Archive for the ‘Manufacturing’ Category

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Patented Technology is Key to RoadLoK’s Success

Tuesday, July 14th, 2015

There is no lack of ingenuity and innovation in the U. S. today. Each year, thousands of new products are invented, and but most are never produced. Knowing how to use technology to create a product doesn’t mean you know how to manufacture it and get it to market. Obtaining a patent is a key factor in achieving success, but you also need to recognize the limitation of your knowledge and expertise and utilize experts in fields you need, such as product design/engineering, patent/licensing, material/process selection for prototyping and production manufacturing, and marketing.

I recently had the opportunity to interview Adam Xavier, founder and CEO of New Hampton Technologies dba RoadLoK Security, who is an example of an inventor and entrepreneur who successfully got his product patented and into the marketplace.

His company distributes products worldwide under the brand name RoadLoK. The company specializes in the design and production of model-specific vehicle locking systems for motorcycles, scooters and off-road power sports vehicles. The RoadLoK is the only locking system that safely and effectively prevents rollaway theft. The system is designed to be permanently mounted on a motorcycle, thereby eliminating the need for storing the lock while riding. The system’s permanent mounting eliminates all momentum, making it virtually impossible to damage calipers and fenders. This is accomplished while also protecting the rider, should the rider forget to unlock the system before attempting to ride off.

I asked how he got the idea for his product, and Adam said, “My twin brother Eric and I were sitting in the outside seating area of a bar the summer after we graduated from college and saw a man forget to take off his lock and tip over his motorcycle. We started talking about a better idea for a lock and drew a sketch on a napkin. The next day, we searched to see if there was a lock similar to our idea, but didn’t find one. We took our sketch to a CAD designer to turn our idea into a design that could be manufactured. A friend from college, Matt Tomosivitch, who had become a machinist, made our first prototype. Matt is now the chief engineer of our company.

Continuing, Adam said, “We made a video of our lock that showed how it worked. We wrote a comprehensive 60-page business plan. We filed for a provisional patent in July 2005. Then, we sent our video to local investor network group in New York and were kicked down to the group in our area, Orange County. The director contacted us, and we gave our pitch in December 2005. We got our first investment check from the Orange County Capital Development Group on February 16, 2006. This investment was enough to get us to our first trade show in March, the International Motorcycle Show in Atlanta, GA.

Adam said that they set up their first office in Middleton, NY and later moved to Newburgh, NY. They spent two years of R&D to finalize the design and raised another $3 million over three years to get into full production. They used 3D printing to make new prototypes as they improved the design. They received a lot of mentoring and hands-on help from their angel investors.

Their first utility patent was granted on December 23, 2008 after their third attempt at an “office action” at the patent office. They got their second patent in 2010.

When they started the company, Adam said that they wanted to keep everything made in the U. S. They used www.thomasnet.com to find all of their vendors. They have seven major vendors for all of the different parts of their product, and they are located in Illinois, North Carolina, New York, and Texas. Their mission is to produce a high quality product, so all of their vendors are ISO 9001-2008 certified to meet the exacting requirements of their customers.

They later moved to California because they needed to have face-to-face communication with their two biggest customers, one located in Murrieta and one in Corona, CA. California also has the biggest population of motorcycle riders.

The executive offices are now located in Santa Monica, CA, but their product is manufactured in Salisbury, North Carolina and assembled to order at their plant in Torrance, CA. Since the RoadLoK is produced to order, production is not automated and does not utilize any robots. They are looking at doing more vertical integration of parts manufacturing. Their screw-machining vendor in Chicago makes two parts, and the patented design of their locking pin has 5 components made by three different vendors.

They started to implement lean principles in 2009 and changed one component from a square rod to an extrusion, which reduced material waste by 62%. They have been working towards reducing other material waste and time since then.

Their original plan was to focus on after-market sales of the product for the first two years and then license the product to motorcycle manufacturers on a non-exclusive basis similar to how the airbag is licensed to car manufacturers. Now in its 9th year of operations, RoadLoK’s largest customers are KTM Sportmotorcycle and Ducati with others to be announced within the next year.

When asked how his company has been impacted by competition from offshore in Asia, Adam said, “We don’t have any direct competitors offshore, just cheaper substitute locking mechanisms. We are selling in Australia, Japan, and China and recently selected a company to partner with to produce parts in China to sell to the Chinese market. We have started the process to file a patent in China. We need to have manufacturing plant in China to sell to the Chinese market because of the high import duties. Brazil is another county we are looking at to set up a manufacturing plant because of the high import duties. There would be a win/win benefit of jobs to the community and provide a much-needed product for the people.”

I naturally asked how the recession affected his company when they were only a little over two years old when it started in late 2008. Adam said that they were spending about 85% of their time setting up a distributor network and program to sell to dealers utilizing direct sales persons. But, motorcycles are purchased with discretionary income, which dried up during the recession as people lost their jobs. So, their direct sales to motorcycle riders through distributors/dealers dropped drastically. To survive and grow, Adam said, “We had to reduce our direct sales staff and reduce our travel costs. We changed our sales model to online retail sales and direct sales to motorcycle manufacturers. This model has helped us grow and succeed. We have also started R&D on the next generation of vehicle immobilizers to other two or more wheeled vehicles that do not have a transmission.”

Adam had read my article on “Which Patent Reform Bill Doesn’t Destroy the American Patent System?” and said, “Our having a patent pending was key to getting investors and having a patented product has been the key ingredient to our success as a company. Investors want the protection of a patent, but they wouldn’t take the risk of being made personally liable. There is no way that we could have gotten investors if our investors had been personally liable for defending our patent in a patent infringement lawsuit.” Note: Adam was referring to the “Loser Pay’s provision of H. R. 9 and S.1137.

If we want to have more successful companies manufacturing products in America, then we need to protect our American Patent System and stop H.R. 9 and S. 1137 from being passed. Instead, we need to pass the Strong Patents Act of 2015, S. 632, which will “Enact balanced reforms to reduce abuse while sustaining American leadership in innovation.”

 

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Posted in Innovation, Manufacturing, Patent Reform, Technology | No Comments »

House Leadership Blindsides Opposition to Trade Promotion Authority

Tuesday, June 23rd, 2015

On Monday, June 15th, House Republican leadership announced that they had decided to delay the re-vote anytime up to July 30th on Trade Promotion Authority (TPA) which “fast tracks” ObamaTrade. Less than three days later, the opposition was blindsided by representatives in the House approving the standalone TPA bill by a close vote of 218 to 208 (see how Representatives voted here.) Because the House approved a standalone TPA bill, the Senate has to vote on a standalone TPA bill as well as legislation extending Trade Adjustment Assistance (TAA) and the U.S. trade preferences program before the president can sign the TPA bill into law. The trade preferences bill would renew the African Growth and Opportunity Act (AGOA), the Generalized System of Preferences, and trade preferences for Haiti.

There was a question whether enough of the 14 Senate Democrats who voted in favor of a combined TPA-TAA bill on May 22nd would vote in favor of a standalone TPA bill. TPA supporters hoped these senators would be influenced to vote in favor of cloture because they have voted for fast track already and because all 28 House Democrats who voted for a TPA bill to be combined with the Trade Adjustment Assistance (TAA) bill were united in voting for a standalone bill on June 18th.

Senator McConnell filed for cloture on both the TPA bill and the preferences legislation late Thursday, for the vote to be held on Tuesday, June 23rd. The vote on cloture requires 60 votes. As I finish this article, I just watched the Republican leadership get the 60 “yes” votes needed to invoke cloture, with 37 senators voting “no,” and three not voting.

This means 30 hours of debate on the bill would begin, meaning that a final vote on the TPA bill could take place as early as Wednesday. Only a majority of 51 votes are needed to pass TPA. After the passage of TPA, the Senate would then vote on cloture on the Trade Adjustment Assistance (TAA) and the trade preferences bill. If cloture is invoked, a final vote on the TAA-preferences bill could come Thursday or Friday.

