Keynote Address at Manufacturing Innovation 2012
May 7, 2012
Roger Kilmer, Director, Hollings Manufacturing Extension Partnership
Hello everyone, and welcome to Manufacturing Innovation 2012. It's great to be standing here today surrounded by this incredible crowd, knowing that each and every one of you is focused on returning manufacturing to the predominant role it has, and can again play in the United States.
Today, there are individuals in this room from many different organizations. Just look at your table, look around the room, and at the exhibit booths. These are organizations, which I am proud to say come together to create OUR manufacturing community.
This year, an increasing number of U.S. manufacturers from around the country are joining us. Our goal is to show you what's new in manufacturing and to open doors to new business opportunities. You're the cornerstone of our economy and the real reason we're all gathered here at this event.
Of course, many in the audience represent our MEP centers and their partners—our nationwide network of organizations—that are working with manufacturers to create jobs, increase sales, and become more competitive. Your efforts have empowered our manufacturers to overcome challenges, to grow and succeed!
And we're joined today by the many organizations that support American manufacturing. As you can see by this large array of logos, this includes our event and other business partners—everyone who shares a positive message about manufacturing. And I'd especially like to recognize our platinum partner, the Society of Manufacturing Engineers, for their support. I also want to thank SME for supplying lanyards for this event, especially since they're made by a U.S. manufacturer in New Mexico.
Together, you represent our American manufacturing community. Let's give a hand to all of our Manufacturing Innovation 2012 partners that have come together to support this event!
I truly believe in the importance of this event. We assemble annually to update you on our progress and to remind you we must learn from our experiences and must continuously evolve, improving our operations, our profitability, our competitiveness, improving manufacturing as a whole.
The world of manufacturing continues to change. It is changing faster every day. In my opinion, it is change for the better, for a better future starting today. Manufacturing is experiencing consistent job growth: in 2012 alone, more than 139,000 manufacturing jobs were created in our economy. Since the beginning of 2010, manufacturing employment has risen by 489,000 positions—pretty impressive progress—and MEP has played an ever-increasing role in this progress.
To further prove this for the folks in the audience that love data, the Purchasing Manager's Index continues to indicate manufacturing growth in 2012. In every month of this year, the index has exceeded 50 where rankings above 50 indicate industry expansion, and the really great news is that the index has exceeded 50 for 32 consecutive months. Yes, for 32 consecutive months, manufacturing has experienced growth. For you NFL fans, that means U.S. manufacturing has been expanding through two seasons of football and three drafts.
In 2012, the spotlight is squarely on manufacturing. Everywhere you turn, you hear someone talking about manufacturing. We ARE finally the "in" thing. With everyone from the media to the political pundits to your neighbors, they're all talking about manufacturing. It's now clear: we need to be a nation that makes things!
At last year's conference, our theme was innovation. We emphasized the importance of innovation and encouraged manufacturers and the MEP system to embrace the concept of innovation as a path to new business growth. So this year, it should be no surprise that we repeat the theme. We re-emphasize the need for us to be all in on innovation because we need to go further and faster so that MEP centers can help their manufacturing clients innovate—it's that important! We don't want to just tell you TO be innovative, we want to show you HOW to be innovative.
Now, everyone here probably has a different definition that comes to mind when I say the word innovation. But at the end of the day, innovation is finding a solution to a problem that helps our manufacturing clients be more profitable and grow. I firmly believe that America is the best at doing this—being innovative.
We encourage manufacturers and our MEP system to embrace innovation as a path to new business growth. Innovation IS what MEP does. Let me give you an example.
Now, I need to preface this first: this story comes to me from New Jersey. It was relayed to me from staff that works at the New Jersey MEP.
A soap manufacturer from China received a complaint from a customer who bought a box of soap. The customer said the box was empty. Management wanted to solve the problem, so the Chinese manufacturer purchased an expensive X-ray machine with high-resolution monitors and manned it with three people. The workers would use the machine to monitor the soap boxes [as they would] pass through on the assembly line and look through each box to make sure that none were empty. Problem solved.
