Offshoring from the US and other high cost economies to low cost emerging market countries was a dominant theme of manufacturing in the late 1990s and 2000s.
Now, Reshoring offers the promise of re-establishing the link between product design and manufacturing, between original equipment manufacturers and strategic supplier ecosystem. Reshoring is also a political topic, as it presents the prospect of bringing overseas manufacturing jobs back to the company’s own country. Reshoring also allows for risk mitigation in the case where there is a disruption to the global Supply Chain, as experienced by most companies with Offshore Manufacturing during the COVID-19 crisis.
The big picture is drifting away from the centrality of labor-cost-arbitrage as a driver of location decisions. Instead, it is moving towards proximity models driven by a supplier ecosystem, with additional focus on people, skills and organizational capabilities.
While macroeconomic data on comparative labor and factor costs may be compelling, the actual process of Reshoring is a daunting task. The process of bringing assembly work back to domestic factories from abroad is substantially more challenging than the economics alone would predict.
In this presentation, we examine 6 key considerations to make the Reshoring effort well directed and manageable:
1. Work Force Stabilization
2. Gaps in Skills
3. Capital-Labor Ratio
4. Supply Base Localization
5. Customer Partnerships
6. Manufacturing Proximity
This deck also includes slide templates for you to use in your own business presentations.
This presentation provides a comprehensive analysis of the strategic and operational factors critical to successful reshoring. It delves into workforce stabilization, addressing skills gaps, and optimizing the capital-labor ratio. The PPT also emphasizes the importance of localizing the supply base and fostering customer partnerships to enhance manufacturing proximity. The insights and templates included are designed to equip executives with actionable strategies and practical tools for navigating the complexities of reshoring. This resource is essential for leaders aiming to make informed decisions and achieve sustainable competitive advantages through reshoring initiatives.
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Source: Best Practices in Manufacturing, Reshoring PowerPoint Slides: Manufacturing: Reshoring PowerPoint (PPTX) Presentation Slide Deck, LearnPPT Consulting
This PPT slide addresses the critical issue of skill gaps in heavily offshored countries, which poses a significant barrier to successful reshoring initiatives. It highlights a generational deficiency in technical skills, particularly in the U.S., where extensive offshoring has led to a shortage of qualified professionals in key areas such as automation engineering and assembly operations. The lack of investment in technical skill development has exacerbated this issue, creating a pressing need for specialized talent in fields like Metalworking and Metallurgy.
The slide outlines a two-pronged strategy to tackle these skill shortages. First, it emphasizes the importance of mobilizing a Global Resource Pool to attract capable individuals from various regions. Second, it suggests identifying local resources from adjacent industries, which can provide experienced personnel familiar with the necessary processes. This dual approach aims to quickly establish effective leadership and enhance process improvements, ultimately driving quality and production yield.
A case example from Fort Worth illustrates the practical application of these strategies. Flextronics management engaged 150 manufacturing leaders globally, including a skilled manager from Hong Kong, to set up essential manufacturing processes. Over a 10-week period, they established critical assembly and logistics functions while training the workforce. Another example from Appliance Park demonstrates the necessity of an intensive recruitment campaign to find experienced engineers, as relying solely on existing resources proved insufficient.
The slide concludes with a reminder that addressing these capability gaps is a long-term endeavor that cannot be resolved overnight. This insight is vital for organizations considering reshoring, as it underscores the need for a strategic approach to workforce development.
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