< Previous174 JANUARY 2019 SI T E S E L E C T IO NConsidering a Tennessee location? Wondering if the labor and skills supplies in the Volunteer State have the capacity to deliver now and in the future? Answers to those and other questions are supplied here by Jennifer Hagan-Dier, director of the Tennessee Manufacturing Extension Partnership Program, a key resource for current and future capital investors. Following are excerpts of a late 2018 exchange with Site Selection Editor Mark Arend.Site Selection: What is the overall mood in the manufacturing community in Tennessee?Jennifer Hagan-Dier: Optimistic, vibrant and excited about growth opportunities tempered by uncertainty around global economic partnerships, trade policies and workforce shortages. Specifically, manufacturers are expressing uncertainty around the application and impacts of tariffs for raw materials coming in and finished products going out. Manufacturers in industries such as automotive, electrical appliances and food production are starting to see impacts of tariffs in their businesses and are examining supply chains and workforce needs more critically. The overall feeling across the state is one of optimism, but cost challenges around raw material imports, supply chain pressures, low unemployment and the potential negative impact on their business from tariffs are a concern for all Tennessee manufacturers regardless of industry sector.SS: “Finding skilled workers” is frequently cited as a primary challenge of manufacturers throughout the U.S. Is that the case in Tennessee, or should that phrase be adjusted to better reflect reality on the ground? JHD: It seems that almost every conversation we have with our manufacturing clients eventually leads to a conversation about workforce and workforce challenges. Tennessee manufacturers cite “finding skilled workers” as a primary challenge, but the reality is that it is not as simple as just “finding skilled workers.” With historically low unemployment rates and a competitive and business friendly environment, many Tennessee manufacturers point to challenges in finding, recruiting and retaining workers — qualified or not.The reality in Tennessee is that small and medium-sized manufacturers recognize they have challenges in terms of recruitment and retention of a skilled workforce, but they rarely have a handle on the improvements they can make in their facility and business to attract and keep talent. Culture matters. The work environment matters. Employee engagement and support matters. Process optimization and new technologies also matter.This is where the University of Tennessee Center for Industrial Services (UT CIS) and the Tennessee Manufacturing Extension Partnership (TMEP) program housed within UT CIS can help. TMEP works with small and medium sized manufacturers every day and has found that these manufacturers are often so focused on the “workforce challenge” that they fail to recognize opportunities to improve operations and adopt new technologies that can boost productivity and help manufacturers grow their business with the workforce they have. In addition, TMEP helps small and medium sized manufacturers identify the root cause of challenges including workforce challenges and works with them to develop a plan to prioritize and address the challenges. UT CIS has a statewide outreach network including a skilled and professional staff who live and work in each of the nine economic development ANY VOLUNTEERS?Jennifer Hagan-Dier, Director of the Tennessee Manufacturing Extension Partnership Programregions and access to partners and resources with unrivaled business and technical expertise in manufacturing and economic development. SS: Not counting your MEP Center and UT CIS, what are the most beneficial agencies or resources available to manufacturers for assistance in overcoming these challenges? JHD: The Tennessee Department of Economic and Community Development (TN ECD)TN ECD is the lead for all economic development activities for the State of Tennessee. TN ECD works with manufacturers through the “FastTrack” program, which includes grants for infrastructure development, job training and a discretionary fund for a variety of other expenses. The Tennessee Board of Regents (TBR) Office of Economic and Community Development The TBR’s Office of Economic and Community Development mission is to develop and maintain a statewide approach for workforce development that directly impacts the state and its communities. TNTrainedThe TNTrained program is a new initiative of Tennessee’s community and technical college system, in partnership with several state agencies, to