Simplicity at home gets second look

Boothroyd Dewhurst Inc. has been arguing against outsourcing the manufacturing of American products to foreign countries since it was founded in 1983 by two engineering professors at the University of Rhode Island, Geoffrey Boothroyd and Peter Dewhurst.
The South Kingstown company develops and sells design software to simplify procedures and minimize expense during the manufacturing and assembly of products and component parts. Such techniques are earning a long, hard second look from business owners who want to keep manufacturing in the United States and are concerned about the dominance of China and other Asian countries.
Karl Wadensten, owner and president of Vibco Vibrators Inc. in Richmond, said the contribution of firms such as Boothroyd Dewhurst and others seeking alternatives to off-shoring is “huge,” because their ideas can simplify and thereby reduce the cost of manufacturing in America.
With engineers in one place and factories in another, and with manufacturers often overwhelmed by the myriad pieces and gizmos they must keep track of, Wadensten, who serves on the R.I. Economic Development Corporation’s board of directors, said he can see a strong need for increased simplicity.
“At the end of the day, the point is that you should use what you’ve got in a better way rather than develop millions of new pieces,” he said.
In June, Boothroyd Dewhurst sponsored an international conference in Warwick – entitled How to Bring Jobs Back to America – at which the 100 or so designers, engineers and manufacturers in attendance heard the argument against off-shoring updated to include the latest conditions in international manufacturing, with a focus on China.
Although acknowledging that more study and discussion are needed, a research paper presented at the conference concluded among other things that American companies when considering outsourcing to China typically fail to take into account “hidden costs” beyond labor rates. When these hidden costs are fully accounted for, and when an American product can be simplified to reduce manufacturing costs, the United States remains the best option for production in many cases because of “potentially stronger supply chain partnerships, better logistics, good rule of law and a smart, development-based community for creating cost-effective, quality products,” said the 26-page paper written by David Meeker, consultant with Neoteric Product Development in Acton, Mass., and entitled “Outsourcing to China.”
Among the “hidden” costs Meeker identified: airfare to the Far East, which he said can cost $10,000 to $12,000 per trip; the cost of ocean-shipping spills, such as the loss of 80,000 tennis shoes and 500,000 cans of beer in the Pacific Ocean in two separate spills; and communication barriers, particularly concerning contracts.
“One cannot stress enough the difficulty in translating contracts into Chinese,” Meeker said.
In May, the Boston Consulting Group released a study that found the cost of manufacturing in China is rising due to several factors, including a demand for higher wages, and by 2015 would be on a par with production costs in the United States.
John Gilligan, president of Boothroyd Dewhurst, said he is not surprised by the BCG study. “Historically, that is going to happen.”
Boothroyd clients are mostly Fortune 1000 companies from out of state and have included such heavyweights as Harley-Davidson, Dell, John Deere, Whirlpool and Abbott Laboratories, according to Gilligan.
Company founders Boothroyd and Dewhurst in the early 1990s were awarded the prestigious Medal of Technology by former President George H. W. Bush in a ceremony at the White House for their work in support of American manufacturing, he noted. Although retired, Boothroyd still does research for the company, Gilligan said. To illustrate in general terms how the Boothroyd Dewhurst software works, Gilligan used the example of a plastic pen, such as those made by Bic.
The software can provide cost estimates for the production of separate parts of the pen and, looking at the pen as a whole, can analyze its overall makeup with the intent of reducing the number of parts required to make it, from perhaps 20 parts down to 10. “Therefore, what you usually have is a better product,” Gilligan said, because fewer parts mean the product is less costly to make and assemble, while “the chance of mistakes” is lessened.
An analysis of 100 case studies, where the actual Design for Manufacturing and Assembly software developed by Boothroyd Dewhurst was used, showed these composite results, according to Gilligan and the company website: a 42 percent reduction in labor costs, 54 percent reduction in the number of parts; a 60 percent drop in assembly time; a 45 percent decrease in the product-development cycle time; and a 50 percent cut in cost.
The best time to utilize the DFMA software is in the early design phase, Gilligan said. He talked in general terms about the difficulties that can arise when a product is designed in the United States for the American market, but then manufactured in China. Manufacturing engineers usually cannot change what design engineers have done, but must send the product back to designers for revisions.
What Boothroyd Dewhurst and other major companies recommend instead, Gilligan said, is that design and manufacturing engineers work together in a process he called “concurrent engineering” so technical production aspects are taken into account in the early design stages, a process difficult to undertake if design is done in one nation and manufacturing in another. •