The House of Representatives would still need to vote on the Trade Adjustment Assistance bill. Since only 86 Republicans voted in favor of the TAA bill on June 12th, it would require at least 92 Democrats to vote in favor of TAA in order for it to pass the House. At that time, only 40 Democrats voted to renew the TAA program, while the vast majority joined House Minority Leader Nancy Pelosi (D-CA) in voting “no” to stop or delay the TPA.

On June 18th, June 18, White House Press Secretary Josh Earnest told reporters that “President Barack Obama isn’t going to support a strategy that gives him half a loaf on his trade agenda.

With Capitol Hill leaders working on a plan that would split Trade Promotion Authority from Trade Adjustment Assistance, Earnest made clear Obama will demand both. ‘The only legislative strategy that the president will support is a strategy that results in both TPA and TAA coming to his desk,’ he said.”

In an email to members of the SoCal Fair Trade Campaign on June 19th, Arthur Stamoulis, Executive Director of the Citizens Trade Campaign, wrote in part, “As short-sighted and inappropriate as the original Ryan-Hatch Fast Track bill was, the House package is actually even worse. It would weaken human trafficking measures; eliminate simple currency measures and other enforcement provisions; and even prohibit the consideration of climate solutions in future trade negotiations. Senators now have even more reason to vote no than they did last time around.

After the previous Senate vote to approve the combined TPA/TAA bill on May 18, 2015, Senator Elizabeth Warren released a 15-page report, “Broken Promises: Decades of Failure to Enforce Labor Standards in Free Trade Agreements,” showing that the United States pursues very few enforcement actions to uphold the labor protections in its trade agreements. In her press release, she stated, ““Supporters of past trade agreements have said again and again that these deals would include strong protections for workers, but assurances without strong enforcement are just empty promises,” Senator Warren said. ” The facts show that, despite all the promises, these trade deals were just another tool to tilt the playing field in further of multinational corporations and against working families.”

In the Weekly Standard of June 17th, anti-TPA Republican, Senator Jeff Sessions, stated, “It is essential that there be no misunderstanding: fast-track preapproves the formation of not only the unprecedentedly large Trans-Pacific Partnership, but an unlimited number of such agreements over the next six years. Those pacts include three of the most ambitious ever contemplated. After TPP comes the Transatlantic Trade and Investment Partnership (TTIP) between the United States and the European Union, followed by the Trade in Services Agreement (TiSA), seeking as one its goals labor mobility among more than 50 nations. Together, these three international compacts encompass three-fourths of the world’s GDP. Including the nations whose membership is being courted for after enactment, the countries involved would encompass nearly 90 percent of global GDP. Yet, through fast-track, Congress will have authorized the President to ink these deals before a page of them has been made public. Then, the Executive sends Congress ‘implementing’ legislation to change U.S. law—legislation which cannot be amended, cannot be filibustered, and will not be subjected to the Constitutional requirement for a two-thirds treaty vote…This nation has never seen an agreement that compares to the TPP, which forms a new Pacific Union. This is far more than a trade agreement, but creates a self-governing and self-perpetuating Commission with extraordinary implications for American workers and American sovereignty.”

On June 19th, Steve Elliott of Grassfire, emailed, “They made their dirty “back-room” deal behind closed doors and now they are on auto-pilot to “land” ObamaTrade Fast Track despite massive public opposition…Boehner and McConnell use deception and trickery to resurrect the defeated Fast Track bill and then announce that this is on a “glide-path”!

In an email I received June 23rd, Chris Chmielenski of NumbersUSA, stated, “The current version of TPA, H.R.2146, would allow Pres. Obama to negotiate immigration increases into free trade agreements that would only be subject to a simple up-or-down vote from Congress. TPA would not only cover the massive Trans Pacific Partnership (TPP) between the United States and 12 other Pacific Rim nations, but also cover the Trade in Services Agreement (TiSA) between the U.S., European Union, and other nations. TiSA includes labor mobility for more than 50 nations and could increase the number of foreign workers allowed to work in the U.S. and extend the length of their work visas.”

In an email I received on June 22nd, Senator Rand Paul stated, “Over the past few weeks, more and more Americans have begun to see why I oppose Obamatrade. As far as I’m concerned, the American people have had enough of government hiding things from us. And every time they say it’s “for our own good,” we’ve found ourselves in an even deeper mess…If passed, “fast-track” authority would allow trade deals the Obama administration negotiates with the 12 member nations covered in the Trans-Pacific Partnership to pass Congress with a simple majority vote — instead of the 67 U.S. Senate votes the U.S. Constitution requires for ratification of a Treaty…It’s time for this scheme to be released for the American people. If the President won’t release it and agree to an open and transparent process — to ensure Americans’ liberty is protected — Congress must vote “NO!”

Food & Water Watch Executive Director Wenonah Hauter, issued a press release June 23rd, which states in part: “Today, the Senate narrowly approved a procedural motion to pass a degraded version of the Fast Track Trade Promotion Authority that passed last month… Today’s bill also weakened the Senate’s earlier provisions addressing human trafficking and currency manipulation and includes new House language that prohibits trade deals from ever addressing climate change or immigration issues…Fast Track will accelerate Congressional consideration of the as-yet-unseen Trans-Pacific Partnership, a trade pact that will undermine key consumer, public health and environmental protections, and other trade deals that follow. These trade deals could undermine America’s food safety standards and commonsense food labeling measures, bringing a rising tide of unsafe imported food to our grocery stores and restaurants.”

After the cloture vote, Michael Stumo, CEO of the Coalition for a Prosperous America issued the following statement, which in part states, “The Republican base and the Democratic base remain united in their opposition to current trade and global governance policy. Job creation claims are no longer believed because they have proved false. Growth claims fall flat. The rhetoric in favor of trade deals contrasts shockingly with the data on post-agreement performance.

America needs to establish a long term goal of balanced trade, a medium term goal of becoming a net exporting nation and a short term goal of producing more of what we consume. We need to recognize that tariffs and quotas are no longer the issue. This is not 1906 anymore. The new mercantilism and trade distortions are currency manipulation, foreign border tax hikes, industrial subsidies and a few other tactics that move the net trade needle towards deficit. Any modern trade policy must address these modern tactics. And America must fix its tax policy to substantially increase our trade competitiveness.”

Since the Trade Promotion Authority only needs 51 votes to pass, it is likely that the bill will pass the Senate because of 60 senators voting for cloture. The only path left for the American people will be to convince Congress not to pass the Trans-Pacific Partnership Agreement. At least, the Trade Promotion Authority requires “at least 60 days before the day on which the President enters into the agreement, publishes the text of the agreement on a publicly available Internet website of the Office of the United States Trade Representative.”

I urge all Americans to stop being apathetic and exercise their constitutional right to address their representatives in Congress. We must stop the Trans-Pacific Partnership Agreement and other treaties in negotiation from destroying our national sovereignty and harming the American way of life.

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Posted in Jobs, Manufacturing, Trade Policy | No Comments »

International Corporate Elite Steamrolls Trade Promotion Authority Through Senate!

Tuesday, May 26th, 2015

Late Friday evening, May 22, 2015, the Senate voted to pass the Trade Promotion Authority (H.R. 1314) by a vote of 62 to 37 to give President Obama the authority to “fast-track” trade agreements through 2018, with an extension to 2021 possible. If this legislation also passes the House, this would mean that the Trans-Pacific Partnership Agreement (TPP) and the Trans-Atlantic Agreement may be negotiated and signed without any amendments by Congress and with only a majority vote rather than the supermajority vote required for treaties under the Constitution.

Of the Republican senators, 54 voted yes, four voted no and one did not vote. Fourteen Democrats joined the majority of Republicans in voting yes. According to the Roll Call, they are: Bennet (CO), Cantwell (WA), Cardin (MD), Coons (DE), Feinstein (CA), Heitkamp (ND), Kaine (VA), McCaskill (MO), Murray (FL) Shaheen (NH), Warren (VA), and Wyden (OR). The four Republicans who voted no are: Collins (ME), Paul (KY), Sessions (AL), and Shelby (AL).

