Flexibility, Innovation Most Important Part of Manufacturing

Special Coverage

Management Briefing Seminars

TRAVERSE CITY, MI – Globalization is turning the old manufacturing models upside down, and high-volume manufacturing operations – no matter how efficient – are losing their value as the ability to predict demand for new products becomes ever more difficult.

In today’s global environment, flexibility and the ability to leverage knowledge and learn faster than competitors are more important than the actual machine tools used to make products, says Bruce Grey, group managing director of Australia-based Bishop Technology Group Ltd.

Bishop develops products and processes for transportation-related industries, including machine tools and automotive steering gears. Daimler AG and Ford Motor Co. are major licensing customers for steering technology.

Australia is having the same debates over the future of its manufacturing base as the U.S., Grey tells attendees at the annual Management Briefing Seminars here, including worries about production costs and the ability to compete with China and India.

Yet, despite high taxes and labor costs, he says Germany still manages to be among the largest exporters of manufactured goods in the world.

Some companies still stick with rigid, highly centralized manufacturing systems because they believe they still are capable of accurately predicting demand for products, but Grey says globalization is making that harder and harder to do.

Bruce Grey

He also tells attendees that large centralized operations tend to stifle product and process innovation.

Grey points out that until recently, only five automotive suppliers produced 50 million steering gears for the global auto industry. However, he says the advent of electric power steering has created myriad options and a much more fragmented steering-gear industry.

With so much of the automotive industry fragmenting in such a manner, innovation and intellectual capital will be the crucial manufacturing commodities of the future, Grey says.

That means manufacturers in the future will have to be more innovative, more flexible and mobilize their resources faster. However, in the panel discussion following his comments, Grey acknowledges that protecting intellectual property remains a challenge.

“A lot of IP in the U.S. has been lost to emerging markets,” he says. “The key thing is to work on protecting those ideas as early as possible.”

Among the innovative technologies Grey shows off during his presentation here is Bishop’s rotary-valve system, which reduces weight and the number of parts compared with traditional reciprocating valves.

The valve system recently was demonstrated on a small motorcycle engine and could provide major benefits on larger vehicle engines, he says.

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