The Focused Factory

The Focused Factory

Wickham Skinner

Harvard Business Review
No. 74308

HBR
MAY–JUNE 1974

The Focused Factory
Wickham Skinner

The conventional factory attempts to do too many conflicting production tasks within one inconsistent set of
manufacturing policies. The chief result is that the plant
is likely to be noncompetitive because its policies are not
focused on the one keymanufacturing task essential to
successfully competing in its industry. In this article, the
author discusses the concept of focused manufacturing,
which offers the opportunity both to stop compromising
each element of the production system and to build on
competitive strength.

The threat posed by foreign competition, the problem of industries suffering from ‘‘blue-collar blues,’’
and theincreasing complexity and frustration of life
in the factory have forced public attention back to
the industrial sector of the economy. Many years of
taking our industrial health and leadership for
granted abruptly ended in the 1970s when our declining position in world markets weakened the dollar
and became a national issue.
Author’s note: This article is an analysis based on my caseswritten
in the electronics, plastics, textile, steel, and industrial equipment
industries, supplemented by recent project research in the furniture industry. Financial support for this work provided by the
Harvard Business School Division of Research and course development funds is gratefully acknowledged.
Mr. Skinner is the James E. Robison Professor of Business Administration at the HarvardBusiness School. His research and teaching have centered on the problems and opportunities of U.S.
manufacturing companies, particularly in regard to the relationship between production operations and total corporate results.
He is a five-time HBR author, including ‘‘The Anachronistic Factory’’ (January–February 1971).
Copyright

In the popular press and at the policy level in government, the issuehas been seen as a ‘‘productivity
crisis.’’ The National Commission on Productivity
was established in 1971. The concern with productivity has appealed to many managers who have firsthand experience with our problems of high costs and
low efficiency.
So pessimism now pervades the outlook of many
managers and analysts of the U.S. manufacturing
scene. The recurring theme of this gloomy viewis
that (a) U.S. labor is the most expensive in the world,
(b) its productivity has been growing at a slower rate
than that of most of its competitors, and therefore
(c) our industries sicken one by one as imports mushroom and unemployment becomes chronic in our
industrial population centers.
In this article, I shall offer a more optimistic view
of the productivity dilemma, suggesting thatwe need
not feel powerless in competing against cheaper foreign labor. Rather, we have the opportunity to effect
basic changes in the management of manufacturing,
which could shift the competitive balance in our
favor in many industries. What are these basic
changes? I can identify four:
1. Seeing the problem not as ‘‘How can we increase
productivity?’’ but as ‘‘How can we compete?’’
2.Seeing the problem as encompassing the efficiency of the entire manufacturing organization, not
only the efficiency of the direct labor and the work
force. (In most plants, direct labor and the work force
represent only a small percentage of total costs.)

1974 by the President and Fellows of Harvard College. All rights reserved.

3. Learning to focus each plant on a limited, concise,manageable set of products, technologies, volumes,
and markets.
4. Learning to structure basic manufacturing policies and supporting services so that they focus on
one explicit manufacturing task instead of on many
inconsistent, conflicting, implicit tasks.
A factory that focuses on a narrow product mix
for a particular market niche will outperform the
conventional plant, which attempts a...