Exploring Advanced Manufacturing Technologies. Steve Krar
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Dr. Wilkerson earned her Masters Degree from Indiana State University and later accepted a faculty position in Industrial Technology and Basic Engineering at Tennessee Technological University. While at Tennessee Technological University she earned a Doctorate in Education at Tennessee State University. Her knowledge and skill in CAD/CAM evolved into the first Internet CAD/CAM course. Dr. Wilkerson’s contributions to educational materials in machine tool practice and reference extend from laboratory manuals and textbook revisions to authoring multimedia tutorials of CAD/CAM.
Dr. Wilkerson is currently Technical Education Officer for Gadsden State Community College at Gadsden, Alabama.
High technology has arrived on the floor of America’s factories and the growing use of these technologies has led to operational excellence, higher productivity, and higher profits. High technology alone cannot provide all these benefits without a skilled workforce that is continually updated and trained to get the full benefits that each new technology can provide. Therefore, training and managing of the workforce should be the greatest focus of any firm wishing to compete and survive in manufacturing.
Executives cannot do their best work or be successful in business without the cooperation and help of others. Conventional manufacturing is being rapidly replaced by new, fast-response, customer-focused techniques that maximize the manufacturer’s return on all resources: capital, materials, equipment, facilities, time, and especially human resources. Without a skilled workforce, we cannot remain the world’s economic leader.
Manufacturing Technology’s Unmeasured Role in Economic Expansion
(Reprinted by Permission of AMT – The Association of Manufacturing Technology – Sept. 2000)
Traditional economic measures of productivity alone do not reveal the full extent of economic benefits contributed by machine tools and related advanced manufacturing techniques. The unmeasured contributions averaged nearly $200 billion per year during the past five years a total of nearly $1 trillion. This represents savings in just two product examples as well as labor productivity improvements in the eight industries that are the most intensive users of machine tools. The measure of economic benefits would be even larger if other products and industries were included in the analysis.
The basis for this conclusion is the Sept. 2000 study by Joel Popkin and Company, Washington, D.C. based economic consultants. It reveals the substantial benefits generated by advanced manufacturing technologies and their positive effect on productivity, an outcome reflecting the blending of new, high productivity machine tool technology with the benefits of information technology based manufacturing processes.
Traditional measures of productivity alone do not reveal the full extent of manufacturing’s true contributions to the growing U.S. economy masking the full potential for continued strong economic growth without inflation. Manufacturing technology, through its application in various types of capital equipment, played a major role in the country’s remarkable economic growth of the 1990s, this analysis of official economic data shows.
Why has manufacturing’s contribution to the nation’s prosperity largely gone unrecognized? Economists believe the main reason that its role has not been fully credited is because of the diverse mix of technological advances in manufacturing and the difficulty of quantifying their total economic benefits.
Yet these contributions to economic growth rival those of computers and information technology. Estimates by Federal Reserve Board economists attribute no more than one half of the recent upswing in productivity to computers and information technology. Thus other forms of improvement deserve a large part of the credit for the upswing in productivity that has given the nation a decade of uninterrupted growth.
Beneficiaries of these understated advances have included nearly everyone:
▪Manufacturers, who make higher quality products faster and at lower cost.
▪Consumers, who pay less for higher quality goods that perform better and last longer.
▪Workers in the manufacturing sector, who acquire new skills and earn higher real wages.
▪The economy, because the U.S. is competitive and inflation stays in check.
PRODUCTIVITY MAKES THE DIFFERENCE
Productivity in durable goods manufacturing is one of the economy’s main drivers. From 1959 to 1996, economy wide multifactor productivity (MFP) the most fundamental measure of productivity that considers factors beyond capital and labor grew at an annual average rate of 0.8 percent for the nonfarm economy, while manufacturing MFP grew considerably faster, at 1.1 percent. Chart 1.2* shows that the durable goods sector accounted for virtually all of the MFP growth in manufacturing during the period from 1971 to 1996, as nondurable MFP was flat during that time. During the 1980s and 1990s, durable goods manufacturing achieved exceptional MFP gains, averaging 4.2 percent annually between 1992 and 1996.
Labor productivity shows a relationship similar to that above. The private, nonfarm economy experienced a distinct slowdown in labor productivity in 1973, and proceeded at that slow pace through most of the l990s. Labor productivity in manufacturing, while also growing at a constant pace until the mid 1990s, accelerated sharply beginning in 1993. Chart 1.4 traces gains in manufacturing output per labor hour to durable goods industries, especially during the 1990s.
*Chart and table numbering conforms to designations used in the main study.
These gains in manufacturing productivity have resulted in enormous benefits.
▪Rapid gains in labor productivity in the durable goods sector generated an additional $618 billion of output (in 1996 dollars) over the 1992–98 period.
▪These same producers also saved $25.3 billion in carrying costs between 1992 and 1997 thanks to a decline in inventory requirements per dollar of sales, attributable to advanced manufacturing processes. This in turn freed up billions of dollars in capital for additional investment.
▪Eight key industries auto parts, aircraft engines and parts, engines and turbines, metal foundries, fabricated structural metal, other industrial machinery, construction and mining equipment, and farm and garden machinery saved a