Now here's slightly different version of the story. A soap manufacturer based in New Jersey received the same complaint: a customer had bought a box of soap and claimed it was empty. Management wanted to solve the problem. One of the assembly workers walked up to his manager and said "Yo. Hey guys, what's up? I heard you got a problem with empty boxes. You really got a problem with empty boxes? I got this. No, trust me, I got this." He walked over to the corner and brought back a $50 industrial electric fan. He pointed it at the assembly line, turned on the fan, and watched as the empty boxes were blown off the line. "Problem solved."
Now this may sound like a trivial example, but it illustrates the point that everyone in an organization can be innovative, and it doesn't have to be complicated or expensive, it just requires some creative thinking and a can-do attitude.
Innovation will continue to be the key to our future. Why? Because as we're faced with increased competition, a shrinking product life cycle, and the demand for specialized services, we will have to differentiate ourselves from our foreign competitors by providing innovative solutions—solutions that target our customers' current and future needs.
We can't always beat our competition on price or quality alone, BUT America can beat the competition with innovation, and only through innovation will we win. And it's important to realize that you can innovate EVERYWHERE in your company. One sure way is to utilize technology, technology that helps improve our products and processes. But we can also be innovative by serving our customers at a faster rate, or provide them with new products or develop enhancements for existing services, in all the ways we conduct business! We will use innovation to grow!
Our MEP Centers have done some incredible work with our manufacturers when it comes to innovation.
For example, 3C Cattle Feeders of Oklahoma is a manufacturer of state-of-the-art cattle feeders for commercial livestock owners. With changes in the industry, ownership wanted to retain their market share while expanding their business.
Oklahoma Manufacturing Alliance worked with 3C Cattle Feeders to identify possible product improvements for their customer base. The MEP center helped the company develop and create a marketing plan for an enhanced high-tech feeder product designed to help their customers overcome their major challenge of losing feed to wild animals.
The product is proving to be extremely popular in the market, which increased sales that led to newly created jobs for the company. The projected sales for the product have been so great that the Oklahoma Manufacturing Alliance has helped 3C Cattle Feeders move to a larger location to accommodate production levels. That's innovation.
Advance Industrial Manufacturing is a custom metal fabrication company based in Ohio. The organization was looking to increase their sales and stimulate growth while containing energy costs.
Advance Industrial Manufacturing signed on to MEP's Economy, Energy and Environment, or E3, program. The TechSolve team in Ohio provided training and coaching to help the organization generate ideas for new product lines and identify new markets, all while decreasing their energy use.
As a result of the program, Advance Industrial Manufacturing significantly increased sales and created more jobs for the company. Most important, the business now has more than 50 new innovative ideas for products in the pipeline, setting the structure for continuous expansion and growth. That's innovation.
Swanson Industries of West Virginia is a worldwide supplier of hydraulic machining and plating services. The company has been a client of the West Virginia Manufacturing Extension Partnership for over 10 years.
Recently, Swanson wanted to further diversify its customer base and expand into foreign markets. The West Virginia MEP provided the company export assistance through our ExporTech service. The MEP center worked with the company to obtain wind supplier certification and introduced Swanson to overseas opportunities in the wind turbine supply chain.
As a result, Swanson was able to enter foreign markets and new domestic industries, earning $20 million in retained and new business, including $1 million in new sales from overseas markets. Again, that's innovation.
As you can see, innovation comes in many forms. These are just a few examples of the MEP centers helping manufacturers nationwide. But the best part of innovation is that ANYBODY can do it. Innovation doesn't care what you produce. It doesn't care if you're a small or large company. And it certainly doesn't care where you're located.
Let me share with you a video representing two very different manufacturers. The first is PFM Manufacturing, a small company in Townsend, Montana, that manufactures the Land Tamer. The organization was coached by the Montana Manufacturing Extension Center to turn several innovations into new business and increased profits.
