manufacturing

Inflation may be rampant, but not all consumer products are getting more expensive. Instead, they’re getting smaller. Three marketing professors from the Olin Business School at Washington University in St. Louis comment on why smaller packaging is a good idea — for business.

If it is a surprise to Gap Inc. that some of its clothing manufactured in India was made by young children, then the company didn’t do a thorough job investigating the pros and cons of international outsourcing, according to Panos Kouvelis, the Emerson Distinguished Professor of Operations and Manufacturing Management at the Olin Business School at Washington University in St. Louis.

After what seems like a never-ending cycle of firms recalling their products, Congress jumped into the ring with an oversight hearing to determine what is going on. But the complexity of sending an effective message to assure the public the products are safe is made all the more difficult when an executive speaks to a congressional committee. The verdict is out on the credibility of Mattel’s message.

Over the past 18 months, many trees have given their lives so that articles titled something like, “Is India the next China?” could appear. But, an equally interesting question a professor from Washington University in St. Louis posed is, “Is China the next India?” These two questions offer a lens through which we might glimpse, however darkly, the economic futures of India and China. And by posing these questions side by side, Professor Jim Little said we can see an interesting pattern emerge: as China moves up the technology ladder, the drivers of its growth are becoming more like India’s. At the same time, India increasingly resembles China’s current economy as it develops as a manufacturing base.

Low quality threatens the high end.What company wouldn’t attribute its profits to the quality product it produces? The answer might be: the company that competes on price. According to research from Washington University in St. Louis, producers of lower quality products actually have better prospects for gaining market share and improving their bottom line. The findings indicate the Chinese manufacturers could easily gain an edge over American producers. More…

OlsenToday, when you walk into a car dealer and order a new automobile, you pay the same price and get the same wait for delivery as every other customer. But in the future, as Tava Olsen sees it, instead you’ll select your price and delivery date from a dynamic menu of lead-times and prices, where you can pay more for quick delivery or get a better price for waiting. While such options benefit the customer, they also pay bottom-line benefits for the retailer and manufacturer, says Olsen, associate professor of operations and manufacturing at Washington University’s Olin School of Business. To help companies reap those benefits, she’s engaged in groundbreaking theoretical research funded by a National Science Foundation (NSF) grant to tell them just how to do it.

KouvelisThe concept of hiring another company to handle “non-core” functions has been around since companies began. But it’s only been in the last several decades that the term “outsourcing” has been coined. Selecting which functions to be outsourced is as individual as each company and the goods and services it provides. Panos Kouvelis, a professor of operations and manufacturing management at the Olin School of Business at Washington University, says that it is often argued that outsourcing helps share risks with suppliers, but new risks enter the picture. “Often difficult tasks, if not appropriately managed, can get out of control,” Kouvelis says. “However, these are the tasks in which a firm can build competency and appropriate market value.” Kouvelis explains the pros and cons of outsourcing.