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The distinction between manufacturing and production, and why it matters

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docdivakar
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re: The distinction between manufacturing and production, and why it matters
docdivakar   4/16/2012 10:10:50 PM
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George, I understand you were trying to put forth an use case to make a general point in that crane example. But your argument does not reach far enough -how does one KEEP the IP-enabled value added products / services from getting copied in places where there is no respect for intellectual properties? Now a days, the gap between lead-lag-innovate/copy cycles is shrinking so businesses in US can not still at all. A new product gets copied in no time by those either riding the coattails or refusing to invest in R&D and innovation. MP Divakar

DMcCunney
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re: The distinction between manufacturing and production, and why it matters
DMcCunney   4/14/2012 4:19:26 AM
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It's especially noticeable in consumer electronics, but the life cycle of just about any product winds up with it becoming a commodity. Commodity products are fungible - they can be easily replaced by something else that does the same thing, and competition reduces to price. Margins are razor thin, perhaps pennies on a dollar, and making money requires large market share and bringing in a *lot* of dollars to make pennies on. The sort of manufacturing outsourced to China is generally commodity products, because the competition is on price, and producers need the lowest possible costs. The issue for the US is creating products that *aren't* commodities, which exist higher in the value chain and can command prices that allow making money even with the higher overhead and pay scales of the US. This has been going on for many decades. Not that long after WWII, for example, Japan began to cannibalize the US steel industry. Their industrial infrastructure had been largely destroyed by bombing intended to halt production of war materials. They rebuilt using state of the art equipment and practices, achieved greater productivity at lower prices than US manufacturers could achieve, and rapidly took over the market for basic steel. US steel companies had to move up the value chain concentrating on higher value finished products. Manufacturing done here can't be commodities unless shipment costs from elsewhere are prohibitive. And the incentive won't be strictly jobs in manufacturing. The products need to be the sorts of things that have an eco-system around them to sell, install, and service and support them, because that's where the jobs will be. The days of the assembly line worker are numbered. One of the major Chinese manufacturers announced a full-scale push into robotics to automate precisely the kind of rote work people like FoxConn are doing. If it *can* be done by a machine, it probably *will* be.

george.leopold
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re: The distinction between manufacturing and production, and why it matters
george.leopold   4/12/2012 4:30:30 PM
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OK, Kris, try this one: A corporate farmer has embedded into the front end of his tractors sensors that determine soil characteristics and crop types and tells the sprayers he is pulling behind the tractor what if any pest/herb -icides or fertilizers to apply to his fields. Such value-added systems are coming off the drawing boards and might sell like hot cakes in developing countries struggling to produce enough food for their growing populations. The key is that the related services would be developed here.

george.leopold
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re: The distinction between manufacturing and production, and why it matters
george.leopold   4/12/2012 1:30:18 PM
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The promoters of cloud-enhanced services also call it "ICT-enabled" services (Information and Communications Technology), so you can see they have been working on their branding....

Robotics Developer
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re: The distinction between manufacturing and production, and why it matters
Robotics Developer   4/11/2012 8:12:57 PM
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I agree with iniewski that the crane example is an over-reach. The US must produce and export goods, services and technical solutions in order to continue to have jobs on shore. We must move up the food chain from just bending metal to creating systems and integrating technologies to further enhance the next generation of products.

junko.yoshida
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re: The distinction between manufacturing and production, and why it matters
junko.yoshida   4/11/2012 7:18:47 PM
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I like your suggestion here, Duane. "Appliance manufacturers could get back into the repair business and add preventative maintenance..." In other words, there is a whole area of eco-system jobs to be created by adding newly enhanced features and services to goods.

prabhakar_deosthali
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re: The distinction between manufacturing and production, and why it matters
prabhakar_deosthali   4/11/2012 10:53:52 AM
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In the sense of "Product", there are many products which do not require assembly lines, blue collar workers and all that. In today's world the word product connotes many things - such as an insurance policy, a tour package or any such offering . In this broader sense the term Product differs with the term "manufacturing" because there are many products which do not require manufacturing but just some bundling of the services

krisi
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re: The distinction between manufacturing and production, and why it matters
krisi   4/11/2012 2:46:33 AM
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Cloud computing can deliver remote computation, data storage or processing but would it deliver remote production? The crane examples doesn't seem to be realistic...Kris

chanj0
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re: The distinction between manufacturing and production, and why it matters
chanj0   4/10/2012 10:55:31 PM
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The article sounds to me that manufacturing is a subset of production. Production includes a lot more, for example, service; whilst manufacturing means transforming materials into a product - for example, assembling components and parts to be a PC. If this is one of the interpretations, the distinction does matter because of multiple reasons. In my opinion, bringing back manufacturing may be difficult because US has lost the infrastructure for it after years of outsourcing. Infrastructure covers labors and manufacturing facilities. Americans may not necessarily enjoy working in production line, assembling toasters or moving heavy refrigerators. They might rather work in front of a computer, writing code or administering computer network. With this said, bringing back production may not be as hard. Engineering services and design service are highly liquid. It can move anywhere in the world. Therefore, these can all be done in US instead of elsewhere as long as our society has enough supply of skilled labors. The cloud computing has been helping to facilitate the production better.

Duane Benson
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re: The distinction between manufacturing and production, and why it matters
Duane Benson   4/10/2012 9:03:34 PM
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I like the phrase "cloud enhanced." I hear far too many people just talking about the cloud as a complete replacement for distributed computing power. In the same way that the Internet has added to and enhanced conventional business, not replaced it with 100% virtual businesses, cloud computing will add to and enhance but not replace localized computer. Your crane example is a good one and just one of many. This same approach could work for everything from cars to refrigerators. Appliance manufacturers could get back into the repair business and add preventative maintenance, upgrades and other as of yet unthought of services to their production business.

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