SME Toronto WWW.SMETORONTO.CA Nigel Southway SME Chapter - - PDF document

▶
sme toronto
SMART_READER_LITE
LIVE PREVIEW

SME Toronto WWW.SMETORONTO.CA Nigel Southway SME Chapter - - PDF document

Nov 26, 2022 361 likes •1.08k views

1/31/2014 SME Toronto 1 Toronto Chapter www.sme.org. About SME: The Society of Manufacturing Engineers Premier source for manufacturing knowledge, education and networking. Connecting manufacturing practitioners together. Provide Tradeshow ,

slide-1
SLIDE 1

1/31/2014 1

1

SME Toronto

About SME:

The Society of Manufacturing Engineers Premier source for manufacturing knowledge, education and networking. Connecting manufacturing practitioners together. Provide Tradeshow , Expo and network events. Reviews latest manufacturing technologies/processes/techniques/practices. SME world-wide supported network of Chapters and technical communities. Many programs, events, magazines, publications, huge technical database and online training …. SME leader in manufacturing workforce Education/training/skill development. SME is a LEAN Business Certification Authority.

www.sme.org.

WWW.SMETORONTO.CA

$125 per Year

Toronto Chapter
slide-2
SLIDE 2

1/31/2014 2

Toronto Chapter Ovidiu Demain SME Toronto Chair 2014 SME Toronto Chapter 2014 Executive Chair (for Jan to Dec 2014) - Ovidiu Demian Chair-Elect (for Jan to Dec 2015) – John Quarterly Secretary – Nigel Southway (past chair 2012/2013) Treasurer – John Quarterly Innovation and Creativity coordinator- Norn Nopper Computer Integrated Manufacturing coordinator- Elizabeth Bidinoff Product & Process Design and Management coordinator (LEAN)- Ken Uy Manufacturing Education coordinator- Ron Kurtz Rapid Technologies & Additive Manufacturing coordinator- Vesna Cota Industrial Laser coordinator- Mehdi Nooraniazad Forming & Fabrication coordinator- Patrice Bansa Automated Manufacturing & Assembly coordinator- Steven Brown Machining & Material Removal coordinator- Bruce Hyde Plastics, Composites & Coatings coordinator- Ryan Watt Admin Group Technical Communities More information at www.smetoronto.ca/information
  • n how to sign up to assist with these technical communities.
Email or call me at: nigel.southway@smetoronto.ca Tel 905 464-5517

SME Toronto

WWW.SMETORONTO.CA

Nigel Southway

SME Chapter Secretary/Past Chair 2012/2013

Toronto Chapter

TBM Advocate

slide-3
SLIDE 3

1/31/2014 3

TBM

Take Back Manufacturing

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

SORRY!

6

We ask for an open mind as we deliver this important message and perspective.

TBM Take Back Manufacturing

WWW.SME-TBM.ORG Provocative Argumentative Mind bending Scary Frustrating Inspiring
slide-4
SLIDE 4

1/31/2014 4

Manufacturing and Engineering has been a good career for a lot of us!!

It’s been good to me!

NIGEL SOUTHWAY

  • 40 years Broad Business and Manufacturing Experience
  • British Engineering Apprentice…Aerospace/Electronics (1966)
  • BSc EEE C-Eng. in Engineering/MSc Management….
  • Manufacturing Engineer (1972)
  • MOTOROLA Director Manufacturing Eng / Lean and Six Sigma Implementation (1980,s)
  • Engineer / Manager / Director / VP Operations
  • Change Agent/Educator/Coach/Advisor for LEAN business improvement
  • AUTHOR : CYCLE TIME MANAGEMENT… Fast Track to Productivity Improvement
  • Consulted / Directed many organizations in different industry sectors.
www.nigelsouthway

NEXUS

Owner of NEXUS CONSULTING SERVICE (1992) Automotive, Aerospace, Avionics, High-tech and consumer Electronics, Pharmaceuticals, Food, Beverage. Consumer Products and Appliances, Steel, Fabrication, Mining, Resource extraction equipment, Construction, Off-road equipment, Service and Financial Industries. LEAN THINKING
  • Assisted many Global Sourcing programs and Joint Ventures (2004 Onward)
  • Society of Manufacturing Engineers …2012 Chair Toronto
slide-5
SLIDE 5

1/31/2014 5

GLOBALIZED MANUFACTURING

2004 Onward

CANADA MANUFACTURING

10

The future of Manufacturing in Ontario’s economy.

