Does manufacturing matter?: The highs and lows of my trip back to MIT

Recently, I went back to my roots. As a young man, I spent four years learning about physics at MIT, and revisited my old stomping grounds earlier this year.

MIT hosts an annual conference on emerging technology called EmTech, and I recently accompanied some of my friends to this highly recommended conference.

The most salient section was a panel discussion entitled “Does Manufacturing Matter?” which discussed manufacturing in terms of innovation and developing new technologies. The panelists were Willy Shih, professor of management science at Harvard; Suzanne Berger, professor of political science at MIT; and Christine Furstoss, global technology director of manufacturing and materials technologies at GE Global Research. The moderator was David Rotman, editor of Technology Review.

Rotman introduced the application of innovation to manufacturing with some interesting thrusts. He pointed out that manufacturing is much like food. Just like manufacturing, a small population of the world today in the advanced nations deals with food growth. Innovation sharply changed farming by reducing the labour content and time to market. He pointed out that the labour cost in manufacturing an iPad is about $10. He continued with, “There is a new modularity. We want to integrate innovation into manufacturing and get value out of this innovation. The difficulty is that the innovation is moving to China.” He then turned the discussion over to the members of the panel.

The General Electric representative said that design used to drive production, but now we need to think about how manufacturing can drive design. She also pointed out that we need to spend more time with small and medium-sized manufacturing businesses, and build quality in, not test it in. She continued, “How do we get the best innovation? How do we connect the designers to the factory floor? And how do we interest anyone in a 20-year return on investment?”

The only panel member that had a hands-on approach to manufacturing was the Harvard representative. He was formerly at Kodak for many years and immersed in the manufacturing process. “Is the process the product? How do we get a return on manufacturing innovation?” he asked. Good questions.

In the discussion, all agreed that we have to have the engineering to develop big facilities, but how do we get the people? In Germany, the skill level in the factories is much higher than in the U.S. What we now do is choose workers that are hardworking people, not necessarily well trained in the manufacturing industry. Wrong! Us manufacturing guys don’t get any respect. And does it really matter where manufacturing is done?

I agree that quick money is an issue in the United States. Big manufacturing does not attract venture capital. In fact, if it’s big M, we don’t invest. We seem to think lowering the cost of initial implementation is the way to lower the cost of production. We don’t think about the value of that 10- to 20-year timeframe. One billion dollars per system is a lot of money. Lowering the component cost is the wrong target. Raising the ratio between value and cost is the right one. What worries me is that we are trying to improve the 1930s manufacturing shop invented by Ford with better components and not with a fundamentally different approach.

Innovation creates problems for pedantic thinking by solving tomorrow’s problems. It changes the way we do things – not cheaper, better and faster, but different. The majority – about 80 percent – of innovation comes from people outside the domain, small groups or individuals. It doesn’t come from big plans and reducing the source material.

Overall, I was disappointed with the EmTech Conference (and even the accommodations). Has MIT been neutered? Or is Morley obsolete? MIT has, in my opinion, gone down the road of political correctness. This is a good thing for most institutions, but we need some who do not think as the rest of the group. We need our top educational institutions to support solutions – not hope. Hope, at best, is a poor strategy.

The reader should refer to the sources referenced below to sort through my biases.

References

Conference info: http://www.technologyreview.com/emtech/11/

Video from session: http://www.technologyreview.com/emtech/11/video/#!/watch/does-manufacturing-matter/

This column originally appeared in the January/February 2012 issue of Manufacturing AUTOMATION.