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T business concentrations that focus on heavy manufac- turing—but what's happened is that b-school adminis- trators are expanding their view of what counts as man- ufacturing. They've also revised their opinions on just what skills managers need when they enter the industri- al world. Today's manufacturing-oriented business course is surprisingly integrated across core disciplines, as administrators stress that students need to under- stand the entire commercial enterprise to add value to any business that is producing goods. "What many schools have done is to broaden their he rise of the knowledge economy has vast- ly undermined the importance of the man- ufacturing sector and led business schools to concentrate on more glamorous business functions as they train MBAs for the cor- porate world. Or has it? It's true that fewer schools today offer sector, the sector still accounts for 22 to 25 percent of the gross domestic product, notes Gerald Susman, Klein Professor of Management and co-director of the Quality Manufacturing Management program at the Smeal College of Business Administration, Pennsylvania State University in University Park. That percentage hasn't changed much for 50 years, he adds. "So the people who do remain in manufacturing add a significant amount of value and will continue to add value," he says. "It's important to focus on how to plan for it, how to be technologically sophisticated, and how to intro- duce new technology to manufacturing." Given these factors, McDermott says it's unfair to scope," says Christopher McDermott, associate professor at the Lally School of Management and Technology, Rensselaer Polytechnic Institute in Troy, New York. "They don't call it manufacturing; they call it operations, which includes manufacturing and service organizations. A lot of the same techniques used in a manufacturing environment are readily transferable to a service envi- ronment. For instance, many of the quality of manage- ment principles that people got fired up about in the '80s are now being applied to health care and service environments. Obviously, a lot of that shift in focus has to do with where the jobs are." While fewer people are working in the manufacturing claim that manufacturing as a field is dead. "There can't just be a knowledge economy where people don't under- stand operations, which is the transformation process of converting some kind of raw material into a finished good at a higher value. An understanding of operations is still relevant to what makes companies tick. There are different focuses today on what people are doing in oper- ations, but there are still a lot of people making things." It's All About the Process Much of what's being taught today in manufacturing- oriented management classes revolves around hot busi- ness topics such as lean manufacturing, Six Sigma, and supply chain management. Many of these, say adminis- trators, really boil down to process improvement—how can any company streamline or upgrade? Moreover, process improvement has vast implications for both the manufacturing and service industries. "When you really think about it, there's an awful lot of commonality between service processes and manufac- turing processes, whether you're making widgets or delivering services," says Peter Ward, professor of opera- tions management and director of the Center for Excellence in Manufacturing Management at Fisher College of Business, The Ohio State University, Colum - bus. "If you go into a manufacturing company, you'll see that tons of services processes are there. The truth is, if a factory has been working for 100 years, there's been 100 years of effort going into making that process as good as people can make it. So the real potential for savings is not in making widgets; it's in getting the order from the cus- tomer to do whatever triggers the making of the widget, and all the other ancillary processes that are involved in designing the widget. If we can get better at those processes, that's where the real savings will be." Old topics are also getting fresh spins in today's man- ufacturing management courses. For instance, managing logistics might be recast as supply chain management. McDermott shows students how Wal-Mart saves time and money by forgoing warehouses, instead transferring goods directly from one truck to another. "That's really managing an operations function," he says. Process improvement leads to efficiency, which improves com- petitiveness. "How do you configure your processes, how do you arrange people, where do you locate? These are all operations functions," says McDermott. Lean management, which focuses on techniques to make processes waste-free and enhance value creation, is another popular subject in schools, and one that can be broadly applied across industries. Hospitals and finan- cial services are extensively using lean manufacturing, BizEd NOVEMBER/DECEMBER 2004 31