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because they were of inferior quality. At PZL-RZESZÓW a bevel gear for the PT6 turbo engine is made; this same bevel gear is also made near Montréal. The main difference is the price, with the one made in Canada costing $921 and the one made in Poland costing $256. In order to succeed, UTC must take into account this price differential.

Other ways of dealing with this price differential include a renewed commitment to increase productivity. This should not be done by focusing on a specific fix-all manufacturing cell, but rather by adjusting to corresponding issues. It is important to be careful, because if a cell becomes too efficient, then inventory overflow occurs. Inventory begins to pile up because the downstream process cannot accept it.

An example where UTC has increased productivity by an overall investigation of a process is the wiring harness assembly. A value-stream map was used in an end-to-end approach, to become more efficient and increase the drive for manufacturing. Initially, this was a slow process with a total cycle time of 403 days and a processing time of 30 days. After using the value-stream map, the total cycle time was cut down to 21 days and the total processing time down to 18 days. By methods such as this one, it is possible to remain competitive in the global manufacturing arena.


In 1997, Peter F. Drucker said:

In a transnational company, there is only one economic unit, the world. Selling, servicing, public relations, and legal affairs are local. But parts, machines, planning, research, finance, marketing, pricing, and management are conducted in contemplation of the world market…. national boundaries have largely become

FIGURE 11-2 Millions of square feet of manufacturing area in the United States and abroad. SOURCE: Census Bureau, Department of Commerce.


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