Manufacturing in the 21st Century

Manufacturing has been established for thousands of years, but distinctly different now.  Although time has evolved manufacturing, the basic principle of producing an end product has remained the same.  Along with the evolution of tools for manufacturing, now comes automated machinery.  While Manufacturing in the 21^st Century is significantly different than even 25 years ago, we must continue to look to the future in order to continue staying profitable and remain a valid competitor within the industry.  In this blog post, I will be focusing on the vision of automated machinery and how it will forever change the manufacturing of store fixtures and industries alike.

Although some believe automated machinery is causing fewer jobs, from our experience and from what numerous statistics show, I find that claim to be FALSE.  While automated machines Do Not Cause staff reductions, They Do Cause a shift in job placement.  With the need for fewer employees doing what once was performed manually, there often is an employment shift to running the new machines, some into various departments like assembly, as well as some in to management roles.  Since automated machines improve performance, it allows for the ability to increase production, which in turn will increase gross revenue, profits, and continue to generate jobs throughout the future.

With automated machinery being the true direction of the manufacturing industries future, investing into automation is a MUST.  In an effort to reduce the labor factor per unit and increase precision, moving in the direction of automated machinery is a great solution.  In addition, by switching to automated equipment it allows the ability to moderate production times, and provide little variance unlike humans.  By converting to automated equipment, it also allows a company to become more competitive within the global marketplace. 

Since many products we produce within the United States are also produced in countries like China, Japan, the Philippines, and other similar countries where labor is significantly less, we are forced to operate within the spectrum of the global marketplace for fear of losing business to foreign competition.  While some clients are still very focused on supporting U.S. businesses, the loyalty to buy made in the United States products has fallen to “price” by foreign competition.  In an effort to remain globally competitive, automated machinery is vital.

Even though the cost involved to purchase automation machinery comes with a hefty price tag, the Savings involved are Huge.  While automation equipment can range from $60,000 to $250,000 per machine or more, with all of the capabilities they allow in addition to the growth potential, the machines often pay for themselves relatively quick.  Obviously, depending on how much automation equipment you have installed will determine your ability to increase efficiency and manufacturing productivity.

Having monitored the trend and watched fellow competitors move toward automation throughout the last 10 years, I would conclude that automation is the developing trend of the 21^st Century for Manufacturing Companies throughout the United States and abroad.  In order to evolve with Manufacturing it is crucial to switch to automated Equipment before the evolution passes and you are no longer globally competitive and out of business.  While we at Interior WooDesigns have several pieces of automated equipment within our current manufacturing facilities, it is with time, that we too will slowly transform with more automation to remain globally competitive and allow the ability to increase our capabilities. 

Automation Equipment is the key to success for Manufacturing in the 21^st Century and should not be overlooked as a fad, but more as a developing long term trend of manufacturing.  With tools having evolved a long way over the years, it is with great pleasure we welcome automated equipment into our lives, to increase productivity and enhance our capabilities.  With such measures, we can ensure sustainability throughout the future near and afar.  

Account Diversification a Must for Manufacturing Companies

While statistics nationwide show U.S. Manufacturing to be down, diversifying your client portfolio is a MUST.  Just like stock brokers diversify their portfolio over high risk, low risk, and a variety of stocks, it is equally important for manufacturers to establish themselves into various types of the market as well.  Having All of your Eggs in One Basket would be considered high risk, and potentially catastrophic if you are solely focused rather than having a scope on a broader spectrum for company revenue. 

Although a horizontal diversification strategy should be implemented first, with a relatively low amount of risk it will help penetrate into similar businesses that the manufacturer is already serving.  With this strategy it requires the creation of additional product/products that would likely serve the clients you already have captured.  While a horizontal diversification strategy is important, it should not be implemented alone, in order for the company to be fully sustainable if a particular industry calls for a decrease in manufacturing output. 

Along with the horizontal diversification strategy, it is suggested that a concentric diversification strategy is also in place.  Even though it is a basic principle which identifies the strategic advantage your manufacturing plant has over your competitor, managers often forget to monitor this on a regular basis.  Identifying what or where you have a strategic advantage manufacturing your current products over your competitors is something that should be monitored regularly and be tweaked when necessary.  Monitoring a concentric diversification strategy also helps identify inefficiencies and helps to ensure industry quality standards are being achieved.

Another diversification strategy which can be implemented, but should be monitored closely due to it volatility and riskiness is a lateral diversification strategy.  Because a lateral strategy calls for the creation of new product/products that are unrelated and completely different than currently produced, they hopefully will reach an all new client base.  Due to the high risk associated and significant investment which is required to develop and market a completely new product to a different client base, it must be monitored closely.  While leveraging a manufacturers other profits to establish a lateral diversification strategy, it can generate a great ROI, but must be monitored to ensure smooth operations.

Even though a Horizontal Diversification Strategy is most common with the least amount of risk, and has the best ratio of success, one cautions no matter what strategy your manufacturing plant is implementing that maintaining profitability throughout the transition is crucial.  Like a stock broker monitors stocks, manufacturers should monitor there diversification strategy to ensure a company is sustainable if an industry in which you serve is negatively affected and there production needs are reduced.  Diversifying your client portfolio is a must, but should be implemented with caution and a close eye.  Consulting with a team of experts is often a good idea, and should be instituted with due care.