THE SMART LITTLE FACTORY
By Eric Lafayette, Los Angeles August 22nd 2011
Creating New Jobs.
It is a concept I have been harboring for a few years and this article :
why-amazon-cant-make-a-kindle-in by Steve Denning in Forbes on line magazine is giving me the oportunity to describe it. The concept is so simple that only Business managers with a very narrow mind could not think of it. Large industrial conglomerates in any of their high tech field of manufacturing should build when feasible a little sister pilot factory AKA the Smart Little Factory. Even smaller groups that are now on the brink of disaster such as Dell and Hewlet Packard would be in a better shape if they had implemented the concept of : " The Smart Little factory" As you already guessed it is very simple but it is more a state of mind or a principle than a blind cost cutting cave age management behavior. It is easier to describe it through an example: Your company is making computers and instead of shipping 100% of the production abroad for cost efficiency you keep 10% or 20% of the manufacturing in the USA, if you are making millions of computers the overall price per computer will not be affected in a noticeable fashion.
I never understood why this simple solution has not been implemented yet! It will please every kind of management. All big Companies have or had many factories. Solution: Each big company KEEPS ONE manufacturing plant in the USA: a small size plant that is versatile and will manufacture 10% of the total output of a specific product. Its work force all living and working in the USA will be the cream of the cream lead by an open minded management. In this fashion everybody is happy; the cost cutters who keep 90% of the production in low cost countries and the innovators have an excellent team of workers with innovative minds.
The most important thing is to keep innovation going in the USA through manufacturing because the manufacturing process with the workers and supervisors is linked so much to software development that separating them is neutering innovation. Recently there has been a glimmer of hope and it is described in the article shown by following this link: Today the achievements mentioned in the article such as poles of innovations in selected cities are obviously more a spark than a roaring fire but they show that there is a very successful ongoing process that can be replicated. However changing the mindset of 99% of large companies business managers is a tall order. Anyway we all know thanks ironically to an old Chines proverb publicized by the ante-Christ of capitalism: Mao Tse Tung that: "A journey of a thousand miles begins with one small step" Although the examples in the article are not yet implementing my favorite solution they are going in the right direction and we will know we reached our goal of " America the Innovative again" when big companies will say" I am outsourcing most of my production to a manufacturing plant in Vietnam that will produce 1 million units a year but at the same time I am opening a plant in the USA with a capacity to manufacture 100 000 thousand units complete with a research center and a crack team of very motivated workers".
Think how great this important step will be and how many more jobs it will create.This mindset must become standard among American CEOs. Even if the company is not high-tech it could be implemented in many cases. More jobs in the USA implies less unemployment More jobs in the USA means less cost for the government in unemployment benefit! More innovation in the USA more success in the markets! Innovation can be like a flood, if enough pockets of innovation are created then the innovation mindset overflows the country! More revenue per companies mean US companies will be more successful! Federal government will be able to lower taxes on companies and still get more money! American conglomerates will be able again to say without lying that they are American companies! American conglomerate will be able to claim that they are socially responsible.
Government monetary incentive in innovation will again be very successful! It is important to understand that the President of the USA must be supporting innovation! If the tea party semiliterate candidates who are so much against innovation and live in the twelve century lead the nation as it is the case now it will be catastrophic! In order to be fair I must mention that companies like IBM and GE are trying to be socially responsible. In addition the fact that they are very successful guarantees jobs and I believe their success is due to their excellent CEO Samuel Palmisano for IBM and Jeff Immelt for GE, Andrew Liveris for Dow Chemical. Eric Lafayettepar