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Study: Manufacturers Face Big Gaps Between Strategies and Execution

Posted By David Brousell, October 22, 2013 at 3:23 PM, in Category: The Adaptive Organization

Coming up with a new idea or better way of doing something is usually a lot easier than making it work. As Thomas Edison once said, “Genius is one percent inspiration and ninety-nine percent perspiration.”

When it comes to manufacturing strategies to grow the business and improve its workings, manufacturers today don’t seem to be perspiring enough.

That, at least, is the conclusion of a new study on next-generation manufacturing (NGM) by the American Small Manufacturers Coalition (ASMC), a trade association of manufacturing extension agents that advocates for small manufacturing companies.

The study, which measured manufacturers’ readiness, support systems and resources, and performance in six “next-generation manufacturing strategies”, found a great deal of distance between the ideas and the execution. The six strategies were customer-focused innovation, superior processes/improvement, human capital management, sustainability, and global engagement, defined as having people, partnerships, and systems capable of engaging global markets.

The study identified the following gaps:

  • Ninety percent of survey respondents believe in the importance of process improvements, but only 44% are near or currently at world-class status in such improvements;
  • Sixty-nine percent said they have the leadership and talent to drive world-class customer-focused innovation, but only 37% have talent development programs in place to support that kind of innovation;
  • Only 11% describe their tools, technologies, and business equipment as state-of-the-art and capable of supporting world-class supply chain management.

The ASMC report, conducted by the MPI Group, a research firm, said manufacturers that achieve world-class status in at least two of the six next-generation strategies and maintain industry-average levels in the other four have the best chance of long-term survival. But most respondents, the association said, are not making the investments they need for future success.

“The study data identifies an enormous execution gap – the difference between the numbers of firms that recognize the importance of a particular NGM strategy, and the number that comes close to or that achieved world-class status in that strategy,” said John Brandt, found and CEO of MPI, in a prepared statement.

How is your company performing in these six areas? Are there additional areas or strategies you would identify as critical to future success?

Written by David Brousell

Global Vice President, General Manager and Editorial Director of the Manufacturing Leadership Council


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