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Summer Reading List: “Factory Man”

Over the years I’ve learned that a combination meticulous research and great story telling can take almost any subject and make it not just readable, but downright fascinating. I’ve read books, for example, over the past decade or so on subjects as esoteric and ostensibly dry as rum, oysters and the global shipping industry that turned out to be page-turners. 

And who can forget author Laura Hillenbrand’s riveting best-seller Seabiscuit, a non-fiction history book offering the inside dope on, of all things, a splayed, overweight and undersized racehorse foaled over 80 years ago?

That’s why I am so excited to have recently picked up Factory Man, the first-ever book by Beth Macy, a reporter for the Roanoke Times.  According to a New York Times book review, which I stumbled upon a few weeks ago, Factory Man is the (at times) riveting story of a handful of Appalachia-based furniture companies, among them, one time industry leader, Broyhill. 

And the book apparently slowly and dramatically weaves together the unlikely story of the birth of the global furniture industry in Appalachia, its salad days, its slow decline in light of growing globalization, modernization and a glut of cheap Chinese knockoffs, and, perhaps most importantly, under the stewardship of the innovative, resourceful, principled and ferociously stubborn titular character, its ultimate reinvention and renaissance.

It also tells the tale of the feuding Broyhill scions, two highly competitive brothers who married two sisters and who settled on either side of an Appalachian peak named (what else) Broyhill. The two rival Broyhills eventually owned so much of the area that they became robber barons of the highest order and were able to leverage the skilled and dedicated local workforce to their own personal gain.

That titular character mentioned above is John Broyhill III, the grandson of Broyhill’s co-founder and his namesake, who in the eighties slowly evolved into the family’s black sheep.  Because it was John Broyhill III who, as mergers, Wall Street takeovers and mass layoffs were becoming more and more the order of the day, began telling people that such quick fixes were short-sighted, corrosive and imprudent long range strategies. 

And it was JB III (as the book calls him) who at the peak of the Chinese invasion of the mid-nineties, took the bold step of traveling to China and walking right into the lion’s den by visiting a factory near Dalian that was churning out massive quantities of exact replicas of his very own furniture. 

But rather than taking the easy way out (as so many others in his shoes might have done), entering into an agreement to partner with the owners of the Chinese plant, closing his factory back home in Virginia, and simply retailing the cheap and plentiful Chinese knockoffs throughout the U.S. at well below market prices, he does the exact opposite. 

He declares war. 

And according to the Times, that’s the moment at which Factory Man goes from being just another non-fiction account of just another David vs. Goliath tale and transforms itself into something almost Capra-esque, becoming a page-turner of the highest order. 

Without giving away too much, I’ll simply say that using some little known but powerful World Trade Organization regulations, the bound and determined “Factory Man” starts to gain a foothold in his epic battle against offshoring and cheap Chinese knockoffs and slowly but surely sets into motion a series of events that will, quite literally, keep his small town alive and save it from being swallowed whole by some toxic combination of fate, circumstance, time and geography.

What I find most comforting (and alluring) about the prospect of spending the next few days reading Factory Man is the fact that the story at its core is one many of us in our sector (regardless of our industry) have lived first hand these past few decades. 

Regardless of what we produce, regardless of our size, for almost a quarter of a century many of us found global competition exploding all around us. But the good news was, that as our competition continued to increase exponentially, so did the size of our marketplace and, more importantly, our selling options. 

And as a result, only the most near-sighted and close-minded of us spent those days obsessing about the former.  The rest of us geared up for the latter, jumping out of our shoes at what turned out to be a once-in-a-lifetime opportunity to go global, to exponentially expand our businesses and to brighten our futures.

I can’t tell you any more about the book than that now, if only because I’ve yet to even start it myself.  But I urge you – especially if you are someone who, like me, comes to work every day, opens your tiny manufacturing plant in some industrial corner of Anytown, USA, and, much like John Broyhill III, proceeds to take dead aim on the rest of the world – pick up Factory Man

My sense is you won’t be disappointed. After all, it’s our lives in hardcover. (Then, at some point, let’s compare notes, OK?)  

Happy summer reading!

From the Shop Floor — The Week in Manufacturing (11/8/2013)

Writing in Bloomberg, author and blogger Gary Shilling says “Let’s not overstate the U.S. manufacturing revival.”

MoneyNews cites a study from ThomasNet.com that says U.S. manufacturing is running a race against a biological clock.

Fortune, writing about the same graying of the manufacturing workforce, calls the imminent retirement and departure of so many Boomers from our sector the “coming brain drain.”

Minnesota Public Radio offers this nice piece on the comeback of American manufacturing.

