arise?
Speed and agility are critical to thrive in today’s marketplace. Start thinking about how you can radically reduce lead times while accelerating cash flow (reducing inventory levels) and increasing profitability. It is no easy task . Yet, it is what is required to thrive in today’s Amazon-impacted world. What can you do to get ahead of this curve?

Like the big dogs from the Industry Week article, should you be thinking about diversification? Or should you be re-shoring? Or should you buck the trend and offshore while everyone else is re-shoring? There are many companies who would be in far better shape if they had taken that approach 10-20 years ago when every Board member wanted to see an increase in outsourcing. There are no perfect answers except to be thinking about these impacts on your industry, your supply chain partners and on your company so that you can take a proactive stance instead of a reactive one. What will you do to successfully navigate these waters?

Certainly, re-shoring, near-shoring and diversifying are topics related to creating a resilient supply chain. If you are interested in an assessment of your situation, contact us. You’ll find more information on these types of topics on our resilient supply chain series.



The Talent Transformation: People or Robots?

April 14th, 2019

automationNo matter the industry and geography, the topic of “People vs. Robots” is a hot topic!

Certainly, manufacturing has been focused on technology and automation for quite some time to navigate the path to thrive in the modern environment of high costs, regulations, and elevated customer demands.

The Manufacturing and Technology Expo in Pittsburgh is going back to the theme of the 1939 World’s Fair, “The World of Tomorrow”. The Manufacturing sector has seen positive job growth not seen in 79 years. As Industry Week says, “We don’t have smoking robots but we have ones that perform lung surgery.”

Our APICS Inland Empire Chapter is hosting an executive panel and networking symposium on just this topic, “The Talent Transformation: People or Robots?” on April 13th at Harvey Mudd. We have an intriguing panel of executives and experts to discuss automation, robots, IoT, AI and much more. How do we co-exist successfully? Join us to learn more and probe further.

In logistics circles, there is quite a bit of worry and opportunity. According to a University of Redlands study, most large metropolitan areas are subject to losing 55% of their current jobs due to automation. In Inland Southern CA, that number expands to 62%. However, it depends on your thought process. UPS automated a section of their facility that reduced the number of people they needed by 100 yet they ended up hiring as they absorbed additional volume. Additionally, it depends on whether you are furthering your education and skills. We find proactive employees and employers in our Association for Supply Chain Management (ASCM)’s APICS certification classes who want to learn and grow.

For Inland Southern California, we have a particularly unique opportunity or challenge, depending on how you want to look at it. According to a Brookings study, we must focus on advancing the capabilities and competitiveness of local firms in opportunity-rich manufacturing and logistics industries. What an opportunity for us to leverage technology hand-in-hand with talent to THRIVE.

If you are interested in discussing whether your organization is prepared to leverage these opportunities and what priorities should emerge, contact us. We are experts and would love to see the U.S., California and the Inland Empire take advantage of this tremendous opportunity to enable scalable, profitable growth.

Find out how to navigate disruption and achieve peak performance.

Did you like this article?  Continue reading on this topic:

Industry Week’s Salary Survey Finds Good Morale Yet Not Higher Wages

What’s Ahead for People

Profit Through People



Industry Week’s Salary Survey Finds Good Morale Yet Not Higher Wages

October 17th, 2018

According to Industry Week’s salary survey, almost 70% of respondents are “satisfied” or “very satisfied” with their current job yet salaries took a 6% dip since last year.   I wonder if the baby boomer retirement ramp up is impacting these numbers as the survey finds that the people with the most seniority make the most money.  

A few interesting statistics:
1) Not surprisingly, bigger companies pay more.
2) Medical devices pay the most, followed by chemicals and food & beverage. Apparel/textiles is at the bottom of the list.
3) VP Manufacturing/Production makes the highest salary ($187,100).

What’s Matters to the Workforce
Yet, the article made a point of saying that salary wasn’t most important to the respondents.  

In terms of what matters most in the job, the respondents said:
1) Challenging work.
2) Base salary.
3) Job stability.

