The future of the US economy, and our future as an industrial power will be the result of our cumulative creativity. New industries will be the result of new ideas, new technologies, new thinking. It’s gratifying to see programs like the First Robotic Competition getting 215,000 junior high school and high school students exposed to and involved in robotics. Problem solving, finding solutions, getting their creativity flowing to make a box of parts into a working machine with real world performance. It will be even more interesting to see what those same kids will be into 5 to 10 years from now as they begin their careers in the many technology pursuits they are likely to follow.
Technology is a major driving force in the economy. The ability to create whole new industries that have never existed before.
And there is a second driving force, sometimes made less obvious by the flash of the latest technical breakthrough. Cost. What is the relationship of cost to the development of industry? As costs decline volume goes up. Steel manufacturing per man year of labor increased 500% during a period of intense competition between the US and Japan. And interestingly, one of the breakthroughs was the creation of the “mini-mill” which could produce specialty steels more cost effectively by making them in smaller batches. Sometimes the solution is counter intuitive. The steel industry was all about increasing batch size. But serving the market with more complex products turned out to be easier with smaller batches, ultimately increasing overall sales and defending the US market to some extent from foreign competition.
Are there other cases where innovation was economically driven? In the machine tool world the majority of manufacturers develop bigger and more complex machines so that a single machine can handle any operation. This complexity tends to drive costs up quickly. So the tendency is to find high performance machine tools costing hundreds of thousands of dollars. In contrast, the HAAS company re-invented the machine tool business by focusing on making a low cost, high quality machine tool that many shops could afford to buy. They were one of the first companies to have several models of machine tool in the $50K range.
They did it by concentrating on the economics of a machine tool that was profitable in operation. That means a machine with a low cost to purchase, low operating and maintenance costs, and sufficient precision to meet the requirements of most operations. In order to reduce their machine cost they had to develop their own controls platform. They restructured everything in the design and manufacture of the CNC system to meet the cost objective.
In act, they are so successful, that HAAS is the largest CNC company in the western world.
Many similar situations exist in other industries. In small plastic parts manufacturing there are a number of breakthroughs that have created lower cost parts in smaller batches based on innovative new tooling systems. In metal fabrication there are new process like thixotropic molding and metal injection molding that have been developed to lower the cost of metal goods by making parts at lower costs. These solutions are focused on reducing costs and other barriers to the entre of new products like tooling costs and minimum batch sizes. And they represent major new markets that were not possible in the past, because they are focused on the economics of the industry they serve. Decreasing the cost of entry and the cost of part manufacturing opens up new markets
So inventing the future can be technology. Or as it can be economics. It’s all innovation. And it’s all about delivering value.