The head of Omron European, while offering a subtle but meaningful variation on the world “global,” tells his peers in the electronics industry, “Welcome to the new global.”

U.S. manufacturing output increased at its fastest clip in 2 1/2 years this past month.

Business Insider says something that we’ve been saying in this space for over a year, and something that must be viewed as good news for our sector of the economy but slightly disturbing news for the economy as a whole:  manufacturing jobs in this country remain at a 60-year low, even as manufacturing itself has returned to pre-crisis profits.

Apple is opening a manufacturing facility in, of all places, Arizona.

Business Week says that while China’s manufacturing is up, some weaknesses remain.

The Wall Street Cheat Sheet says U.S. manufacturing ended up in the recent crisis bruised but not broken.
The Mail Tribune, which covers Southern Oregon, says that U.S. manufacturing shrugged off the recent government shutdown.

Caterpillar’s CEO, speaking at a conference at George State University in Atlanta, said U.S. manufacturers are being hindered globally by high taxes, onerous regulations and a slowly decaying infrastructure, especially in a number of domestic ports.

 

 

 

 

 

 

 

 

On Jobs, Workers and the American Manufacturing Renaissance

Not too long ago I read an amazing (and frankly uplifting) story in the New York Times about the textile and apparel industries returning to the U.S. in the form of new (and renewed) small-to-midsize companies that just a few years ago had been off-shoring much if not all of their work.  Unfortunately, according to the story, the resurgence in those two industries, a phenomenon that remains concentrated in the Atlantic Coast, has come without a corresponding increase in American jobs.

In fact, manufacturing jobs are but a fraction of what they used to be only a few years ago.  Why?  One word:  automation.

A radical decrease in the amount of manpower required to make textiles and clothing products in this country, combined with increasing labor costs abroad, has leveled the playing field considerably for American manufacturing firms.

Toss in variables like worker safety in the third world, ever-increasing shipping costs and other logistical considerations, ease of supply chain management, and of course, the growing demand for “Made in the U.S.A.” products, and what you have is a perfect storm of circumstances, all of which have led to this new “renaissance” in manufacturing in the U.S.

There’s just one problem.  This renaissance remains in jeopardy as worker skills in this country continue to erode and as more and more of those handful of new manufacturing jobs out there remain unfilled for a lack of qualified candidates.

But before I go any further down that path, let me go back to this boom in the textile industry.  It is critical to understand that this revolution has been a product of supply and demand and has been entirely market driven.  It has not been because of good ol’ boys from the Carolinas started waving their red, white and blue banners and got all star-spangled in their decision-making.

No, this re-shoring of those industries was fueled by market factors that led managers and owners to a series of inevitable decisions.  In fact, as one conspicuously successful factory owner told the Times, “When I framed the business, I wasn’t saying, ‘From the cotton in the ground to the finished product, this is going to be all American-made,’ ” he said. “It wasn’t some patriotic quest.”

To the contrary, it was because global competition and the demands of the marketplace led to dramatic changes in those two industries, and it is those changes in things like factory air quality, production capability and plant efficiency that have made the textile and apparel industries stronger and far more profitable today.

And that competition for jobs and those world market influences are exactly what the American worker needs to come to understand and needs to adapt his thinking to.  These days, if you are an unemployed or hopeful factory/plant worker, you are not going to land a job in manufacturing simply because you know someone, or because you’re a U.S. citizen, or because you’ve filled out the necessary paperwork and maintained a clean record.

You’re going to get hired because, just like those textile and apparel firms in the Times story, you’ve made the kinds of enhancements to your own personal set of skills that have made it financially prudent for a manufacturer to hire you.

It is supply and demand taken down to its most-basic, most-personal level.

That’s why, as industry leaders and as people invested in the long-term economic viability of American manufacturing, we cannot leave it up to the individual worker to enhance his or her skills.  Some of the most motivated and forward-thinking, of course, will take it upon themselves to go back to school or get the training they’ll need to service, build and repair the sophisticated machinery that will drive the factories of tomorrow.  But we must also do what we can to systematically instill in our industries and job markets the kind of training/worker development programs needed today to keep us strong in the short term and will not put at risk all we’ve earned back over the past decade.

My take on the manufacturing job/renaissance dynamic, which remains complex and multi-dimensional, is maybe best summed up by a single paragraph from the Times story, which I found at a point deep into the piece.

“Now, companies that want to make things here often have trouble finding qualified workers for specialized jobs and American-made components for their products. And politicians’ promises that American manufacturing means an abundance of new jobs is complicated — yes, it means jobs, but on nowhere near the scale there was before, because machines have replaced humans at almost every point in the production process.”