A NORTH AMERICAN PROBLEM

slide-6
SLIDE 6

1/31/2014 6

TBM

Take Back Manufacturing

A Forum Dedicated to Restoring

  • ur Manufacturing Sectors.

A HUGE CHALLENGE!!!

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

TBM

Take Back Manufacturing

www.SME-TBM.org

A Forum Dedicated to Restoring

  • ur Manufacturing Sectors.

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

Since Mid 2011

slide-7
SLIDE 7

1/31/2014 7

13 M

TBM

TBM…Our Ultimate Goal

14

Work together ….

Government, Education organizations Industry leaders ROADMAP……..Recover our future industrial capability …… and therefore our future prosperity.

TBM Take Back Manufacturing

WWW.SME-TBM.ORG
slide-8
SLIDE 8

1/31/2014 8 CMTS Toronto Canada October 2011 SME Annual Conference Cleveland USA June 2012 Many Society and Association events in 2012/13

Presentations.... TAKE BACK MANUFACTURING M

Raising the Awareness

TBM

SME/TBM Communication Sessions

  • TBM Forum Kick-off
June 2011
  • CMTS Tradeshow TBM Road-show at SME Pavilion
October 2011
  • PEO Review sessions on TBM
January/February
  • FABTECH Canada Tradeshow TBM Road-show
March 2012
  • Ontario MPP Briefing meeting/s On TBM
April 2012
  • CME Strategy review (SME Toronto/PEO supported)
Apr/May 2012
  • Book Launch …How to Make Manufacturing Sexy .
25th April 2012
  • ASME TBM Toronto Ryerson University
3rd May 2012
  • OCEPP Policy Session Toronto
May 11th
  • CAW Auto Industry Report review
May 2012
  • SME MMTS Show Montreal LEAN/TBM Presentation
15 May 2012
  • CAMM Dinner and TBM Windsor
May28th
  • SME Annual Conference Cleveland (Presented TBM)
June 2012
  • Ontario manufacturing Council TBM Presentation
July 2012
  • Lambda/Alpha..Intro To TBM
10 Sept 2012
  • PEO TBM Symposium University Of Toronto..
13 October 2012
  • SME-AMT Show Toronto
October 2012
  • SME-Medical Show Toronto
November 2012
  • Plant Magazine Outlook 2013 SME Supported
November 2012
  • Canadian Industrial Machinery Magazine TBM interview
November issue
  • USA Manufacturing Revival Radio show Interview on TBM
November 2012
  • AME TBM/Reshoring San Antonio USA
Q1 2013
  • ASQ TBM Presentation Waterloo chapter
March 2013
  • PEO east chapter on TBM
May 2013
  • CIM Niagara falls symposium on TBM panel
June 2013
  • Ontario Technologist magazine front page on TBM
September 2013
  • CTMA magazine on reshoring
September 2013
  • CMTS show
September 2013
  • EDC Reshoring study
September to November 2013
  • AME LEAN conference & executive quiz for Ontario MEDTE
October 2013
  • PEO east chapter LEAN talk
October 2013
  • Youth Labor market review
November 2013
  • Syspro user meeting ….TBM overview
November 2013
  • Polish engineering chapter on TBM
November 2013
  • ASQ Toronto chapter on TBM
November 2013
  • TIN Manufacturing symposium and panel Toronto lands
November 2013
  • Romanian engineering association Talk on TBM
November 2013
  • Toronto Presidents club dinner on TBM
November 2013
  • ASQ on LEAN and Six Sigma
December 2013
  • Many TBM/LEAN presentations requested for 2014
slide-9
SLIDE 9

1/31/2014 9

http://www.canadianmanufacturing.com/fabrication/production/taking-back-manufacturing-51066 http://sme-tbm.org/app/download/5809147904/PEO+TBM+article.pdf

