The Canadian Manufacturing Identity Crisis - and the opportunities it offers for all of us
Co-Founder, Berlin KraftWorks Inc.
Manufacturing has been around for a long time. From the time early humans picked up a sharp rock or stick and grasped the concept of a tool, we have had to consider how to make things to survive and thrive.
Manufacturing is simply the process of converting something into something else of greater use/value. Although the methods and materials we use have, and will continue to evolve, the requirement to produce physical things will never go away and the need is ever increasing. But there seems to be endless confusion about what manufacturing is.
So why then if manufacturing is a part of our survival, have we become content to be so vague in our understanding of it? On a global scale it does make sense to trade with other nations for different aspects of manufacturing, but this does not relieve us of our responsibility to maintain our manufacturing knowledge and innovation. To do so is to cut ourselves off from opportunity.
Confusion caused by disconnected points of view
There’s a lot of terminology out there: Industry 4.0, Advanced Manufacturing, Additive Manufacturing, Lean Manufacturing, IoT, Digital Transformation in Manufacturing, Technology Adoption for Manufacturing, etc. The confusion comes as each of these approaches to manufacturing splinter the focus into separate solutions bringing with it contradictions and generalizations. The resulting confusion translates into lost productivity and lost opportunity, for individual firms and for Canada.
If we focus on individual tools as universally applicable, we gloss over the opportunity to understand the true operational challenges facing the majority of Canadian manufacturers, who happen to be manufacturing start-ups and small and medium enterprises, at a macro level. There is no substitute for going out and listening to folks at individual firms who can tell us those things which are not written down, unlocking the experience and tacit knowledge that lives in individuals, and individual firms, which can then develop into new knowledge for innovation collaboratively. This cannot be done in isolation, or through any kind of automated method.
Manufacturing is more than factories and folks in coveralls
There are many firms who produce physical products (in some cases the physical products are simply a device to deploy software as a core product) who vehemently reject any association with “manufacturing” in favour of being “tech” or “IoT” (Internet of Things, which from a purely manufacturing point of view is simply any manufactured product with connectivity). In doing so, they set down a path of reinventing the wheel with the belief that their firm or product is unique, and they disconnect themselves from over a century of knowledge advancement around how to produce things effectively, and competitively. All the while, time to market is extended, as is cost and risk. While not the sole cause, this is a major contributor to Canada’s decline in productivity on the global stage compared to other nations.
It’s a little like watching someone starve while they sit in front of a feast.
To be clear, this is not the fault of “tech” or “IoT”! My belief is that it’s the fault of all of us who call ourselves professionals in manufacturing.
Manufacturing is our best kept secret
Canada has a strong manufacturing sector and in fact, is exceptionally good at manufacturing and product development. It’s a massive part of our economy. However, misinformation runs rampant and we hear myths like “You can’t develop product in Canada”, “Canada can’t produce products economically” and “manufacturing is dead” which is frankly, garbage. As manufacturing splinters itself into the categories mentioned above, we miss the forest for the trees.
Ultimately the decision of where to produce is a data-based equation specific to each product and there is no one-size fits all answer. But many products can be developed right here, quickly and economically, regardless of where they are ultimately produced, and this has been demonstrated time and again by many firms. For the most part however many of us in manufacturing are guilty of saying “we’re too busy getting the job done to talk about it”. We really need to shift that perspective.
Collaboration is key
Our friends in tech have an approach that we should definitely learn from. Many tech folks regularly share information, articles, celebrations, etc. through LinkedIn and other social media outlets. While it may seem time consuming, it does demonstrate a different approach – let’s share knowledge, let’s collaborate, and let’s solve common problems together so we can focus our individual innovation effort on the things that make us different and competitive. While many firms divorce themselves from being “manufacturers” and therefore from manufacturing knowledge, Canadian manufacturing itself hasn’t adopted the same external collaborative philosophy common to tech and common to manufacturing in other nations, and so we also sit and starve at a table full of food.
I’m as guilty as anyone. But because of that, I know that for any firm which produces a physical product – any physical product - there is a definite path to break through the fog.
Manufacturing is strategic, not transactional
If your firm generates revenue from a physical product, then your manufacturing is the engine that enables your firm to deliver the value your customer will pay for. Often, it’s viewed as just the opposite, as an afterthought or as transactional activity. The reality is how well you manufacture will decide how well your firm will survive. Supply Chain is the connective tissue from your customer’s customer to your supplier’s supplier. But manufacturing is the one element of overall Supply Chain that must be supported by the whole organization, and in turn it supports the organization itself. Manufacturing by its nature can multiply value (or waste if managed poorly), so its worth placing it as front and centre if your business relies on physical product to make money.
There is tremendous opportunity!
Canada sits on the edge of massive opportunity! The connectedness of our modern world affords opportunities to re-imagine manufacturing. Specifically, Canada is very well positioned to be a global leader in the manufacture of low volume, high value/complexity products. Think MedTech, DeepTech, Machinery, Automation Equipment, and virtually any other product where the volume will not be that of consumer goods, but precision as well as reliability is critical. This is Canada’s future, and its ours to lose!
From my point of view, here’s how we can collectively improve Canada’s productivity from the grass-roots on up, and get past manufacturing’s identity crisis:
1) Seek to understand your own firm and your own business case
Applying a system thinking approach to your firm’s challenges will separate symptoms from root cause problems if applied horizontally across all functions and not localized within one department. Understanding how to select the right data to base decisions on is key, since too much data (and over-complexity) can be as problematic as none at all.
2) Seek to understand manufacturing beyond your firm, for better context
A common truth around all of these manufacturing approaches is that they all have value, but none of them can solve all problems for all firms (nor should they). Its up to each firm to acquire knowledge specific to their manufacturing first in order to identify the right tools and then know how to apply them effectively. Application is key.
3) Finally, collaborate outside of your firm.
Both your competitors and your colleagues in manufacturing will face common operational challenges. It is a waste of money and worse, a waste of time for firms to work separately to find solutions to common challenges when they could leverage knowledge across industries to solve them. Instead, grow your involvement and awareness of your own ecosystem, who the players are and ways to work together for common benefit which will increase knowledge development, and innovation. This will increase the time and resources you have to apply internally to those things that differentiate your firm from others – your competitive advantage.
Canada’s manufacturing can have a bright future, and we have all we need today to get there if we collaborate under a system thinking mindset. Who’s in?
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