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SOUTH CENTRAL
From Site Selection magazine, March 2019
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Straight from the Source:

What state manufacturing experts want you to know.

by MARK AREND
SOUTH CENTRAL

Curious about a South Central location for your next manufacturing operation? Site Selection has done some of the leg work for you by reaching out to the directors of the National Institute of Standards and Technology’s Hollings Manufacturing Extension Partnership (MEP) offices in Arkansas, Louisiana, Oklahoma and Texas for their take on the manufacturing landscape in their states. MEP Centers are located in every state, and they provide a variety of services, from innovation strategies to process improvements to many others. For more information on the nationwide MEP program, visit www.nist.gov.

We sent the same four questions to each of the four MEP representatives, and we appreciate their participating in this valuable exercise. Let’s meet the participants:

For Arkansas:
Mike Preston
Executive Director, Arkansas Economic Development Commission
mpreston@arkansasedc.com
501-682-7351

For Louisiana:
Ali Ahmad, Ph.D.
Director, Manufacturing Extension Partnership of Louisiana (MEPOL)
ali.ahmad@mepol.org
321-945-3330

For Oklahoma:
Dave Rowland
Director, Oklahoma Manufacturing Alliance
dave.rowland@okalliance.com
918-592-0722

For Texas:
Rodney Reddic
Metroplex Regional Director
TMAC
rodney.reddic@tmac.org
(817) 219-7951

 

What is the “manufacturing mood” in your state in early 2019? For example, are manufacturers optimistic/pessimistic/neutral about the year ahead?

Arkansas ranks sixth in the nation for percentage of population working in manufacturing. We’ve seen some impressive increases in existing companies adding workforce, and an increase in those companies interested in Arkansas. Governor Asa Hutchison’s recent tax cuts have made us extremely competitive with surrounding states. So, we certainly can say Arkansas companies are optimistic, while also concerned about a new recession. And with our comparatively lower cost of doing business, we think companies are preparing for the future by paying close attention to those costs and considering what changes they can make to remain competitive.

The manufacturers are optimistic going into 2019 as the economy is picking up after a long period of recession in Louisiana. Manufacturers are beginning to look ahead to a healthier economy where oil prices are rising from $65 per barrel this year to a forecasted $80 per barrel in 2020. There have been large industrial announcements throughout Louisiana — particularly in the Lake Charles, Baton Rouge and New Orleans areas — ultimately leading to more jobs across the state.

After a couple of lukewarm years, state manufacturers are seeing their output expand with increasing confidence of future growth. The Oklahoma manufacturing economy is buoyed by surging petroleum activity and strong aviation-related production. There is some dismay over the effects of new tariffs, but most are supportive of regulation adjustments and have an overall positive outlook. Optimism is relatively deep as innovative manufacturers adapt to worldwide challenges and compete on a global scale.

Texas factory activity continues to expand in 2019 based on information collected in the Texas Manufacturing Outlook Survey. The general mood of manufacturers is positive, and we continue to see plans for expansion with TMAC customers. The aerospace industry continues to remain strong in the North Texas area. We are also seeing continued growth in the biotechnology sector. However, due to declining oil prices, Texas manufacturers supplying products to the oil and gas industry are feeling less confident about their business going forward.

 

What are the most common issues manufacturers reach out to your office about?

Workforce is a national issue and we’re no different. But we’re lucky: Our workers have the skills, we just need more of them. So we continue to train and look to bring more young people into the manufacturing and craftsman trades. We consistently meet with companies to find their needs and we do a great job with our higher education institutions to train for the work needed.

The most common issues manufacturers reach out to our office about are growth services, workforce training, and process improvement. Manufacturers in today’s business climate are most concerned about the challenges they face related to the new trade tariffs between China and the U.S. The proposed tariffs affect $200 billion worth of goods that affect a manufacturers’ supply on a day-to-day basis, ranging from parts/assemblies to food ingredients to various materials. The 2018 Tax Reform bill approved last year has also been a hot topic where businesses have not yet seen advantages or disadvantages.

We’ve done a lot of work lately in preparing companies to do business with foreign customers throughout the world. That assistance is vital, especially to small manufacturers that find themselves competing globally for business.

Many of our programs focus on emerging technologies like next-generation robotics and automation, additive manufacturing, supply-chain management, predictive data modeling and digital marketing. We want our efforts to bridge the gap between technology developers, R&D organizations and private firms. Advanced manufacturing systems are now essential to even the smallest companies. Incorporating new technologies not only makes the process more efficient, it can alleviate the problem of finding enough skilled workers, which is one of the toughest challenges faced by manufacturers. High-tech equipment like collaborative robots will play an important part in reducing the worker shortage.

