Part of the blog routine is a daily scanning of dozens of news sites to find interesting fodder. Usually it is pretty straightforward but occasionally there are days like today when it seems that one article after another contains something that makes me stop, go back and reread something, scratching my head at how anyone could say such a thing.
Take for instance, this press release in which the folks from Zack's Equity Research report that Caterpillar "has reduced its workforce significantly. Also, the company has implemented full or partial shutdowns at some of its plants, delayed its R&D programs and reduced its capital expenditure substantially." This is all under the heading of "encouraging" news from Caterpillar. What investor can possibly be 'encouraged' by news that capital investment and R&D have been slashed, and that valuable human resources have been cast adrift? What can possibly be "encouraging" about that? Perhaps some of it was necessary, but in no way can it possibly encourage anyone.
Then there is the matter of Colonel Cheri Provancha, who runs the Army's Letterkenny Depot where a variety of things are manufactured. It seems as though there is an uptick in orders so some folks are being recalled from layoff status. Rather than have them work for the government, however, the Colonel is making sure the work is done by a contractor. Why the private contractor, you ask? "It is easier to lay off employees under a private contract than federal employees, Provancha said. A reduction in force of federal workers takes months to prepare." Now I am as big a supporter of the US military as you will find - I could not be more proud of my son who is about to wind up his third Middle East deployment, but really! Did the Colonel learn this 'planning to fail' strategy in leadership school? Does this technique work well for her in motivating and inspiring her troops to great things? What on earth would posses her to say something like that to anyone, let alone the writer for the Chambersburg rag?
Some times the issue is more with the reporter or the editor who lets the piece fly, without taking note of what seems to be an obvious contradiction. In this all-too-common sob story from the Indianapolis Starthe loss of jobs from Indiana manufacturing to China and Mexico is bemoaned ad nauseum. On page 1 we have the mayor of Scottsburg, Indiana sagely attributing it to the 'fact' that "it's impossible to be competitive with Mexico or China because of their labor costs." Then on page 3 we read, "Washington noticed. In 2009, Indiana automotive companies such as Allison and EnerDel landed more than $400 million in energy and green-car grants and loans.'We're starting to build a new manufacturing base' in the Midwest, Ed Montgomery, the White House's director of aid to distressed automotive cities."
I would have thought the reporter might have asked Ed the obvious question, how on earth are the "energy and green car" manufacturing plans going to work when, according to the mayor, labor costs are too high and the jobs all go to China and Mexico as a result. Won't the 'energy and green car' manufacturing jobs just go there too? If the cause is high labor cost, then the solution can hardly be having the same over-paid workers manufacture different stuff - or maybe expecting the reporters to ask the obvious questions is expecting too much.
Of course, an enterprising reporter might have actually done some research. An amateur like me learned in a couple of clicks and about three minutes time that (1) a company in Vermont called BioTek Instruments is booming, and adding manufacturing jobs. "We export products, not jobs," said CEO Briar Alpert. And (2) the cost of living in Burlington, Vermont is 26% higher than it is in Fort Wayne, Indiana. That would have led the reporter to the idea that both the mayor and the White House guy are off by a few miles. The problem apparently isn't labor costs in Indiana, and the solution isn't to put the same manufacturing thinking to work on different products. The problem, it seems quite obvious, is that the companies in Indiana that are shipping jobs to China and Mexico wholesale, just aren't managed as well as BioTek.
But perhaps what is so plainly obvious to the lean community is not nearly as obvious to the rest of the world.