Nearly every Democrat or Democrat-leaning organization from unions to the Sierra Club opposed the Trade Promotion Authority, so those fourteen Democrat Senators turned their back on their constituencies and the American working class they claim to support to follow lock-step with the Republicans they accuse of being in the pocket of “big business,” i.e. the large multinational corporations that comprise the membership of the U.S. Chamber of Commerce, the National Association of Manufacturers, etc.

There were over 100 amendments proposed, but only ten were allowed to reach the floor for a vote. Three were rejected for discussion or a vote because they were ruled as not being not germane to the topic: Inhofe (R-OK) # 1312 (AGOA), Shaheen (D-NH) SA #1227 (small business), and McCain (R-AZ) #1226 (catfish).

The Hatch (R-UT) (substitute) amendment #1221 was approved without any description or discussion by a vote of 62 yes to 37 no.

The Flake (R-AZ) amendment #1243 to strike the extension of the Trade Adjustment Assistance program (TAA) failed 35 yes to 63 no. The Trade Adjustment Assistance was originally a separate bill and was added to the Trade Promotion Authority to “sweeten” the deal to gain Democrat votes. Trade Adjustment Assistance is a federal program to reduce the damaging impact of imports. The current program features four components for workers, firms, farmers, and communities.

The Brown (D-OH) amendment #1251 purpose was to require the approval of Congress before additional countries may join the Trans-Pacific Partnership Agreement because the TPP is a “docking” agreement in which other countries may be added after it is signed and in effect. In his comments in support of this amendment, Senator Brown specifically mentioned the need for Congress to approve the addition of China to the Agreement. Unfortunately, the amendment failed by a vote of 47 yes to 52 no.

The Stabenow-Portman amendment #1299, whose purpose was, “To make it a principal negotiating objective of the United States to address currency manipulation in trade agreements,” failed by a vote of 48 yes to 51 no.

The Hatch amendment #1411 was agreed to by a vote of 70 yes to 29 No without any description or discussion.

Two Amendments had already been considered on May 21st:

  • Lankford SA 1237 passed by a vote of 92 to 0 to establish consideration of the conditions relating to religious freedom of parties to trade negotiations as an overall negotiating objective of the United States.
  • Brown SA #1242 failed by a vote 41 to 45 to restore funding for the trade adjustment assistance program to the level established by the Trade Adjustment Assistance Extension Act of 2011

Of equal importance, the Warren amendment #1327 failed to pass by a vote of 39 Yes to 60 No. Its purpose was “To prohibit application of the trade authorities procedures to an implementing bill submitted with respect to a trade agreement that includes investor-state dispute settlement” [ISDS].

This is the chapter of the TPP that allows foreign corporations to bypass the domestic legal system to use to fight laws they don’t like. International Tribunals, not U.S. courts, would decide on lawsuits between the U. S and “investor” companies in member countries. Foreign “investors” could file lawsuits against city, state, and federal agencies for laws and regulations they feel infringe on their “expected future profits.” They can also sue for compensation for the loss of these “expected future profits.”

In her comments to introduce the amendment, Senator Elizabeth Warren mentioned that over 100 law professors had sent a letter to Congress and the Obama administration urging them to not include the ISDS in the TPP. I discovered that she was quoting from the “Analysis of Leaked Trans-Pacific Partnership Investment Text by Lori Wallach of the Citizen’s Trade group” that was released on Wednesday, March 25, 2015. You can download the leaked chapter at https://wikileaks.org/tpp-investment/

This 13-page analysis includes this paragraph: “A March 2015 letter signed by 139 U.S. law professors urges congressional leaders and the Obama administration ‘to protect the rule of law and our nation’s sovereignty by ensuring ISDS is not included” in the TPP, stating, “ISDS threatens domestic sovereignty by empowering foreign corporations to bypass domestic court systems and privately enforce terms of a trade agreement. It weakens the rule of law by removing the procedural protections of the justice system and using an unaccountable, unreviewable system of adjudication.’ A May 2012 letter signed by former judges, law professors and other prominent lawyers from TPP nations warns: ‘the foreign investor protections included in some recent Free Trade Agreements (FTA) and Bilateral Investment Treaties (BIT) and their enforcement through Investor-State arbitration should not be replicated in the TPP. We base this conclusion on concerns about how the expansion of this regime threatens to undermine the justice systems in our various countries and fundamentally shift the balance of power between investors, states and other affected parties in a manner that undermines fair resolution of legal disputes.”

This analysis is well worth reading to become fully informed of the dangers of international tribunals adjudicating cases instead of our domestic legal system. Two of the most dangerous features of the ISDS chapter are:

  • “Foreign investors alone would be granted access to extrajudicial tribunals staffed by private sector lawyers who rotate between acting as “judges” and representing corporations in cases against governments, posing major conflicts of interest.”
  • “Foreign tribunals would be empowered to order governments to pay unlimited cash compensation out of national treasuries.”

Senator Warren also mentioned that even the CATO Institute, a champion of free trade, had recommended removal of ISDS from the Trade Promotion Authority legislation. The report she referenced is Free Trade Bulletin No. 57, “A Compromise to Advance the Trade Agenda: Purge Negotiations of Investor-State Dispute Settlement,” by Daniel J. Ikenson dated March 4, 2014. The CATO Institute is a well-known American libertarian think tank, so its recommendations should have had some influence on Republicans in the Senate, but evidently did not. Instead, the vast majority of them chose to follow their cue from the international corporate elite behind this treaty.

Ikenson wrote that there are “practical, economic, legal, and political reasons to expunge ISDS from current trade negotiations.” He presented “Eight Good Reasons to Drop ISDS from TPP and TTIP, which you can read in full at the above link.

Since there was very little information on the Trans-Pacific Partnership Agreement in the major media prior to its introduction in the Senate and the failure of the first cloture vote on May 12th, it is imperative that freedom-loving organizations make Democrat and Republican Representatives in the House aware of the facts about the damage the TPP would do to our country.

America now stands at a crossroads, whether Americans will remain in control of their destiny or will be forced to bow before foreign tribunals and have even more of their jobs shipped overseas. If we are to protect our national sovereignty and our jobs, we must stop this legislation in the House by flooding their switchboards!

Members of the manufacturing task force of the California chapter of the Coalition for a Prosperous America of which I am chair have done their part by visiting the offices of all 33 of the southern California Representatives in the past year. The final hour is near. Let your Representative hear your voice! If you don’t know who your Representative is, click here.

Posted in Jobs, Manufacturing, National security, Trade Policy | 1 Comment »

New Technologies Featured at DMEDS 2015

Thursday, April 30th, 2015

In these busy times when face to face appointments have nearly become a thing of the past, don’t miss the opportunity for face to face interaction at the Del Mar Electronics and Design Show on May 6th and 7th at the Del Mar Fairgrounds.

This show is our only local trade show and convention for people who design, manufacture, and test products. The two-day event is free for industry professionals and will be held at the Del Mar Fair Grounds with plentiful free parking and easy highway access. Show hours are 10:00 AM – 5:00 PM Wednesday, May 6th and 10:00 AM – 3:00 PM, Thursday May 7th. Stay to network at the free reception at the Mexican Plaza and enjoy the free food and music after the show ends on the first day. Visit here for more information or to register.

Over the last 19 years, the show has evolved from a sales rep/distributor show to become a major exhibition of local, regional, and national manufacturing companies and organizations.

Since San Diego is a hotbed of innovation and start-up companies, there will be a special program on May 6th starting at 3:00 PM, “Starting Block to Success – Utilizing San Diego’s Resources to Start and Grow Your Business.” First, CONNECT CEO Greg McKee will share some of his experience as an entrepreneur and executive at innovation companies, as well as discuss the ways in which CONNECT supports tech and life science companies at every stage of the business lifecycle. CONNECT provides resources for start-ups, mid-market, and multi-national enterprise companies.

