President Trump and the New Manufacturing

Trump 1Like most Americans, I’ve been watching the first two weeks of the Trump administration with a curious mixture of fascination, hope and concern.

I’m fascinated watching a man who’s never done a day of public service in his life perform after he woke up one morning to discover he’s suddenly the most influential civil servant in the country.

And while his two executive decrees – the one banning immigrants and refugees from seven predominantly Muslim countries, and the one mandating we begin building a wall between the U.S. and Mexico – seem astonishingly reactionary and half-baked, I remain cautiously hopeful.

I’m hopeful, despite the ham-fisted way his administration rolled out the ban on Muslim refugees, that he can bring about meaningful change in Washington – without, of course, having that change (or his odd, ego-fueled, and now obvious personality tics) lead our economy down too many rabbit holes.  After all, our national economy has been growing gradually and steadily for eight years running.

Trump 2But my guarded optimism aside, I cannot help but feel deeply concerned that, based on the man’s bombastic and ready-fire-aim rhetoric, Mr. Trump seems to understand precious little about the very same American manufacturing he promises to return to prominence.

I’ve been writing in this space for six years now that that tide has been shifting for a while, and that manufacturing is already returning. (Those who study such things have been calling the phenomenon “re-shoring.”)  The problem is, so much of what is returning is doing so because in the industrial sector automation and robotics have replaced many of our most repetitive and lowest-skilled factory jobs.

Manufacturing is coming back, in other words. Manufacturing jobs are not – at least not the ones the president seems intent on saving. It’s another one of those times in which Mr. Trump’s lack of specific knowledge and his infamous disinterest in even the most basic of details promise to derail his otherwise noble intentions.

Trump 3I’m concerned as well that he has no idea what “Made in America” even means – if only because so many of us in the sector don’t understand it either.  After all, if Volkswagen in Georgia continues to employ fulltime 3,000 U.S. citizens, are those workers assembling an American-made car or a German one?

I’m very concerned that globalization is happening, and that we have only two choices in that regard; we can either leverage it to our benefit, or – in the name of protectionism – we can close ranks, impose hefty tariffs, and then watch as China, Japan, India, Brazil, the EU and the like impose reciprocal tariffs on all American goods. Then we’ll all be forced to suffer the consequences as countries quickly (and gladly) fill the global void created as hundreds, if not thousands, of customers of small U.S. shops like mine start pursuing cheaper, tariff-free alternatives.

And speaking of small shops, I’m worried too that given the president’s apparent 1970’s view of manufacturing, he has yet to realize that many of the one-time sprawling, belching, behemoths of 20th Century American industry, the ones that exist in his mind, have been supplanted by a new generation of lean, agile and market-specific specialty manufacturers.

Trump 6And I’m worried the president – who, as a candidate, echoed the “drill baby drill” cry of the fringe right, and promised to bring back a coal industry whose product, practices and technologies all date back to the 19th Century – doesn’t realize most manufacturers (large and small) have begun weaning ourselves off fossil fuels, including natural gas and nuclear, and are already migrating toward cleaner, more sustainable, and far more efficient fuel sources, knowing such cost-effective energy sources are not only better for our planet, they’re better for our bottom line.

I guess, to sum up, what I’m really trying to say is I hope our president has a successful run. I hope, as he promised, he strengthens our economy and creates jobs. And I hope too he is able to run interference for all U.S. manufacturers and help small, thriving and independent shops like mine grow and prosper.

Trump 5But, that said, I hope Mr. Trump comes armed with more than what’s he’s shown so far.

I hope he has at least a few tangible and workable solutions in his back pocket.

I hope he’s got ideas for a stimulus package or two that will spur companies like mine to invest in ourselves and evolve as the technology the defines us evolves.

And, finally, I hope he develops a broader and deeper understanding of the marketplace, a hyper-competitive and often borderless world in which innovation, ideas and efficiencies are currencies that promise never to lose value.

Trump 4But I remain concerned.  Because, at least after these first few weeks, it seems we’re being led by a man willing to venture into the global marketplace armed with little more than a few wafer-thin promises, a rear view mirror, and a time machine he still wants to believe exists.

What Manufacturing Needs from Trump

Trump 1Let’s forget the rancor of the campaign. Let’s forget the hate-speech, the xenophobia, the simplistic war cries, and the negative passions both candidates managed to trigger. Let’s just get past those things.

Because, whether half the country likes it or not, we’ve all chosen Donald Trump our next president.

