Commentary: Don't Expect a Rescue

Since the U.S. Department of Commerce's study on 'Manufacturing in the America' was released in January, both those in industry and in Washington have had time to digest and comment on it. The report, subtitled: 'A Comprehensive Strategy to Address the Challenges of U.S. Manufacturers,' was indeed comprehensive, with its findings based on 23 town hall meetings held throughout the U.S. in 2003.

The meetings, which were small and varied, captured good dialog across several manufacturing disciplines, gathering the perspective of those directly involved in heavy equipment, tool & die machinery, general machinery and high technology. So what's the verdict?

Manufacturing is in trouble! No surprise here ﾖ but there are some encouraging signs:

• The study accurately assesses manufacturing's current plight;
  
• Proposed solutions are succinctly identified and systematically considered; and,
  
• There's general acknowledgement in Washington, D.C. that manufacturing is grappling with serious challenges.

The Commerce Department's current dilemma is much like the challenges we face in our own businesses at the next logical phase of strategic planning ﾖ implementation! Many years ago, management guru Dr. Peter Drucker summarized it best, 'Strategy is a commodity, execution an art.' And our elected and appointed officials have rarely been accused of being artists!

Meanwhile, the report is well written and worth review. The solutions are sound and worth pursuit. The report identifies actions that have been and remain AMTDA legislative priorities: 1) making the recent tax cuts permanent, including the increase in expensing limits and the incentives for small business investment; 2) eliminating the estate tax; 3) reducing the cost of tax complexity and compliance; 4) reducing the cost of health care for small businesses; and, 5) liability reform. While many other proposed solutions exist, maintaining the focus on lowering the cost of doing business in the U.S. is critical and it's the area in which we can achieve the greatest impact in the shortest amount time.

At this stage of the game your involvement, by engaging our elected officials to work on the solutions, is vital. Changing our laws and regulations is where we need to devote our primary focus and resources! External objectives, such as opening up markets around the world or changing other countries' fiscal or monetary policies related to currency manipulation, while important, are further beyond our control compared with taking care of our 'own house.'

So where does that leave us? With the opportunity ﾖ and the obligation ﾖ to execute the plan's action items. And just as in our own businesses, that's the toughest part. We can't expect to be rescued by a knight on a white horse. But together (those in U.S. manufacturing and serving manufacturing), we must work with our government and focus on solving our own challenges by adapting, morphing and changing our businesses to reflect the permanent structural shift in our manufacturing environment.

Ralph Nappi is president of the American Machine Tool Distributors Association.

MDM published a condensed executive summary of the 88-page Department of Commerce report in the Jan. 25 issue. View it here.