access the education and training resources of all 40 of the College System’s campuses and meet the needs of business and industries. The TNTrained program designed a four-step process to ensure our workforce professionals are ready to assist 176 JANUARY 2019 SI T E S E L E C T IO N is was 10 years in the making. is did not happen overnight. Nashville has been working up to this for years.” — Bob Rolfe, Commissioner, Tennessee Department of Economic and Community Developmentkind of jobs we all dream about in Tennessee. But I want everyone to know that this was a city-driven initiative. e state was involved in economic development incentives, but they would have applied to any winning city in Tennessee.”Originally, four cities in Tennessee submitted bids to land Amazon HQ : Nashville, Memphis, Chattanooga and Knoxville. “We knew that none of our cities met all of Amazon’s parameters for HQ , but we were very pleased when Nashville made Amazon’s top short list.”Amazon also had a history of investing heavily in Tennessee. From to , Amazon invested more than $ billion in the state, including customer ful llment infrastructure and compensation to its , employees in Tennessee. e new deal began to come together in September when Amazon executives, under the leadership of project head Holly Sullivan, returned to Nashville for a day and a half of meetings and negotiations, says Rolfe. “ ey said, ‘We are changing our strategy for Nashville,’ ” says Rolfe. “ en we didn’t hear anything until the Monday afternoon of Veterans Day. I called the Governor at : p.m. Central Time that day with the news. Amazon originally was going to make this announcement just with a press S I T E S E L E C T I O N JANUARY 2019 177release, but with Holly being from Nashville, we wanted to have our own media event here. We managed to pull everything together on less than 24 hours’ notice.”Rolfe credits the city of Nashville, Davidson County, the Tennessee Valley Authority, the Nashville Area Chamber of Commerce, the Governor’s Office, and other state and local entities with working around the clock to close the mammoth deal.“Former Mayor Megan Barry and current Mayor David Briley really stepped up,” says Rolfe. “It was a total team effort.”Nashville Faced ‘Enormous Competition’The project site chosen is an ideal fit, he adds. “It is right along Interstate 40, just two blocks from the highway,” he notes. “It has enormous visibility. Lots of housing options are there already, and more are coming. A new Grand Hyatt Hotel is under construction there now, and more retail, office, residential and entertainment are coming.”Rolfe says that “there was enormous competition for this Center of Excellence,” although he would not divulge the other finalist locations. “It was very stiff competition for this red-ribbon project. This will be one of 17 Amazon divisions that will report directly to Jeff Bezos, and we know that 20 percent of the jobs will be IT-related tech positions such as programmers and software developers.”Nashville’s talent and academic footprint helped close the deal, says Rolfe. “We provided Amazon with a labor shed report of all the talent they needed within a 90-to-100-mile radius,” he says. “Nashville has so much going for it.”Amazon will house workers in temporary space while the new facilities are being constructed, Rolfe adds. “They are in the final design stages now for their new building. It will take them about 20 months to complete construction, but we know this about Amazon: They grow ahead of schedule.” 178 JANUARY 2019 SI T E S E L E C T IO NINVESTMENT PROFILE:TENNESSEE VALLEY AUTHORITYHow TVA helped recruit a Belgian bus maker to a town in Tennessee.When word fi ltered out in that one of the world’s top bus makers hoped to build a plant in the southeastern U.S., economic developers from throughout the region began beating a path to Koningshooikt, Belgium. ey came from Kentucky, the Carolinas, Virginia, Georgia, Florida and Tennessee, all intent on luring Van Hool, a fourth-generation family enterprise, which has delivered more than , buses to the U.S. market since . e prize for the winner: a $-million investment and the promise of at least at least coveted manufacturing jobs. Chris Berryman, target market specialist for transportation-related industries for Tennessee Valley Authority (TVA) Economic Development, witnessed the site selection process from the inside. It took three years.