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What is World-Class Manufacturing?

Posted by admin on January 26, 2016

The term “world-class manufacturing” is one that gets thrown about pretty loosely.  Heck, we’ve been guilty of it ourselves.  It has been used so much it has become as meaningless as the words “awesome” and “amazing” at a grade school awards ceremony.

So why should we care about “world-class manufacturing”?   The first reason is because the world is becoming a smaller and smaller place.  Goods can move around the world pretty easily as free trade has made global markets more open than every before.  So the companies you’re competing with are no longer those in your state or region of the country.  Rather they’re probably half way around the world or anywhere wages allow product to be made at a lower cost than it can be produced in countries with higher cost structures.

In terms of an actual definition for world-class manufacturing you can find many.  So we’ll throw in our two cents.  We define a world-class manufacturer as one where strategy, planning and operations all align to make a product that is preferred over competitors’ products in the global market.  This doesn't mean that the company is the lowest cost provider.  It means that the company has the right quality-cost balance to be preferred in its target markets.

While we’ve helped clients define their strategies, and develop and implement plans to carry out the strategy, we’re focused these days on the operations of manufacturing, specifically the processes that convert raw materials into a finished product to be shipped to customers.  In our careers consulting with many companies over the past 30-plus years, we’ve seen many manufacturing theories, concepts and fads.  A few of these have been revolutionary, but frankly, many of these are simply repackaging of the fundamental processes and skills that have been applied for centuries.  And while we don’t want to belittle new ideas, we think there is a lot of time and energy wasted in implementing these.

When we think of the actual manufacturing processes of the best companies we work with, they share some common traits:

Focus on quality – Quality is a way of life, not a flavor-of-the-month program.  Everything they do is focused on delivering a quality product that will delight customers.

Planning – They are very effective at planning and leave very little to chance. They focus on schedule and rarely miss a shipment. They have redundancies and redundancies for their redundancies.  They think about what could go wrong, and make plans to avoid it and to mitigate the effects if it happens.

Project management– They understand the importance of projects in driving to higher levels of performance.  Performing normal operations well is important but they excel at implementing projects effectively to leapfrog their competition.

Solve problems – They know the unexpected will happen. They have developed employees’ skills to solve problems and take action to prevent problems from recurring.  We refer to this as “reactive” problem solving and “proactive” problem solving.

Improve skills – They strike the right balance between technical and “soft” skills, such as communications and teamwork.  They know that the soft skills are as important in delivering a high performing team.

No matter how you define it, world-class manufacturing is about knowing what your customer wants and meeting or exceeding those requirements at an acceptable price for the customer.  There are many ways to get there but putting the focus on being world-class is an important first step.