So, what does that mean? Well, the ripple impact of a Trump presidency remains to be seen, and will have to play itself out over the course of the next four years.

But I do know this, there are two forces at work in today’s marketplace that are way, way, way bigger – not to mention more powerful – than any single politician, regardless of his political ideology or country.

Trump 7And those two forces are these: globalization and technology.

What’s more, despite what Trump may have promised on the campaign trail, those two things are simply not going away. Not now. Not ever.

As manufacturers, you and I have felt (and been impacted by) by both for decades. Not only has the global market created unexpected (and often unforeseen) competition, but it’s also taken countless manufacturing functions that used to be the sole purview of this country and off-shored them to dozens of raw and even primitive economies abroad.

But at the same time, that globalization has also increased our potential market, and done so exponentially. What’s more, it’s opened wide the global market for American-made goods and brand names – things that remain wildly in-demand in the two biggest and fastest growing of those economies, China and India.

And from a technology perspective, the development of game-changers like 3D printing, computer modeling, robotics, and automation have revolutionized our segment and left those upstart economies scrambling. That’s why so many industries experts said were lost forever, have started migrating back.

Trump 3Manufacturing, in other words – despite what the president-elect might have us believe – is in remarkably good shape and well-positioned for the future.

But that’s not to say we in the industrial sector don’t need at least two things from the next administration. And they’re two things we need right now.

The first is tax reform that make sense, not some kissin’ cousin to the flawed “trickle down” theory of the 1980’s.

The new administration must understand that, while American manufacturing is in the midst of a very-real comeback, what’s emerging from the ashes is a new and improved type of manufacturer. Today’s industrial job-creators are not a few bloated, smokestack-belching mega-corporations with facilities the size of urban neighborhoods, but hundreds, if not thousands of smaller and far more efficient shops, just like mine.

Trump 6We are the face of manufacturing today, and we’re the ones who remain our best hope at reenergizing America’s middle class. We’re the hirers and income-creators that Trump should really be trying to help, not the elite one-percenters in all those well-appointed corner offices in places like Wall Street. Because tax incentives for nimble and market-responsive manufacturers will pay dividends in not simply more American jobs, but better (and better-paying) ones as well.

What’s more, we’d then be incentivized to invest in state-of-the-art upgrades and the kind of capital-intensive technology that will allow us to stay one-step ahead of our foreign competition.

Secondly, industry needs an almost epic overhaul of our national infrastructure.

Trump 5As a proud and long-standing member of the industrial sector I can assure you, there is no segment of the economy more reliant on an efficient and well-maintained supply chain than ours. A strong supply chain is our lifeblood, and, by extension, this economy’s. And for that reason, it is essential we keep the cost/headache of transporting, shipping and receiving raw materials and finished goods to a minimum.

And that is becoming harder to do the more our roads crumble and the more our bridges decay, our pipes corrode, our airport computer systems crash, and our power grids stay wedded to aging, archaic technology.

For years I’ve been calling for the Obama Administration to invest trillions and build for this country a state-of-the-art, 21st Century infrastructure – both physical and electronic. And to its credit, that administration has invested in what, to this point, has been a small but steady step in that direction.

Trump 9But we need more. We need a public works project the likes of which this country’s not seen since the days of FDR and the New Deal, and the likes of which no Republican has commandeered since the days of Civil War Reconstruction.

Such a program would give thousands of Americans jobs. It would restore worker pride and stimulate the economy by getting money moving up and down the food economic chain. And it would ensure that every sector of the U.S. economy could keep abreast of what, in terms of today’s global supply chain, has has become the new normal.

Trump 8Yes, Donald Trump did his ever-loving best to divide us for 18 months. Yes, he made a lot of promises that are going difficult to keep under the harsh glare of his new job. And yes, he has a lot of mending of fences and a lot of re-building of bridges to do before this country can truly heal its still-open wounds.

But, believe me when I say this; the best way to start rebuilding so many of those metaphorical bridges is to start rebuilding a few hundred or so real ones. #

To see the full report and learn more about what is being called the Mississippi “Golden Triangle” of manufacturing, visit the 60 Minutes site here.

Manufacturing 4.0: The Ground Level Perspective

4.0 aIt reminds me a little of the old “Summer of Love” in the Haight-Ashbury section of San Francisco when I was a kid, or the grunge music scene in Seattle in the 90s; two hot, trendy and newsworthy movements that by the time the academics had gotten around to naming them, by the time the media had begun covering them, and by the time they’d wormed their way into mainstream awareness, those at their epicenter had long-since moved on.

