The global economic reality of the past decade has forced the Massachusetts manufacturing community to focus on cost containment and Continuous Improvement. The good news is that this has helped the Massachusetts manufacturing sector to rank #1 in contribution to state GDP, up from #5 in 2002. But hold the applause for now.
Manufacturing Sees Extraordinary Gains
This unheralded achievement has been largely ignored by those who continue to believe that manufacturing has left the state, or who believe that what remains of manufacturing is of no consequence to our economy. Such perception is not surprising after decades of media coverage about the loss of manufacturing jobs and the outsourcing of production. To many, it probably seems impossible that the manufacturing sector has returned to a position of such importance for the state’s economy.
How did manufacturers manage to expand output despite a substantially smaller workforce?
As noted by Professor Barry Bluestone in the Northeastern University Staying Power II study of the Massachusetts manufacturing sector, "The answer lies in the extra ordinary gains in this sector’s productivity. Between 1997 and 2007, productivity in the total private sector (as measured by GDP per Worker) increased at an average rate of 2.3% — a quite respectable increase in efficiency. But the state’s manufacturing sector experienced a remarkable 9.7% of growth in productivity. In the most recent period between 2007-2011, annual productivity slipped a bit to a still respectable 8.7%. For the private sector as a whole, it was just 1.7%."
This achievement and the health of the overall manufacturing community has improved with unprecedented speed over the last 10 years. Manufacturers big and small have established individual Continuous Improvement programs which, in the aggregate, have contributed to the industry’s stellar performance.
Typical among such firms is the Housatonic Curtain Company, located in the quaint town of Housatonic Massachusetts. They continue making and buying as many of their textile products in the US as they possibly can. We are fortunate for Housatonic’s commitment. With its two factories, one in Connecticut and one in Massachusetts, they continue to design, develop, and manufacture their products in the US. And the bucolic town of Housatonic would certainly be poorer without the millions of dollars in payroll that the firm brings to it.
Textile Manufacturing Thrives
Thom Swift, President of Housatonic Curtains, has led the firm for 18 years. When he started, it was a plain vanilla manufacturer with 25 to 30 fabrications; they now produce over 400 items. Thom has faced many of the same challenges seen by other manufacturers over the past decade – increased product offerings in the face of decreased average customer order size, a necessary step to meet more diffused consumer demand.
Anyone who has been in manufacturing for the ast 10 years can easily relate to this transition, which has affected the entire manufacturing sector. Everyone in manufacturing needs to work harder than they did 10 years ago, in exchange for smaller returns. Manufacturing to meet changing customer demands, coupled with an era of continually rising costs — from healthcare to energy – has been a challenge that has not all companies were able to meet.
Thom Swift’s continuous improvement plan for Housatonic, attested to in this letter to the editor, focuses on employee training, Lean manufacturing tools, and utilization of the state’s workforce training grant program. US manufacturing in the textile industry is especially difficult. The company faces an extended offshore supply chain and must figure out how to not drown in inventory while supporting a complex manufacturing environment that has moved from approximately 800 stock keeping units to over 3,500. Thom has managed in this volatile environment and has handled a succession of changes evolving from today’s highly competitive marketplace.
Massachusetts is fortunate to have such small manufacturing enterprise leaders as Thom Swift, who know that Continuous Improvement is a journey and not a destination, and who are willing to take continually improve productivity in their respective enterprises.
So please, hold the applause for manufacturing’s achievement of a number one ranking in the state’s economy. Manufacturing, as whole, is still on its continuous improvement journey and has a long way to go.
