In days gone by, the factory floor was a loud, equipment-laden
place with assembly lines clinking and clanging, and belts whirring
and groaning. Today, in large part, that world is gone, replaced by
the relative silence of computer-driven machinery. The change is
indicative of the manufacturing sector's metamorphosis over the
past 30 years.
Those changes have had enormous impact, not only on those in the
industry, but on the American economy as a whole because, as one
academic puts it, "manufacturing is the engine that drives our
economy."
According to the U.S. Department of Commerce, in 1992 (the
latest year for which figures are available), manufacturing
businesses employed more than 18 million people--about 15 percent
of the American population. Although this is down from an average
of 25 percent between 1960 and 1992, manufacturing nonetheless
contributed $925 billion to the nation's gross domestic product
in 1992.
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Small businesses are a critical part of this sector. Of the
387,000 manufacturers in this country, 381,000 are small or
midsized (having under 500 employees); the bulk of
those--262,000--employ fewer than 20 people.
But these figures don't tell the whole story, says Wally
Hopp, a professor of industrial engineering at Northwestern
University in Evanston, Illinois, and co-director of the
college's Master of Management in Manufacturing program.
"If you look at how many jobs are tightly linked to
manufacturing, you'll find over half the jobs in the American
economy [about 60 million] are directly related to
manufacturing," Hopp contends. "That doesn't even
count the indirect effects. That's why I look at manufacturing
as the foundation of the economy."
That foundation has undergone a profound transformation; during
the 1950s and '60s, U.S. manufacturers ignored some
evolutionary changes. The advent of computerized machines and a new
understanding of how work flowed led to new philosophies on how
factories should operate, explains Uday S. Karmarkar, director of
the Center for Operations and Technology Management at University
of California, Los Angeles (UCLA). Unfortunately, America was not
at the forefront of this transformation.
By the 1970s, the rest of the world had rebuilt after World War
II and become competitors. It took 10 years, however, for American
manufacturers to realize they were being surpassed in many areas by
their foreign competitors. This forced them into copycat mode in an
attempt to catch up, says Hopp. "But that had mixed
success," he says of the Japanese management techniques that
took the industry by storm in the 1980s. "The Japanese did
what was right for them, and there were particular reasons why they
did things specific ways." Manufacturers that modified the
imported systems to fit their own needs did fine, Hopp says, but
those who blindly imitated fell on their faces.
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