From 3:30 – 4:00 PM, Jeff Draa, President & Board Member of Tech Coast Angels will discuss available sources of capital for startup companies, how to access these sources, which are the right ones at the right times. He will answer the questions about what early stage investors want to see from startups to help guide entrepreneurs through successful funding events which can determine success or failure in early stage businesses.

From 4:00 – 4:30 PM, Rory Moore, CEO and Founder of the EvoNexus incubator will share real life examples of companies at that have been “incubated” at EvoNexus.

Finally, from 4:30 – 5:00 PM, Lou Kelly, Director & Chairman of the San Diego Regional Innovation Cluster at San Diego State University will describe how their federally funded organization brings together 23 organizations in the San Diego area to create a customized package of support for high tech small businesses to help them grow, commercialize their product, and bring it to the market.

Program Manager Douglas Bodenstab stated “This year we are focusing on San Diego’s entrepreneurial spirit with a special program consisting of San Diego’s premier incubators, funding, and entrepreneurial organizations. The Del Mar Fair Grounds presents a relaxed atmosphere that is representative of San Diego’s entrepreneurial business personality, and the show is seen by the local community as the annual event to catch up with old friends, and also see what is new.”

New technologies will be displayed on the show floor with over 500 exhibitors. Dozens of free seminars will be provided on both show days. A few of the technical topics to be presented are:

How to Reduce Costs Using Rapid Prototyping Techniques

3D Printing Processes and Materials

3D Functional Inkjet Printing of Solder Mask & Legend on PCBs

Batteries: Yesterday, Today, and Tomorrow

What’s New in Wire and Cable

Integrate Mobile and Cloud Technology in our Next Electronic Product

Non-technical topics include:

Growth Strategy: How to use Market Intelligence to Shorten the Sales Cycle

How to use LinkedIn to Advance your Career

Using Digital Marketing to Accelerate your Sales Cycle

I will be one of the first speakers at the show on the topic of  “How to Return Manufacturing to America” at 10:00 AM on Wednesday, May 6th, in Room A of the Mission Tower building, (adjacent to Mexican Plaza across from the show buildings). Workshops on this topic at other venues can cost hundreds of dollars, so save money by attending my free seminar.

It has become common knowledge that cost savings of outsourcing in China have eroded due to higher labor rates and shipping costs. Quality problems, IP theft, and counterfeit parts are causing companies to rethink where to source. I will discuss how to select the right parts and products to reshore, how to calculate the Total Cost of Ownership using the Reshoring Initiative’s worksheet, what are the latest trends of reshoring, and share some new case stories of companies that have reshored.

My company, ElectroFab Sales, will be exhibiting at Booth 223 in the Bing Crosby Hall at the show. We will have sample parts on display for Century Rubber Company and some of the companies we represent.
One of the other companies we represent will have their own booth in the Exhibit Hall: A Squared Technologies (booth # 437). Please drop our booths.

Posted in Economy, Manufacturing, Reshoring | No Comments »

What would be the Impact of the Trans Pacific Partnership Agreement?

Monday, April 20th, 2015

Last Thursday, Senators Hatch, Wyden, and Ryan introduced “The Bipartisan Congressional Trade Priorities and Accountability Act of 2015,” which is the Trade Promotion Authority bill that would grant President Obama “fast track” authority for the Trans Pacific Partnership Agreement.

The TPP agreement has been in negotiation since 2010 between the United States and 11 other countries around the Pacific Rim: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The TPP would cover 792 million people and 40% of world’s economic activity. It is a “docking agreement” so other countries could be added, and India, China, and Korea have expressed interest in joining the TPP.

There has been no involvement by Congress in the writing of the Agreement; instead, 600 corporate advisors have worked with the U. S. Trade Representative and his staff to write the more than 1,000 pages of the Agreement. Members of Congress did not even have access to view the Agreement until last year, and they cannot take any staff with them and are not allowed to take pen, pencil, paper, or a camera when they go view it at the U. S. T. R.’s office.

This Act would give Constitutional power over trade to the President and take it away from Congress. It would allow the Executive Branch to conclude negotiations and sign the Agreement before a vote by Congress. It allows only 45 days for committee analysis and only 15 days to bring it up for floor vote. It allows only 20 hours of debate by Congress and eliminates amendments, filibuster, and cloture. It requires only simple majority vote in the Senate and House whereas the U.S. Constitution Article 1, Section 8 Treaty clause requires 2/3 vote of Senate. The TPP would remain in effect until 2018, but could be extended to 2021.

What is missing in the TPP

 The TPP does not address any of the “predatory mercantilist” actions that our current trading partners are using that have created the enormous trade deficit that I wrote about a few weeks ago. These policies are: currency manipulation, “border adjustable” taxes called Value Added Taxes (VATs), which are a tariff by another name, government subsidies for State-Owned Enterprises, and “product dumping” by manufacturers in one country at below their cost to produce to destroy competition in another country.

“Over 20 countries, representing 1/3 of global GDP, are engaged in currency wars” by undervaluing their currency. These governments work with their central banks to manipulate the currency value in order to provide a competitive advantage to boost exports and impede imports. China’s currency is estimated to be 25-40% undervalued. As Paul Volcker, former Secretary of the Treasury, has explained, “In five minutes, exchange rates can wipe out what it took trade negotiators ten years to accomplish.” Foreign government intervention in foreign exchange markets is manipulation, not free trade.

Value Added Taxes (VATs) range from a low of 10% to a high of 24%, averaging 17% worldwide. The U. S. is one of a handful of 159 other countries that do not charge a VAT. This means that American products that are exported are an average of 17% more expensive when imported by a country that adds a VAT. In reverse, foreign imports are an average of 17% less expensive because the U. S. does not charge a VAT. Thus, we reduce tariffs through our trade agreements only to have our trading partners add a tariff by another name to the cost of our products that we export. This gives other countries an unfair competitive advantage in the global marketplace.

We have all read news stories about “product dumping” cases against U. S. industries, such as the tires, steel, and solar panel industries. With regard to government subsidies, the best example is how Foxconn was able to get Apple’s business for manufacturing the iPhone, iPad and now the iWatch because the Chinese government gave them the land and built the building for them.

What is wrong with the TPP?

 The TPP overrules prior acts of Congress and destroys our national sovereignty. For example:

 Buy American Act made Null and Void: For the manufacturing industry for which I play a role, the most adverse effect would be that the U.S. would have to agree to waive Buy America procurement policies for all companies operating in TPP countries. What this means is that the TPP’s procurement chapter would require that all companies operating in any country signing the agreement be provided access equal to domestic firms to bid on government procurement contracts at the local, state, and federal level. There are many companies that survived the recession and continue in business today because of the Buy American provisions for defense and military procurement. The TPP could be a deathblow for companies that rely on defense and military contracts, such as the U. S. printed circuit board industry. Most of the commercial printed circuit manufacturing was already offshored to China and South Korea years ago.

Product Labeling: Country of Origin Labeling, labeling of GMO products, and “organic” labeling could be made illegal because of being viewed as an “illegal trade barrier.” Even the health warnings on tobacco products could be viewed as an “illegal trade barrier.”

Many TPP countries are farm-raising seafood using chemicals and antibiotics that are prohibited in the U. S. and farmed seafood from China is being raised in water quality equivalent to U. S. sewers. According to Food & Water Watch, around 90% of the shrimp and catfish that Americans eat are imported. They warn, “The TPP will increase imports of potentially unsafe and minimally inspected fish and seafood products, exposing consumers to more and more dangerous seafood.”

Bill Bullard, CEO of R-CALF USA (Ranchers-Cattlemen Action Legal Fund, United Stockgrowers of America) has stated “that fast food restaurants are not required to disclose the origins of their beef and even when restaurants say the beef is “U.S. Inspected,” it is as likely as not to be imported.” When we were in Washington, D. C. together last month, Mr. Bullard told me that the increased importation of sheep and lamb from Australia and New Zealand could wipe out the American sheep ranching industry.

