by Gary Mintchell | May 29, 2019 | Commentary, News, Workforce
I saw this note in today’s Espresso from The Economist, “France’s finance minister pledged to save jobs under threat at General Electric’s plant in the country’s north-east. The American industrial conglomerate, which made a loss of $23bn last year, had said it would cut around 1,000 jobs. Earlier this year GE paid France a €50m ($56m) fine for failing to create jobs after it took over Alstom’s energy business.”
Meanwhile in the US, officials are taking a second look at the results of Foxconn’s supposed multi-billion dollar investments. Politicians made great PR hay in 2017 with the announcement of a large investment in Wisconsin. Two years down the road, maybe the investment may not be so large and the employment a few thousand shy.
Governments can preach and give breaks and whatever, but market forces and bad management mean much more than governments for success. Take Alstom, for example. Perhaps there is French pride involved, but GE discovered that that particular acquisition was not all that it hoped for. One of a string of GE missteps. The French government can fine all it wants, but job creation depends upon good management and proper economic tailwinds.
I recently reported on the “success” of re-shoring manufacturing jobs, as the Reshoring Initiative would have it. Most likely it’s a result of financial analysts taking a closer look at supposed savings from only low wages discovering that other costs, such as logistics, insurance, loss of intellectual property, longer lead times, inability to quickly respond to changing markets all combined to make manufacturing offshore unappealing.
Most of the ills of manufacturing society I read about have a common root cause—less than competent management. I don’t see any quick fixes for that! And it won’t come from government fines generated by disappointment at lack of political gain.
by Gary Mintchell | Jul 31, 2017 | Internet of Things, Operations Management
We keep touting manufacturing jobs in America. An electronics assembly company has announced another plant in the US. When a process automation company lands a contract with a customer, it sends a press release touting the fact. But in process industries, the amount of the contract can be significant.
I seldom see one in discrete manufacturing.
On the heels of the Taiwanese manufacturer known as Foxconn announcing plans to perhaps build an assembly plant in Wisconsin, local automation supplier Rockwell Automation announces a partnership.
Main Point: This may be the most significant release I’ve ever seen from Rockwell. Not in terms of business value. Read this carefully and tell me where there is a product mentioned! This encompasses two things–one is workforce development and training. The second thing is a strategy. Sure, there will be products involved probably. But Connected Enterprise sounds more strategic, more consultative. This is decidedly not one of those things where we’ll cut you a deal if you buy 5,000 PLCs.
Maybe I’m reading too much into it, but I’m thinking this signals a direction shift under new CEO Blake Moret. Could be interesting times.
Downside: However, my research on Foxconn and America reveals a pattern of big announcements followed by little activity. For the people of rural Wisconsin, I hope this time they follow through.
News: Hon Hai Precision Industry Co. Ltd., also known as Foxconn, and Rockwell Automation announced July 28, 2017, that they are collaborating to implement Connected Enterprise and Industrial Internet of Things (IIoT) concepts for smart manufacturing in Foxconn’s new U.S. facilities.
The companies will also collaborate to develop and apply Smart Manufacturing solutions at Foxconn’s global electronics assembly operations and within the related industry ecosystem. Technologies and extensive domain expertise of both companies will be combined to deliver a state-of-the-art manufacturing system with unparalleled levels of operational efficiency.
Terry Guo, Foxconn chairman and CEO, said, “I am very excited about the opportunity for Foxconn and Rockwell Automation to work together. Foxconn is the global leader in electronics design manufacturing, and Rockwell Automation is the world’s largest company dedicated to industrial automation and information. I am confident that together we will increase operational efficiencies in electronics manufacturing to new levels, achieving the vision of Smart Manufacturing and Made in China 2025.”
The companies will also work together on workforce development and training. Specifically, as Foxconn increases its employee base in the United States, it has committed to participate in the previously announced program developed by Rockwell Automation and ManpowerGroup to upskill military veterans and create a pool of certified talent for in-demand advanced manufacturing roles across the United States.
