Foundry is a tough business. Surviving, let alone achieving, long-term growth, is challenging. The goal of this series is to provide some perspective and tools that foundries may use to develop sustainable, profitable growth. The vantage point is my experience first as a supplier to the global foundry industry, and more recently as a strategist in the metalcasting sector. I have attempted to frame the challenges and opportunities for growth specifically for foundries, using a number of tools and techniques used by strategists.
This article sets the stage by taking a look at the big picture. These are observations that I believe are important for defining the boundaries in which most foundry growth strategies must be derived and delivered.
Observation 1: 'Foundry' is not an industry. Let's get something straight: "foundry" is not an industry. A foundry is a place where castings are produced, or the process that transforms molten metal into a cast metal part. Referring to foundry as an industry has strong and historic precedent, probably originating with the pre-industrial age craft guilds, and promulgated today by the fraternity of foundrymen and trade associations.
To be clear, the foundry process is unique and referring to 'foundry' as an industry is useful in many ways. However, from strategic perspective, focusing on foundry as a place and a process makes us too internally focused, and prone to miss a bigger picture. It creates a "if we build it, they will come" mindset for the business. Instead, our approach should start be "what should we build, market, or sell."
Referring to metalcasting as the market gets us closer to what's needed as the basis of a growth strategy. Better yet, careful segmentation of end-use markets and sub-segments is necessary to gain the best understanding of the most substantial growth opportunities.
|The rate of increase in production of cast products is not consistent with the increase in the value of those products.|