The sheer volume in my email inbox as result of my post yesterday concerning Industry Week’s list of the top 50 manufacturing companies is testament to how ineptly I handled the point I attempted to make. One thing you gotta love about manufacturing people is that, for the most part, we do not beat around the bush. It took most email authors very few words to explain the depth of my ignorance to me. A few even made the case quite succinctly that the post enabled them to draw very clear conclusions concerning my genealogy.
I tended to ignore the more personal attacks until I received a late night phone call from my younger sister – a Frito Lay packaging engineer. I now must contend with the fact that I not only insulted a very large, essential and capable segment of the manufacturing community, but my perch in the family tree has become quite precarious, as well.
I meant no disrespect for the folks who are out there manufacturing products made of materials other than steel, resin or silicon. Some of the companies on the list were a bit of a manufacturing stretch. At least, two of them outsource 100% of their production and, while managing contractors in the far reaches of Asia is challenging, I think that should disqualify them from any list of manufacturing companies. I also think that the big oil companies – also in a daunting business – are in an industry of their own and should not be on such a list.
But the others – especially the food and beverage companies and those making personal care products – are most certainly manufacturers. A key point of agreement between Henry Ford and Taichi Ohno is that manufacturing revolves around managing three critical variables: quality, flow and synchronization. I believe that is true whether a company is making Chevrolets or potato chips. How those variable are managed, however, is quite different if you are making Chevrolets than if you are making potato chips.
All things considered, I would much prefer to be the person responsible for quality at an appliance manufacturer than at a food company. Controlling the variability of organic, highly sensitive materials has to be an overwhelming task. When there is a quality failure at the appliance plant, there are disgruntled customers and financial implications. When there is a quality failure at the food plant, they have the same business problems, and on top of them, people may get sick, or worse.
On the other hand, I once worked for a former food industry executive who decried the fact that there did not seem to be the same sensitivity to inventory reduction outside of the food business. In a typical manufacturing colloquialism, he often mentioned the driving inventory management principle in the food industry – "sell it or smell it". In a food business, inventory does not retain its asset value for long. I often thought that it must be much easier to sell accounting on the lean principles of inventory minimization and short cycle times in a food factory than in one of the durable goods plants in which I worked.
In any event, I have great respect for the people in the food business – especially the outstanding professionals at Frito Lay (a shameless plug that I hope reinstates my invitation to Thanksgiving dinner). I am sure that my respect will be even greater around noon when my stomach starts growling. The point that I handled about as well as the proverbial bull in a china shop was simply this: Not too many years ago any list of the top fifty manufacturers in the United States would have been studded with names such as General Motors, IBM, RCA, Ford, General Electric, Motorola and Westinghouse. Not only have all of the great old icons of American manufacturing disappeared from the lists, but there are few others in their industry segments either.
P&G and the people bottling Budweiser and Pepsi are great manufacturers, surely deserving of the recognition IW gave them and of my humble respect. I just wonder how they have been able to maintain their true course, while the old stalwarts working with steel, plastic and circuit boards have not.