Monday, March 31, 2014

Europe's Solution Factories

Europe's Solution Factories Harvard Business Review 92, 4 (2014) 111-115

Manufacturers in developed countries can no longer rely on lean management practices to stay profitable. They face increasing competition from plants in large emerging economies that are able to produce on a large scale at a lower cost, while still providing high quality. The way forward, the authors suggest, can be glimpsed from analyzing past winners of Europe's annual Industrial Excellence Award. Those companies have succeeded by using one or more of these strategies: Leveraging data flows to integrate closely with supply chain partners. Germany's Schmitz Cargobull, for example, has become a leading trailer manufacturer by using sophisticated information technology to help customers monitor their vehicles. Creating value downstream in other parts of the supply chain. One example is Markem-Imaje, a maker of industrial printers for coding products; the company adds value for customers by offering a variety of ancillary services. Collaboratively designing manufacturing processes that can rapidly evolve to meet customers' needs. A prime example is ASML, which works closely with customers and suppliers to make innovations in production technology for the semiconductor industry. Specializing in customized products. Focusing on small runs of custom-designed products has been an effective strategy for companies like BuS Elektronik and the Daimler Group's Smart car division.