Month: December 2009

Manufacturing Facts They Don't Get in Washington

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MANUFACTURING: THE ENGINE OF AMERICA
 The following fact sheet was assembled by the team at Vanamatic Company to spell out their concerns to their Senator.
This is as articulate a case as we have seen. Too bad they don’t get it in Washington D.C..
Manufacturing is the country’s productivity powerhouse: a strong and vibrant manufacturing sector is a critical component in our country’s long-term economic future.
Federal Reserve Chairman Ben Bernanke has said that productivity growth is “perhaps the single most important determinant of average living standards.”

  • 1987 thru 2005, manufacturing productivity grew by 94%, roughly 2 1/2 times faster than the 38% increase in productivity in the rest of the business sector.

With productivity comes higher wages.
  • Manufacturing jobs pay 23% more than the rest of the workforce.
  • Every $1.00 of manufacturing sales supports $1.37 in other sectors.  Educational, healthcare, and social services support $.70.
  • Every manufacturing job supports as many as 4 other jobs.
We've been reducing CO2 as a matter of good business.
  • Manufacturing CO2 emissions have dropped by 6% compared to a 38% increase in other sectors.
Reducing energy needed to produce as well.
  • Energy requirements per $1.00 of GDP have dropped by almost 50% in the last 30 years.  Half of the reduction is attributed to increases in energy efficiencies of industrial manufacturing.
Who will pick up the jobs if manufacturing continues to decline?
  • Manufacturing has declined from 25% in the 1950s to 12% of the GDP in 2005.
  • The U.S. has lost over 5 million manufacturing jobs since 2000.
  • Individual net worth has declined by 25% since 1999. 
  • 2/3rds of private sector R&D in the United States is done by manufacturer.
  • More than 1 in 6 U.S. private sector jobs depends on the manufacturing base. 
  • Future Growth Lies with Manufacturing 

What do you think about the Administration ‘s and Congress’  current treatment of Manufacturers? 
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OSHA Inspections: Speakingofpriorities

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OSHA inspections don’t just ‘happen.’ They are the result of some initiating circumstance that makes them a priority. OSHA inspection priorities  follow the hazards faced by the public that OSHA is charged to protect. While no lapse is desireable in one’s safety planning and execution, the highest priority items for OSHA should also be your highest priority to eliminate.

How many imminent dangers can you find?

Imminent danger situations. Hazards that could cause death or serious physical harm receive the top priority. As they should. Compliance officers (OSHA INSPECTORS) will ask employers to correct these hazards immediately. If the hazard cannot be removed, then the employees that are exposed should be.  Imminent danger and serious physical harm should not be part of working  in precision manufacturing.
Fatalities and catastrophes.  My take on this is that a catastrophe is an incident that requires the hospitalization of three or more employees. We all know what a fatality is. You must report these to OSHA within 8 hours. You can expect the OSHA follow up right away.
Complaints. If someone alleges that a hazardous situation exists, you can bet the agency will treat it seriously.  More seriously, in fact than referrals from other agencies.
Referrals from other agencies, organizations, or media. While these are not an assured way to initiate an investigation by OSHA,  they are considered.
Follow-ups (abatement). Checks to assure that violations cited from prior inspections are a lower priority, but remain a class of inspections that you can expect. Best prevention- Don’t have prior violations.
Planned or programmed investigations. The current National Emphasis Program  (NEP) on Recordkeeping is an example of this. These have been typically targeted at specific high hazard industries or workplaces that have high rates of injury and illness.
Whenever my team brought a problem in to me I asked them three questions.
 “Was there a procedure?”
“Was it followed? “
“Was it effective?”
 They always knew what the fourth question would be- Why not?
Do you have a procedure or system to assure that no imminent danger situations exist in your shop?
 Do you have a system to assure that your people are instructed, trained, and their knowledge reviewed to assure they follow safe and best practices?
Are you leading by example and setting the highest standards for safety, just as you do for quality and service, in your shop?
You know what the next question is.

Quality Is Never An Accident

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High intention, sincere effort, intelligent direction, skillful execution.

“Quality is never an accident; it is always the result of high intention, sincere effort, intelligent direction and skillful execution; it represents the wise choice of many alternatives.”
“Qualität ist niemals Zufall, sie ist immer das Ergebnis hoher Ziele, aufrichtiger Bemühung, intelligenter Vorgehensweise und geschickter Ausführung.”
-attributed to Bob Desseker
Do you have a Quality Quote that sums it all up for you? Please share it as a comment by replying below.
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Manufacturing Growth Not Just A Wish

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ISM’s report of manufacturing’s expansion for the fourth , and economic expansion for seventh month in a row,  combined with PMPA’s  Business Trends Index improvement for 5 consecutive months,  confirm that we are in a recovery phase, rather than the free fall we just survived.
What should we be doing differently in the recovery phase, compared to what we  needed to do while we were free falling?

ISM values over 50 indicate expansion of manufacturing.