The California Farmers Union recently sent a letter to Rep. Davis Valadao (R-CA) stating, “Passage of the TPP would lead to a flood of dairy imports from New Zealand chronically depressing U. S. dairy producer prices…Agricultural imports will rise dramatically under the proposed agreement…The Agreement further poses a threat to the food security that we have long enjoyed as a nation because imports will replace U. S. produced agricultural products.”

Investor State Dispute Resolution: ISDR is designed to allow foreign corporations to bypass the domestic legal system to use to fight laws they don’t like. International Tribunals, not U.S. courts, would decide on lawsuits between “investor” companies in member countries and the U. S. Foreign “investors” could file lawsuits against city, state, and federal agencies for laws and regulations that may infringe on their “expected future profits.” They can also sue for compensation for the loss of these “expected future profits.” Thus, the TPP would infringe upon states’ rights as state and local governments have the constitutional authority to enact rules governing many areas covered by the TPP. But, they will no longer have the freedom to do so in the many regulatory areas covered by the TPP.

The TPP includes hundreds of pages that govern the policies of states concerning non-trade domestic policy and state and local officials would be bound to comply with much of the Agreement’s rules and regulations.

Space doesn’t allow me to cover all of the things that are wrong with the TPP with regard to non-trade issues, such as patent and copyright laws, land use, as well as policies concerning natural resources, the environment, labor laws, health care, energy and telecommunications.

Except for the large multinational corporations that participated in writing the Agreement and are its beneficiaries, there is something for everyone to hate. Opposition to the TPP cuts across party lines ? there are Democrats, Republicans, and Libertarians opposed to many of the “leaked” provisions of the TPP. Organizations from the left to the right are opposed to the TPP as negotiated. It will hurt the 98-99% of American manufacturers who had no place at the table in writing the Agreement. It will hurt American consumers and American workers of all ages. It will harm our environment and put our food and water safety at risk. But, most of all it will destroy our national sovereignty. Now is the time for you to write, call, or email your Senator and Congressional representative to urge them to vote “no” on granting Fast Track authority.

Posted in Country of Origin, Economy, Manufacturing, National security, Taxes/Regulations, Trade, Trade Policy | 1 Comment »

Additive Manufacturing is Making Rapid Technological Advances

Tuesday, April 7th, 2015

Advances in additive manufacturing and 3D printing are occurring so rapidly that there is now a daily newsletter on 3D printing for which I recently subscribed. Design News, Industry Week, Manufacturing.net, and many other publications are also publishing frequent articles on additive manufacturing, and most trade shows are now scheduling one or more sessions related to the topic of additive manufacturing/3D printing.

The latest e newsline from Manufacturing.net had the headline, “Liquid Printer Turns 3D Manufacturing Upside Down” and describes the new 3D printer introduced by Carbon3D at the TED conference on March 16. The new “3D printer can print up to 100 times faster than conventional additive manufacturing thanks to its ability to ‘grow’ materials upward from a pool of liquid,” using “their Continuous Liquid Interface Production (CLIP) technology, which builds material upward in a continuous stream.” The Carbon3D printer uses UV light to trigger “polymerization, the creation of three-dimensional polymers, while oxygen inhibits the reaction” and “can be used with a broad range of polymeric materials.”

Dr. Joseph DeSimone, the CEO and co-founder of Carbon3D, said “Our CLIP technology offers the game-changing speed, consistent mechanical properties and choice of materials required for complex commercial quality parts.”

A couple of weeks ago, I was contacted by Zach Simkin, Co-President of Senvol LLC, a company that does analytics exclusively for the 3D printing industry, letting me know that they recently launched a tool, the Senvol Database, which is the first and only searchable database for industrial 3D printing machines and materials. Simkin said, “Users are able to search the database by over 30 fields, such as machine build size, material type, and material tensile strength. The database is online and free to access. The database already has thousands of regular users since launch, many of whom are engineers across a variety of verticals.”

A few days later, I interviewed Annie Wang, Co-President of Senvol LLC, and she said, “Additive manufacturing is never going to replace 100% of subtractive manufacturing.” She emailed me the Video link to their presentation from the RAPID Conference last year ? “Determining Cost-Effectiveness of Additive Manufacturing.” She also emailed me the write up from the Wohlers report (“Cost-Benefit Analyses for Final Production Parts”), which gives an overview of two case studies that they did for GE and Johnson Controls. She said, “We used the Senvol Algorithm to determine whether or not it’s cost-effective to switch from conventional manufacturing to additive manufacturing.”

While the results of the analysis are proprietary, Wang and Simkin provide guidelines in the introduction of their study, writing, “However, just because a part can be produced using AM does not mean that it should be. Prior to implementing the technology, it is essential to conduct a thorough cost-benefit analysis. Generally speaking, it is often stated that AM is economically suitable for parts that have the following features: low volume, complex, and small. Although this can be true, it is not sufficient to only consider features of the part. Rather, when trying to determine whether a particular part can be cost-effectively produced using AM, it is critical to analyze the entire supply chain.”

In the report, they provide “… the seven supply chain scenarios that tend to lend themselves well to AM. If a part falls into one or more of these scenarios, then that part may be cost-effective to produce via AM. If a part does not fall into any of these scenarios, then the part almost certainly will not be cost-effective for AM given the current AM technology.” They are:

Scenario Description
 

Expensive to Manufacture
Do you have parts that are high cost because they have complex geometries, high fixed costs (e.g. tooling), or are produced in low volumes? AM may be more cost-efficient.
 

Long Lead-Times
Does it take too long to obtain certain parts? Are your downtime costs extremely high? Do you want to increase speed-to-market? Through AM, you can often get parts more quickly.
 

High Inventory Costs
Do you overstock or understock? Do you struggle with long-tail or obsolete parts? AM can allow for on-demand production, thus reducing the need for inventory.
 

Sole-Sourced from Suppliers
Are any of your critical parts sole-sourced? This poses a supply chain risk. By qualifying a part for AM, you will no longer be completely reliant on your current supplier.
 

Remote Locations
Do you operate in remote locations where it is difficult, time consuming, or expensive to ship parts to? AM may allow you to manufacture certain parts on-site.
 

High Import / Export Costs
Do you pay substantial import/export costs on parts simply because of the location of your business unit and/or your supplier? On-site production via AM can eliminate these costs.
 

Improved Functionality
AM can enable a part to be redesigned such that its performance is improved beyond what was previously possible.
© Senvol LLC

Just like a Total Cost of Ownership analysis is beneficial to determine whether or not to offshore the manufacturing of a particular part or product or return manufacturing to America from being manufactured offshore, Simkin and Wang state, “For parts that fall into one or more of the above scenarios, a detailed, quantitative cost-benefit analysis is warranted. To conduct such analyses, an algorithm, courtesy of Senvol, was used to determine what types of parts can be more cost-effectively manufactured using AM versus the status quo. The algorithm analyzes an array of variables that span the entire product life cycle.”

I told Wang that 3D printing is greatly accelerating the development of new products by the inventors that I advise as part of the San Diego Inventors Forum, but there are many times that a part can be made by 3D printing that can’t be replicated in a production process. For example, you can produce “chunky” plastic parts using 3D printing that cannot be made in the production process of injection molding. The use of 3D printing is enabling inventors to have a sample part to show/demonstrate in person or by means of a video to secure potential investors, but the inventor needs to do a careful analysis of the best manufacturing process to use for production, depending on where it will be used (home, office, or outdoors), product certifications required, and projected life cycle volumes, among other considerations. A 3D printed sample can be the essential ingredient of a video to do a crowdfunding campaign via Kickstarter, Indiegogo, or GoFundMe.

