Carrier Air Conditioning is hardly alone in shipping U.S. manufacturing jobs to other countries. They’re more visible given the the video release of the Indiana plant operations relocation to Mexico announcement to newly displaced workers.

Here’s the video: https://www.youtube.com/watch?v=Y3ttxGMQOrY.

The affair brings to mind an essay Jim Womack wrote in 2003, Move Your Operations to China? Do Some Lean Math First.

From news sources we know that Carrier’s Indiana workers earned 5 to 10 times the amount of the anticipated Mexican workers’ wage. If Carrier’s manufacturing labor component is typical for manufacturing that means they may be able to save 10% of manufacturing costs. That is not much given the currency, supply chain, political and quality risks Carrier is now incurring. Perhaps there are also substantial overhead costs going unmentioned that are forecast to be saved.

Carrier had at least two other options that would have kept these 1,400 jobs in Indiana. One, management could have admitted they failed, have no clue about how to lead a Lean transformation, and resigned. Two, management could have admitted they failed, brought in help to lead the plant in a Lean transformation, increase productivity so that manufacturing costs are less than forecast in the Mexican plant, saving 1,400 jobs in the process.

Sadly, Carrier chose Bulk thinking over Lean thinking, hurting families in Indiana as a consequence.