Why would a rich man want a poor man's product?

Bigthink.com talks about the concept of reverse innovation - that is... creating value for many rather than value for money.

Vijay Govindarajan, Professor of International Business at the Tuck School of Business, defines it as innovation that starts in poor countries and brought to people in wealthy countries. He argues that poor countries have unique problems that inspire solutions usable throughout the world, regardless of economic status.

Reverse innovation, however, is not about making cheap products, says Govindarajan. "It's about giving value because poor people, their hard earned money, they want value they don't want cheap products." he said.

This means the onus is on innovators to find creative ways to drive down the cost of material and labor and add features that cater to the needs of the community. It's about doing more with less.

Click here to read the full article.

Manbulloo heats up export competitiveness

In 2010, only 44% of Manbulloo mangoes met the required standard for export to Japan, China and Korea.. In monetary terms, this meant a $20K-$30K loss for just one batch. By the end of the project with QMI Solutions, the plant was operating effectively – more than 80% of Export Premium mangoes met the requirements, with negligible losses due to heat damage.

Through the project we were able to save Manbulloo approximately $500K per year.

Click here to read the full article.

Forget onshoring (reshoring) - what about MIMOC?

Do you ever a read a post and say to yourself "Man, this person is smart!". I've only read a few posts by AJ Sweatt and all fill me with excitement and envy. In a post dated October 2011 (nothing like keeping my finger on the pulse), he discusses reshoring and how the concept is important in redressing the balance of unneccesarily lost jobs overseas, but ultimately not sustainable.

Instead he suggests MIMOC - Manufacturing in Markets of Consumption, which apparently has been around for years. Known by Coca-Cola and many well-known auto manufacturers, the process specifically locates production locally for exposure to local markets. Makes sense.

The benefits of MIMOC are:

• it encourages exports
• it’s sustainable
• it simplifies politics & public opinion
• it creates jobs
• it creates, nurtures & moderates the global manufacturing network

I also like his point that MIMOC gives corporations an "out". Corporations can relocate operations based on where the local market is situated. No need to admit failure over an unsuccessful offshoring initiative.

Click here to read the full article. 

Middle managers are holding back innovation

So it's the middle managers fault that we aren't innovating! I knew it!!

I'm unfairly framing what is a very good post from Paul Hobcraft on Innovation Excellence. He says that middle managers are often too focused on delivery operational objectives when they are the key to innovation execution. Hobcraft offers a staged approach to remedy this:

1. Core competences need to be changed
2. We need to focus the middle manager on different learning concepts
3. Working the innovation learning ‘muscles’ through the three learning loops
4. Apply a coaching framework
5. Use the ADKAR methodology of change

As with the Theory of Constraints principle, it makes sense to address the constraint of innovation, if in fact it is the middle manager. I suspect this is partly true. The challenge for our clients (SMEs) is the same challenges felt by middle managers, as Hobcraft suggests, is felt across the whole business. Neverthless the approach is still valid.

Click here to read the full article.

How to save manufacturing - well, some good starting points anyway

Following is an article in last week's Huffington Post. It's a little misdirected in its approach, implying that the manufacturing industry is faced with challenges caused by the recent onset of technological advances and globalisation. In fact, the manufacturing industry has arguably had ot be the most adaptive being particularly more sensitive to the booms and busts of past decades. Fuel prices go up, manufacturing has to adapt. Mining booms occur, manufacturing has to cope with the talent drain. GFCs, natural disasters etc have made manufacturing an industry chameleon that has had to adapt or die. The industry's resilience is not to be underestimated and most companies have had to inmplement, in some form, the 'next generation' points made by the author, which are:

• anticipate customer needs
• innovate around the core
• focus on collaboration
• pre-solve problems
• inform and communicate
• do continuous de-commoditisation

This is a good start for sure and more details abouts each of these points is provided in the link below, however SME manufacturers need more guidance.

Being time and resource poor, they need (external) assistance to validate their strategies. This where government should play a role as funding the enablers for a more globally competitive and sustanaible industry.

Click here to read the full article. 

Lean leadership lessons from General Colin Powell - Problems are gold

A great post from Lean Pathways.

General Colin Powell says of leadership:

“The day soldiers stop bringing you their problems is the day you have stopped leading them. They have either lost confidence that you can help them or concluded that you do not care. Either case is a failure of leadership.”

In the article referred to by author Al Norval, General Powell goes on to say that in his opinion, given this test, the majority of CEOs would fail.

Norval makes a comparison between Powell and Lean's Mental Models:

"Problems are Gold, buried treasure to be unearthed. But in all too many organisations, problems aren’t treated as gold, rather they are treated as things to be swept under the carpet and left alone. People learn quickly to stop bringing problems to leaders. The funny thing is - the problems still exist."

Click here to read the full article.

How to Measure New Product Productivity in Your Industry

Geovanny Romero blogs on Innovation Excellence about the importance of new product development to keeping your business ahead of the game. But how does your industry fare? He says:

• the best firms have twelve times the productivity in new product development compared to the worst
• the most productivity industry is consumer packaged goods, including food
• the least productive industry is pharmaceutical

For new products to be a succesful part of the business, the new product development process needs to be clear, measurable, sustainable and consistent.

Click here to read the full article.

Manufacturing and innovation - tied together

Detroit is synonymous with the US auto industry and as such, experienced the worst of the industry's downturn over the past 30 years. So you may be excused for thinking an article on manufacturing from The Detroit News may carry baggage, but the author Mark Benvenuto uses the past troubles as a good example of the importance of an intrinsic link between innovation and manufacturing.