Professional Engineers Ontario

slide-10
SLIDE 10

1/31/2014 10

19 20
slide-11
SLIDE 11

1/31/2014 11

21 Take Back Manufacturing on TVO The Agenda Marie Laird … Past Chair SME Toronto 22 THANK YOU EVENT SPONSORS: Attention: Paul Scrivener, The Toronto Industry Network This message will confirm your registration for the Toronto Industry Network and NAIOP Greater Toronto Chapter co-hosted Employment Lands Forum: Why Manufacturing Matters! Here are some important details about this event: Date: Tuesday, November 26, 2013 Venue: The National Club, 303 Bay Street, Toronto Time: 3:30 p.m. - Registration 4:00 p.m. to 5:30 p.m. – Presentation Speakers: Keynote Address:
  • Dr. Matthias Oschinski, Lead Economist, Mowat Centre,
School of Public Policy & Governance, U of T Panelists: Nigel Southway, Chair, Toronto Chapter, Society of Manufacturing Engineers; Councillor Peter Milczyn, Chair, Planning and Growth Management Committee of Toronto Council; Paul Bain, Project Manager, Official Plan Review, Toronto Planning Division Moderator: Rick Spence, Consultant, National Post Columnist, Entrepreneurship Champion Upon arrival please be sure to pick up your name tag from the registration desk so that we can greet you and note your attendance. If you have any questions in the meantime about the event, please do not hesitate to give our office a call. We look forward to seeing you tomorrow, Tuesday, November 26, 2013 Yours truly, Constance Wrigley-Thomas, CAE Executive Director | NAIOP Greater Toronto Chapter 1100 Burloak Drive, Suite 300 | Burlington, ON L7L 6B2 Tel: (905) 332-2322 or 1-855-432-2322 | Fax: (905) 331-1768 www.torontonaiop.org CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, is for the sole use of the intended recipient(s) and may contain confidential and privileged information. Any unauthorized review, use, disclosure, or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply e-mail and destroy all copies of the original message. DÉCLARATION DE CONFIDENTIALITÉ - Ce message électronique, ainsi que toute pièce jointe, peut contenir des renseignements privilégiés et confidentiels et est réservé à l'usage exclusif du ou des destinataires prévu(s). Toute révision, utilisation, divulgation ou distribution non autorisée est strictement interdite. Si vous n'êtes pas le destinataire prévu, veuillez en informer l'expéditeur par retour de courriel et supprimer toutes les copies du message original.
slide-12
SLIDE 12

1/31/2014 12

WHY?..Take Back Manufacturing

FOR OUR KIDS!!

23

TBM Take Back Manufacturing

WWW.SME-TBM.ORG 24

Our Kids will think we don't make things!!!

This is NOT a game!!!...

? ? ? ?

slide-13
SLIDE 13

1/31/2014 13

GLOBALIZED MANUFACTURING GLOBALIZED MANUFACTURING

slide-14
SLIDE 14

1/31/2014 14

GLOBALIZED MANUFACTURING

? ?

Question …. “With extreme prejudice"

Moved Off-shore…..

28

Textiles

Furniture Footwear Electronics AUTO PARTS Appliances Plastic goods Equipment metalwork Fittings Foods

Un-controlled trade….. “herd behavior”

For low cost labor rates

15% Reduction in Manufacturing Intensity in the last decade

TBM

slide-15
SLIDE 15

1/31/2014 15

29 2009 2010 2011

CANADA

More than 500,000 jobs lost in last 6 years 25% Reduction (Quantity and Quality) Only 25000 jobs added in Resource Sector

TBM

50% of Manf SME’s lost in Ontario Economic Productivity trending downward due to reduced Capacity utilization

Yet ….we have a skill shortage!!! (NOT a labor shortage)

1,000,000 Young Canadians Now out of work!! We have become an Over-educated / Under-trained /Redundant Workforce!!! Redeployed to part time and lower paying service jobs Source: Statistics Canada 30 ? Any ratio far above 1.5 is an issue EAST WEST

TBM

Major UNDER-employment About 12.5% Youth under-employment 20+%

We need jobs!