I told her that I give a presentation each year at our meetings on “How to select the right manufacturing process and sourcing location for your product,” which incorporates the Reshoring Initiative’s Total Cost of Ownership analysis. We agreed that companies could benefit from doing a cost-benefit analysis of comparing conventional manufacturing to additive manufacture as well as doing the Reshoring Initiative’s Total Cost of Ownership analysis when making the decision to manufacture in the U. S. vs. offshore.

Posted in Innovation, Manufacturing, Reshoring, Technology | No Comments »

Looking Back at 2014 and Ahead to 2015

Tuesday, January 20th, 2015

Most economists are predicting a rosy forecast of more than 3 percent expansion for the U.S. economy in 2015, up from 2.3% in 2014. If it does, this “would mark the first time in a decade that growth has reached that level for a full calendar year.” The unemployment rate is also predicted to drop from the current 5.6 percent to 5.3 percent. The questions are: How much will American manufacturing benefit from this expansion and how many manufacturing jobs will be created?

While the country gained 252,000 jobs in December, only 17,000 were manufacturing jobs according the monthly report from the Bureau of Labor Statistics ? “In December, …Manufacturing added an average of 16,000 jobs per month in 2014, compared with an average gain of 7,000 jobs per month in 2013.”

This was a significant increase over the previous year, but notice that President Obama recently stated that “more than 764,000 manufacturing jobs have been gained since the end of the recession.” This means that we still have a long way to go to recoup the 5.8 million manufacturing jobs that we lost between the years 2000 – 2009. According to Scott Paul, President of the Alliance for American Manufacturing, “…December’s manufacturing job gains were behind the previous month, and that halfway through the president’s second term, the country is just over one-quarter of the way to his pledge to create 1 million new manufacturing jobs in that four-year span.”

While the U3 unemployment rate dropped to 5.6 percent, the U6 rate is double at11.2 percent. The U-6 rate includes “Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force.”

In a recent article, business reporter Jonathan Horn of the San Diego Union-Tribune noted, “the unemployment rate fell in part because people dropped out of the labor force ? they either retired or left the labor force. Last month, the number of unemployed persons fell 383,000 to 8.7 million. However, less than one-third of people out of work found jobs; the rest stopped looking. The percentage of Americans who are either working or looking for work fell back to a 37-year low last touched in September.”

The January 6-11, 2015 edition of the San Diego Business Journal’s reported that manufacturing jobs in San Diego increased by 3.3 percent from November 2013 through November 2014, for a total of 97,400 industry jobs, up by 3,100 jobs. However, we still have a long way to go to get back to the 122,600 manufacturing jobs in the San Diego region we had at the end of 1999.

Two manufacturing sectors led the job growth in San Diego: shipbuilding and Unmanned Aerial Vehicles (drones.) General Dynamics’ Nassco division has contracts for five commercial tankers and one Navy ship and plans to “add about 300 additional jobs to the shipbuilder’s staff, bringing the total workforce to about 3,500.” General Atomics Aeronautical Systems Inc’s “local employment grew 9 percent year over year to 4,843 as of June 2014.”

In this same article, I was quoted as saying, “For those with skills and experience in a particular industry, things were definitely trending up in 2014…This (2014) has been a year when people could find jobs.” I’m also quoted as saying, “San Diego greatly diversified its economy following the previous major recession in the early 1990s, and that’s made a huge difference in the past several years…One of our strengths is that we’re not hurt as much from the lack of new defense programs.”

Looking Back at 2014

The R&D tax credit that had expired December 31, 2013 was extended for 2014, but has now expired again as of December 31, 2014. The R&D Tax Credit was originally introduced in the Economic Recovery Tax Act of 1981 sponsored by Rep. Jack Kemp and Senator William Roth. The credit has expired eight times and has been extended fifteen times. The frequent expiration of this tax credit creates unnecessary uncertainty for business investment planning. The R&D Credit Coalition, National Association of Manufacturers, and many other business groups recommend that this tax credit be made permanent.

One bright spot on the national scene is that a bill requiring a National Strategic Plan for Manufacturing authored by Rep. Daniel Lipinski (D-IL) and Rep. Adam Kinzinger (R-IL) became law right before Christmas. Three of Lipinski’s previously authored bills had passed the House three times over the past five years, but failed to either pass or be considered in the Senate. This bill was included in legislation that passed both houses and was signed into law by the President. U.S. Senators Mark Kirk (R-IL) and Chris Coons (D-DE) and Mark Pryor (D-AK) introduced the language in the Commerce, Science and Justice Appropriations bill passed by the Senate.

Rep. Lipinski stated, “After many years of hard work, my bipartisan legislation to boost domestic manufacturing and American jobs by. The bill requires that at least every four years the president works with public and private stakeholders to produce and publish a plan to promote American manufacturing. In addition, every year the president’s budget blueprint will have to contain an explanation of how it promotes the most recent manufacturing strategy. This bill guarantees that Washington has to pay attention to what can be done to help manufacturers and workers. Getting this provision into law can really make a difference by leading to economic growth, increased American security, and more middle class jobs that pay hard-working Americans a good wage. I look forward to finding many more “Made in USA” labels on products we see in our stores and online.”

In June 2013, I wrote an article criticizing an earlier version of this bill, H.R. 2447, the American Manufacturing Competitiveness Act of 2013, and was contacted by Rep. Lipinski’s Chief of Staff to discuss my criticisms. I am anxious to see whether or not the current language included in the Commerce, Science and Justice Appropriations bill addressed these criticisms.

In his 2014 State of the Union address, President Obama pledged to launch four new manufacturing institutes this year, for a total of eight institutes launched so far on an original goal of creating 15 manufacturing innovation institutes. On December 11th, President Obama announced that” the government will invest more than $290 million in public-private investment for two new Manufacturing Innovation Hub Competitions.

One will be in smart manufacturing at the Department of Energy and one in flexible hybrid electronics at the Department of Defense. Each institute will receive $70 million or more of federal investment to be matched by at least $70 million from the private sector for a total of more than $290 million in new investment.”

“The Department of Defense will lead a competition for a new public-private manufacturing innovation institute in flexible hybrid electronics…The Department of Energy will lead a competition for a new public-private manufacturing innovation institute focused on smart manufacturing, including advanced sensors, control, platforms, and models for manufacturing…” The press release invites interested applicants to find more information on the manufacturing innovation institute competitions at www.manufacturing.gov.

While funding manufacturing institutes may have a long-term benefit similar to funding research at other government institutions, there are actions that President Obama and Congress could take that would have a more immediate benefit on the manufacturing industry and create more jobs, such as making the R&D tax credit permanent, addressing currency manipulation by our foreign trading partners, easing taxes to repatriate corporate profits, and actually doing comprehensive tax reform. Let us hope that the economic predictions of a better 2015 than 2014 will come true and that more manufacturing jobs will be created by even more companies returning manufacturing to America.

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Posted in Economy, Jobs, Manufacturing, Reshoring, Taxes/Regulations | No Comments »

Miller Ingenuity Combines Innovation and Lean to Create a Unique Culture

Tuesday, December 9th, 2014

Last month, I had the pleasure of interviewing Steve Blue, President of Miller Ingenuity, located in Winona, Minnesota. Winona is a medium-sized Midwestern town of under 30,000 people located on bluffs overlooking the Mississippi River in the southeastern corner of Minnesota across the river from Wisconsin.

“Rudy” Miller founded the company more than 60 years ago after inventing the wick lubricator, a maintenance free lubricating system for locomotives. Miller’s inventiveness enabled the company to develop into a successful company by means of the ability to design, produce and deliver innovative railroad parts that meet the needs of the industry.

Miller Ingenuity currently has 50 employees at their 70, 000 sq. ft plant, but has 18 sales people around the world selling to 100 countries, including Asia. The company remained a privately held enterprise of the Miller family after Mr. Miller’s death 18 years ago, and Mr. Blue became president 15 years ago.

