LyrArc Insights

Myths and Reality - the American Worker and quality, craftsmanship spirit

Myths and Reality

Myth: There is something wrong with American workers and their ability to engineer high quality into products.

Reality: American workers are some of the the best in the world. Trouble lies with management at the top of the company. When Boeing fails to engineer quality into its aircraft. Not enough attention has been given to the production line. Top management does not work well with engineering and manufacturing people and has other priorities. Here is the example of what happened at Apple which I saw with my own eyes in 1996 when a new CEO Michael Spindler from Germany was made CEO of Apple.

China's tariffs on US products could be called self-respect tariffs as US exports to China are small compared to China's $1 trillion surplus a year. US business not willing to rely on US labor created the outshoring that created Chinese industrial growth shipping out technology in the process that created this situation. Consultants to Apple at the time such as myself bringing Total Quality of Management from Japan to the US could see the failure of production quality at the Colorado Springs plant just before Steve Jobs returned to the company in 1998. About 20-25% of PC product was defective on the production lines seen with my own eyes. Looking back I believe it was not just the workers but the managers and engineering that needed to guide and motivate the workers with new ways to build in quality control. These were the days when Apple's Steve Jobs hired Tim Cook to revamp production and ship it to China. American workers got blamed. Yet as Jim Carlton shows in Apple the Inside Story of Intrigue, Egomania, and Business Blunders, by 1996 a new CEO from Germany Michael Spindler 1993-1996 had driven the company to the ground. The struggle with Microsoft gave Jobs an idea by shifting production to a low cost location he could make the high margins to outinvest all competitors with new products-ipods, iphones, ipads. There is nothing wrong with American workers and their craftsmanship.

Timeline-

Steve Jobs returns to Apple 1997-1998

Tim Cook is hired from Compaq to revamp manufacturing in 1998

1999-2000 - the strategy is made to shift all of the production to China. Jobs could generate the margins and quality to challenge Microsoft, and profits to invest in new products

2020 -   the weakness of the strategy is apparent with supply side shock for chips and computers with the pandemic stopping shipping

2024 - after taking small steps to shift production to India does little to shift back to America

2025- Apple facing serious tariffs and the country's mood shifting to Make in the USA tells the new US president DJT it will invest $500 billion to shift production back to America.