(Agreed that some skill mix is an issue) ???
slide-16
SLIDE 16

1/31/2014 16

31 ? Any ratio far above 1.5 is an issue EAST WEST

TBM

Major UNDER-employment About 12.5% Youth under-employment 20+%

We need jobs!

(Agreed that some skill mix is an issue) ??? It is now VERY obvious that we need a Balanced Economy

(Resources/Services/Manufacturing)

What happened?

32
slide-17
SLIDE 17

1/31/2014 17

  • 1% GDP
33

OUR BIG BROTHER

(US GDP 2010=14000B)

USA

  • 1% GDP
34

OUR BIG BROTHER

(US GDP 2010=14000B)

USA

Economists started to follow an almost fanatical view of free market doctrine
slide-18
SLIDE 18

1/31/2014 18

Globalized Trade
  • 1% GDP
35

OUR BIG BROTHER

(US GDP 2010=14000B)

USA

Free Market forces… Chased Emerging Markets

Used liberalized Trade approach Removed barriers and controls Accepted Out of Balance Trade. Assumed More Service Sector Jobs???? Assumed local exports would grow/balance
  • 4% GDP
Globalized Trade Cumulative Deficit is now 50% 2010 GDP
  • 1% GDP
36 (US GDP 2010=14000B) Significant government deficit and foreign borrowing

USA

slide-19
SLIDE 19

1/31/2014 19

  • 4% GDP
Globalized Trade Cumulative Deficit is now 50% 2010 GDP
  • 1% GDP
37 (US GDP 2010=14000B) Significant government deficit and foreign borrowing

USA

Allowed emerging economies via corporations uncontrolled access to our consumers (employees)

How did it happen?

slide-20
SLIDE 20

1/31/2014 20

How did it happen?

Corporate “brow-beating” “If you don’t Go Offshore you wont be on the bidders list!” (Fortune 500 Corporations to local NA Suppliers) Corp cash stash Middle Class 50% of the mid –sized manufacturers (100 to 500 employees ) have disappeared since 2000 Citizens need passports But Jobs and capital don’t! Hard Lesson…Globalization Rule #1 “Is the only way to compete with a 3rd World Economy to Become One!!”

?

Economic Doctrine

Share holders

Moving toward Wealth Inequality?
  • 4% GDP
Globalized Trade Cumulative Deficit is now 50% 2010 GDP
  • 1% GDP
40 (US GDP 2010=14000B) Significant government deficit and foreign borrowing

USA

slide-21
SLIDE 21

1/31/2014 21

(GDP=1350B)
  • 10% GDP

CANADA

  • 1% GDP
  • 2% GDP
Worse than USA numbers!!! Canada/World 41
  • 1% GDP
42 Declining Prosperity INDEX

CANADA

We have lost our BALANCE to remain Productive.

It is not that we are less productive.. but more about having idle capacity! Emerging Market Resource Demand Dependent
slide-22
SLIDE 22

1/31/2014 22

Ontario Economic Performance

How has Globalized Manufacturing Affected our Province?

M 13% GDP & 15% Employment ONTARIO Reduction Intensity Gap
slide-23
SLIDE 23

1/31/2014 23

Offshore content has increased Reduced Manufacturing intensity Declining Capital Investment (70% LESS) Reduced Investment trends will mean 25% further decline in the next decade
slide-24
SLIDE 24

1/31/2014 24

SERVICE JOBS????

? ? ? ?

Significant “out-shoring” in some of these sectors

(1 Manf Job = 3 Service Jobs)

slide-25
SLIDE 25

1/31/2014 25 Large Out-of-Balance Trade Gap…. -15% of GDP. Unbalanced Revenue Flat to low growth … so recovery difficult. Business and Job loss….. no real plan to fix. Under- Capitalization and low technology investment… Productivity loss (Utilization loss) Erosion of skills and knowledge Apathy and no vision for the future!

Summary

We are now a “have-not” Province!

M

Why…. Take Back Manufacturing

For Our…. Population Province/State Workforce Business Leaders Investors Kids

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

The message is getting through!!

