6
Minority Opinion

Mr. Robert A. Pritzker and Mr. Paul D. Rimington, as members of the Committee to Assess Barriers and Opportunities to Improve Manufacturing at Small and Medium-Sized Companies, disagree with the opinions of the committee majority that a national industrial assistance system is justified. To a large degree, the disagreement is ideological. However, it was not until late in the project that we discovered a mutual belief that federal government intervention or ''help'' is more costly and less efficient than natural market forces. Our view did not alter the project schedule or goals (1) to identify major barriers, (2) to determine the means to overcome those barriers in the context of the NIST Manufacturing Technology Centers, and (3) to identify how the MTCs could best be focused. As a result, our minority opinion was not the basis for any fact finding related to the project.

In their opinion, the committee's charge implies that there is a need for a national policy. The minority opinion feels strongly that this report should not be treated as a blanket endorsement of a national industrial policy. Our interpretation of the results is to resist the temptation of a national cure-all.

Although our minority opinion is not written based on the data gathered, it does provide an alternative perspective derived from substantial industrial experience and expertise and also draws on our participation in committee meetings, discussions during workshops with smaller manufacturers, and conversations with Manufacturing Technology Center staff.

Our perspective is summarized in the following points:



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Learning to Change: Opportunities to Improve the Performance of Smaller Manufacturers 6 Minority Opinion Mr. Robert A. Pritzker and Mr. Paul D. Rimington, as members of the Committee to Assess Barriers and Opportunities to Improve Manufacturing at Small and Medium-Sized Companies, disagree with the opinions of the committee majority that a national industrial assistance system is justified. To a large degree, the disagreement is ideological. However, it was not until late in the project that we discovered a mutual belief that federal government intervention or ''help'' is more costly and less efficient than natural market forces. Our view did not alter the project schedule or goals (1) to identify major barriers, (2) to determine the means to overcome those barriers in the context of the NIST Manufacturing Technology Centers, and (3) to identify how the MTCs could best be focused. As a result, our minority opinion was not the basis for any fact finding related to the project. In their opinion, the committee's charge implies that there is a need for a national policy. The minority opinion feels strongly that this report should not be treated as a blanket endorsement of a national industrial policy. Our interpretation of the results is to resist the temptation of a national cure-all. Although our minority opinion is not written based on the data gathered, it does provide an alternative perspective derived from substantial industrial experience and expertise and also draws on our participation in committee meetings, discussions during workshops with smaller manufacturers, and conversations with Manufacturing Technology Center staff. Our perspective is summarized in the following points:

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Learning to Change: Opportunities to Improve the Performance of Smaller Manufacturers Establishing public sector organizations to assist smaller manufacturers is not an effective means of improving the competitiveness of manufacturing in the United States. Sufficient private sector resources are available to smaller manufacturers that are willing to make the commitments necessary for improving their competitive capabilities. These include, but are not limited to:  suppliers that are happy to demonstrate their new machines, products, or technologies and teach buyers to use them;  customers, particularly larger ones, are more and more demanding of high quality and will assist suppliers in various forms of quality improvement. Even the second and third tier of suppliers are influenced by the quality requirements of the subcontractors so that one large customer can influence hundreds of smaller supplier firms.  industry groups, such as the thousands of trade associations in the United States, sponsor seminars and meetings to discuss problems unique to their industry and to educate their members;  consultants, in addition to large consulting firms such as Arthur Anderson and McKinsey, there are thousands of very small firms with modest costs but great expertise;  universities and community colleges, besides working directly with companies, also furnish individuals who provide direct consulting services, hold seminars and classes, and offer other forms of assistance to smaller firms;  published materials, as a source of information about new activities, already exceed the time business people have available to read and digest; about the last thing they need is to receive more of these mailings.  special business groups, such as the Young Presidents' Organization, disseminate considerable information to smaller businesses; and  professional societies such as the Society of Manufacturing Engineers (SME), American Society of Mechanical Engineers (ASME), and so forth. The Manufacturing Technology Centers (MTCs) have not proven their ability to substantially influence the overall competitive performance of U.S. industry. There is a dearth of metrics for properly evaluating the success of this and other federal and state funding spent to date. The MTCs are a series of small-scale experiments investigating

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Learning to Change: Opportunities to Improve the Performance of Smaller Manufacturers various ways of assisting manufacturing companies, but anecdotal evidence should not be the sole basis on which to conclude that they have demonstrated that they are the best means of improving the competitiveness of U.S. manufacturing companies. There is insufficient talent available to the public sector for adequately staffing a national system of manufacturing assistance. It is likely that those people initially employed and trained by the assistance centers would subsequently be hired by companies offering higher wages and benefits. The MTCs would constantly be in doubt as to long-term survival. The MTC program would be extremely expensive and we believe that it would have great difficulty securing the local components of the funding for long periods. The MTCs tend to be in direct competition with small consulting companies. We believe the government does not wish to compete with private sector service providers but the present structure of the MTCs encourages such competition. MTCs are not a particularly good manner of achieving technology transfer. It is difficult for the government to know what is the best technology for a given situation, and if the small businessperson does not know much about the appropriate technology, the project is likely doomed. MTCs offer no help in alleviating the regulatory burden of manufacturers. The single biggest assistance that government could provide to manufacturers is to reduce the amount of regulation to which smaller manufacturers are subject and really incapable of handling.

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Learning to Change: Opportunities to Improve the Performance of Smaller Manufacturers This page in the original is blank.