Top 10 Survival Tips For Manufacturers: What Are Yours?

Nov 9, 2011 8:28 AM

Guy Morgan, president of Performance Improvement LLC and managing director of business advisory consultants BBK, has developed ten top tips for the survival of US manufacturers:

1 - Maintain your focus

2 - Reinvent your products regularly

3 - Enhance product and process design

4 - Manage your supply chain

5 - Rethink off-shoring

6 - Improve quality

7 - Diversify your customer base

8 - Embrace globalization

9 - Invest in your employees

10 - Facilitate total productive maintenance

Morgan seems confident that these strategies can help US manufacturers rebuild a stronger US manufacturing base.

"With advanced manufacturing techniques being adapted on a broader scale, with total cost of product considerations favoring American manufacturers and with poor quality being a serious problem in low-cost countries, American manufacturers can reverse a generation-long exodus that closed many American plants," Morgan told a US manufacturing conference yesterday. "They just need to do the rights things to make it happen."

Which of Morgan’s tips do you think are most important for the future? Are the right ideas even on this list?

What would your top tips be for manufacturing survival?

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Tags: supply_chain_management, workforce_strategy, us_manufacturing, survival

Bill DelTosta
4 posts since
Oct 11, 2011

Currently Being Moderated

Nov 9, 2011 2:14 PM (in response to Paul Tate)
Top 10 Survival Tips For Manufacturers: What Are Yours?

Outsourcing in the U.S. - collaborative outsourcing - can greatly augment product development and assembly while allowing manufacturers to better maintain their focus. Being in the US also provides a good basis for collaboration and communication. I will be publishing an article on this, soon.

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- Paul Tate
  221 posts since
  Nov 8, 2010
  
  Currently Being Moderated
  
  Nov 30, 2011 3:18 PM (in response to Bill DelTosta)
  Top 10 Survival Tips For Manufacturers: What Are Yours?
  
  Bill - sounds like an interesting article. Have you had a chance to develop this?
  
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Steve Bryant
6 posts since
Nov 13, 2011

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Nov 15, 2011 11:02 PM (in response to Paul Tate)
Top 10 Survival Tips For Manufacturers: What Are Yours?

The first tip running through the business owner's mind is "where to start?" it's especially relevant to SMEs that are time and resource poor. Additionally, management may suspect there's an issue but need an objective validation. There's a range of objective benchmark tools that help these companies identify areas of greatest need and greatest gain - we use the Probe for Manufacturing Microscope on many clients, developed by IBM and the London Business School and sourced out of the UK by Comparisons International.

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Dave Ottenstein
1 posts since
Nov 25, 2011

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Nov 30, 2011 7:47 AM (in response to Paul Tate)
Top 10 Survival Tips For Manufacturers: What Are Yours?

I think number one should always be "Run the numbers". This will give you a starting point. The numbers are Current Ratio, Quick Ratio, Inventory Turnover, Operating Cycle, and Working Capital Turnover. Knowing the relationship of all these numbers, and what it means to your operation, gives a very quick rundown on where your pain is.

Another item on the list should be "Operate for Cash Flow, Quote for Profit". This means optimize your operations to reduce the operating cycle and produce a positive cash flow period over period. Leave the profitability to the quoting. If you have a sound business model and optimize for cash flow, profits will come. If your too worried about profits on the operations side your cash flow will suffer every time. Many profitable businesses went bankrupts because of bad cash flow, but not one single company, ever, went out of business because of too much cash!

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- Nan OBrien
  1 posts since
  Dec 1, 2011
  
  Currently Being Moderated
  
  Dec 1, 2011 10:27 AM (in response to Dave Ottenstein)
  Top 10 Survival Tips For Manufacturers: What Are Yours?
  
  One of the issues I consistently see is a VOID on the Internet. Either the website is poorly designed, missing critical information or totally non-existent.
  
  With a huge percentage of all industrial sales being initiated on the web today, why would a company not get their presence out there, allowing them to reach beyond the local market and garner some of the national or global marketshare!
  
