The ever-changing global economy has had a huge impact on Wisconsin manufacturing, and the pace of change continues to accelerate. To remain competitive, manufacturers need to embrace a new outlook for the future.

A new WMEP initiative, Next Generation Manufacturing, details “the characteristics and competencies that manufacturers need to have over the next decade to succeed in the global economy,” said Mike Klonsinski, WMEP’s executive director. Next Generation Manufacturers understand that if they want to be in business in five or ten years, they need to look different
than they do today.

A Next Generation Manufacturer:

Makes the commitment to Lean Manufacturing and Lean Culture. “They need to be heavily invested in sustainable continuous improvement,” said Klonsinski. “There’s got to be a cultural change to sustain productivity, not just one-time cost  improvements.”

Uses innovation as a competitive advantage. “The life cycle of a product is getting shorter and shorter,” said  Klonsinski. Because of technology and the sheer number of manufacturers, products can be copied very easily. To succeed, manufacturers must make innovation an ongoing process.

Focuses globally to tap fast-growing overseas markets. “That doesn’t just mean exporting more,” he said. “It means understanding how you leverage the rest of the world to improve your bottom line.” That includes identifying global markets and international distributors and partners, as well as considering sourcing options.

Builds and secures a highly skilled workforce. Beyond a strong focus on traditional training, “Next Generation Manufacturers look to develop employees as business people and full partners engaged in the firm’s success,” said John Brandt, a management systems expert and the CEO and founder of the MPI Group. This includes understanding finances and the bottom line.

Is conscious of environmental concerns and incorporates “Going Green” into strategic planning. Manufacturers will need to become green as a matter of requirement and of opportunity. That means looking at products,processes, waste reduction, raw materials and energy usage.

Next Generation Manufacturing is about securing your future in the global marketplace. Klonsinski said, “You don’t have to exhibit all five characteristics, but you need to be considering them if you’re going to be in business in the next ten years.”

While “Next Generation Manufacturing” often refers to high-tech industries, in a broader sense, it means manufacturers in any industry who are trying to operate on a new level and in new ways. “Manufacturers need to think beyond the production of goods to bundling products with services and providing total customer solutions because the customer’s perception of value is changing,” said Brandt. This level of customer intimacy results in loyal customers who benefit from the manufacturer’s expertise.

General MetalWorks Gets Lean, Innovates

One Wisconsin manufacturer who applied the concept of customer intimacy in its transformation into Next Generation Manufacturing is General MetalWorks, a Mequon sheet metal fabricator that employs 81. They responded to serious threats from overseas competition by rethinking the direction of the business and what their customers really valued.

“We thought about who we wanted to be and where we wanted to go,” said Mary Isbister, General MetalWorks president. “We thought about what our customers would want from a local fabricator. The biggest things were turnaround time, small lot sizes and highly engineered products.”

They chose Lean as a way to bring about the change. “The first step was reducing the time it took to fill orders,” she said. Lead times were cut in half and employee productivity tripled. Lean became embedded in their culture. Revenues took off, from $6 million in 2002 to $12 million in 2007.

“You have to have quality, good sales and strategy, but I wouldn’t be able to get $12 million out the door if it weren’t for Lean,” she said. They’ve also developed rapid prototyping, invested in capital equipment and emphasized employee training, including offering specialized training for welders.

Tailored Label Going both Digital and Green
Another manufacturer, Tailored Label Products, Inc. of Menomonee Falls, which produces custom labels and die-cut adhesives and employs 62, adopted new digital technology, including in line/off line digital printing, variable data web printing and digital die cutting. “We’d be a much slower growth business today if we didn’t stay current with this technology,” said Michael Erwin, Tailored Label president.

In addition, they’ve implemented Lean, most recently as part of a redesign of the entire plant, which will double in size this year. The plant redesign is based on all new work flows, a plant within a plant focusing on enhanced information levels and material velocity.

Developing an engaged workforce is another priority. “We want to hire people who are excited and interested in the computerization of the manufacturing world,” said Erwin. “If you can manage all the files in an iPod, you can certainly do a lot of the things we do.”

As a printer, Tailored Label is well aware of its impact on the environment. “We are a profuse user of water-based inks versus those with solvents,” he said. “We’ve recycled for years.

The result of their work is that the company has doubled in size in four years while building a highly engaged, award-winning and motivated workforce.

The benefits of Next Generation Manufacturing include:

• Greater efficiency that improves the bottom line
• Freed-up capacity to enable top-line growth
• Development of new products, entering new markets
• Increased sales and revenue
• Increased employee satisfaction and reduced turnover
• Minimized impact on environment and meeting growing consumer demand for green products.

The course set out by Next Generation Manufacturing offers both competitive advantage and the chance to prosper. “The opportunities are available to any firm in any industry, and at a reasonably low cost,” said Brandt. “Hardly anybody is doing all of it well,” creating a real opportunity for manufacturers to embrace a profitable future.