Reigniting American Manufacturing

Last month I shared with you that I would periodically use this space to communicate key information.

At the end of January I was one of several presenters on innovation at the National Institute for Standards and Technology Manufacturing Extension Partnership (NIST MEP) national quarterly update meeting.

It was a signature moment because the MEP program has evolved and last week the national leadership rolled out a transition to a new MEP Center performance and evaluation system.  Changes-in-brief:  Increased focus on Center performance in two key areas, among others.

1. Growth for manufacturers (new sales, creation of new jobs)
2. Innovation (enables growth and diversification)

NIST MEP Transition to Innovation – Historically the NIST MEP Network focused on Lean Manufacturing Systems – based on research on company needs, and specific requests from MEP clients, NIST MEP nationally has partnered with innovation experts in private industry and at universities to develop a reliable system for using innovation to drive sales growth with current and new customers.

Companies tell us their two big problems with innovation is it can take a long time and it can be risky. The system is called Innovation Engineering – it’s a system that has been shown to increase innovation speed up to 6x and decrease risk by 30 to 80% – a system that has worked regardless of the industry sector or type of organization, even not-for-profits.  The bottom line for manufacturers — we have a system for creating and implementing an Innovation Pull System in your company.  The graphic below was drawn by Erick James, a colleague of mine here at CEG; Erick was recently certified as an Innovation Engineering Black Belt – a rigorous process that includes writing a provisional patent and taking a final

exam that lasts more than 40 hours.  Don Wiesenforth, another CEG colleague, is in the process of taking his final exam; and, both Jeff Lawrence and I are in the process of going through the training.  Over time additional CEG staff will be trained as Innovation Engineering Black Belts — this all contributes to CEG’s transformation into an MEP Innovation Center and dovetails with the national NIST MEP FY 2012 focus of making the MEP Innovation System a reality.

To fully achieve the transformation of each Center into an MEP Innovation Center requires that each Center develop an Innovation Plan integrating services that address Next Generation Strategies.  The outcomes we are seeking are clear . . . the transformation of U.S. manufacturing . . . the MEP System is clearly focused on Reigniting American Manufacturing.

To ensure success, MEP must transition our products, our services, and our evaluation system.  To achieve the latter, MEP is implementing a Balanced Scorecard approach to reviewing each statewide MEP Center.  Going forward 50% of each Center’s performance review will be based on Client Survey Impact Metrics and 50% will be based on a NIST MEP Review of Center Diagnostics in six areas:  Innovation Practice, Next Generation Strategy, Market Understanding, Business Model, Partnerships, Financial Viability.

The CEG Grow Team will continue to focus on delivering world class services to Capital Region manufacturers — in doing so we know we will continue to lead the nation and retain the recognition and status as one of the top performing Centers within the NYMEP as well NIST MEP nationally.

I encourage every manufacturer throughout the Capital Region to take advantage of the growth opportunities available through MEP’s Innovation Engineering System, especially since these can and will be supported by National Grid’s Manufacturing Productivity Program; however, the National Grid program funds are expended on a First Come, First Serve basis so don’t wait and risk missing this opportunity – we are the envy of other states and other region’s thanks to National Grid!!

New York is the Empire State . . . together with Innovation and Growth we will Reignite Manufacturing in New York State . . .

Excelsior!!!

Louise

Why Innovation? Why Now?

Reigniting American Innovation and Growth Starts with Leadership

Year-end message from the CEN Executive Director; this will be a periodic message focused on issues relevant to manufacturers in 2012.

Greetings Everyone -

As we close out another year and contemplate our accomplishments for 2011 as well as our desires for 2012, I wanted to take a moment and share with you WHY I am so passionate and persistent when it comes to innovation and American manufacturing.

As many of you know, I began Innovation Engineering Black Belt training back in July, and I am working on earning the IEBB certification.  I am incredibly lucky and so honored to work with a team of consummate professionals at CEG and with an equally incredible team of 1,300 nationwide throughout the Manufacturing Extension Partnership system.

Competitively, the United States is failing — especially US manufacturing which is in crisis with almost 6 million jobs lost and 42,000 factories closed over the last decade (Source:  Rob Atkinson, Information Technology and Innovation Foundation).

But take note in the following chart that the majority of job losses were experienced by the larger companies.  This is what makes the news.  The red and blue lines superimposed over each other at the bottom of the chart indicate that medium and smaller firms held employment relatively steady over the past 30 years — about 800,000 jobs collectively – almost equaling larger firm employment in 2010.

Source:  http://www.ces.census.gov/index.php/bds/sector_bar_charts

Even with the current state of affairs for US manufacturing, we know Manufacturing = Jobs and restoring manufacturing will require effort on everyone’s part.  Manufacturing has traditionally meant secure, well-paying, middle-class jobs until recently.

