…product and process innovation are intertwined. So the decline of manufacturing in a region sets off a chain reaction.
— Gary Pisano and Willy Shih, “Restoring American Competitiveness”
As manufacturing moves from the U.S. to other countries, we miss the jobs lost. But we also lose two things that continue to hurt us in the future: expertise, and the ability to create significant new products.
When we crystallize our manufacturing processes and ship them to the factory Over There, we lose the ability to improve them ourselves. This isn’t felt immediately, but outsourcing means you’re paying someone else to get better at it, and then they can use that expertise for their own benefit when new opportunities come along.
But you’ll just move on to the Next Big Thing, right? Unfortunately, you’re at a disadvantage there, because even new product categories are built on expertise in existing ones. Pisano and Shih offer the example of the rechargeable battery market, which is swelling to supply the most expensive component to tomorrow’s electric cars. U.S. companies can’t compete here because battery technology has grown by leaps and bounds in Asia, ever since we farmed it out along with the rest of our consumer electronics in previous decades.
It is now apparent that these firms have not merely outsourced production. They have actually outsourced their future.
— Steve Denning, “The End Of The Road For Outsourcing?”
Read Denning’s series at Forbes. He makes a powerful case that it’s just better management to consider: Are you cutting costs now, or expertise later?
Supermechanical is using American manufacturing to build not only our products but also home-grown expertise. We believe that this investment leads to innovation through original, solid products at good prices.