Blake Moret, Rockwell Automation president and CEO added, “We are excited about the opportunity to work with a global technology and manufacturing leader to deliver advanced IIoT solutions to the electronics manufacturing industry. Our work with Foxconn will further demonstrate the power and broad applicability of The Connected Enterprise. We are also pleased that Foxconn shares our commitment to expanding and upskilling the U.S. workforce to ensure there is the necessary talent for advanced manufacturing roles.”
by Gary Mintchell | Apr 5, 2017 | Automation, Education, News
Manufacturing jobs—will they be people or robots? Whenever I am presented with an either/or I tend to think why not both or neither. Four choices, not two. In this case, three choices since neither means no manufacturing. And every country on God’s good Earth wants manufacturing. Just check out all the government initiatives underway.
Within the past week, I’ve seen two articles in local newspapers—The Sidney Daily News and The Dayton Daily News—parroting the New York Times article about how robots take jobs away from people.
This week was the biennial edition of Automate—the trade show of Association for Advancing Automation (A3). A3 released a white paper for the show, and I had a chance to sit with two association executives, Bob Doyle and Alex Shikany, to discuss the findings and analysis leading up to the white paper Work in the Automation Age: Sustainable Careers Today and Into the Future.
“As a representative of over 1,000 companies and organizations making up the automation ecosystem, A3 believes it is critically important to clear up some of the confusion surrounding the relationship between automation and jobs,” said Jeff Burnstein, A3 president quoted in the press release. An admirable goal.
My take is that I agree with pretty much everything they found with one addition—I still believe that manufacturing enterprise executives bear much blame for problems with manufacturing in America. Such things as management-by-spreadsheet, no passion for products or customers, faddish reactions (such as unintelligent offshoring), and lack of investment.
Technology Makes Lives Better
We discussed that humans have been developing technology to increase production and make lives better probably since there were humans on earth. Recent discussions that cover only the past 250 years or so with technology advancing from steam to electricity to IT-driven human prosperity and quality of life have all advanced.
Let’s look at a summary of findings. Here are some surprising facts.
Manufacturing Jobs
More robots, more jobs.
As employers add automation technologies such as robots, job titles and tasks are changing, but the number of jobs continues to rise. New technologies allow companies to become more productive and create higher quality products in a safer environment for their employees. This allows them to be more competitive in the global marketplace and grow their business. We see this in the statistics: over the seven-year period from 2010 to 2016, 136,748 robots were shipped to US customers—the most in any seven-year period in the US robotics industry. In that same time period, manufacturing employment increased by 894,000 and the US unemployment rate decreased from 9.8% in 2010 to 4.7% in 2016.
Specifically looking at two companies, Amazon had more than 45,000 employees when it introduced robots in 2014. While the company continues to add robots to its operations, it has grown to over 90,000 employees, with a drive to hire more than 100,000 new people by the end of 2018. Similarly, General Motors grew from 80,000 US employees in 2012 to 105,000 in 2016, while increasing the number of new US robot applications by about 10,000. We see similar results from multi-national companies with thousands of employees, to small manufacturing companies.
The skills gap and its impact.
Skilled workers are key to companies’ success and countries’ economic development. Employers rank the availability of highly skilled workers who facilitate a shift toward innovation and advanced manufacturing as the most critical driver of global competitiveness. But studies show an increasing skills gap with as many as two million jobs going unfilled in the manufacturing industry alone in the next decade. Fully 80% of manufacturers report a shortage of qualified applicants for skilled production positions, and the shortage could cost US manufacturers 11% of their annual earnings.
Changing job titles reflect changing tasks.
In the automation age, as in the computer age before it, job titles shift to reflect the impact of technology. A recent study concluded that occupations that have 10% more new job titles grow 5% faster. Just as we saw the rise of entire industries around previously unheard-of job titles in cloud services, mobile apps, social media, and more, we’re seeing similar shifts in the automation age. As lower-level tasks are automated with advanced technologies such as robots, new job titles and industries arise across nearly every economic sector.
Supply and demand and wages.
