Taking Innovative Casting Technology To Your Bottom Line
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Monthly archive for April 2011

We can see the finish line for the first step of our ISO 9001 journey

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

While Graphicast has always maintained a reputation for quality products, we did not have a lot of market pressure to become an ISO-9001 registered supplier. Our customers were happy with our quality system and we regularly passed quality audits. That is, until the recession hit us square in the face. We found very quickly that in response to the recession, many companies were actively strengthening their supply chains. Besides ensuring that their suppliers were financially viable, they were also trying to eliminate internal costs associated with working with those suppliers. One way to reduce costs was to reduce vendor audits and any vendor uncertainty. This put the pressure on us to be able to succeed in this environment. So began our ISO 9001-2008 registration and certification journey.

With a good production quality system in place. our efforts were aimed at the documentation and control aspects of the ISO quality system. We’ve made a lot of progress in the past nine months and just completed our certification stage 1 audit. Based on the results of that audit, we have our registration audit scheduled for the end of July.  If all goes well, we will have completed the first part of the ISO journey, getting our ISO 9001-2008 certification. Then the challenge of maintaining and improving the system begins. We’re looking forward to it!

Are You Ready for “The Sixth Wave”?

“Geoff Forester photograph, courtesy of the New Hampshire Community Loan Fund”.

No, I’m not talking about surfing. I’m talking about an economic wave that’s in its early stage of emergence and will drive our economies for the next 50 to 60 years. In the 1920s, a Soviet economist, Nikolai Kondratiev, studied capitalist economies and noticed that they went through repetitive cycles of expansion and contraction. These  “Kondratiev Waves” last about 50 years. He identified the first wave as occurring in the early 18th century. His ideas eventually lead to his execution in the late 1930s, but other economists continued his work, trying to understand the reasons for these cycles. Although this theory is not universally accepeted, it does offer insight into societal, political, and technological changes that have occurred throughout history.  In the 1980s, Cesare Marchetti offered supportive research when he wrote about society as a learning system and decribed Invention/Innovation Cycles whose ebb and flow correspond to these economic waves.

The Kondratiev Wave consist of four periods. As liquidity expands in the initial phase of the cycle, commodity prices rise reflecting the increasing business activity and inflation. As business activity and inflation accelerate, speculators bid up commodity prices due to their fear that inflation will continue to accelerate. After the rate of inflation peaks and starts to fall, the acceleration premium is removed from prices. Thus, commodity prices start to fall despite continued but slowing inflation, a trend called disinflation. At the same time, a change in psychology away from fear and toward feelings of relief and hope induces people to channel the excess purchasing media created during disinflation into bidding up the prices of investment assets such as stocks. Because inflation continues, the wholesale prices that manufacturers charge for finished products, the retail prices that stores charge for goods and the levels of wages that employers pay for labor all continue to rise but at a continously lesser rate, following the rising but slowing trend of business activity and inflation. Near the end of the cycle, the rates of change in business activity and inflation flip to zero. When they fall below zero, deflation is in force. As liquidity contracts, commodity prices fall more rapidly, and prices for stocks, wages and wholesale and retail goods join in the decline. When deflation ends and prices reach bottom, the cycle begins again.

Most who subscribe to the Kondratiev Wave theory identify our current economic situation as being in the last phase of the fifth wave cycle. The authors of The Sixth Wave have suggested that the emerging wave will be powered by the economics and technology of scarcity. Those who can do more with less and reduce waste will prosper. Industrial trends such as Lean Manufacturing, Six Sigma, and Theory of Constraints are all associated with elimination of waste, reduction of variability, and improvement of production velocity. These practices support a Sixth Wave mentality. 

At Graphicast, we recently described our experience with a customer who worked with us to take an expensive assembly of four machined components and turn them into a single, economical casting that was stronger, more rigid, and less wasteful to produce. There are many more opportunities to reduce costs by redesigning and rethinking your needs, than by just making the old design “cheaper” by outsourcing to a low labor cost area. In the long run, the better design is the most productive way to succeed in the Sixth Wave economy.

Good luck getting ready for the next wave. We may not yet be out of the Kondratiev “winter”, but prosperity awaits those who embrace the upcoming “spring”.

Graphicast on the Road at AmCon, Denver, April 26 and 27

Graphicast will be in Denver from April 26, 2011 – April 27, 2011, exhibiting at the  AmCon (American Contract Manufacturing) Show. We will be in Booth 416. Stop by for the latest information on our cost saving metal casting technology.


Taking Innovative Casting Technology to Your Bottom Line™

Graphicast Inc.

PO Box 430 36 Knight Street,
Jaffrey, NH 03452
phone: 603-532-4481
fax: 603-532-4261