  Considering that businesses are now spending a significant amount of time and energy having their information being found on social media as well, the companies who don't even bother with the basics like a serviceable web solution showing off their capabilities and portfolios are not even being considered when new projects open up.
  
  If a company cannot be found, how can they possibly compete for the job opportunities?
  
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  - Heather Steele
    2 posts since
    Dec 7, 2011
    
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    Dec 7, 2011 3:53 PM (in response to Nan OBrien)
    Top 10 Survival Tips For Manufacturers: What Are Yours?
    
    This is a great point, Nan - I am always surprised by the poor quality of websites we see other manufacturers using to represent their businesses online. The flip side of this though is that we're in an industry where standing out above the crowd online can be pretty darn simple with a little effort and some strong marketing skills.
    
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Heather Steele
2 posts since
Dec 7, 2011

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Dec 7, 2011 4:00 PM (in response to Paul Tate)
Re: Top 10 Survival Tips For Manufacturers: What Are Yours?

This is a great topic, so much of the list can be boiled down to investing resources in R&D and Marketing (and increase your efficiencies there). Let those areas drive the progression of your business and great things can happen.

We actually put out a short ebook similar to this post called 5 Keys For Survival Post Recession - you can grab a copy of it here

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Dan Edey
6 posts since
Dec 29, 2011

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Dec 29, 2011 9:14 AM (in response to Paul Tate)
Re: Top 10 Survival Tips For Manufacturers: What Are Yours?

Give your customers a reason other than price to buy your products verses your competition.

And Nan, I think you make a great point. No matter what your marketing efforts are, you must assume future customers will look you up online. Make that experience as intuitive and user friendly as you possibly can.

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- Paul Tate
  221 posts since
  Nov 8, 2010
  
  Currently Being Moderated
  
  Dec 29, 2011 4:08 PM (in response to Dan Edey)
  Re: Top 10 Survival Tips For Manufacturers: What Are Yours?
  
  Nan, Heather and Dan,
  
  I couldn't agree more. Why is it that so many otherwise astute manufacturing companies - apart perhaps from the more consumer-aware CPG, auto, white goods and fashion sectors - still seem to ignore the increasing impact of the web and other digital platforms as a way of getting their unique message across to key customers - B2B and B2C?
  
  Have they been asleep for the last few years? Do they lack business case understanding? Do they lack digital skills? Do they still think it's not part of their traditional business?
  
  What can the manufacturing industry community do to help?
  
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  - Dan Edey
    6 posts since
    Dec 29, 2011
    
    Currently Being Moderated
    
    Dec 29, 2011 6:50 PM (in response to Paul Tate)
    Re: Top 10 Survival Tips For Manufacturers: What Are Yours?
    
    I think the focus has been diverted heavily into optimization on the production floor and relentless reduction in costs. There must be 10 lean black belts for every manufacturing focused marketer. (Gut feeling, no scientific basis for that statement at all)
    
    It blows me away when companies spend money to optimize an undersold process. Then they think that the output is a commodity, and bid contracts based on price and fear rather than showing value.
    
    Having a website that works doesn't take priority when you are running tight margins and bidding low.
    
    The good news is that companies that see what digital marketing can do for them have little competition. The internet is definately a land of opportunity.
    
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Susan STRALEY
3 posts since
Jan 2, 2012

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Jan 2, 2012 9:05 PM (in response to Paul Tate)
Top 10 Survival Tips For Manufacturers: What Are Yours?

It's not a one time thing. Just like lean practices and process improvements, These topics need to be addressed over and over. A circle of thinking and activity and testing.

Maintaining Focus is good. But we constantly have to re-assess that our day to day focus is backing up and helping us reach our vision, or ultimate goal of being known by US Manufacturers as the best source for weld fixture designs and weld fixture components.

We re-did our web site and social media strategy in 2011. Check out our web site and let me know what you think! http://www.rentapen.com

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- Dan Edey
  6 posts since
  Dec 29, 2011
  
  Currently Being Moderated
  
  Jan 3, 2012 5:36 AM (in response to Susan STRALEY)
  Top 10 Survival Tips For Manufacturers: What Are Yours?
  
  Susan,
  
  I just took a quick look at your site. Rentapen does beautiful work.
  