It is now VERY obvious that we need a Balanced Economy (Resources/Services/Manufacturing)
slide-26
SLIDE 26

1/31/2014 26

For our Population Recover lost prosperity and reduce risk of global economic instability now and into the future. Recover higher income jobs of all types via manufacturing's higher productivity Recover the ability for manufacturing to create the 3:1 economic activity into other sectors. For Our Province Recover lost tax revenue to balance budgets at all levels of government and public services. Recover an autonomous and balanced economy without over reliance on natural resources For our Workforce Stabilize future skills and career opportunities at all levels ……. Including Professionals For Business Leaders Provide a strong incubator and support system for local Innovation and R&D investment. Better protect and sustain the Intellectual property of the next generation of innovations Improve ability to compete world wide from a stable home market/manufacturing base. For our Investors Provide solid Value-added investment opportunities for local capital via manufacturing. For Our Kids Reduce the Global Carbon Footprint and oil dependency … Reduce the Negative wealth flow

Why…. Take Back Manufacturing

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

Questions?

52

OUR ECONOMY NEEDS MANUFACTURING!

slide-27
SLIDE 27

1/31/2014 27

So what’s next?

53

We need a critical mass of awareness by every-one to force action taking to recover our future……

THE GAME CHANGER! A 2nd Chance?

GLOBALIZED MANUFACTURING

? ?

TBM Positional Paper on the Waste in a Global Supply Chain
slide-28
SLIDE 28

1/31/2014 28

55

Waste of VERY Expensive Bunker Fuel Much Non-Value-Adding Inventory

PURE WASTE 56

Waste of VERY Expensive Bunker Fuel

This low grade bunker fuel is used by the worlds 90,000 cargo ships A single large container ship emits pollutants equivalent to 50 million cars. Total container ship pollution is 6 times that of the TOTAL cars in world 2,000 times the amount of sulfur compared to diesel automobiles. Container ships account for 90% of global trade by volume. Our Economies will be jeopardized by this global warming enabler

VERY LARGE CARBON FOOTPRINT

slide-29
SLIDE 29

1/31/2014 29

57 Numeric data is available, click here for information. Crude Oil Prices in USDs Start of Globalization Globalization breakeven point Note: localized supply of energy will not change this outlook The end of cheap China

What do soaring Chinese wages mean for global manufacturing?

Mar 10th 2012 | HONG KONG AND SHENZHEN | from the print edition

CHINA … Low Cost Country?

WEALTH TRANSFER???
slide-30
SLIDE 30

1/31/2014 30

GLOBALIZED MANUFACTURING

? ?

START THINKING LEAN & GREEN

?

60

GLOBAL SUPPLY CHAIN Localized TRADE Bloc

LEAN Review of Trading Models

slide-31
SLIDE 31

1/31/2014 31

GLOBAL SUPPLY CHAIN

CHINA/ASIA Manufacturing recycle loop Canada USA 9000 km Each way MIN 6 weeks Transit Inventory MIN $100/M cube to transport MIN Many Transactions / Handling…… Much Waste of Natural Resource’s 61 HIGH WASTE NOT LEAN NOT GREEN Dig Resources Ship resources Dock resources Use Resources Ship products Dock products Ship Store ship Sell Process

LEAN Review of Trading Models

SCRAP $

NOW

When Interest rates are “normalized” we will have a “High cost of Inventory trap” Cost Drivers

GLOBAL SUPPLY CHAIN

CHINA/ASIA Manufacturing recycle loop Canada USA 9000 km Each way MIN 6 weeks Transit Inventory MIN $100/M cube to transport MIN Many Transactions / Handling…… Much Waste of Natural Resource’s 62 HIGH WASTE NOT LEAN NOT GREEN Dig Resources Ship resources Dock resources Use Resources Ship products Dock products Ship Store ship Sell Process

LEAN Review of Trading Models

SCRAP $

NOW

When Interest rates are “normalized” we will have a “High cost of Inventory trap” Cost Drivers
slide-32
SLIDE 32

