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Innovation in Sourcing: US and Mexico

We interviewed Praveen Gupta, the Director of Innovation Science and Applications at IIT, School of Applied Technology and also the adjunct faculty for teaching innovation classes. He talked about he's experiences on working with Mexico.

"We have found that people in Mexico are fun to work with and have a very strong desire to excel in manufacturing. I think it is great for American companies utilizing additional resources in Mexico, not at the cost of manufacturing capabilities in the USA, but to supplement manufacturing in the USA"

Praveen is an internationally recognized thought leader in Process Management, Corporate Performance, Six Sigma and Innovation. He has also authored many books regarding business innovation in the 21st century. Praveen is the President of Accelper Consulting, which is an operations management consulting firm.

We understand you have experience working with companies in Mexico. What kind of work you have done with companies or institutions in Mexico?

We have worked with companies in San Carlos and other places where we have helped them align their manufacturing processes with the companies in Chicago and other areas in the US. We have found that people in Mexico are fun to work with and have a very strong desire to excel in manufacturing. I think it is great for American companies utilizing additional resources in Mexico, not at the cost of manufacturing capabilities in the USA, but to supplement manufacturing in the USA.

Recently, we have been working universities to bring our education on innovation in Mexico. We were so surprised that this was the first university where the President has committed to have the entire full time faculty to be trained in education to be innovative educators. I think it is a great commitment by the university. We are excited to be working with the universities in Mexico and companies in Mexico because it is an enriching and rewarding experience.

What kind of differences and similarities you have observed among companies in Mexico and USA?

In any evolving and developing economy the initial focus is on reproducibility in manufacturing. It is just like the USA for years where the focus was on manufacturing. Similarly, in Mexico the focus is on manufacturing. As the competency in manufacturing is achieved it leads to product innovations.

We find that in the USA companies are more focused on creating new products, new services where people are competing globally for the big market share. They have to keep up with the speed of customer demand and they may not be able to manufacture competitively if they just manufacture in the USA.
We have to supplement our manufacturing capabilities in the USA with the manufacturing capabilities in Mexico. The benefits of working with Mexico are that it is next door in the same time zone and at least there is some familiarity of the cultures between the two nations.

We recognize current focus is innovation. Can you share your innovation recent innovation experience in Mexico?

Product Life Cycles are shrinking. Companies in the USA have a challenge to produce new products faster and better. Companies in Mexico have a challenge to develop new manufacturing capabilities faster at the production level, not just the prototype level. Both of these economies and corporations in both countries have to focus on how they can bring in competency in innovation in-house so that they can quickly develop innovative solutions in product design, manufacturing or information technology – rapidly to meet the customer's demands and to sustain profitability.

How can innovation help in designing sourcing solutions in USA and Mexico?

Sourcing is the right approach when two companies work together. Outsourcing or Offshoring is just a name given to suppliers or partners that are not on the mainland USA. In a global economy offshoring and outsourcing means going to some other planet. We are not talking about another planet. We are talking about a next door neighbor.

What we have to look at is what are the constraints in the USA in reproducing the products quickly and what are the strengths in the USA that would allow us to produce quickly. Similarly, we need to learn in Mexico what are the strengths in supporting new product development or information technology or manufacturability? What are the opportunities or weaknesses that could be addressed? It is looking at the strengths and weaknesses of both countries and the constraints. We need to find a way to optimize them and take an innovative approach to developing manufacturing design and development solutions. Both companies have some challenges. For example, in the USA the development and design process could be much better than it is today. I think manufacturing in Mexico has been very good but there is room for improvement. Some things they can do to improve include improving communication with American companies, providing more timely responses and better align with the needs of management and the mindset. I think that will create a more cohesive approach to helping companies in both countries. That is a very innovative approach.

What kind of relationship can be useful between corporations in US and Mexico?

We have learned that with any team one and one should not become two; one and one should become eleven. If you put one next to the one it becomes eleven. Similarly, it is not a zero sum game for companies in Mexico and companies in the USA. It is the eleven game. You have to basically multiply by an order of magnitude the capabilities of each other so that you both benefit tremendously.

praveen-gupta-innovation-sourcing-mexicoInnovation and Six Sigma Trainer and Consultant
Director, Center for Innovation Science and Applications at Illinois Institute of Technology
President at Accelper Consulting

Posted by Dustin Mattison on Dustin Mattison's Blog

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