CHALLENGE FOR A NEW GENERATION
by John Clark, on 6/15/16 9:51 AM
Election years are a good time to look back to see where we have been. They also afford an opportune time to look forward and see what lies over the horizon. This exercise will examine the challenges facing a new manager entering a packaging plant for the first time.1968:
- U.S. population: 200 million
- Price of a gallon of gas: $0.34
- U.S. president: Lyndon Johnson
- No. of female U.S. senators: 1
- U.S. GNP: $4.62 trillion Unemployment rate: 3.7% Percent of world GNP: 42%
This was a very good time for manufactur- ers. The car you drove was made by Ford or General Motors, your television was made by RCA or Zenith, and your clothes were made in textile mills that filled New England and the South. Almost every- thing consumed in the United States was made there, and the packaging containers required to ship these goods were made in plants from coast to coast.
Estimates and samples were all built by hand. More sophisticated companies had brought in adding machines to help speed up calculations, but we were still several years away from microchips and calculators. With gas at 34 cents a gallon and mostly local deliveries, logistics were something of an afterthought. Lead times were measured in weeks, and manage- ment structure was based on the shared experience of military service.
A new employee would spend most of their time learning how the plant func- tions, with particular attention paid to learning the machines and the manufac- turing process. Periodic trips to the office to learn about estimating and scheduling were part of the curriculum, but more emphasis was placed on plant knowledge. At the end of the day you could go home, and except for the occasional paperwork, leave your work life behind and enjoy time with your loved ones.1992:
- U.S. population: 265 million
- Price of a gallon of gas: $1.75
- U.S. president: George H.W. Bush
- No. of female U.S. senators: 3
- U.S. GNP: $9.41 trillion Unemployment rate: 7.3% Percent of world GNP: 31%
Just one generation later, the world had changed. A new crop of high-speed con- verting machines and specialty equipment allowed for wider breadth of designs and styles, and the introduction of sheet feeders allowed sheet plants to fight on an almost level playing field with their cousins that had their own corrugator. Computer technology had become affordable, and plants replaced paper with computer monitors and packaging software solutions. Industry education was still based on understanding the plant, but as these new hires were younger and more proficient with computers, their day was shifting away from the plant and toward the office.
Gas prices had skyrocketed, and now most oil was coming from the Middle East, not the middle of Texas. Logistics were now an important part of the plant’s vocabulary, but few had the skill, tools, or knowledge to implement any kind of programs to reduce costs.
Now, at the end of the day, you took your portable car phone with you, and you may have had a fax machine at home to receive time-sensitive documents.
- U.S. population: 320 million
- Price of a gallon of gas: $2.45 (down from a 2012 high of $3.80)
- U.S. president: Barack Obama
- No. of female U.S. senators: 20
- U.S. GNP: $16.4 trillion Unemployment rate: 4.9% Percent of world GNP: 22%
This new generation of packaging indus- try leaders will take lessons learned from other industries to drive out costs and increase profits. Logistics, for example, might borrow from companies such as Amazon and UPS, bringing trans- portation solutions to bear using traffic patterns, historical data, and customer incentives to keep the time and cost of transportation in check.
All this data will be in the cloud, accessible from mobile devices. Tying this all together will be increasingly sophisti- cated algorithms and analytics developed to ensure all the moving parts lead to increased ROI and profit.
And at the end of the day today, there really is no end of the day. You can be in instant contact with anyone nearly any- where in the world. The old work day of 9 to 5 is long gone. Today’s manufacturing leader, possibly for the first time, will have to be more knowledgeable in the area of business, rather than running the plant.