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Global Manufacturing: Myth, Reality & Strategic Options Offshore Group - 12th Annual Manufacturing in Mexico Summit Michae...
“ We can’t compete from the U.S.”   © 2006 M.L. Hetzel As presented at The Offshore Group’s Manufacturing in Mexico Summit...
Who says?   © 2006 M.L. Hetzel As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
Don’t Trust Your Business to Media <ul><li>Very little accurate and objective  information coming from media any more – ev...
Why Listen to Me? <ul><li>Over 20 years of manufacturing experience in SMMs, from the shop floor to 9 ½ years as CEO </li>...
Do Your Own Research <ul><li>Don’t believe me - or anyone else </li></ul><ul><li>All competitive and market information mu...
Amplified Costs & Risks  of International Procurement <ul><li>Supply chain length, inventories and queues </li></ul><ul><l...
Culture & Language <ul><li>Mexico & China </li></ul><ul><li>Greater Asia </li></ul><ul><li>Central & Eastern Europe </li><...
Time Zones <ul><li>Communications </li></ul><ul><li>Travel </li></ul><ul><li>Dateline Effect </li></ul><ul><li>© 2006 M.L....
Product Life Cycle Phases <ul><li>Innovative & unique introductory phase </li></ul><ul><li>Popularity & competition arrive...
Common Myths vs. Reality <ul><li>China’s growth and size </li></ul><ul><li>U.S. current account deficit </li></ul><ul><li>...
Marketing <ul><li>The number one cause of failure for U.S. manufacturers is a lack of marketing and market research </li><...
Common Traits Identified in Successful U.S. Manufacturers <ul><li>They open their minds to global trade even if they choos...
Common Traits Identified in Successful U.S. Manufacturers <ul><li>All of these companies are committed to excellence acros...
Example Strategies from  Case Studies <ul><li>Attitude of positive outlook rather than anger about global business conditi...
Example Strategies from  Case Studies <ul><li>Sharing all of their metric tracking with their clients and engaging in “val...
Example Strategies from  Case Studies <ul><li>Build a business network of alliances and partnerships to remain in alignmen...
Four Fundamental Changes <ul><li>Attitude </li></ul><ul><li>Marketing </li></ul><ul><li>Collaboration </li></ul><ul><li>Pr...
Strategic Overshoot <ul><li>The tendency to decide to operate in another country, often China these days, before careful a...
The U.S. Doesn’t Import Too Much… <ul><li>… We Export Too Little </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As present...
Global Manufacturing: Myth, Reality & Strategic Options Offshore Group - 12th Annual Manufacturing in Mexico Summit Octobe...
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Global Manufacturing Strategic Options

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Michael Hetzel of Pro QC Interational presented on the topic of Global Manufacturing at The Offshore Group's 12th Annual Manufacturing in Mexico Summit. Among other topics, the presentation examines that traits that make manufacturers successful in global markets.

For more information please visit: http://www.offshoregroup.com/mexico-outsource-showcase/manufacturing-in-mexico-summit

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Transcript of "Global Manufacturing Strategic Options"