As described on their website, Mr. Blue is carrying on the innovation legacy of Mr. Miller: “Our continued innovations are driven by three core motivations: to take on customer challenges, to think more creatively about solutions, and, humbly, to be everyday heroes to our customers. We put these beliefs into action based on deep and “factory floor” relationships with our customers and on our ability to invent, engineer, and deliver ingenious solutions.”

Mr. Blue stated that the company started on their Lean journey ten years ago, and every employee went through the training. Two of their employees are Black Belts from training they had received when they worked for General Electric. The company has expanded Lean out of the shop floor into “lean office,” but not into “lean accounting” as yet.
In answer to my question as to whether the company is having problems finding employees with the right skills, Mr. Blue said, “Yes, but it is because we are picky by design. We have created a culture, and not everyone fits into our culture. We are slow to hire, but fast to fire if someone doesn’t fit. It’s easy to teach skills, but attitude is more important.”

Mr. Blue added, “We do continuous training as part of our Lean program. We have self-directed work teams and utilize peer interviewing and reviews. We have a “bounty” program with a $5,000 cash award for the most innovative ideas. For example, six production workers reduced a stamping die set up from four hours to 16 minutes.”

Since I saw a wide variety of products on their website utilizing many different fabrication processes, I asked if they were vertically integrated to do sheet metal fab, machining, rubber and plastic molding, wire forming, electronics assembly in-house or if they subcontracted out some of these fabrication services. Mr. Blue said, “We do metal stamping, compression rubber molding, and injection molding of plastics in-house, and subcontract out the other fabrication processes.”

Naturally, I asked if he outsourced any manufacturing offshore to China or other Asian countries, and he responded, “We have some electronic subassemblies and surface mount printed circuit boards sourced overseas, along with some overmolded rubber parts because our competition was selling products at our U. S. cost.”

On their website, I had noticed a heading for the Larry McGee Company and asked Mr. Blue about the company. He said, “We acquired the Larry McGee Company in March of this year. They were our third acquisition in the past 10 years. They had a great product line of radio-controlled interface devices, but no sales force. It was a low risk opportunity to enter into a different technology. We moved their operations into our plant from their Chicago facility.”

I had received a press release about the company’s Creation Station, so I asked Mr. Blue why they started it. He said, “We started the Creation Station because our ability to innovate was slowing down and needed to be accelerated. We hired the ex-Chief Creativity Officer from QVC to teach us innovation principles. We started by having an innovation session every Tuesday, but wanted innovation to be more spontaneous and not wait until Tuesdays. This led to creating a space away from their working space in the middle of the manufacturing area. Glass panels provide natural light. Smart boards are scattered about the room, and there is a pool table in the middle of the room. But, the magic is in the people, not the room.”

An article in the Winona Daily News provides further information, “Creation Station is a big investment in creativity and entrepreneurialism in manufacturing at a level where it needs a shot in the arm,” said Steve Blue, Miller Ingenuity President and CEO. “It’s truly a breakthrough moment for our company, the town of Winona, the region, and small and mid-sized manufacturers in this country.”

“Creation Station offers a flexible workspace designed for both large and more intimate presentations, trainings and meetings. Creation Station will also be made available during off-business-hours for regional organizations and companies looking for a high-tech “think tank” space.”

In addition to the Creation Station, Miller Ingenuity created the 2014 Ingenuity Challenge, open to employees and the general public. The public invitation stated: “The Ingenuity Challenge invites ALL college and graduate students to submit plans and creative ideas in response to the challenge – How Might American Manufacturers Attract the Best and Brightest Innovative Minds to Pursue Careers in the Manufacturing Industry. The best solutions will win: 1st place $7,000; 2nd place $2,000; and 3rd place $1,000.” The deadline was November 19th, and they had eight entries at the time of our interview on November 17th. The winners have not been announced yet, but the results will be made publicly available, and the ideas will not be proprietary to Miller Ingenuity.

In answer to my final question as to what does he attribute the company’s ability to prosper after 60 years in business, he answered, “Our culture by design, not default has enabled us to prosper. We have a cohesive, collaborative, and creative culture.”

We will be hearing more from Steve Blue as he told me that he had just signed a deal with Praeger Publishing to publish a book titled “American Manufacturing 2.0: What Went Wrong and How to Make it Right.” We obviously share a common love of manufacturing and realize its importance to our economy and the creation of good-paying jobs. His book is expected to be published in the fall of 2016 and will utilize “up-to-the-minute data and trends to discuss the future of manufacturing in America and offers an inspiring vision—featuring his own company’s case studies—for revitalizing an entire industry.”

Posted in Innovation, Lean, Manufacturing | No Comments »

Idea Jam Explores Future of Jobs in San Diego

Tuesday, December 2nd, 2014

On November 7, 2014, I attended the “Idea Jam – Innovating for the Future” session put on by the Pacific Center for Workforce Innovation in San Diego. The purpose of the session was to identify the major challenges to the San Diego workforce in the coming years and to generate audience participation in visioning exercises to explore new and innovative workforce development ideas. The event was held at Colman University, and major sponsors were SDG&E, Qualcomm, the Eastridge Group, Point Loma Nazarene College, and Cal State University, San Marcos.

To get our creative juices flowing, Master of Ceremonies, Susan Taylor, San Diego’s TV news icon, introduced Futurist Speaker, Thomas Frey, of the DaVinci Institute as the keynote speaker. It is difficult to do justice to his very visual presentation of images of break-through technologies, but his statements alone created much food for thought about the future. He stated, “We are a backward-looking society…the future gets created in the mind. The future creates the present…Visions of the future affect the way people act today.” He rhetorically asked, “What are the big things that need to be accomplished today?

He continued, “Catalytic innovation creates entirely new industries, like electricity did…Most successful companies today are in the second half of the bell curve…the steel industry had its peak employment in the 1980s.”

It was a shock to hear him state that “Two billion jobs will disappear by 2030…Every time you download a mobile app, you are eliminating a piece of a job.” In answer to his own rhetorical question, “Where will our next generation’s jobs come from, he answered, “from new industries that don’t exist now.” He added, “As you raise the bar for our achievement, we create the new norm.”

“Software is heating the world,” he proclaimed. “In 2030, there will be 100 trillion sensors in the world. Information is being parsed into small things.” He cited some of the new enhanced objects such as: Amazon’s Track Car, the Asteroid Moon Micro-imager Experiment (amie) For Smart-1 Mission, the Vitality Glow Cap for medication management, the Ambient Umbrella by Ambient Devices, Mimo’s Baby monitor, the flying Nixie camera (a tiny wearable camera on a wrist band in which the wrist straps unfold to create a quadcopter that flies, takes photos or video, then comes back to you), the Philips biometrics coffee maker that can recognize users via their fingerprint and make coffee just the way that individual likes it, and the Pintofeed, calling itself the “first intelligent pet feeder”

He explained that “we are entering the age of hyperawareness and the quantified self with products such as printable skin sensors, smart body watches, brain hacking, transcranial brain stimulation.”

Frey stated, “3D printing is changing the world. The new HP 3D printer has 30,000 spray nozzles and can utilize over 200 materials. The iBox Nano is now the world’s smallest, least expensive 3D resin printer. Even shoes can be 3D printed, and Contour Crafting has developed a type of ceramics printing that could be used in construction. Whole walls can now be made by 3D printing, and a company in China was the first company to print a small house for under $5,000. The goal is to print an entire house in one day. In the future, you may live in a printed house…Bio printing can now print skin, veins, organs like a liver, limbs, and an exo skeleton, and there is a pill printer that chemprints antibiotics.” He quoted Chris Anderson, former editor of WIRED magazine and now cofounder and CEO of 3DRobotics, as saying, “3D printing is going to be bigger than the internet.”

“We need to prepare our children for jobs that don’t exist and technology that hasn’t been invented, he declared…By 2030, the average person will have to ‘reboot’ their career six times in their lifetime. To do this, we need to frame our work to train people in a faster way…By 2020, half of all traditional colleges will disappear.”