“It,” of course, is Manufacturing 4.0. And “it” is where our sector is supposedly headed, to an era (if not an entire environment) all-but devoid of human input in the process of designing, molding, shaping, forging and distributing durable goods, an era in which computers, software and sophisticated machinery promise to do something like 90% of the work.

4.0 bNow, given that I’m a small manufacturer, and given that the workers in my modest but still-humming shop come to work these days with this trendy, media-darling of a concept hanging over their heads (and, to be sure, their livelihoods) ominously like a razor-sharp, job-killing guillotine, I decided a week or so ago to have a sitdown over pizza with a few of my employees to get a sense of what Manufacturing 4.0 means to them and to gauge what, if any, angst they may harbor over it.

What I discovered in the course of that extended lunch both surprised and delighted me. Where I expected to find at least trace elements of denial, I found a universal and very palpable sense of anticipation. And where I expected to find some level of fear and trepidation about job security, I found excitement; real honest-to-goodness fervor over American manufacturing’s (and, by extension, my company’s) possibilities for growth.

4.0 cI suppose much like the Summer of Love and the Grunge scene, just as the idea was finally making its way into polite conversation on Main Street, U.S.A., so many of those who represent the heart and soul of U.S. industry had long since moved on from Manufacturing 4.0 – and, I’m happy to report, gladly so.

4.0 dUsing those few employees as a barometer, emotionally and intellectually anyway, whatever anxiety U.S. factory workers may have once had about Manufacturing 4.0 seems to have been more than supplanted by an eagerness to work in a modern, efficient and technology-driven environment. Granted, those eating pizza and sharing their thoughts with me that day were some of my longest-termed and highest-skilled workers, but to a man they agreed they couldn’t wait to work in a shop whose capacity and output were going to be defined not by our sector’s traditional limitations, but by the latest and most cutting edge advances in industrial technology.

They’d moved on from Manufacturing 4.0, in other words. In fact, one of them even said he had already started imagining “Manufacturing 5.0” in which shop machines would not only do the bulk of the work, but would also have Artificial Intelligence and actually learn as they operate, becoming much more efficient and far less wasteful in the process.

4.0 eA few of the other notable things mentioned that day over pizza:

  • Manufacturing 4.0 is going to be a significant change, no doubt, one employee told me. But it may not be as big a leap as either the broad deployment of the CNC turning centers in the 90’s or the universal adoption of the MTConnect standard in 2009.
  • One told me the broad use of standardized machines and the integration of software has had a huge impact on productivity and efficiency, which is making his job easier and far less stressful. What once took three operators and five machines, he said, now takes one operator and one machine. It allows him to do more and focus on planning and long-term strategizing.
  • 4.0 fWhat’s more, another one added, from a retooling or new-job perspective, thanks to our the latest generation of software what had once taken almost three days can now take as little as a few hours.
  • One said that, while certain low-skill jobs may disappear, better paying and more secure jobs will be created by manufacturing’s increased reliance on technology. What’s more, he added, a different type of worker is going to be attracted to factory work. Where the industrial sector once countless drew linear-thinking, task-oriented people, the level of automation along with our growing reliance on computers and cutting edge software is going to entice conceptual thinkers, bright young technical minds, and even gamers.
  • One employee told me he thought that the move to automation might actually be harder on management than the rank and file since it’s all going to be about making the right investment in the right technologies. You don’t want to be investing hundreds of thousands of dollars of precious capital in manufacturing’s version of the Betamax player or the Blackberry.
  • Finally, one said, even though people all talk about Manufacturing 4.0 bringing about these “radical” changes in the manufacturing process, the simple fact is that’s not how things ever seem to play out in real life. They constantly change to be sure, but they do so at a rate often so slow and steady that it’s not until you look back a year or two later that you realize the extent to which things (and how you do your job) have evolved.

4.0 gIf you’re in management or a shop owner and have not yet had a sitdown with those on your shop floor about technology, robotics, automation and the rapidly changing demands on the American factory worker, I urge you to do so, and soon. You may realize, as I did, it’s not them who need to get up to speed. It’s you.

What’s more, you’ll likely discover a level of anticipation and excitement on their part that may just do much more than comfort you.

It may just inspire you.

 

A version of this blog post originally appeared in August/September 2016 edition of Manufacturing Today magazine.