1/31/2014 32

INSANITY

63

GLOBALIZED MANUFACTURING

slide-33
SLIDE 33

1/31/2014 33

Canada USA 65

LEAN Review of Trading Models

LEAN & GREEN

Intrinsically less wasteful Short Supply Chains FAST RESPONSE to customers Local Manufacturing Strong Incubator for INNOVATION Balanced Trade 1000 km Each way MAX 1 week Transit Inventory Max $10/M cube to transport Max Few Transactions Minimal Inventory/Interest rate exposure

BALANCED ECONOMY

Localized TRADE Bloc

HEALTHCARE EDUCATION TRAINING

We have “Run the Numbers”

66

USED BALANCED SOURCING MODELS

Every Engineer should understand business costing and economics!!!

LEAN Review of Trading Models

TBM

slide-34
SLIDE 34

1/31/2014 34

BEST WORST % of Total Cost LOCAL OFFSHORE OFFSHORE Issues Material content 40 40 50 Foreign country materials may need harmonizing with your designs Labor content 25 3 3 A clear advantage, but product skill and training may be an issue Overhead 25 4 6 A lack of foreign management capability may effect other hidden costs Local Support costs 7 10 10 Your internal support for offshore will be an adder to your business costs Offshore support costs 3 6 Support at offshore site will be an adder to your business costs Transportation 6 8 These added costs can also be effected by containerization skills and knowledge Inventory costs 3 6 10 longer line of supply and maybe associated forecasting will attract inventory Duty (export and import) 8 10 Brokerage, duty and insurance will add to the costs Total factory cost 100 80 103 Baseline set on local supply 20 40 60 80 100 120 LOCAL BEST CASE WORSE CASE

We built Cost Trade-off Models … LOCAL versus Off-shore

BALANCED SOURCING

BALANCED LANDED COST LOCAL BEST OFF-SHORE WORST OFF-SHORE

?

OFFSHORE SAVINGS CAN GO POSITIVE OR VERY NEGATIVE OFFSHORE LOCAL 68 Material DIRECT OVER HEAD OH

Balanced Source Landed Cost Comparison

LOCAL Material OFFSHORE Transportation Other Duty Inventory costs Support costs COPQ Material OFFSHORE 2015 DIRECT OH DIRECT 10% 20% 30% + + + + + + 2012 2011 Tipping Point RESHORE
slide-35
SLIDE 35

1/31/2014 35

LOCAL BEST OFF-SHORE WORST OFF-SHORE

?

Boston Consulting Group (BCG)……

Predict BALANCED LANDED COST parity by 2015 in most sectors The REAL Costs to Manufacture OFF-SHORE will be projected to rise. Due to: Exchange, tariffs, Labor wage inflation, Product Quality Cost escalation Transportation costs, Customer location Inventory costs, Ease of doing business, Many Other hidden drivers…. OFFSHORE LOCAL

BALANCED SOURCING

Validated Cost Trade-off Models … LOCAL versus Off-shore

LOCAL BEST OFF-SHORE WORST OFF-SHORE

?

Boston Consulting Group (BCG)……

Predict BALANCED LANDED COST parity by 2015 in most sectors The REAL Costs to Manufacture OFF-SHORE will be projected to rise. Due to: Exchange, tariffs, Labor wage inflation, Product Quality Cost escalation Transportation costs, Customer location Inventory costs, Ease of doing business, Many Other hidden drivers…. OFFSHORE LOCAL

BALANCED SOURCING

Validated Cost Trade-off Models … LOCAL versus Off-shore

slide-36
SLIDE 36

1/31/2014 36

GLOBALIZED MANUFACTURING

? ?

