The word manufacturing has its roots in three ancient Latin words: manu, meaning by hand; facere, meaning to make; and faber, or maker. Recent definitions have expanded this definition into “to make from raw materials by hand or machinery.” The Department of Trade and Industry  of the British government  has defined manufacturing more broadly as “manufacturing firms transform  ideas into  products  and  services,” incorporating  a range of activities from research  to recycling of products.  Over the past thousands  of years, manufacturing has evolved from a craft practiced by individuals to an organizational activity performed by firms to an intraorganizational activity coordinated and  controlled  by sophisticated  networks  of firms transforming raw material into finished products. The equipment used to support manufacturing has undergone a similar evolution from simple tools to systems employing complex technology combinations.

In the years before the Industrial Revolution, manufacturing was an artisan activity. Craftsmen produced customized items and services for clients using hand tools. Production  was heavily reliant on the judgment of the craftsman  who implemented  his own idea of standards and quality. Components could not be substituted  from one producer  to another  and replacement parts had to be made by the original craftsman. To identify their work, some craftsmen would place a distinctive sign or “brand” on items.

The Industrial Revolution

All of this changed in the Industrial Revolution that occurred  between 1770 to 1820 in England. Several factors combined to create the Industrial Revolution: a critical mass of people, improved  market  access, political stability, technology, and financial innovation. The critical mass of people was as a result of improvements in living conditions,  increasing  the local population. This created a market for manufactured products  as well as labor for factories. Expansion of European  powers in the previous 200 years provided large global markets for manufactured products.   Political  stability  in  England  provided a  low-risk  environment for  investments  in  large-scale production and distribution.  Mass production required improved equipment,  and the invention of the steam engine provided  motive power for these new tools to produce items on a large scale. To support  these  production innovations  required  large amounts of financial capital that was available at the time from local banks.

Manufacturing in England and in the United States developed along different paths. English manufacturers focused on integrating skilled labor with machinery while the United  States incorporated the use of unskilled  labor.  The  machine  tool  industry  began with Henry Maudsley, who created the first powered lathe, a machine to turn and cut metal. In the hands of skilled craftsmen, the ability to accurately produce metal components with a round profile such as screws accelerated the development  of other machines supporting  innovations  in iron  and  textile  production. The colonies in America initially imported all of their requirements for manufactured products.  However, the conflict for independence  encouraged Americans to develop their own sources of manufactured products. Development was initially slow because England prohibited  the export of production tools or emigration of skilled labor. This changed  when an English immigrant, Samuel Slater, brought British textile technology to America.

Technological  improvements developed  machine tools further,  improving  their  accuracy and providing a basis for an increased range of metal processing industries. During this period, the manufacturing techniques  of standardization and interchangeability began to be adopted into industry, beginning with the production of weapons in the United States. Simeon North, who developed a milling machine, and Eli Whitney applied these ideas in the manufacture  of guns for the U.S. Army. Unlike the previously handcrafted items, these muskets were composed of standardized, uniform  subcomponents, enabling any combination of them to be assembled into finished items. Another advantage of standard components was that relatively unskilled labor could be involved in manufacturing, enabling rapid expansion of production.

Scientific  Management

Parallel developments  in machinery  and production techniques continuously improved manufacturing.  A key advance in production technique  was the Scientific Management paradigm created by Frederick Taylor that had the following principles: (1) the optimal methods  of working should be identified and implemented  across the organization;  (2) workers should be selected and trained  to perform  the tasks of the organization; and (3) management of the organization should focus on planning and analysis while workers executed manual tasks.

In practice, manual tasks were analyzed and decomposed into subtasks, which were then optimized to improve efficiency. Mass production,  which was implemented  by Henry Ford in the manufacture of automobiles, was the combination of standardized, interchangeable  component production with the management  techniques of Taylor.

Postwar Developments

U.S. manufacturing firms began growing rapidly, with further  gains in efficiency occurring  during the two world wars. The years after World War II saw the dominance of U.S. firms as they improved their processing and organizational  abilities using techniques  learned from  weapons  production.  Wartime  improvements in electronics enabled better control of machine tools resulting in Numerical Control systems, developed by MIT for the U.S. military. Rising incomes also meant that there were ready markets for finished products.

Even though  U.S. manufacturers dominated  world markets  in  1970 and  were  refining  their  advantage with the  development  of computer-controlled tools, new techniques were being refined in Japan that would result in major changes by 1980. By focusing on efficiency and  quality, Japanese manufacturers lowered production costs  dramatically.  Toyota,  for  example, achieved production efficiencies and quality levels that were several times  better  than  its U.S. competitors’ using a system called Just-in-Time manufacturing or JIT. These production techniques were a logical extension of the  mass production approach  and followed these principles: (1) elimination of waste by elimination of inventory and by improved quality; (2) shifting workers from individual, low-skill tasks to high-skill, shared tasks; and (3) continuous  refining and improvement.

