All right.
Well, after decades of increasing reliance on overseas manufacturing, the U. S.
May soon see a resurgence in domestic production.
Major events like the pandemic Russia's invasion of Ukraine and Taiwan tensions,
They've thrown the global supply chain into turmoil.
Making american businesses
and leaders hyper aware of increasing self reliance.
Well,
the biden administration is now pushing hard to return manufacturing to the US
and joining me now is
Gandhi partner at the global management consulting from Carney.
Thanks so much for coming on the show. How did the events of these past two years?
Certainly the pandemic,
we're still in a pandemic reveal the risks of relying on overseas manufacturing.
Well, the risks Kristin always existed, right?
I know this is our favorite topic of supply chain.
The risks always existed,
but now they brought it up to the surface and when
we started running short on everything from laptops to diapers,
it became pretty clear that we got to get closer
to the point where the customer needs the product,
where it's being made.
So the risks were there. Now they came to the surface.
Okay,
so what's the importance to get to how big of a priority should
it be for the US to bring manufacturing back home to the US.
Um, so one interesting indicator,
supply chain and reassuring used to be talked about maybe, you know,
100 150 times on investor calls.
Now we are seeing that increase to about
1000.
So there's a significant increase in the attention
of board Ceo and chief operating officers,
we are having multitudes of conversation on this particular topic.
But one thing to remember, we're trying to change 40 years of history
And it's gonna take a bit more than 3-4 years to bring this back in.
So what kind of endeavor are we talking about?
What's the timelines you get to,
what are going to be the challenges to accomplish this goal?
Uh It is a somewhere between 18 to 36 months. For sure. That's the first thing.
The second thing is if you just do a simple lift
and shift which is moved from um Asia back here,
uh it actually increases the cost somewhere between 3
to 7% is what we have seen across industries,
whether it's consumer products or its medical products
and what that this requires a true strategic look
at how you think about what you have.
There are kind of three big areas that we tend to
talk about quite a bit with boards and Chief operating Officers.
The first, what does your customer really want?
Because for a long time we made, we designed the product,
send them across and they got made and came back and
we did not think about what does the customer really care.
The second is how many of these particular kinds of products do we have?
Right, Do we have a lot of them?
Do we have too many time to rationalize your portfolio?
And then the third, which is a new element is how do we bring in human intelligence,
artificial intelligence and automation together
to create something that is truly compelling.
So those are the three areas that jump out in,
really looking at the strategic plan for bringing back products,
What's the business investments to get to that?
This is going to take?
And do you find in your conversations
that you're alluding to here that businesses are
open even in this economic environment to making
those investments necessary for the long run?
Yes,
but businesses by themselves will not be able to complete this because as we know,
manufacturing has a lot of partners.
So for example, something as simple as a, you know, hand tools,
hand machine tool has somewhere between 50 to 100 suppliers.
So how do you get suppliers into the dialogue, that's one second. We need labor
In the 40 years, we have lost a lot of labor who had supplies and expertise.
So how do you train them up? So we need support from government.
And then the third thing is technology partners, how do you bring them to the table?
So it is gonna take not just the company making investments,
they do have the cash they do want to because it's a top line issue,
but it's gonna take a few more players to come together to drive this.
What does this mean for jobs in America and for the american worker?
Uh it is a tremendous opportunity for high paying jobs Kristin.
If there was a silver lining in this whole um changed environment,
it is the ability to bring in high paying jobs back here and training our folks to
become experts and engineers and craftsmen and scientists in
the area of end to end supply chains.
Um Look, I think that certainly the american workforce would welcome that.
What is the right way to skill a worker for some of
these jobs to get to is have you given that any thought?
I mean I know a lot of these major companies are considering
themselves re skilling their own workforces for the economy of the future.
Absolutely.
It is a combination right on the one level we need
kind of broad talent that understands how things are made right?
We've we've lost quite a bit of the skill but it is not difficult
to train up because the american worker
works hard and it's pretty darn intelligent.
So that's the first thing.
The second thing is,
companies need to scale people up on what their particular products are,
what are the nuances and again, what do customers care about?
And then the last thing is how do we work
with others within the same ecosystem to drive the upscaling.
So all three are open and technology is a wonderful way, right.
Uh you and I could go on youtube right now and redesign a motor and assemble it.
That information is available.
All we gotta do now is uh point people
to that information that's available and off we go.
So, so
my final question to you is perhaps the most important one,
at least for our viewership here on cheddar news and closing bell,
what is this ultimately mean for the consumer?
Does it mean higher prices, lower prices, faster delivery, ease of use?
What can the american consumer expect
the first thing right in this inflationary environment,
higher price is not gonna be acceptable.
So companies are working hard to ensure that at least it's hard.
The second thing is much more customization
since you're closer to the customer now,
you have the ability to create things that we really like.
And the third thing is, you know,
really innovative companies are gonna bring customers into designing
of the products so we get what we want
and you know, you can't beat that.
Alright, You can't beat that. We all want what we want. That's true.
So you can't you got any partner of the global management consulting from kearney.
Thank you so much