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Is quality really important?
Seems like it’s almost fashionable to kick the three U.S. automakers these days, and I rarely hear people mention U.S. built as one of their first choices. Yet people almost always cite reliability as one of their most important criteria for buying a vehicle.
The most recent J.D. Power and Associates rankings show that 2 of the top 5 highest-ranked brands for vehicle dependability are from U.S. automakers. Two other U.S. brands had top rankings in other vehicle segments. It seems that many foreign makers have a perception of quality that is based on past success or marketing. Manufacturing of products in the U.S. has seen a steady rise in quality over the past 10-15 years; the perception in the marketplace should keep pace. If nothing else, the data points out that buyers should consider U.S. brands and not jump to conclusions on outdated results.
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The Root Cause of Product Complexity!
Emcien defines product complexity as simply the ability to predict what the next order coming into the company will be.
Think about it: If you only made product configuration A, you have 100% confidence in knowing that the next order in the door will be configuration A (assuming you get an order in the door at all, not a total given in this economy). But if you have configurations A and B, it’s harder to know and with A, B and C, it’s even harder, and so on. When you have thousands of configurations, predicting the next one is very difficult.
It’s not just the number of configurations that’s important but also how they’re distributed. If I have 10 configurations but 90% of my orders are for config A, then it’s still safe to predict that the next order is config A. But having 10 configs that have each been ordered 10% of the time is extremely complex!
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Why product complexity matters
I was telling some friends at a brunch about what I do, and how variety drives cost in manufacturing. “But all the manufacturing has moved to China,” commented one person. I’ve heard this comment over and over.
A picture is worth a thousand words — and here’s one that fits the bill.
- Commoditization of labor in manufacturing
- Higher output per worker
- The percentage of cost in goods is much higher
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