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Rethinking ‘Getting From Here to There’

Preparing for the future of highly automated advanced manufacturing is more than a study of the latest innovations and trends, and an investment in technology—it’s also a mindset.

For small- and medium-sized manufacturing businesses, engaging in global trade is no longer cost prohibitive; it’s at the doorstep. The key to competing successfully—and surviving—will likely depend on the efficient and effective management of a chain of intricately connected activities, from design through distribution and delivery.

Long before the academic world gave the process a label of “logistics and supply chain management,” the businesses world had a name for it—getting from here to there.

In a world of GPS precision and instantaneous communication, there’s a clear yet often complex path from here to there—and winning the game demands speed and cost efficiency. Today, managing a business’ supply chain is essential to reduce cost, time and risk, all of which are prerequisites in the path to competitiveness and profitability.

The Big M: Shaping the Future of Manufacturing,” a conference held this week in Detroit, will explore the fundamental transformation of manufacturing in a “motor city” that put the world on wheels, and a state that is home to General Motors, Ford, Chrysler and more than 60 of the top North American auto suppliers.

The four-day conference leverages the collective power of an industry and aims to further the discussion about how to find solutions to manufacturing’s complex challenges. An essential part of the solution is creating a highly adaptable and sustainable logistics and supply chain strategy.

To support many of Michigan’s small- and medium-sized manufacturing businesses, Gov. Rick Snyder established the Commission for Logistics and Supply Chain Collaboration, composed of members from the private sector, government and academia.

A range of experts on the commission and around the state can address ways to improve supply chain efficiency. Michigan is home to many of the top auto industry suppliers and two of the nation’s Top 10 supply chain management programs (at Michigan State University and the University of Michigan).

Freighter American Courage passing under the Blue Water Bridge and into Lake Huron. Photo: Flickr

The commission’s main objective is to find ways for small- and medium-sized businesses to reduce costs by collaborating on logistics such as transportation costs.

In a hectic work week, few businesses have the time (or patience) to confer with other businesses regarding delivery of materials and distribution of costs. Here’s where a statewide network of relationships and experts could step in with direct assistance and demonstrate the most cost-efficient supply chain paths and management techniques.

One of the commission’s main projects is a mapping of the state’s road, rail, pipeline, air and waterway routes. The map provides an easy-to-understand reference of the transportation, cost-savings possibilities. In addition, several pilot programs have begun to help the commission establish the most responsive methods to address the supply chain needs of Michigan businesses. Never before has such a direct and thorough approach been undertaken.

For Michigan, a comprehensive and collaborative-based statewide supply chain strategy is a win-win for the state and business—especially today.

Michigan is undergoing a historic economic reinvention. Changes in manufacturing, technology and capital investment have fundamentally transformed the nature of business and work. Today’s business occurs at breakneck speed and requires a fluid understanding of the many ways to cut costs and reduce risk while keeping customers satisfied.

Years ago, economic development agencies would create programs and hope they worked. Today the thinking has changed. New models of logistics and supply chain strategy are based on continual dialogue with the business community, whose members have a vested interest in the success of these programs. At the Michigan Economic Development Corporation, for instance, researchers look for ways to facilitate solutions rather than mandate them.

A collaborative network of public and private agencies in the economic, agricultural and transportation sectors is key to Michigan’s supply chain strategy. Regional and local economic development organizations are also important.

A high-performance supply chain allows firms to deliver their products to global consumers at a more competitive price and at the right time.

In a state undergoing a fundamental economic transformation, there’s a lot at stake. But we believe the odds are in our favor.

Michigan is the trade capital of the NAFTA corridor and is located within 500 miles of nearly half of the U.S. and Canadian market; it includes one of North America’s largest foreign trade zones, four class-one rails, access to 15 major international shipping ports via rail and Great Lakes ports, and is one of the largest U.S. air hubs to Asia.

With productive public-private collaboration and a clear map of the intricate distribution and transit routes leading into the market of the U.S.’s largest trading partner, businesses in Michigan are strategically positioned to take advantage of its supply chain expertise and proximity to Canada.

Collaborating to create a world-class supply chain system is a necessary and timely step to compete in a world where the distance between here and there is growing ever more complex.

Peter Anastor is managing director of Logistics, Supply Chain and Manufacturing, and a member of the auto team at the Michigan Economic Development Corporation.

Rethinking ‘Getting From Here to There’ was originally published on Ideas Lab

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