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Competitive Analysis of the P/M Industry

Chickery Kasouf

At the Spring 1998 meeting, the PMRC membership approved Competitive Analysis of the P/M Industry: Inter-Industry Cost Comparisons to complement and expand upon the Sloan funded work. This work involved two separate research initiatives, one which has been completed and one which is continuing.

The first initiative is the development of tools for economic analyses of alternative technologies. The emphasis of this project is expected to change from year to year, resulting in a series of case studies of components manufactured via different technologies. Process-based Technical Cost Models (TCMs) of materials production technologies have proven to be powerful tools to evaluate processes, alternative materials and alternative manufacturing technologies. This initiative on Inter-Industry Cost Comparisons was completed in June 2002 under the supervision of Professor Jacqueline Isaacs, and a summary of the work is included in the completed projects section of this area.

The second initiative of the project is the development of a statistical data base of P/M part producers. This phase of the research, which is conducted in conjunction with the Powder Metallurgy Parts Association (PMPA) is began in 2000 and is entering its seventh year of data collection. It includes three annual reports:

• Report A - Expenses, Asset Management, and End Sales Distribution (corporate)
• Report B - Operational Benchmarking Analysis (plant level)
• Report C - Wage and Hourly Survey (corporate level)

Each report includes a summary of each statistic (including mean, median, and quartile scores), a report of the responding company's performance ranked within the industry, and a trend line of mean and median values since the inception of joint data collection in 2000. Thus, each participating firm receives valuable benchmarking data that is very useful in operational planning and performance evaluation.

For example, below is a summary of the data on direct labor costs from the 2004 Report A. For a participating company, their data would be entered for benchmarking purposes, allowing the company to compare their performance to industry averages and see their rank relative to other companies in their size range.

These reports are made available for participants only although results can be disseminated as part of PMRC reporting after a "quiet period" to ensure that companies contributing data receive value for their participation. Results are also discussed with PMPA membership at the annual MPIF Fall Management Conference.

Presentation

Kasouf, Chickery J. and Craig Paullin (2004), "The PMPA/MPI Statistics and Benchmarking Project: A Four-Year Perspective," presented at the 2004 PM²TEC Meeting, Chicago, IL, June 15, 2004.

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Last modified: October 23, 2007 08:41:51