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Wealth of nations board game

Jan 17 2012

Manufacturing and Wealth

When you are engaged in an activity, it is easy to endow it in your mind with qualities an outsider would not see. Manufacturing produces tangible, physical goods, things that you can see, touch, use, and express your social status with. It is a necessary sector of the world economy and, as manufacturing professionals, we have the privilege of working in it. But we have no grounds to claim that it is the only true way to create wealth.

What is wealth, anyway? To accountants, it is the difference between the totals of what you own and what you owe, synonymous  with net worth;  it is expressed in money and easily quantified. To others, it is how long you could survive if all your sources of income dried up, and expressed in time, however it might be measured. To others yet, it is related to human relations and happiness.

In none of these meanings does it make sense to assert that  the production of material goods is the only source of wealth. This leaves out movie making, health care, tourism, or software development, just to name a few activities that generate wealth for many. As much as I personally like manufacturing, reality is that converting materials into products is only one of many ways of getting other people to pay. Making things is necessary, and somebody needs to do it. But immaterial goods or services are equally valuable creations, that can be exchanged for material goods.

18th century physiocrats thought that agriculture was the only true wealth creation. They were deluded because agriculture was the dominant sector of the economy of their day. Just because manufacturing was dominant for, say, 150 years doesn’t mean that sector has special virtues. In advanced economies, I see it headed in the same direction as agriculture : a vital and important sector, but employing a small, highly skilled fraction of the work force. It has been moving slowly and steadily in this direction since 1960, and I don’t think it can be reversed, no matter what politicians may say.

On the other hand, the human and social consequences can be anticipated. A production operator with 15 years of experience on the same machine is vulnerable; a multi-skilled machinist is much more likely to be retained and to find a rewarding alternative job if necessary. Schools can train young people wishing to make a career in manufacturing to meet the rising requirements.

Like agriculture, manufacturing matters because we need the goods, not because it provides jobs. Whether we make the goods or buy them is a decision that should not be based on direct labor cost alone but instead on all the relevant issues, including engineering, quality,  logistics, intellectual property, the skills base, customer communications, public relations, taxes, etc.

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By Michel Baudin • Management 8 • Tags: Management, Manufacturing

Jan 14 2012

Tip for Getting More Organized: Don’t

Via Scoop.it – lean manufacturing

This post challenges conventional wisdom on improving the productivity of office work.

“How much time do you spend each day getting better organized? Cut it in half. When it comes to investing time, thought and effort into productively organizing oneself, less is more.”

Via blogs.hbr.org

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By Michel Baudin • Blog clippings 2 • Tags: Management

Jan 13 2012

Lean pharmaceutical plant design

Via Scoop.it – lean manufacturing

Global facility engineering company M+W Group and GE Healthcare announced last month a partnership to bring biopharma manufacturing capability to developing countries. The idea is to join M+W’s Read more…
Via www.fiercepharmamanufacturing.com

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By Michel Baudin • Press clippings 0 • Tags: industrial engineering, Lean manufacturing, Manufacturing engineering

Jan 13 2012

Lean = outsource, fire people, and apply ERP ???

Via Scoop.it – lean manufacturing
This is an unusual take on Lean from a UK ezine. We should recommend homework to the author.

“Following the recession, many businesses have adopted lean principles in the most obvious areas, such as moving production to cheaper locations or reducing non-essential staff. However, simple cost cutting is only a part of the story. To be truly lean, a business also needs to reduce inefficiency in less obvious areas. By using Enterprise Resource Planning (ERP) software, companies have a complete, integrated overview of their entire organisation, combining information from all business areas into one simple system.”

Via www.businesszone.co.uk

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By Michel Baudin • Press clippings 0 • Tags: Lean, Lean manufacturing, Management

Jan 13 2012

5S First?

Via Scoop.it – lean manufacturing

I agree with the comments, but not with the heckler’s assumption that 5S is easy. It may look easy, but, if it really were, 5S efforts would be successful more often. The key reason it should almost never be done first is that it is so hard to make it stick. Companies that start with 5S usually have a big spring cleaning event followed by rapid backsliding that destroys the credibility of 5S with their work force.
A consultant who recommends 5S first is like a parent telling a kid to clean up his room because he has problems at school. It probably needs doing, but it won’t solve the school problems.

“Some time ago, while speaking at a conference in the land down under, I was taken to task by a participant for suggesting, “5S is usually the first improvement” in Lean implementation.”
Via oldleandude.com

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By Michel Baudin • Blog clippings 3 • Tags: 5S, Lean implementation, Management

Jan 12 2012

Steve Jobs as a Model Leader? As a Manufacturing Leader?

Via Scoop.it – lean manufacturing

Blog post at Lean Blog : As I wrote about after his death, I am appreciative of the products and services that Steve Jobs brought to the world.  That said, some of [..] (From our free app: Steve Jobs as a Model Leader?
Via www.leanblog.org

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By Michel Baudin • Blog clippings 0 • Tags: Management

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