“It was all about building relationships,” Berryman tells Site Selection. “We knew that, this being a family company, they were going to need all the advice we could give to get them comfortable with making an investment in the southeast U.S. We probably spent more on relationship building and doing site selection processes than most other companies would do.” e hard work paid off . Van Hool narrowed its list of potential locations to three, all within the TVA’s seven-state footprint, before choosing a -acre (-hectare) site at an industrial park in Morristown, Tennessee. “We’re very excited to invest in Morristown,” said company president Filip Van Hool at a ceremony in April. “We looked at lots of diff erent places, but we opted for Morristown to make the largest investment outside Belgium in Van Hool’s -year history.”Wanted: Multi-Skill TalentTucked away in Tennessee’s northeast corner, Morristown is a place that’s known for making by G ARY DAUGHTERSgar y.daug hter s @ site s ele c tion.c omA three-year site search culminated in Van Hool’s selection of Morristown in April 2018.Photo courtesy of Morristown Chamber of Commerceof Persuasion PersuasionPowerThe S I T E S E L E C T I O N JANUARY 2019 179This Investment Profile was written under the auspices of TVA Economic Development. For more information, please visit TVA’s sites and buildings database TVAsites.com.things. e city of , people supports manufacturing companies, and once called itself the “chair capital of the world.” It has a robust roster of automotive suppliers, including Mahle, Kawasaki, Lear, JTEKT and Meritor Gear Systems. TVA’s Berryman said Morristown’s “labor story” was instrumental in landing Van Hool, even though the city has never produced a vehicle from the ground up.“Transferable skills,” says Berryman, “drove this project home. is is a case study of where a company can truly take transferable skill sets from other target industries like construction, contracting, furniture making and cabinetry. ere’s quite a bit of cabinetry that goes into a bus. ey can utilize those skill sets to turn people into auto workers. at’s the unique part of bus manufacturing. It has a lot of fl exibility in terms of fi lling its workforce needs.”If auto-making leans toward the rote assembly of pre-made components, bus manufacturing requires more craft and versatility, says Marshall Ramsey, president of the Morristown Chamber of Commerce.“Van Hool liked the fact that the workers don’t just stand on the assembly line and push buttons,” Ramsey tells Site Selection. “A lot of our workers are multi-skilled and multi-faceted and adaptable. It’s sort of like the furniture industry. Van Hool seemed to appreciate that we have a lot of people with a lot of diff erent skills.“Advanced manufacturing is great, but not everybody can make things that way,” he says. “Van Hool needed true craftsmanship, not just a robot making a part. ey appreciate people putting their hands on something and being responsible for that end-product.”With jobs to start and the prospect of more in the next fi ve years, Van Hool, says Ramsey, will quickly become one of the top employers in a town that has lost thousands of furniture-making jobs to lower-cost markets in Asia.“ is,” Ramsey says, “will allow people with furniture skills to continue in that trade. When you get in your s and s and the company moves to China, it’s hard to re-train yourself. Allowing some of those people to be able to continue in that line of work for a good company that’s going to be here for a long time is really important for us.”Says TVA’s Berryman: “A bus manufacturing company is a great resume builder for someone in a craftsman type industry that would like to seek a traditional automotive supplier job in their community. When working at Van Hool, that employee will be able to put on their resume ‘automotive,’ giving them an edge to compete for higher skilled automotive supplier work in their community.”It’s More Than Just ElectricityUtilities such as TVA are valuable assets in economic development. Often, they have more marketing and project management resources than economic agencies themselves. While selling power remains the primary objective, job creation and capital investment are increasingly important metrics in measuring success.“ ey’re one of my strongest partners,” says Ramsey. “Any project I do, whether jobs or , jobs, TVA is deeply involved. I don’t make a phone call to a prospect without talking to TVA fi rst. A lot of people think of them as just a wholesale power provider, but that’s the last thing I think of when I think of TVA. “When we buy land,” says Ramsey, “I let TVA come in and look at contour maps and help do our conceptual park layouts. And then when we have prospects for each site, they will come in and do the building layout, assess how to expand and how to make the roadways work. ey do work that I would typically have to pay engineers $, to $, to do. TVA comes in and does that at no cost to me. A lot communities don’t even realize this. I use TVA for everything.