In the manufacturing industry, which is the largest user of automation today, the skills gap is driving up what are already strong wages and benefits, well over the US average. In 2015, manufacturing workers earned $81,289 including pay and benefits compared to $63,830 for the average worker in all nonfarm industries. And 92% of manufacturing workers were eligible for health insurance benefits. Despite that, manufacturing executives reported an average of 94 days to recruit engineering and research employees and 70 days to recruit skilled production workers.
Bridging the skills gap with innovative training.
Automation age jobs range from well-paying, entry-level and blue-collar positions through engineers and scientists. Stable automation-age manufacturing jobs can start at $20 per hour with just a high school diploma, a few months of automation training, and professional certification. Employers, vocational schools, and universities are offering innovative training approaches that give workers alternatives to the traditional (and expensive) high-school-to-college-to-job route. And employers such as GM are revitalizing apprenticeships, recognizing the significant advantage those programs offer.
Summary
Consider this equation
Automation –> Increased Productivity –> Improved Competitive Position –> Company Growth –> More Jobs
by Gary Mintchell | Mar 28, 2017 | Automation, Education, Leadership, Technology
Manufacturing in America—an event bringing together vendors, academia, end users of controls and automation. Siemens Industry, collaborating with its local distributor Electro-Matic, held a trade show/seminar series/thought leadership summit at the Marriott Renaissance Center Detroit March 22-23. The show has a distinct automotive industry feel, as you might expect, even though Detroit, and indeed all of Michigan, is reforming itself along high tech lines with less reliance on traditional automotive.
There was certainly a lot of thought leadership opportunity at the event. There was the Siemens Industry President of Digital Factory. There was the Governor of the State of Michigan.
And then, there was the group of high school students competing in the FIRST Robotics competition known as the ThunderChickens—Engineering A Better Way To Cross The Road. The picture shows a model of their robot. Such passion. Such creativity. The mechanical guy pointed to the control module. “It limits me to 6 motors,” he said. “Last year we only had one, but this year I could have used many more.”
Six motors!! What I’d have given as a kid building stuff to have one! Oh well, they were great.
Raj Batra, President of Digital Factory for Siemens, said the focus is on digitalization. Digital Twin is a piece of digitalization. This is the digital representation of a physical thing—product, machine, or component. Siemens brought all this together through the 2007 investment in acquiring UGS to form Siemens PLM. “Companies thought it was hype back then, now we know it drives value,” said Batra. “If you are a pure automation company how do you accomplish all this without a design component? You can’t have the digital twin. Meanwhile, a CAE company that doesn’t have automation and control do manufacturing—what do you get?” Batra added challenging the competition.
Batra continued, “We are close to a new era of autonomous manufacturing. And there is the growth of IIoT, we call Mindsphere. This all means manufacturing is no longer a black box to the enterprise. Indeed, it is strategic to the enterprise.”
Paul Maloche, vp sales and marketing Fori Automation, manufacturers of automated guided vehicles, discussed the methods by which collaboration with suppliers (in this case with Siemens) leads to innovation. Fori was diversifying from reliance on building machines for automotive applications, and evaluated the aerospace industry. The Siemens rep came in and said they could help get them into that market. But Fori would have to convert to Siemens control. The Fori team replied, “OK.” This led to development of automated guided vehicle technology and products. The partnership opened doors. Fori won several orders in aerospace market for the new AGVs with Siemens control.
Alistair Orchard, Siemens PLM, riffing off a space movie, began his talk, “Detroit, we have a problem.” All the old business models of trying to ship jobs overseas has not worked. We need to make stuff to be successful as a society. “So much of what we do has not changed in 50 years in manufacturing,” he noted, “but digitalization can change everything. Additive manufacturing can lead to mass customization due to 3D printing using the digital twin. You can try things out, find problems in design or manufacturing. You can use predictive analytics at design stage. Digital enterprise is about manufacturing close to the customer.”
Governor Rick Snyder, Michigan, touted his manufacturing background as former operations head at Gateway Computers. “As governor,” he said, “it’s about how you can build an ecosystem and platform for success. Long term, success needs talent. His philosophy contains the idea that we shouldn’t tell students what they should study, but let them know where opportunities are and how to prepare for them. The private sector needs to tell government what they need in the way of talent.”
