US Manufacturers Face New Challenges to Stay Competitive

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American manufacturing companies may be struggling, but the fact is that manufacturing still accounts for 11.5 million U.S. jobs. As the economy continues to sputter, these manufacturers are being forced to adapt to a new era of American manufacturing. It will require change and flexibility, but the changing manufacturing landscape may also give them a competitive edge, according to a new report.

The report, which was released by the Wisconsin Manufacturing Extension Partnership, along with its trade association, the American Small Manufacturers Coalition, finds that this is a critical point in time for U.S. manufacturing, and manufacturers must assess whether they have the work force, business systems, equipment and strategies in place to successfully compete in the future. While external factors, such as the economic downturn, present challenges, manufacturers can remain competitive by focusing on the following key areas, the report found.

Leadership: Nearly six out of 10 U.S. manufacturers could have a new leader in the next five years — a 5 percent increase over 2009. This presents an opportunity for manufacturers to solidify leadership and direction for years to come if they develop their next generation of leaders now.

Sustainability is increasingly important to manufacturers, with 59.2 percent of manufacturers reporting that sustainability is important or highly important to their future, up from 35.1 percent in 2009. Many of these manufacturers are responding to customer demands for greener products , while others recognize cost-control opportunities such as reduced energy consumption and the re-use of materials.

Staying current: Few manufacturers describe their equipment as "state-of-the-art." For example, only 18 percent have state-of-the-art equipment to support world-class innovation, and just 14 percent have state-of-the-art equipment to support world-class process improvements. Manufacturers will need to invest in new and innovative equipment and procedures to stay competitive.

Staff development: Few manufacturers have both talent and work force development programs to drive world-class performance. Due to an aging work force and gap in skilled labor, more professional training and development is needed to prepare manufacturers for the next generation.

The study, called the 2011 Next Generation Manufacturing (NGM) Study, was first conducted in 2009 and surveyed more than 800 U.S. manufacturers.

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