TMAC continues to see strong activity with request for implementing quality management systems, (ISO, AS9100, and 13485). TMAC is also highly active with the delivery of Lean Six Sigma Training across the state. TMAC is engaged in a number of transformational projects that focus strategies to help drive company profitability and sustainable growth. We have also assisted a number of companies with facilities layout and expansion.

 

Are MEP Centers promoting any particular strategy (process improvements, green manufacturing, etc.) in 2019?

Arkansas works with manufacturers to develop customized workforce training plans to increase performance, profitability and productivity, including Toyota Kata, Lean Manufacturing, Managing for Continuous Improvement, and ExporTech. Those services are located here at the Arkansas Economic Development Commission, and when we engage with companies to bring efficiencies to help them expand, we have all of those resources under one roof.

The Louisiana MEP promotes process improvement and growth strategies. More recently, with the advent of Industry 4.0 and smart manufacturing, cybersecurity is a topic of increasing interest among the manufacturing community, and companies are starting to reach out for support to protect their businesses. Every manufacturer should be confident that their company has an acceptable level of data security to successfully combat cyber incidents. The MEP of Louisiana will continue to host cybersecurity events which outline the NIST Cybersecurity Framework: Identify, Protect, Detect, Respond and Recover.

There is increased attention toward sustainability. But it’s not all solar panels and environmental footprint. Much of what we assist with is energy efficiency and waste reduction, but it goes beyond that into the areas that will truly sustain a company for the next generation. Resource efficiency and productivity go hand in hand. So too do strategic and succession planning, as well as employee development and continuing education.

TMAC has recently been promoting Smart Manufacturing and we have conducted a number of site assessments, as well as, some robotic production cell implementations. Cybersecurity is another area of TMAC focus in Texas and we have assisted a number of companies with site assessments to help them meet NIST 800-171 Compliance. 

 

What is the most effective way to help manufacturers locate and acquire the talent they need?

AEDC is working with manufacturers and school counselors to help them recognize and identify the interests and aptitudes of students who would be great fits in manufacturing careers. Be Pro Be Proud (www.beprobeproud.org), a workforce initiative of the Arkansas State Chamber of Commerce, brings together a statewide coalition of public and private partners in education, workforce services and industry to showcase career opportunities in highly skilled professions. Future Fit is a 120-hour training program aimed at students who don’t plan to enroll in a college or university, for military veterans, for unemployed or underemployed individuals, and for non-violent offenders released by law enforcement. The program is currently being piloted with plans to roll out a full-scale version to the entire state with industry-specific training for each region.

As a sponsored program of the Louisiana Community and Technical College System (LCTCS) which has a key initiative to train a successful workforce, the MEP of Louisiana works to connect manufacturers with the colleges. As a team, we analyze the needs of manufacturers, determine what areas may need improvement, and develop a plan to address those areas. Dr. Willie E. Smith, Sr., LCTCS’s vice president of training & business partnerships who oversees the MEP program, stated that “the system office works with each individual community college to create relevant, timely programs and services that address specific industry needs.” Through the MEP, LCTCS works with small and medium sized manufacturers every day to improve operations and adopt new technologies that can boost productivity and help manufacturers grow their businesses. In addition, they help small and medium sized manufacturers identify the root cause of challenges (including workforce) and work with them to develop a plan to prioritize and address these challenges. 

The challenge of finding and retaining skilled employees remains a difficult task. In fact, it continues to be what manufacturers tell us is their No. 1 concern. We think our organization is in a unique position to more deeply involve industry leaders in solutions and build programs that will benefit Oklahoma manufacturers directly. We recently created a new position, a director of workforce development, filled by Sharon Harrison. She is pursuing innovative strategies that help cut through some of the traditional barriers facing real-world improvement. This involves more directly providing what manufacturers need now, but also preparing company leaders and next-generation workers for what will be required in the future.

TMAC can provide facility layout and equipment selection services that save time and money for businesses looking to relocate and expand. TMAC has also developed a site selection tool to better matchup company requirements with potential site location. We can also help manufacturers with their supply-chain through supplier scouting utilizing proximity sourcing leverage through the MEP network centers like TMAC to identify and pre-qualify supplier capabilities and capacities. Talent recruitment continues to be a challenge, and TMAC can work with companies to help develop training programs to better develop new hires. TMAC Metroplex recently hired a human resource specialist to help assist companies with their HR functions for onboarding

Mark Arend
Editor in Chief of Site Selection magazine

Mark Arend

Mark Arend has been editor in chief of Site Selection magazine since 2001. Prior to joining the editorial staff in 1997, he worked for 10 years in New York City at Wall Street Computer Review, ABA Banking Journal and Global Investment Technology. Mark graduated from the University of Hartford (Conn.) in 1985 and lives near Atlanta, Georgia.

 




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