To facilitate this rapid training, he shared that the DaVinci Institute now offers 11-13-week courses in such topics as 3D printing, web design, game design and development and becoming a drone pilot.” He concluded by saying, “The fastest way to create new jobs is to eliminate the old ones out of existence.”

In California, the community college system is already providing this type of accelerated, focused training through their certificate programs in such subjects as multimedia, web design, web server maintenance and security, and culinary arts. It will be relatively easy to add new training topics to the curriculum to meet future needs.

After Mr. Frey’s predictions of the future, a panel of business leaders discussed what is happening in their industries and what new industries should we focus on. Jeff Nichols from Sempra Energy stated that “San Diego is the nexus of cyber security…Delivering electricity and water is synergistic, so there are opportunities to putting these two together.”

Dr. Ed Abeyta from the University of California, San Diego said, “We need to teach skill sets in a non-university setting but he hasn’t seen an online program that successfully replaces teaching in person.” He added, “We need micro-credentials that you could earn rapidly.”

Matt Grob of Qualcomm said, “The companies that change fastest are the small, startup companies. San Diego is very well placed in the robotics industry…UCSD is starting an incubator for robotics” With regard to training, he said, “A combination of a person and a computer are better than a computer or a person alone.”

In answer to the question, how do we prepare for the change and foster the culture of change in others? Dr. Abeyta responded, “Humanity had its core values before technology came, and we must instill those in our children. We need to marry the technology with our core values. It is not about getting the answer; it is Are we asking the right questions?” Dr. Smith of West Health commented, “We can teach how to think and not what to know.”

The last half of the morning was spent in an idea jam session by small table groups to come up with two ideas: most innovative and most likely to succeed. After lunch, the following panel of judges discussed the ideas developed by the audience: Molly Cartmill, Sempra Energy, Michael Alston, Qualcomm, and Mary Walter-Brown, Voice of San Diego. After presenting all of the ideas for the 17 different tables, the audience voted on the best ideas for both categories. The best ideas were:

Most Likely to Succeed

“Tinder, but for networking and mentoring.” (Note: Tinder is a matchmaking mobile app that uses GPS technology, in which users can set a specific radius have the option to match with anyone that is within that distance.)

“Industry developed after school programs to build skill sets and networking for specific career areas.”

“Change the hiring process from resumes to problem solving practices.”

“Retool community centers and libraries to be career path hubs.” (my idea at my table)

Most Innovative:

“Programmer boot camps for under-served communities integrated with soft and life skills.”

“Establish a mentoring program for retired professionals to share advice and knowledge to persons in transition”

“Implement playgrounds of interests at schools to help students see the possibilities i.e. Maker Spacers & digital playgrounds.”

“Geolocation app that reveals available parking, especially in downtown SD via satellite, with timer alerts”

When I think of the fact that I am now on my fourth career path, I can see that six career paths is a realistic prediction for the future. Just like continuous improvement is one of the tools for becoming a Lean company, continuous learning will be a prerequisite for everyone who wants to keep working during their even longer productive lifetime in the future. My definition of success has been to learn something new to the point of proficiency, so I can highly recommend continuous learning to others. It’s what makes life interesting, challenging, and fun!

Posted in Economy, Education, Innovation, Jobs, Manufacturing, Technology | No Comments »

Why We Must Stop the Fast Track Authority in the “Lame Duck” Session

Tuesday, November 18th, 2014

The rumors in Washington, D. C. are that granting President Obama Fast Track Authority under Trade Promotion Authority will be brought up in the “Lame Duck” session, perhaps as an addition to one of the bills extending certain tax credits, called “Tax Extender bills.”

Simply put, granting Fast Track Authority to the president means:

  • Choice of countries is delegated to President
  • Executive Branch negotiates and signs a trade agreement before vote by Congress
  • Allows only 20 hours of debate by Congress
  • Forbids any amendments to the trade agreement
  • Requires only a simple majority vote in each House violating U.S. Constitution Article 1 Treaty clause giving the Senate authority to approve a treaty by a supermajority.
  • Gives Constitutional power over trade to President and takes it away from Congress
  • Usurps Constitution and is dangerous to give this much power to the Executive Branch

There are two trade agreements that have been in secret negotiations since 2010. The first is the Trans-Pacific Partnership. Eleven nations have participated in the negotiations: Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. Japan announced its intention to join the agreement last spring. However, the TPP is intended as a “docking agreement,” so other Pacific Rim countries could join over time, and the Philippines, Thailand, Colombia, and others have expressed interest. Even China could join the TPP at a later date without suffering any disadvantage though this would negate the original reason for the TPP as a counter to China’s hegemony in the Pacific.

The TPP is much more than a trade agreement; it is a Trade and Global Governance Agreement because only five of the 30 chapters relate to tariffs and quotas. The other 25 chapters cover such topics as: domestic regulation: food & product safety, financial regulation, investor states’ rights, immigration, intellectual property, federal, state and local laws on taxes, patents, copyrights, trademarks, immigration, environment, labor standards, among many other issues. Clauses in these chapters may even overrule prior acts of Congress without new legislation being introduced, passed in Congress, and signed by the president.

Most dangerous of all, International Tribunals, not U.S. courts, would decide on lawsuits between companies in member countries and U. S. In a commentary article on October 15, 2013, Lt. Col (Retired) Allen West wrote, “TPP would subject the U.S. to the jurisdiction of foreign tribunals under the authority of the World Bank and United Nations. These unelected, unaccountable panels would constitute a judicial authority higher than the U.S. Supreme Court. They would have the power to overrule federal court rulings and order payment of U.S. tax dollars to enforce the special privileges granted to foreign firms that would be exempt from EPA and other regulations that strangle American firms.”

In addition, the U.S. would have to agree to waive Buy America procurement policies for all companies operating in TPP countries. What this means is that the TPP’s procurement chapter would require that all companies operating in any country signing the agreement be provided access equal to domestic firms to U.S. government procurement contracts over a certain dollar threshold. To meet this requirement, the U.S. would have to agree to waive Buy America procurement policies for all companies operating in TPP countries. There are many companies that survived the recession and continue in business today because of the Buy American provisions for defense and military procurement. The TPP could be the death knoll for these companies!

The other trade agreement is the Transatlantic Trade and Investment Partnership (TTIP) also known as the Transatlantic Free Trade Agreement (TAFTA), which is a proposed free trade agreement between the European Union and the United States. The Obama administration considers the TTIP a companion agreement to the Trans-Pacific Partnership, and it is similar in scope and nature to the TPP, incorporating all the same global governance chapters.

In the last 20 years, the U. S. has made trade agreements with 20 nations, of which the major trade agreements are:

  • NAFTA
  • Created the World Trade Organization & let China join
  • Panama Free Trade Agreement
  • Central America Free Trade Agreement
  • Colombia Free Trade Agreement
  • Korea Free Trade Agreement

What have been the consequences of these past trade agreements? One consequence is an increasing trade deficit. In 2013, our total trade deficit in goods was $688.4 billion, of which China represented 46% at $318.4 billion. Our top six trading partners of Canada, China, Mexico, Japan, Germany, and South Korea represent 64% of our total trade deficit.

Another serious consequence is the loss of American jobs. From 2000 to 2010, the U. S. lost 5.8 million manufacturing jobs and 57,000 manufacturing firms closed. Where did most of the jobs go? U.S. Department of Commerce data shows that “U.S. multinational corporations… cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million.” Millions of people have lost their jobs because corporate CEOs concluded, “It’s cheaper to manufacture where they pay 50 cents/hour and let us pollute all we want.”

As a result, the real unemployment rate is 16.1%, and there are still nearly 2 million less jobs than there were at the start of the Great Recession in December 2007!

The TPP and TTIP/TAFTA are bad for American companies, American workers, and American consumers. What good does it do to have cheaper consumer goods if you don’t have a job?

I urge everyone to Contact your Congressman to ask them to vote no on granting Fast Track Authority!

 

Posted in Jobs, Manufacturing, Trade, Trade Policy | 2 Comments »

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