Monday, 14 May 2012

MADE in CHINA: a challenge of Quality

The global shift in levers of competitive advantage, manufacturing industries have been moving from one part of the world to another. Over the years, industries such as automotive, chemicals, steel, textiles, and semiconductors have almost disappeared in some countries while flourishing in others. With the trend towards being “green”, western society tends to look down on manufacturing and does not seem perturbed by the departure of such industries from the western shores.As long as prices are low, consumers do not mind where the products they buy come from. At the same time, the western world preaches to the newly industrializing nations about the importance of reducing emissions and greenhouse gases.

In the western world, Science and Technology have taken a back-seat to business, finance, political science etc., and fewer and fewer people want to major in fields such as manufacturing.  People in the west want to pursue careers in Consulting, Marketing, Finance, Private Equity, Venture Capital etc. Somehow, we have created the perception that technology and hence, manufacturing is an “inferior” career to pursue.

But once the western world did just fine without China and  it became the lowest possible wage labor supplier and moron manufacturers flocked there to take advantage of the slave labor. The Made in China label is one of the most recognizable labels in the world today due to the China's rapidly developing large manufacturing industry. China today is  the largest exporter in the world and the Made in China label can be seen on a large range of goods from clothing to electronics.

The Industry produced 53.7 percent of the country's gross domestic product (GDP) in 2005. Industry (including mining, manufacturing, construction, and power) contributed 46.8 percent of GDP in 2010 and occupied 27 percent of the workforce in 2007. The manufacturing sector produced 44.1 percent of GDP in 2004 and accounted for 11.3 percent of total employment in 2006. China is the world’s leading manufacturer of chemical fertilizers, cement, and steel. Before 1978, most output was produced by state-owned enterprises. China manufactured everything  in the world and along with it is the  unimaginable pollution. With all the press about lead paint in toys, industrial chemicals in food. Clearly with the low cost of China-made goods comes a great challenge in quality management.

A series of highly publicized quality scandals in exports from China in the late 2000s has harmed the "Made in China" brand abroad, during which time 40% of product recalls in the United States were of imports from China.It is LONG passed time that we woke up and stopped doing business with China. The only opportunity there is a loosing proposition where short term gains are quickly offset by long term political and intellectual larceny.

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