  1. 1. Global Manufacturing: Myth, Reality & Strategic Options Offshore Group - 12th Annual Manufacturing in Mexico Summit Michael L. Hetzel, VP/Americas Pro QC International www.proqc.com As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  2. 2. “ We can’t compete from the U.S.” © 2006 M.L. Hetzel As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  3. 3. Who says? © 2006 M.L. Hetzel As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  4. 4. Don’t Trust Your Business to Media <ul><li>Very little accurate and objective information coming from media any more – even trade media </li></ul><ul><li>Lack of context is nearly universal </li></ul><ul><li>Head counts trumpeted, actual output ignored </li></ul><ul><li>Plant closings highlighted, plant openings ignored – “If it bleeds it leads” </li></ul><ul><li>Politicization of global trade issues resulting from general domestic political polarization </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  5. 5. Why Listen to Me? <ul><li>Over 20 years of manufacturing experience in SMMs, from the shop floor to 9 ½ years as CEO </li></ul><ul><li>Case study information from producing and moderating 2 years of the ITCC Global Manufacturing Series </li></ul><ul><li>Direct research – no second hand statistics </li></ul><ul><li>Current visibility of the global supply chains of over 300 companies, large and small </li></ul><ul><li>Daily contact with Asian operations </li></ul><ul><li>Regular consulting engagements with SMMs </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  6. 6. Do Your Own Research <ul><li>Don’t believe me - or anyone else </li></ul><ul><li>All competitive and market information must be customized and dynamic – there’s no canned solution </li></ul><ul><li>Go direct to data sources – statistics can distort </li></ul><ul><li>Always account for the context of information and data </li></ul><ul><li>Research global conditions even if your market is domestic only – don’t miss opportunities or threats </li></ul><ul><li>Use government market research resources such as USEAC </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  7. 7. Amplified Costs & Risks of International Procurement <ul><li>Supply chain length, inventories and queues </li></ul><ul><li>Quality disruptions & replacement product delivery delays </li></ul><ul><li>Logistical risks & market tolerance for delays </li></ul><ul><li>Political risks </li></ul><ul><li>Currency risks </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  8. 8. Culture & Language <ul><li>Mexico & China </li></ul><ul><li>Greater Asia </li></ul><ul><li>Central & Eastern Europe </li></ul><ul><li>Regions of the U.S. </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  9. 9. Time Zones <ul><li>Communications </li></ul><ul><li>Travel </li></ul><ul><li>Dateline Effect </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  10. 10. Product Life Cycle Phases <ul><li>Innovative & unique introductory phase </li></ul><ul><li>Popularity & competition arrive </li></ul><ul><li>Commodity phase </li></ul><ul><li>Mature phase & proximity to market </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  11. 11. Common Myths vs. Reality <ul><li>China’s growth and size </li></ul><ul><li>U.S. current account deficit </li></ul><ul><li>U.S. Import sources </li></ul><ul><li>U.S. manufacturing output </li></ul><ul><li>U.S. export levels </li></ul><ul><li>India’s growth and size </li></ul><ul><li>What about Canada & Mexico? </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  12. 12. Marketing <ul><li>The number one cause of failure for U.S. manufacturers is a lack of marketing and market research </li></ul><ul><li>Number two is failing to adapt the company once market conditions are known </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  13. 13. Common Traits Identified in Successful U.S. Manufacturers <ul><li>They open their minds to global trade even if they choose not to participate in global markets or sourcing. No one benefits from anger and fear </li></ul><ul><li>All have a “can do” attitude embedded from the top down in their corporate cultures, with high levels of employee development and commitment to executing global strategies </li></ul><ul><li>Most of the companies engage in international activities of some type (Sourcing, Alliances, JVs, WOFEs), and all are creating growth and success in the U.S. as a result </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  14. 14. Common Traits Identified in Successful U.S. Manufacturers <ul><li>All of these companies are committed to excellence across the enterprise, not just as a buzzword but as a functional, deliberate and measurable business practice. </li></ul><ul><li>Whether operating internationally or not all of these companies are exercising a strong commitment to good, old-fashioned operational excellence as a key foundation of their success. </li></ul><ul><li>These companies directly engage in marketing and market research – the benevolent U.S. market anomaly of the last 50 years is over </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  15. 15. Example Strategies from Case Studies <ul><li>Attitude of positive outlook rather than anger about global business conditions. “Daily attitude ‘adjustments’ shared with staff to keep the organization from falling prey to the discouraging headlines our industry and the global economy creates” </li></ul><ul><li>Evolution in the recognition that “The world will not wait for your company. Take a ‘reasonable risk’ and help the company to evolve into something better (and typically different) than it used to be” </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  16. 16. Example Strategies from Case Studies <ul><li>Sharing all of their metric tracking with their clients and engaging in “value engineering redesign” to create new opportunities for their products through the conversion of designs from other production methods </li></ul><ul><li>Harnessing offshore inputs for local competitive advantage, using global experience to conduct a successful “U.S.-China balancing act” </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  17. 17. Example Strategies from Case Studies <ul><li>Build a business network of alliances and partnerships to remain in alignment with the global movements of their clients. </li></ul><ul><li>Remember that trade flows both ways, not just inbound, and pursue more exports </li></ul><ul><li>Recognize that resistance to change and globalization is not unique to people in the U.S. </li></ul><ul><li>Look for and capture crossover opportunities to other sectors and categories </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  18. 18. Four Fundamental Changes <ul><li>Attitude </li></ul><ul><li>Marketing </li></ul><ul><li>Collaboration </li></ul><ul><li>Products & Processes </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  19. 19. Strategic Overshoot <ul><li>The tendency to decide to operate in another country, often China these days, before careful analysis of the actual business and market conditions rationalizes the decision </li></ul><ul><li>The real solution is often much closer to home </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  20. 20. The U.S. Doesn’t Import Too Much… <ul><li>… We Export Too Little </li></ul><ul><li>© 2006 M.L. Hetzel </li></ul>As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
  21. 21. Global Manufacturing: Myth, Reality & Strategic Options Offshore Group - 12th Annual Manufacturing in Mexico Summit October 20, 2006 Michael L. Hetzel, VP/Americas Pro QC International www.proqc.com © 2006 M.L. Hetzel As presented at The Offshore Group’s Manufacturing in Mexico Summit. www.offshoregroup.com
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