Michigan has grown more manufacturing jobs than anywhere else in the country. Not only manufacturing, though, Michigan is also a center of industrial design. But the economy not only needs designers and engineers, but also people in skilled trades. “We need to promote that as a profession. We must break the silos that said your opportunities are limited to your initial career choice.”
Michigan has invested a lot in students, especially in FIRST Robotics, where Michigan teams have risen to the top. The state has also started a computer science competition in cyber security.
How are you innovating and making the world better?
Josh Linkner, CEO Detroit Venture Partners, gave the keynote address on innovation. I’ll leave you with his Five Obsessions of Innovators.
1. Curiosity—ask open ended questions
2. Crave what’s next—future orientation
3. Defy tradition—use Judo flip to turn idea on its head
4. Get scrappy—grit, determination, tenacity
5. Adapt fast
by Gary Mintchell | Jan 5, 2017 | Commentary, News, Workforce
Manufacturing jobs are a hot topic. The concern was prominent in the presidential election. Journalists who know nothing about manufacturing or automation are pontificating. Everyone has ideas.
Seth Godin has written a perceptive article on jobs—where they were and where they are going. He is known as a marketing guru, but he is a keen observer of business.
In this post, he wrote about jobs going away. “The good jobs I’m talking about are the ones that our parents were used to. Steady, consistent factory work. The sort of middle class job you could build a life around. Jobs where you do what you’re told, an honest day’s work, and get rewarded for it. Those jobs. Where did they go? The computer ate them.”
Now, I argue that that is not all bad. Many of the jobs were mindlessly repetitive. Many were also physically debilitating or downright dangerous. But there is no denying that the economics of the 1950s and 1960s allowed companies to buy labor peace with high wages.
But things have changed.
“For a hundred years, industrialists have had a clearly stated goal: standardized workers building standardized parts. The assembly line was king, and the cruel logic of commodity economics pushed industrialists to improve productivity. They did this by improving the assembly line and, when they could, by paying workers less.”
Godin opines that today, workers serve the computer. From machine operators to office workers. “Sure, there are still pockets of work that are essentially unmeasured or unique enough that they’re difficult to replace. This is where the remaining ‘good jobs’ exist. For the rest, though, the first brick in the wall is clear: Either you serve the computer or it serves you. Either you are working on spec to create a commodity, or you are using new tools to create disruptions and to establish yourself as the linchpin, the one we can’t easily live without.”
Then Godin strikes at the schools. A topic that I’ve devoted time in thinking and acting on. “During the last forty years, as the computer and the network destroyed the system that our schools were built for, we (from the top down, and also, most definitely, from the bottom up) did almost nothing to change the schools we built.”
Whose fault is this? Well, that can be spread around. “Parents and the institutions they fund closed their eyes and only paid attention to SAT scores and famous colleges.”
Schools were developed to serve the new manufacturing economy. Emphasis on basic skills, sitting in rows, and following instructions replaced education. Godin—“When a pre-employed person says, ‘I don’t know how to code and I’m not interested in selling,’ we need to pause for a moment and think about what we built school for. When he continues, ‘I don’t really have anything interesting to say, and I’m not committed to making a particular change in the world, but I’m pretty good at following instructions,’ we’re on the edge of a seismic shift in our culture. And not a positive one.”
Reminds me of when my dad told me when I was around 14, “Study, go to college, learn to be an engineer. Don’t settle for a job on the assembly line where you sit there all day putting a bolt in a hole.”
Funny thing, though, that many of the guys I’ve known over the years who had rote jobs like that were quite creative outside the factory. If only we could have tapped and encouraged that creativity.
Godin concludes, “No, the good jobs aren’t coming back. But yes, there’s a whole host of a new kind of good job, one that feels fundamentally different from the old days. It doesn’t look like a job used to look, but it’s the chance of lifetime if we can shift gears fast enough.”
