Start considering your supply chain

As I sit and write this editorial it has been less than one month since the 45th presidential inauguration. And, while the White House claims it’s “running like a well-oiled machine,” what I see is an administration busy tweeting and battling the media. This accomplishes nothing to move our country forward and I think the administration should focus less on tweets and more on how to best support our country today and for future generations.

I want to know how they plan to support manufacturing, not just tweets threatening increased tariffs for U.S. businesses that offshore jobs. It goes much deeper than that.

Manufacturing functions because of its vast supply chain, which starts with delivery of the raw material and travels through many tier suppliers who add value to that material, turning it into a part. This doesn’t stop until the end-user buys the final product – whether it’s a left ventricular assist device (LVAD) or the car you drove to work today. So, a company’s supply chain has a significant effect on its success or failure, profit or loss, and the cost consumers pay.

That’s why companies now must look closely at their supply chains to see where disruption will occur because of political agendas – getting a solid understand of when and where the part specified into your final product will increase in cost because it began its path as raw material sourced overseas. At each stage of the supply chain, the increase from a tariff may get passed along and compounded. The cost of that original part could skyrocket – greatly reducing any chance of consumers being able to afford the item with its new high-ticket price.

So, while the Oval Office tweets its plans to cut corporate taxes, impose a steep border tax on imports, and curtail regulations, a positive step comes from Congress with the introduction of bipartisan, bicameral legislation to establish a U.S. Chief Manufacturing Officer (CMO) in the Executive Office of the President. Supporters of this legislation include executives from AMT – The Association For Manufacturing Technology, American Society of Mechanical Engineers, Automation Federation, Information Technology & Innovation Foundation, Intelligent Systems International, International Society of Automation, Manufacturing Alliance of Communities, National Center for Defense Manufacturing and Machining, and National Council for Advanced Manufacturing.

The role of the U.S. CMO would be responsible for coordinating manufacturing-related policies and activities across agencies, as well as developing of a national manufacturing strategy to revitalize the manufacturing sector, spur economic growth, and expand U.S. competitiveness.

I hope the U.S. CMO will look at the impact policy changes will have on the manufacturing supply chain. But, until one is in place, I’d like to know what you are doing to evaluate your supply chain. Send me an email (emodic@gie.net) letting me know the steps your company is taking. I’ll start by suggesting you ask your vendors about the reliability of their supply chain…all the way down the line. ~ Elizabeth