Strategic Technology Innovation Partnership Planning
A common story: We are very good at producing our current products. We have R&D resources specifically committed to product improvement and development. However, we cannot afford to have on staff R&D-level expertise related to our manufacturing/production processes and systems. So, we rely on tooling and equipment vendors. Simply put, the global environment is pushing us to compete more and more on cost, our labor rates are high, and while we are getting rid of waste through Lean Manufacturing principles, opportunities to reduce waste will diminish in time.
Do you see any similarities with your position? Are you relying on your vendors for your manufacturing competitive advantage? So are your competitors. Are you saved at present by your foreign competitors' difficulty in producing sophisticated and higher precision products with acceptable quality? You know that is sure to change with time. Are your products not yet commoditized to the point where only cost and delivery are grounds for competition? That too is sure to change in time.
To retain domestic manufacturing activities in a cost-competitive manner, you need to innovate now more than ever in your manufacturing technologies. To maintain your global competitiveness you must also innovate beyond your existing processes and systems with a particular focus on enhancing the effectiveness of your workforce. Since your labor rates are far higher than those of your emerging foreign competitors, such innovations are strongly to your advantage. Furthermore, as any of your products becomes commoditized, you must be prepared to compete on non-commoditized manufacturing capabilities, as well as revolutionary changes to your products that come with simultaneous innovation of new processes for their manufacture.