A recent article in The Economist leads me to reflect on the manufacturing revolution that has occurred, not in my lifetime, but only in the last 25 years. Economies, industries, and companies have been transformed by digital technology.
When I went to work in 1980 for GM in the Detroit area, within 50 miles of my home there were dozens of factories producing automobiles: With an annual volume approaching perhaps 8 million vehicles. Now, most of those factories (and their jobs) are gone, and those that remain (certainly with a vehicle capacity of less than 2 million) have been dramatically transformed.
Back then, it took 6 years to bring a new automobile to market, and the development process involved up to ten distinct prototype builds. Now, with a vastly more complicated product, it takes two years, often with no prototypes. A prototype build, if it exists, is used to prove the manufacturing process, not to evaluate product performance.
In the 1980s, automotive engine plants were noisy, unpleasant places employing perhaps 3,000 people. Today, they are more akin to electronic clean rooms, employing a tenth as many.
Jobs have been exported overseas, only soon to be eliminated and then re-created in hi-tech factories in the developed countries. In the same issue of The Economist, you can read how Adidas is shortening its supply chain and on-shoring (a relatively few) jobs back to Germany, Europe, and the USA.
Right or wrong, this revolution has been enabled by the companion technologies of ERP and PLM, and by the astounding advances in computing capability, which has been doubling every 18 months for six decades!
The Economist article makes some interesting points, including that final product assembly contributes a small part of a product’s value. What matters are responsiveness, agility, logistics, and the supply chain.
So it does not so much matter where the auto factories are located, Detroit remains a hotbed of engineering expertise, with domestic and foreign companies continuing to expand and grow their technical engineering centers.I will admit my part in this revolution: In 1980 I joined GM Research Labs, and they soon thereafter bought a US$40 million Cray-1 computer to do combustion simulations. Today, that same computer code is running in real time in the powertrain control unit under the hood of your car to minimize emissions and optimize fuel economy. Your cell phone is at least 50 times as powerful as that Cray-1.
But, we are surely not done. IT technologies, and the ERP and PLM capabilities used to exploit them, continue apace. Products will continue to be better designed and more efficiently manufactured, and better meet customer needs.
Some of us believe we are at the dawn of a new product development and manufacturing revolution, that of generative design and additive manufacturing.
Let me know what you think!
Best,
Keith