Additional  techniques  employed  by these  firms included  Concurrent Engineering,  in which  design and development was done simultaneously, and Total Quality Management, where quality was viewed as an organizational  rather  than  a departmental function. By the end of the 1980s, Japanese  firms dominated the manufacture  of consumer  items and occupied a sizable share  of automobile  manufacturing.   Global financial  liberalization  and  opening  of world  markets enabled manufacturers to invest in markets that were previously unavailable. Simultaneous  improvements in information and communication technology enabled control  of these organizations,  linking them into production networks. The 1990s saw movement of manufacturing capacity from developed to developing countries  with Mexico, then  China benefiting from investments by U.S. manufacturers.

Current Methods

Present-day  manufacturing is driven by the changes in production created by new technology, work methods, and the economic environment and changes in demand caused by new market requirements. Unlike the environment faced by firms 50 years ago, customers demand higher levels of customization,  resulting in  fragmented  markets.  In  response,  organizations are increasing their pursuit of a cross-functional approach  to coordinate  complex  flows of materials and information  in manufacturing networks. Instead of breaking tasks into subunits to be optimized, firms are developing integrated approaches to all manufacturing activities.

One  approach  to  serving  the  new,  fragmented market is Mass Customization,  the ability to provide customized  products  or services using flexible process at an acceptable cost. Under the mass production paradigm,  individual customization would be prohibitively expensive, out of the reach of all but a few consumers. However, improvements in manufacturing technology  and supporting  services have made the concept of Mass Customization increasingly feasible. Dell  Computers   has  leveraged  standardized computer  components and its supply chain to provide millions of computer  configurations  to customers. Smaller manufacturers have used advanced technologies to provide a range of customized items from clothing to toys.

Manufacturing currently revolves around six major activities: research, design and development, production, logistics and distribution,  sales and marketing, and services. Research is conducted  into new technologies  and  techniques  for  manufacturing.   Many established   aspects  of  present-day   manufacturing technology  began  as research  ideas at  universities. Computer-Aided Manufacturing, for example, had its roots in research conducted at MIT, and manufacturing techniques  have been refined using industry and university research.  Design activities translate  ideas into detailed specifications for production.  Products, services as well as the processes that create them, can be designed, and design is seen as a way of differentiating products  in the marketplace. Customers  have been found to pay a premium for products with superior aesthetics, such as those produced by Apple.

Production  activities convert  inputs  into  outputs according to the design specifications provided. Material processing  activities, for example, convert  metals, plastics, and ceramics  into finished items using techniques  ranging  from  cutting,  joining, deformation, and melting. Traditionally,  manufacturing processes have been  subtractive  or  formative.  In  subtractive processes, material is removed from a block larger than the size of the finished product. Examples include machine tools such as lathes, drills, and milling machines. Formative processes apply transforming forces, heat or force, to material, creating a final shape. Examples of formative processes include forging, casting, or bending equipment.

Advances in materials science and process control have created  a new class of processing technologies known as additive processes. In additive processes, material  is  manipulated   to  form  a  finished  product in successive layers. Examples of additive processes, sometimes  called rapid  prototyping  or  rapid manufacturing processes, include stereo lithography, selective laser sintering, 3D printing,  and laminated object  manufacturing.   Initially,  these  technologies only formed specialized plastics into prototypes, but recent  refinements   have  enabled  them  to  process metal components.  These technologies enable organizations to engage in mass customization strategies, providing individualized products to customers.

Logistics can  be  defined  as the  management   of material flow and information  both within and across facilities. Within facilities, logistics is required to ensure  that  material  is available where and when it is needed. Across facilities, logistics coordinates  the movement  of components and finished products  for further  processing or final sale. Sales and marketing activities interface  with the  final customer,  earning revenue and providing valuable information  on market  developments.  Coordination of marketing  and production activities is important to manufacturers because improperly  managed customer  demand  can lead to additional cost or lost revenue.

Finally, services have increased in importance from support  functions such as advice and repair to business drivers in their own right. Manufacturers have pursued  “servitization”  strategies,  in which the  sale of industrial products  is replaced by the provision of industrial services. The engineering firm Rolls-Royce offers a program  for integrated  provision  of equipment and support  on a lease basis, enabling customers to reduce up-front  capital costs. Global concerns about the environment have placed increasing pressures on manufacturers from a range of public and private stakeholders.  Manufacturers are being called to  account  for the  impact  of their  products  across the  entire  life cycle from  raw material  to  disposal. Some organizations have taken a proactive approach, launching  initiatives  to reduce  material  and  energy usage by changes in design and production.

The future  of manufacturing is likely to  see an increasing range of technology and techniques to convert concepts into finished products and services. In this context, firms may exhibit a range of models to serve customers, from the traditional sale of products to service-led models. Manufacturing has come full circle, from individual artisans  creating  customized products  to  mass manufacturers and  now to  small and large organizations  providing customized  products to individuals.


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