Increasing manufacturers’ capacity for innovation resulting in profitable sales growth is the overarching strategy for the MEP system nationwide.  The approach is to provide a framework for manufacturers that reduces bottom line expenses and adds to top line sales — this is key because no one can cost cut their way to profitability.

This is why I spend so much time talking about the importance of innovation, and why CEG has invested time and energy in this endeavor — we are seeing the fruits of our labors pay off with increased confidence in manufacturing execs ability to lead growth within their companies, and in both top and bottom line growth within those companies.

No one person or entity can do it alone though, and so I am blessed to have access to a community of Innovation Pioneers within the national NIST MEP system.  Leaders such as Roger Kilmer, Aimee Dobrzeniecki, and Mike Simpson at NIST MEP headquarters, and Doug Hall and his team who are the thought leaders behind the Innovation Engineering Management System that all NIST MEP centers are using for their own growth as well as to help US Manufacturing grow.

Another one of those Pioneers is Cathy Renault in Maine; she recently sent a note to Doug sharing:  ”A few weeks ago, one of the Pioneers referenced a guy called Simon Sinek, and his book, Start With Why. I quickly sent off to Amazon for this book, and it’s a great read. He has two key points. The first is that great leaders can articulate the Why of what they are doing — e.g., Martin Luther King, Steve Jobs,  etc. The second point is that having a powerful Why allows the followers to internalize the message, and makes the work so much more powerful. . . . “

This issue of the “why” is a big one.  Doug Hall recently shared with us that he started reading Friedman and Mandelbaum’s book “THAT USED TO BE US.”  Doug shared the following excerpt with the NIST MEP Innovation System Leaders to speak to our purpose and WHY this is so important.   The sections in bold italics are added by Doug.

“All the talk about China is likely to give any American over the age of forty sense of deja vu.  After all, we faced a similar challenge from Japan in the 1980′s. The challenge that Deming, Universities and Dept. of Commerce took a leadership roll in addressing.  It ended with America still rising and Japan declining.  It is tempting to believe that China today is just a big Japan. 

Unfortunately for us, China and the expansion of globalization, to which its remarkable growth is partly due, are far more disruptive than that.  Japan threatened one American city, Detroit, and two American industries: cars and consumer electronics.  China – and globalization more broadly – challenges every town in America and every industry.  China, India, Brazil, Israel, Singapore, Vietnam, Taiwan, Korea, Chile, and Switzerland (and the list could go on and on) pose a huge challenge to America because of the integration of computing, telecommunications, the World Wide Web, and free markets.  Japan was a tornado that blew through during the Cold War.  China and globalization are a category-5 hurricane that will never move out to sea.

Charles Vest, the former president of MIT, observed that back in the 1970′s and 1980s, once we realized the formidable challenge posed by Japan, “we took the painful steps that were required to get back in the game.  We analyzed, repositioned, persevered, and emerged stronger. We did it.”   

“This time around something much more comprehensive is required.” said Vest, “it requires a public awakening, establishment of political will, resetting of priorities, sacrifice for the future, and an alliance of governments, businesses, citizens and Universities.  It requires truth-telling, sensible investment, (leading established customers with new technologies and adapting for new customers and export markets)  a rebirth of civility, and a cessation by both political and corporate leaders of pandering to our baser instincts such as believing that we can cost cut our way to growth OR that if we do nothing the economy will magically resolve itself.  

Engineering, education, science, and technology are clearly within the core of what has to be done. After all, this is the knowledge age.  The United States cannot prosper based on low wages, geographic isolation or military might.  We can prosper only based on brainpower: properly prepared and properly applied brainpower.”

The revolution poses an educational challenge – to expand the analytical and innovative skills of Americans – that is no less profound then those created by the transition from plow horses to tractors or from sailing ships to steamships.”

As I indicated above, the United States of America cannot cost cut itself into prosperity any more than any company or individual can.  A friend and mentor in Wyoming is retired and he never needs to work again — yet, he is as passionately committed to innovation growth in American manufacturing as I am.  He recently stated, “In the broad sweep of history this is going to prove to be an inflection point.”

CEN Manufacturing, as a community of manufacturers, and the United States, as a country, owes it to ourselves and to the generations to come to Create, Communicate, and Commercialize Meaningfully Unique products and services.  The NIST MEP System, and CEG here in the Capital Region, are leveraging a process to help companies continually develop their innovation pipeline with the promise of a sustainable innovation culture that increases innovation speed up to 6x and decreases innovation risk 30-80%.  CEN Manufacturing members are uniquely positioned to lead by increasing their individual and collective capacity for innovation resulting in profitable sales growth.

