The Beer Game -or- Why Apple Can’t Build iPads in the US • Hacker News Board

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#131

Post by travem » Thu, Apr 05, 2012, 5:21 PM UTC

e40 wrote: post #98

acslater00 wrote: post #54

Earlier quoted context omitted.

That's a myth. The US has a huge and growing manufacturing base. We make airplane engines, medical devices, computer chips; all kinds of complex, high-tech manufacturing. We have the highest manufacturing productivity per worker in the world. What we don't make anymore are the kinds of products that require rote assembly tasks, like shoes and clothes and iPads. The upshot is that we have decreasing manufacturing empl…

You realize I didn't mean we manufacture nothing, but that we manufacture much, much less than we used to, right? If we can't agree that manufacturing started to move out of the US decades ago, was accelerated by NAFTA, and that we are a consumer of goods made elsewhere (more than others are a consumer of goods made here), then this conversation isn't going to go well.

Here's a good article to read on the subject http://www.washingtonpost.com/opinions/a-welcome-rise-in-man...

In summary US manufacturing output is increasing and US manufacturing output exceeds that of China by about $100B, but only employs about a tenth as many workers as China.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#132

Post by jsz0 » Thu, Apr 05, 2012, 5:21 PM UTC

Do we even have the affordable housing & mass transportation required for something like this anymore? The 'FoxConn cities' in China look a lot like the old factory towns in the United States that have mostly disappeared. Even with the huge number of home foreclosures most cities simply do not have affordable housing for an influx of even 100,000 people. Most cities don't have the mass transit capacity to carry them to work. They don't have room in their schools for tens of thousands of new students. They could be built of course but it's not a turn-key solution the way it is in China. If Apple started the process today I bet it would take 5-7 years at minimum.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#133

Post by kevinalexbrown » Thu, Apr 05, 2012, 5:24 PM UTC

farnsworth wrote: post #128

kevinalexbrown wrote: post #79

From a practical perspective, it seems to me that the Beer Game rests in three parts: in imperfect information, time delays, and most importantly, independence of agents. If each member of the supply chain knew consumer demand perfectly far enough in the future, they could compensate. Likewise, if each member of the supply chain could instantly scale their process, they could compensate. The key, though, is that even…

Couldn't the factory have hired temporary/seasonal workers?I know that only helps for these cases where you know something about the demand ahead of time though.

That's what they tried to do indirectly via college students. Due to labor agreements with the union, everyone had to join, but most college students didn't stay on and pay the full union dues when they knew they'd be heading back to school. Every hire had a 3 month probation period, but they couldn't just hire a ton of people every summer and systematically terminate their employment after the 3 months when the summer was over.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#134

Post by mkswp » Thu, Apr 05, 2012, 5:25 PM UTC

RedwoodCity wrote: post #103

There are plenty of counter examples to this. Boeing has suppliers for key components for its airplanes as far away as Italy and Japan. Toyota and BMW assemble vehicles in the US from imported parts. A CPU from intel is often fabricated in a US based factory, tested in Costa Rica, and packaged in Asia. The issue has too many variables related to margins, tax breaks for factories, and import tariffs; to say the whole…

Some good points here. There are a lot of variables however, Boeing has run into the problem of the bullwhip effect too with the Dreamliner: http://articles.latimes.com/2011/feb/15/business/la-fi-hiltz...

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#135

Post by hkmurakami » Thu, Apr 05, 2012, 5:26 PM UTC

There's another, perhaps overlooked, place that does exactly what the author proclaims as China's manufacturing advantage (proximity, flexibility, etc). And it shouldn't be surprising: It's Toyota's auto manufacturing empire in Aichi Prefecture, Japan.

Aichi is only 2000 square miles in area[1], and Toyota's supply chain is concentrated on its Eastern half. It takes less than 1 hour by car (or more relevantly, by truck) to travel between all of the major players in the supply chain (Aisin, Toyota Industries, Denso, etc). Of course, all of Japan's manufacturing is in Jeopardy with increased manufacturing costs and the strong yen (which are analogous to what HN posters here have discussed as distinct Chinese advantages over US manufacturing).

Another place that I suspect has a similar centralized, flexible manufacturing ecosystem: Germany's auto industry (with the granddaddy of all industrial suppliers, Bosch, situated right in the middle of it all).

[1] http://en.wikipedia.org/wiki/Aichi_Prefecture

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#136

Post by mindslight » Thu, Apr 05, 2012, 5:28 PM UTC

damoncali wrote: post #122

mindslight wrote: post #109

Earlier quoted context omitted.