How Employees See It
And, the overwhelming challenge faced in manufacturing by respondents goes back to the skills gap with #1 being the lack of skilled labor.  A distant second (tied) was the adoption of technology and leadership lacking. Lastly, foreign competition and governmental regulation were next. Do you know how your employees feel about their jobs?

What Should We Consider and/or What Impacts Could Arise?
Do these survey results surprise you?  We find that our clients largely seem to follow in line.  There haven’t been significant pay increases.  However, they are starting to lose top talent to the competition due to the intangibles (location, vacation etc.) as well as pay.  Thus, it’s important to watch the market carefully – is saving 3% worth losing one of your best employees? I doubt it!

Our clients definitely are experiencing the skills gap.  They are automating as quickly as possible to keep up with demand while also pursuing new strategies to gain employees (such as reducing degree requirements) and mentor, train and educate employees to promote with the needs of the business.  Only the proactive companies with excellent leaders (as everyone can “look up” their new potential boss and see what others’ think) will thrive!

What are you doing to stand out from the competition when it comes to talent?

 



According to the Industry Week U.S. 500, Manufacturing is STRONG!

September 21st, 2018

 

According to the Industry Week U.S. 500 (America’s largest manufacturers), manufacturing is STRONG!  In fact, the author uses the words VERY STRONG – most likely the largest opportunity for manufacturing since the end of World War II.   Now that is saying something….

The economy is strong and is supplemented by a tax overhaul that supports manufacturers combined with a deregulation focus.  The key is to leverage the opportunity. Even though there are lots of worries about trade wars and skill shortages, thus far, manufacturing continues to outperform.  Get ready for agile and speedy manufacturers with high tech tools to outpace the pack and further spur the economy! Will you be in the fast lane or watching them race by?

What Should We Consider and/or What Impacts Could Arise?
Take a pragmatic look:  Are you in the fast lane, driving with the pack or in the slow lane?  

With the VAST opportunities for manufacturers to succeed, perhaps it is time to put on your turn signal and step on the gas!  As one of our LMA Associates has been saying lately, perhaps we should all “make hay while the sun shines”. Are you?

Making It Happen
Strangely, one of the most important to-do’s should be to not get carried away with all the negative “what if’s” (such as trade wars).  Of course, don’t hide your head in the sand. Stay up-to-date on what’s most likely and relevant to your industry.  Focus 95%+ of your energy on how to distinguish your company from the competition while providing superior customer experiences and enabling scalable, profitable growth.  

Make hay while the sun is shining. Bring your best team players together.  Bring in experts to accelerate progress.  Ignite innovation.  Create the environment to ensure success.  Remember your supply chain partners.  AND THEN, “get out of the way”. Success will follow.



The Highest # of Factory Jobs Since 2008!

May 1st, 2018

Supply Chain Briefing

According to Industry Week, we have the highest number of factory jobs since 2008!  We have reached over 12.6 million people employed by the sector. This is all the more impressive when we consider the significant rate of automation and deployment of technological advances occurring the last several years.  

In the era of the customer, executives are locating manufacturing in close proximity to their customers. Since customers expect rapid deliveries and high levels of customization, it is making more and more sense to locate manufacturing in Southern California and especially the Inland Empire with lower costs, extra space and access to top talent.  Are you prepared to grow?

What Should We Consider and/or What Impacts Could Arise?
Since manufacturing is transitioning from a necessarily evil into a strategic advantage supporting superior customer service, it is well-worth thinking about how you are positioned.  A

re you leveraging the opportunity if you are well-located by a significant customer base? What can you offer to provide customized, specialized experiences for your customer? Undoubtedly, the executives thinking this way will surpass their competition.  

Similar to retail shopping – if the store you go to doesn’t have what you want customized for you when you want it, what do you do? Buy from the competition! We don’t wait for products to arrive on a boat from China patiently.

Take note if you would pay more for customized, quick service.  I find that I am willing. Are your customers?