“TVA,” Ramsey says, “has a strong desire to improve everyone’s community.” Any project I do, whether 25 jobs or 1,000 jobs, TVA is deeply involved.”— Marshall Ramsey, President, Morristown Chamber of CommerceChris Berryman, TVA180 JANUARY 2019 SI T E S E L E C T IO NAnn Arbor’s growing tech community is making a name for itself.by G ARY DAUGHTERSgar y.daug hter s @ site s ele c tion.c omWhile Detroit was left reeling by November’s news of GM plant closures and the potential loss of more than , local auto-working jobs, its tech-centric neighbor to the west, Ann Arbor, observed a signifi cant milestone. Duo Security, launched from an Ann Arbor incubator in , was acquired by Cisco for a whopping $. billion, the largest acquisition of a venture-backed startup in Michigan’s history.Founded by Dug Song and Jon Oberheide, two graduates of the University of Michigan, Duo is a cornerstone of Ann Arbor’s tech community. In an email exchange with Site Selection, Oberheide noted the company’s humble beginnings, which were not that long ago.“When Dug and I started Duo in at Tech Brewery, a co-working space for entrepreneurs and startups in Ann Arbor, we worked from two desks in the corner of the offi ce. Our fi rst salesperson was a stuff ed tiger — our patron saint, so to speak. Fast forward eight years, and we help protect , customers, including many of the world’s largest and fastest-growing organizations.”Duo is a leader in multi-factor authentication (MFA), which combats security breaches by adding tell-tale layers to the login process. (continued on Page )Caption: Ann Arbor startup Duo Security scored a $2.3-billion payday in October. Photo courtesy of Duo SecurityST A TE SPO TLIGHTMichigan182 JANUARY 2019 SI T E S E L E C T IO NThe automotive industry recorded a unique triple play in Michigan last month.The rst wave of investment news came Dec. 5 when PlanetM awarded grants totaling more than $224,000 to HAAS Alert, Humanising Autonomy and RoadBotics to launch pilots that address transportation challenges in Michigan as part of the PlanetM Startup Grant program.PlanetM is a partnership of mobility organizations, communities, educational institutions, R&D and government agencies that work together to develop and deploy in Michigan the mobility technologies driving the future. HAAS Alert is a Chicago-based startup that has partnered with Grand Rapids Police, Fire and Life EMS to deploy the nation’s rst complete citywide alert system. Humanising Autonomy is a London-based startup that builds human-centered tools to improve safety and ef ciency of autonomous systems through understanding human behavior. It will test bus driver alerts to help predict pedestrian, cyclist and other driver actions in collaboration with the Ann Arbor Transportation Authority. RoadBotics is a Pittsburgh-based startup that uses arti cial intelligence to generate automated pavement condition data.The second investment project came Dec. 6 when Drive System Design Inc. announced that it would invest $1.7 million to expand in Farmington Hills. A global engineering consultancy specializing in the design, development and control of future transmission and driveline systems, DSD is expected to create 25 high-wage engineering jobs. Michigan was chosen for the expansion over a competing site in California. The Michigan Economic Development Corp. (MEDC) awarded DSD a $175,000 performance-based grant in support of the project.The third investment project was delivered Dec. 13 when Tooling Technology LLC announced that it would relocate its headquarters from Ohio to Macomb Township as part of a $19.9-million investment that will create 100 new jobs in Michigan over ve years. MEDC agreed to give the company a $750,000 performance-based grant.The automotive supplier said it would move from Fort Loramie to Michigan, where 257 of the company’s 650 employees work in four different locations. Founded in 1982, Tooling Technology is an automotive interior die-cast and stamping tooling business that operates 12 U.S. plants.“We have aggressive growth plans, and being in Macomb in Southeast Michigan puts us in a good position to accomplish them,” said Tony Seger, chairman of Tooling Tech Group.A A TRIPLE TRIPLE PLAY PLAY OF AUTOMOTIVE INGENUITYWe have aggressive growth plans, and being in Macomb in Southeast Michigan puts us in a good position to accomplish them.” —Tony Seger, Chairman, Tooling Tech GroupB y RON S TARNERWe have Next >