As a general negotiation technique for assigning of responsibility, sure. But management at both Chinese factories is still small and in touch enough to know that if 1M unneeded custom parts are produced, it's a waste no matter how the financial cost is split. American companies meanwhile are so deep in overabstraction and middle management that the individuals are only capable of covering their asses and claim to ha…

I don't think it's a false piece of mind. Managers at Dell, for example, know all about the bullwhip effect. They also know that when buying commodity parts, you can generally source from more than one supplier. If you squeeze one too hard and they die, you just get another one because they're lining up to serve you. You can't "solve" the bullwhip effect - you can lessen it. You can use IT, training, etc. And you can…

The original article is a little inconsistent, focusing on self-oscillation (bullwhip effect), but driving the point home with response time to changing requirements.

Adding bandwidth and damping lessens the bullwhip effect so it isn't the show stopper. It's the response time to changing requirements that's the hard part. If the specifications of a screw need to change and all similar screws are produced in China, having a distributor already stocking (productionUseRate * leadTime) quantities of previously-unneeded types of screws is going to cost a lot more when leadTime includes crossing an ocean. Pretending that the distributor can solve this problem is going to (at best) cost you up front or (worse) end with a large delay as it turns out the distributor doesn't really have that many unallocated screws of the newly needed type. (Actually, connectors are a much better example than screws)

And no, nothing I've said has anything to do with nationality, but everything to do with relative age of economies, their levels of ossification, and fundamentally failing to see through abstractions to underlying realities.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#137

Post by excuse-me » Thu, Apr 05, 2012, 5:30 PM UTC

nknight wrote: post #117

excuse-me wrote: post #102

Earlier quoted context omitted.

If people that work on an assembly line in a factory in the US are middle class - what's the definition of working class?

"Working class" is a terrible misnomer for "lower class" or "poor".

Not where I come from it isn't.

I'm working class, I come from a pit village in N. England, my father was a miner, my family were miners or steelworkers.

I now have a PhD in physics and work in aerospace, but I'm still working class! And for most of my life (certainly my academic career!) I was poorer than most working class people with union jobs on assembly lines.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#138

Post by Caballera » Thu, Apr 05, 2012, 5:30 PM UTC

jgervin wrote: post #74

Cost is the main driver here. I am lefty, but I agree the unions are a little out of control. I am sorry, but a guy who stands in a production line building cars should not be making $125k per year (source was a series on TV, think 60 minutes where they talked to some of those workers). I am glad unions are there to help make sure people are not overworked and have benefits, but come on guys. You shot yourself in the…

Not only salaries, but also benefits. I think Health Care Insurance (that the company provides)is often overlooked. American Health Care cost for businesses has increased a ton over the last few decades.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#139

Post by showerst » Thu, Apr 05, 2012, 5:37 PM UTC

_delirium wrote: post #61

showerst wrote: post #36

Earlier quoted context omitted.

It's not that they necessarily want factories, it's that they're looking for stable career for life jobs for people with _low skills_, which is the difficult part. There are tons of openings in the US for plumbers, and (i believe, not sure post housing boom) also electricians, welders, pipe-fitters, etc. The problem is that these are all jobs that require a few years of training, which the US system isn't very well s…

The problem is that these are all jobs that require a few years of training, which the US system isn't very well set up for. Automation is also making the skill/demand curve look more step-like I believe, where your value stays near zero up until you cross the "better than a machine could do" threshold, instead of scaling in some more smooth way. That makes it harder to get training on the job by just taking low-end…

That's an interesting point, and one that further suggests that we're better off shifting to more services and less manufacturing for the low-end stuff.

Eventually automation might replace the bottom level of nurses and plumbers, (more so nurses than plumbers), but it will take _much_ longer.

I have some family/friends who are in that 'only high school diploma, no credentials/money/drive to go to a non-community college' trap, and one big barrier is that the training programs for Nursing Aides, Auto Tech, and even office/clerical have 1 year+ wait times. Even though they _want_ to gain these skills, they need to support themselves until they get into the program, and while they're working through it.

Even though there's great demand for the skills, and workers who want to gain them, the training pipeline just hasn't expanded yet.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#140

Post by showerst » Thu, Apr 05, 2012, 5:41 PM UTC

excuse-me wrote: post #137

nknight wrote: post #117

Earlier quoted context omitted.

"Working class" is a terrible misnomer for "lower class" or "poor".

Not where I come from it isn't. I'm working class, I come from a pit village in N. England, my father was a miner, my family were miners or steelworkers. I now have a PhD in physics and work in aerospace, but I'm still working class! And for most of my life (certainly my academic career!) I was poorer than most working class people with union jobs on assembly lines.

Those words have slightly different meanings in England vs the US I think.

In the US upper vs middle vs working class is related to income and lifestyle. If you're a coal miner who somehow makes 80k/year (i just made that up, who knows if it exists) you'd be firmly middle class in popular discourse the US, despite the fact that you're in a working class job.

Similarly one auto-plant can pay union workers 70k (middle class) and non-union 30k (working class, or at least on the line) for the same job.

I think in the UK it's more delineated by job and upbringing than income, right?

Note that I'm just speaking out usage by normal people/media, those words (although usually avoided in favor of income deciles) can be given specific definitions in academic research.