The most salient point for me was the theory that didn't work - namely the practice of shipping production overseas, whil hoping to retain the idea factories locally.

"To believe that is to misunderstand something fundamental: many of the most valuable innovations happen close to production, where scientists, engineers and researchers have tangible problems before them to solve."

He also mentions an admirable initiative from the American Chemical Society, which is awarding chemical scholarships to encourage innovation and job creation in the chemical sciences.

There are plenty of lessons we can learn from Detroit.

Click here to read the full article.

Mature aged workers - an unrealised resource?

An article from the AMMA - the Australian Mines and Metals Association ran a discussion on mature age workers on LinkedIn. Our MSQ General Manager Erik Salonen replied with the following points, which were then used on the AMMA site. Here is the article.

Last week The Australian ran an article about the economic benefits of having older people in the workforce. While Australia struggles with a skills shortage, many other countries are tapping into a particularly rich vein of talent, the over 50 market.

Erik Salonen, General Manager at Manufacturing Skills Queensland, wasn’t one bit surprised at the report. He believes mature aged workers play an important part of any organization, particularly because of the vast amount of intellectual property they take with them when they leave.

Flexible work options

Mr. Salonen advises a key method of attracting and retaining mature age workers is providing flexible work options to accommodate caring responsibilities, health issues or a desire for a different work/life balance. Mature age employees can often be encouraged to stay on when offered:

• phased retirement
• part-time work
• job sharing opportunities
• work from home arrangements

"In particular, phased retirement enables mature age employees to continue to participate in the workplace, allowing employers to retain employees - and their skills and knowledge - for longer than they would otherwise."

“Many options are available for phased retirement, depending on the needs of employees, as well as business and operational requirements.”

Options for Phased Retirement

Mr Salonen shares the following options employers can provide to mature age employees:

• Transition from full-time to part-time work in their current job
• Take alternative job opportunities on either a full-time or part-time basis
• ‘Retire’ from the organisation and contract back
• Work full-time with additional flexible leave and flexible hours entitlements

Business benefits of phased retirement

• Retention of skilled employees in the workforce for a longer period of time
• Preservation of organisational and/ or corporate knowledge
• Provision of a system for effective succession management
• Creation of a flexible and responsive workforce
• Increased return on investment in training and development

Help for mature age workers

Employers are being encouraged to hire and train older workers under a Department of Education, Employment and Workplace Relations (DEEWR) government scheme called Experience +. Over the next three years, 7500 workers aged 50 years and over with trade relevant skills but no formal qualifications will have the opportunity to have their skills assessed and formally recognised. Assistance is available for workers needing an apprenticeships or traineeships. Industries given priority include Construction, Manufacturing, Electricity, Gas, Water and Waste Services. These grants are also available for small business owners.

For more information, check out:

• Experience +
• More Help for Mature Age Workers

It’s all good news for older workers looking for jobs in mining, energy jobs or oil and gas jobs. As the global resource industry feels pressure to find skilled workers, the biggest source may well be the people who have powered the economy for the past 40 years.

What is your experience with mature age workers?

Click here to see the webpage or comment below.

Stemming the flow - the reluctance of youth to pursue STEM careers

A Reuters article recently points to an ASQ Survey results stating that youth in the US are reluctant to pursue careers in STEM (Science, Technology, Engineering and Math) for a number of reasons, perhaps the most disturbing of which is that too much work is involved.

There were 713 respondents surveyed from grades 6-12 who offered the following insights:

• STEM careers offer the most opportunities
• STEM degrees cost too much
• their grades aren't good enough
• too much work is involved
• teachers aren't preparing students well enough for STEM careers (with girls feeling underprepared x4)

I'm not sure if these results for US students translate to the rest of the world, but let us assume they do. So there is a major paradox present here. There is recognition of the opportunities offered by STEM-related careers, but (leaving cost aside) students feel underprepared, disinclined or insecure about pursuing these careers.

Of course, it is probable that a section of those surveyed have not been aligned to STEM careers no matter what the circumstance. However, what seems to be lacking is a passion and drive for STEM careers and visibility of a pathway towards that career.

Certainly from any engineering perspective, there are a number of programs on offer to ignite that passion. See the F1inSchools program that we have been specifically involved with, but also a list of engineering programs for schools is available at the Australian National Engineering Taskforce website.

Such programs ignite the interest, the passion and the drive for students to prepare themselves to take advantage of STEM opportunities.

Click here to read the results of the STEM survey.

Social media for innovators

A blog from the Innovation Excellence site about the importance of social media when it comes to building personal brands. No real surprises there. But author Stefan Lindegaard talks about social media in the context of providing and promoting innovation offerings and constructing the strategy and innovation eco-system supporting this.

Click here toread the full article. 

The disappearing of exports

An opinion piece in the New York Times explores and compares the world of a politician and that of the CEO. Politicians see the world as dominated by voter geography, while CEOs see the world as a global supply chain where anything can be sourced, made and sold.

The author, Thomas Friedman, quotes a Hong Kong manufacturer who says, “Source everywhere, manufacture everywhere, sell everywhere. The whole notion of an ‘export’ is really disappearing.”

But until we vote a one global community, the tension will still exist. So the focus of our elected officials is as key enablers; immigration for the skills, protection of ideas, funding research and provision of logistical infrastructure.

Freidman also alludes to the long-term debt problems of the US, which is not enabled by the four year election cycle. One way around this may be a long-term (longer than four years anyway), bi-partisan, debt-reduction strategy committee - my 2 cents worth, not Freidman's. That is, only if debt-reduction strategy is an important goal for governments.

Click here to read the full article.