Foreign Policy magazine has an interesting article comparing US industrial practice to that in Germany. Here's an excerpt.
"We have a line of Cherry office furniture that's just flying out of the showroom," he replied. "Where do you make it?" I asked. "Well," he said, "we cut the cherry trees in West Virginia. They have the best cherry trees in West Virginia. Then we ship the logs to Germany where they peel the veneer. Then we ship the veneer to China where it is glued to the frame and then they ship the finished furniture to us in Wisconsin where we market and sell it." Astonished, I asked in a tone of disbelief, "You ship the logs to Germany? Is there no one who can peel veneer in America?" "Yes," he admitted, but went on to emphasize that "the Germans do it far better than the Americans."
Veneer peeling never shows up on the lists of high-tech industries and is never discussed when there is talk of the need for more Silicon Valley style start-ups and innovation. Nor do veneer peelers need advanced college degrees. Yet veneer peeling in Germany is so high-tech and so innovative that furniture makers are shipping logs and veneer around the world to get something done in Germany that one would expect to be easily done in the United States. Innovation and high tech doesn't have to be Google or Silicon Valley. It may not necessarily take a lot of basic Research spending (although certainly some D spending) or advanced formal education.
What Germany has is a lot of family owned, medium sized businesses and a government and society that are committed to the long term and to keeping German-based production competitive in as many sectors as possible. It also has a system of training and maintaining skills that doesn't turn out PhDs, but does turn out supremely qualified workers. And, of course, to gain full advantage from those skills, it strives through cooperation between industry, government, and labor to keep producers competitive from a German production base.
There's more at the link.
I think the article is a little simplistic, in that it doesn't take into account the nature of the products manufactured in each country, or consider imports, consumption, etc. Nevertheless, it raises interesting questions. Recommended.