  Quick comment.
  
  At 1:26 of the video on your main page, it shows a plastic block with
  
  RENTAPEN INC
  LASER CUTTING &
  ETCHING SERVICE
  
  A rule of thumb is you have 3 to 7 seconds to explain to a visitor what your site is about, that they are in the right place, and what they can do in that place. If you don't accomplish that right away, a common symptom is high bounce rates or low traffic.
  
  At 1:26 in your video is the first time I really knew what you did. It put the rest of the site into perspective. A quick thing I would try is adding LASER CUTTING AND ETCHING SERVICE to your header, right beside the logo.
  
  If you would like a deeper evaluation of your site, send me private message with your email address and I'll send you one back within a day. I try to find at least 10 improvements that can be tested.
  
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  - Susan STRALEY
    3 posts since
    Jan 2, 2012
    
    Currently Being Moderated
    
    Jan 3, 2012 5:56 AM (in response to Dan Edey)
    Re: Top 10 Survival Tips For Manufacturers: What Are Yours?
    
    Laser Cutting and Etching is only a small part of what we do. There are four things listed on the right hand side of the front page with pictures.
    
    We are first and foremost a machine design company that helps manufacturers reduce costs. That, I believe is in the first line.
    
    But your comment probably explains why we aren't getting a lot of laser cutting work right now.
    
    Thanks for your input.
    
    Susan StraleyQueen of Lean Machine DesignOwner/President
    RENTAPEN INC.
    
    400 Travis Lane #30Waukesha, WI 53189(262) 542-8891 Phone(262) 542-8892 Faxhttp://www.rentapen.comVideo Rentapen Story
    Video "Shim King" song
    Follow me on twitter >> @SusanStraley
    Hook up with me on LinkedIn >>http://www.linkedin.com/pub/susan-straley/22/2a9/4a1
    Sign up for my Educational posts on Fixture DesignRentapen is a machine design company that specializes in cost reductions for manufacturers. We do this through: * Rapid Tooling Components(TM) * Just-in-Time Laser Cutting Services(TM)* Excellence in Machine Design
    
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Gustavo Povarchik
1 posts since
Aug 2, 2011

Currently Being Moderated

Jan 6, 2012 3:34 AM (in response to Paul Tate)
Re: Top 10 Survival Tips For Manufacturers: What Are Yours?

Whenever a time of crisis arrives, the only way to survive is to adapt yourself to the changing reality. From the manufacturing and operations point of view, the matching tip for adapt your organization to the crisis is renegotiate everything.
From raw material prices to bank charges, from exchange rate commisions to employees bonus structure, even signed agreements with suppliers are not sacred to re-negotiation. Everybody is aware that the economic environment has changed and the best way to survive is to recognize it and build on cooperations between partners in the supply chain or eith the organization's personnel.
Re-negotiation as a tool to adapt to a crisis environment, is my tip.

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- Paul Tate
  221 posts since
  Nov 8, 2010
  
  Currently Being Moderated
  
  Jan 6, 2012 5:18 AM (in response to Gustavo Povarchik)
  Re: Top 10 Survival Tips For Manufacturers: What Are Yours?
  
  Gustavo - thank you for your insightful comment. I think your point that - "Whenever a time of crisis arrives, the only way to survive is to adapt yourself to the changing reality" - is exactly on point.
  
  Adaptive approaches are essential in times of change, and today's rapidly shifting landscape for manufacturers makes adpatability more important than ever. In fact, we feel that such approaches are so critical to the future of manufacturing that we are launching a special course this year on Adaptive Leadership for Manufacturing Leadership Council members. This is specifically designed to help create more agile and innovative manufacturing company cultures that are able to grasp new business opportunities, build more flexible teams, and succeed in today's constantly changing business environment.
  
  If you, your colleagues, or any Manufacturing Executive community member, would like to find out more about this new program click here to register and join us for a special free introductory webinar - "Learn to Lead Adaptively For Manufacturing" - which we're running in partnership with international leadership development practice Cambridge Leadership Associates on January 24th.
  
  We hope you can join us.
  
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