The latest Institute for Supply Management Manufacturing Report for November showed that Manufacturing expanded for the fourth month in a row. While the Purchasing Manager’s Index decreased from 55.7 in October to 53.6 in November, the fact that the November value is above 50 indicates that mnufacturing activity continues to expand.
The Precision Machined Products Association’s Business Trends Index of Sales  for October was up for the fifth month in a row, to 85, its highest value for the year.  Almost three quarters of PMPA Business Trends respondents expect industry sales to remain at current levels or increase.
This reinforces the signal from ISM’s New Orders measure, which climbed to 60.3 in November from October ‘s 58.5. (The tie-in for precision machined components and manufactured goods  should need little explanation- our products are the enablers of multiple technologies in automotive, appliances, aerospace, electrical/electronic, heavy truck, off road, and medical  products to name a few.
These are not the halcyon days of  “ship it, ship it, ship it.,” that seem like distant, almost forgotten memories. But ISM’s report of manufacturing’s expansion for the fourth , and economic expansion for seventh month in a row,  combined with PMPA’s  Business Trends Index improvement for 5 consecutive months,  confirm that we are in a recovery phase, rather than the free fall we just survived.
What are your doing differently now? What lessons have you learned? What is your new top priority every day?

Machining- Music To Our Ears

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Even if the cash box isn’t ringing with the sweet sounds of success, here is proof that our ‘tools of the trade’ can make sweet music.

Music to our ears!

Video1
Video2
Created by the team at dpmmfg   
Thanks for the link contributed by Chris Koepfer and the folks at Production Machining.
Your contributions are welcome too!
Encore! Encore!

6 Reasons Why Heavy Truck Recovery Will Lag Slow Growth Economy

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 “Medium and heavy duty commercial vehicle markets are at the beginning of a three year period of steady growth.” according to a press release from ACT Research Co. LLC.
We certainly hope so. In PMPA’s last Business Forecast Report, our industry’s sales to the heavy truck market fell over 16% from 2007 to 2008.

We don't have data for this year yet, but...

And then 2009 hit.
Here are 6 reasons we think that this truck recovery will be slow and behind GDP throughout the first half of 2010:

  1. Commercial credit availability is still impaired,
  2. Reduction of debt throughout the economy,
  3. Decrease of “stimulus” spending,
  4. General  reticence to invest because of higher than normal risk.
  5. The economy has lost many years of growth- so fewer trucks are needed. (For instance, The precision machining industry sales are 85 percent of what they were in 2000 according to PMPA Business Trends Report for October.
  6. The cost of EPA 2010 Regulation compliant trucks is $10,000 higher. * 

But according to ACT, things are looking up. The industry bottomed out in 2009, with Class 8 heavy truck production falling to a mere 25,000 units in the second quarter. That is down almost 60% from the prior year. Medium duty (class 5-7) production of 22,000 units in the second quarter was 53% below the prior year.
Slow and faltering  growth behind the economy are what we are expecting out of commercial truck market from our vantage point here in Precision Machining Land. We hope  it turns out that we’re pessimistic to a fault.
What do you think? Have you managed to maintain sales in this market? New orders for EPA 2010 Technology components?
* (The new EPA 2010 regulations, are designed to reduce heavy truck emissions of Particulate matter, Nitrogen oxides, and Hydrocarbon emissions. While our industry stands to produce components for the new on board compliance technologies (sensors for CEGR (Cooled Exhaust Gas Recirculation Technology) and components for SCR (Selective  Catalytic Reduction) systems,  until the volume s grow, we’re ‘underwater’ in terms of our outlays for tooling compared to sales. )
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Are They Experienced?

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Probably not intended as a design statement for the White House Cabinet

“If you can just get your mind together
Then come on across to me “
So begins “Are You Experienced?” by Jimi Hendrix.
(Note to daughters: “Yes, I listened to Jimi. On an album. What’s an album? Never mind.”)
“Are you experienced?” is the current question on the mind of the people who watch Washington. People like Michael Cembalest, Nick Schulz, and Kyle Wingfield.  And like a shop quality engineer trying to solve an intractable problem, these people collected data, analyzed it, compared it to prior data available, and made a graphic so that the data would talk   data can sing to us. 
(My first statistics professor  told us “when you put your data in rows and columns, your data will sing to you.” Honest.)
Here’s the data regarding the private sector experience of the president’s cabinet, compared to prior  president’s cabinets.
"Data in rows and columns almost sings to you"

Here is Kyle Wingfield’s analysis: “the current Cabinet largely lacks a practical understanding of the country and companies which it now regulates — understanding that might come in handy now that our government is more enmeshed than ever with banks and auto makers, and is pushing for radically different rules for energy and health-care producers and consumers…And I think it means more than just that. If the members of the Cabinet have gotten more than 90 percent of their experience from a sector that makes up less than 20 percent of the work force, they represent a relatively small pool of people.”
And from where I sit,  they sure don’t seem to understand manufacturing. About how we have to meet a payroll, collect receivables, have access to working capital.
The typography of that  album cover reminds me that things certainly have changed since I was in college.
The percentage of cabinet appointees with private sector experience reminds me that there has been a change in Washington too.
And not on the side of  ‘experience.’
So what were the last two lines of the first stanza of “Are you Experienced?”
“We’ll hold hands and then we’ll watch the sunrise
From the bottom of the sea .”
End of Flashback…
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