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How exports make you better
By Lawrence Maloney, V.P. & Editorial Director -- Design News, October 23, 1995
Twelve years ago, Robotron, a Michigan manufacturer of adhesive-curing equipment, stood on the brink of being liquidated. Today, the company is enjoying healthy sales, boasts several new products, and in 1994 won a prestigious U.S. Chamber of Commerce award for business initiative. The secret of Robotron's comeback: It decided to play the export game.
Thousands of other U.S. companies--and the engineers who design products for them--have enjoyed similar success by devoting an increasingly larger share of their resources to exports. As a percentage of gross national product, exports of manufactured goods rose to 10.7% last year--up from just 7.5% a decade earlier.
Not only are exports far more important to our general economy, but they can transform export-oriented companies into much better places to work, according to a new study, "Why Exports Really Matter," jointly developed by the National Association of Manufacturers and the Institute for International Economics in Washington. In analyzing companies that export, researchers found:
Employee pay, on average, is 15% better than it is for non-exporting firms.
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Worker productivity is 30 to 50% higher.
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Exporters adopt new technology far more frequently and intensely than non-exporters. This is true for some 15 technologies, ranging from total quality management to the use of CAE tools.
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Business at these companies tends to be more stable, with fewer shutdowns and greater job expansion.
Moreover, the report notes, these benefits accrue not just to the big multinational companies. Small firms enjoy similar benefits. "If you stay home, they'll come here and beat you at your own game," says Mitchell Saranow, CEO of Fluid Management, a small Illinois manufacturer of paint-mixing equipment. Nearly 60% of FM's sales come from exports, up from 25% six years ago. Without those exports, the company would be only 40% of its current size.
The underlying message in all this is that competing against the best companies worldwide forces U.S. exporters to embrace a philosophy of continuous improvement in every phase of business life--from compensation to R&D policy.
Fortunately, more and more engineers find themselves working for such companies. In a March poll of our readers, 70% of respondents said their companies are getting more aggressive in exporting their products. And 75% said they are very interested in learning about OEM products and product design strategies for world markets.
To get more insights on how exports are improving the outlook for thousands of U.S. manufacturers, call NAM for a copy of the new report at: (202) 627-3089.
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