The other is Lee Spring, a mid-sized manufacturer of springs and metal parts headquartered in Brooklyn, New York. Lee Spring has worked with ITAC, the MEP center in New York City, to expand into new business areas.
When you watch the video, you will notice some differences between the speakers—where they're from, their lines of business, their accents.
However, you will also notice a common theme among their comments. Let's take a look.
As I mentioned, the companies are different sizes, have different customers, and come from very different locations. But there is one common factor: they both used INNOVATION to better their businesses!
If you haven't caught on by now, we're going to be pushing INNOVATION as the important theme while we're here in Orlando. And that's because we're at a crossroads. Many of us here have accepted that innovation is important, that we need to be innovative to grow and succeed, BUT, many of us here haven't personally invested in innovation!
NOW is the time to become full invested! We can't wait any longer. We have talked about it long enough. It's time for action! As American composer John Cage once said, "I can't understand why people are frightened of new ideas. I'm frightened of old ones."
At the beginning of my remarks, I mentioned that all of us here collectively create a manufacturing community. I like to think of us as something else, something that I have a personal fondness for. To me, this community is like a baseball team. In this league, innovation is what allows our team to compete. And while we're all on the same team, we all serve different functions, play different roles supporting the team.
The manufacturers are the players. You're out there on the field, day after day, giving it your all. You're the ones who have to deal with the curveballs and have to fight back when you're behind on the scoreboard, especially when the playing field seems uneven.
The MEP system of partners, our "extended family," represent the fans. They're the people that support the players, the manufacturers, both in good times and bad. Whether winning or losing, they're the people who cheer for us, because they believe manufacturers will win.
The coaches are the MEP center field staff, the folks that connect all the elements to make it a team. The MEP field staff recognize that the manufacturers have the ability, the talent, to innovate! It's their job to help the manufacturers grow and succeed—to bring out their best!
And finally, there is NIST—folks like me and my staff—scouting for new opportunities, assessing what the future holds, and preparing the team for success.
All players have an "a-ha" moment—a moment when they visualize and understand their potential for success. The coaches —the MEP field staff—are helping manufacturers realize that "a-ha" moment. And when that moment occurs, and when we all come together to play the game, boy does it feel good to hit that homerun. To hit that innovation home run, there's nothing else like it!
This team that I refer to, our team, will serve as an example for generations to come!
Innovation will transform the world of manufacturing. Innovation has renewed interest in manufacturing across all demographics, locations, and age groups. With innovation, we will develop the next generation of manufacturers. Yes, with this team, we're helping to make manufacturing cool again.
This conference is for OUR team, and everywhere you look over the course of the conference, there will be examples of our teamwork in action.
Throughout the next few days, you will have the opportunity to learn HOW to innovate in the 70+ workshops and seminars that are part of MI2012. These workshops will be led by experts that will help you become even better manufacturers, partners, and consultants. There are three key tracks: 1) Informing Business Decisions, 2) Leading Innovative Organizations, and 3) Implementing Growth Strategies. Please take advantage of the workshops—the knowledge sharing and the transformational experiences they provide.
This year, we're also introducing two new special sessions, both on Tuesday. The first is a Business Matchmaking session. This event will match small company "sellers" with participating "buyers" represented by government agencies and OEMs, creating new opportunities for business.
The second is our Next Generation Rail Supply Chain Forum, which is designed to bring rail car builders and OEMs together with smaller, capable, and interested U.S. manufacturers. The forum will provide a venue for small manufacturers to learn what products are needed to enter the rail industry, for which the U.S. Department of Transportation has set a goal of 100% domestic content for all future rail equipment purchases.
I look around the room and see a diverse community of people—a smart, talented group of folks who believe in manufacturing. Use the resources at this conference to better understand your business. Confirm, once again, that manufacturing is what makes our country great. A renewed American Dream is alive and well in this room today. I can feel it. This conference proves that through innovation that we have and always will "Make it in America."
Again, welcome to Manufacturing Innovation 2012, and thank you!