Our singular purpose is reigniting American Innovation and Growth.  I cannot think of a better present to give my little nephews and for you to give your descendants — the gift of opportunity in the greatest country in the world.

May you and yours have a wonderful Holiday Season!!

Louise

CEN Manufacturing Member Featured in The Business Review

Solid Sealing Technology Inc. was featured in The Business Review today; the article quoted Gary Balfour, co-founder and president of SST, and CEN Chairman.  The focus was on U.S. Sen. Kirsten Gillibrand’s (D-N.Y.) announcement in support of making the federal research and development tax credit permanent.  In speaking with Gary Balfour earlier today, he credited CEN Manufacturing as the source of his knowledge regarding the tax credit citing a CEN program from a number of years ago.  You can read the entire article from The Business Review at the following link:  http://www.bizjournals.com/albany/news/2011/01/28/gillibrand-urges-making-rd-credit.html?ed=2011-01-28&s=article_du&ana=e_du_pub

Hugh Johnson Addresses CEN at Annual Meeting

Hugh Johnson at the CEN 2011 Annual Meeting

Hugh Johnson was the keynote speaker at the CEN Annual Meeting on January 26, 2011; the meeting was held at the Albany Institute of History & Art. 

Mr. Johnson shared his approach to developing his opinion on the economic outlook and how he identifies meaningful trends in order to position portfolios or businesses to participate in those trends.  He explained the anatomy of a cycle as well as the anatomy of a “mania” — the state of investment, speculation, financial distress, and revulsion — of which contribute to psyche of individuals and investors.  The attendees were then schooled in elements such as yield curves and quality spreads so that all understood the basis of his position and opinion.  Mr. Johnson stated, “the message of the financial markets is . . . the conditions that ordinarily accompany an ongoing recovery in the economy and earnings are in place.  We are in a gradual period of economic recovery.”

The audience was treated to Mr. Johnson’s forecast for: 

• The national economy
• Employment
• Consumer spending
• Industrial production
• Manufacturing employment
• Vehicle sales
• Short-term interest rates
• Longer-term interest rates
• Stock prices
• The New York State economy
• Housing

He then shared historic perspective through a discourse on the 1907 Financial Crisis which involved F. Augustus Heinze and Charles Morse; their actions led to panic and a run on the banks, and ultimately JP Morgan and others saved the day.  Mr. Johnson stated the root of quelling the panic in 1907 was restoring public confidence in the financial institutions and markets, and the same holds true today — public / consumer confidence is key to a sustained, long-term economic recovery.

Mr. Johnson is Chairman and Chief Investment Officer of Hugh Johnson Advisors LLC.

AWESCO Becomes Noble Gas Solutions

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Noble Gas Solutions team at the unveiling of updated image and branding on Nov. 12, 2010.

Capital Region BOCES to provide MSSC Adult Manufacturing Course

The Capital Region BOCES were recently awarded a grant to provide a Manufacturing Skills Standards Council (MSSC) certified manufacturing skills course in 2011. 

The course consists of 140 hours of instruction in four modules: Safety, Quality Practices & Measurement, Manufacturing Processes & Production, and Maintenance Awareness; as well as employability and academic skills. Classes are a blend of traditional instructor led classroom work, as well as online virtual training. An MSSC-Certified Production Technician (CPT) certification will be awarded to each participant completing the program. 

The MSSC provides a nationwide, industry-based skill standards assessment certification system for all sectors of manufacturing. The Capital region BOCES have partnered with the MSSC and the Greater Capital Region Workforce Investment Boards (WIB) to provide this training in order to help prepare a regional workforce capable of conducting advanced manufacturing production.  The course cost is $2,000 per attendee, but due to the grant, the BOCES will be able to provide a $1,500 subsidy to CEN Manufacturing member companies. In addition, CEN member company employees in management positions are able to take the course free of charge on an audit-only basis.

Classes will be held at the Myer’s Education Center campus of the WSWHE BOCES and the Career and Technology campus of the Capital Region BOCES. 

Anyone interested in participating in this program should contact the CEN (info@cenmfg.org), or by calling 518.465.9875 and ask for a CEN representative.  

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Incoterms ® – “You may not know what it is, but you need to!”

Here is a useful piece of information from one of the CEN Platinum Level Sustaining Members – Mainfreight – all manufacturers that do business overseas need to pay attention to this post!!

International Commercial Terms for International Trade are changing as of  January 2011, some new ones added and some old ones gone for good. Get all the information you need by contacting Tracey Belgiano, Mainfreight Inc. tracey.belgiano@mainfreightusa.com   You can get the latest chart by clicking on the file cabinet on our newest CEN website! Please also visit www.mainfreightusa.com