START THINKING LEAN & GREEN

COMBINED OPERATIONS

Take Back Manufacturing

TBM

slide-37
SLIDE 37

1/31/2014 37

CIM: What factors are driving manufacturers' decisions to bring production back to Canada? Southway: It's a North American-wide realization that
  • ff shoring is getting more expensive with increased
transportation expense due to oil costs, as well as labor price escalation in emerging economies. Many corporations and large consulting groups also recognize that there are many hidden costs and issues in supporting a remote supply chain. In general, local manufacturing is now considered to be no more expensive than offshore
  • production. The landed cost tipping point in some sectors
and commodities is projected to be reached by 2015. Local manufacturing also offers more stability and the ability to innovate at home more effectively. And, being closer to the customer has added inventory and flexibility advantages. CIM: How can industry members communicate the importance and value of manufacturing to the general population? Southway: We have had three decades of people thinking manufacturing is bad news. Manufacturing has been viewed as dirty and dangerous, risky and unstable employment, and so forth. We have a lot of work to do to change this negative image. Just talking about TBM, telling the real story, and showing what we do will help. If we look at the long term, today's 12- to 15-year-olds will lead the way. When they reach 22 years old, we will have a thriving localized manufacturing economy. It certainly won't be based on cheap oil or energy, but it will be very lean and very green. Things will be made in local manufacturing hubs or clusters. Factories will be very high-tech and their
  • peration will demand high levels of skill and education.
All this needs vision and a can-do attitude. Not having both
  • f these is our biggest risk.
Take Back Manufacturing 90 70 10 50 30 40 20 60 80 % LABOR CONTENT WORST LCC PERFORMER BEST LCC PERFORMER

OFFSHORE VERSUS LOCAL MANUFACTURING BY % LABOR CONTENT

(SINGLE LEVEL COMPONENT) OFFSHORE OFFSHORE MIGRATE ALL PRODUCTS TO THIS ZONE VIA PROCESS: INNOVATION SIMPLIFICATION AUTOMATION TO REDUCE LABOR CONTENT TYPICAL EXAMPLE 75 Material Content LOCAL Tipping Point
slide-38
SLIDE 38

1/31/2014 38

90 70 10 50 30 40 20 60 80 % LABOR CONTENT Post LCC Escalation Period

OFFSHORE VERSUS LOCAL MANUFACTURING BY % LABOR CONTENT

(SINGLE LEVEL COMPONENT) OFFSHORE OFFSHORE MIGRATE ALL OUR PRODUCTS TO THIS ZONE VIA AUTOMATION AND PROCESS INNOVATION PLUS SIMPLIFICATION TO REMOVE LABOR CONTENT TYPICAL EXAMPLE 76 Material Content LOCAL

What is happening in the USA?

  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US exchange rate ……………………………... Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

THE GAME CHANGER!

slide-39
SLIDE 39

1/31/2014 39

What is happening in the USA?

  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US exchange rate ……………………………... Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

Reasons.. Transportation costs Labor costs Product quality Customer location Ease of doing business

What is happening in the USA?

  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US exchange rate ……………………………... Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

Most Next generation products will Re-shore if:

Large bulk shipping cost % Low/Mid labor content (less than 50%) Hi Technology (Embedded Innovation) Value adding local supply chains Integrated with customer services

TBM

?

slide-40
SLIDE 40

1/31/2014 40

80
  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US $ value …….. Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

Maybe not us with a RESOURCE ESCALATED

TBM

slide-41
SLIDE 41

1/31/2014 41

  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US $ value …….. Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

Maybe not us with a RESOURCE ESCALATED

TBM

Experts are certain Manufacturing will Re-shore to North America ……. ……..but not sure it will be Canada! 83

CANADA / US $ EXCHANGE

(Appreciated) 75 cent $ 0.5 1.0 100 cent $ 1985 1990 2000 2010

We did not earn it with Productivity growth!

4% Prod Growth 2% RESOURCE ESCALATED
slide-42
SLIDE 42

1/31/2014 42

84

CANADA / US $ EXCHANGE

(Appreciated) 75 cent $ 0.5 1.0 100 cent $ 1985 1990 2000 2010 RESOURCE ESCALATED

Not Entitled to $ Appreciation

Created by Resource boom/ hedge funding. Appreciates Currency Reduces ability to Export \ be productive Reduces Competitive Manufacturing Increases exposure to global instability

What is happening in the USA?

  • Resurgence of Manufacturing in USA … Now at “tipping point”
via lower US exchange rate ……………………………... Rethinking of globalized supply

Balanced Sourcing Cost trade-off modeling

Re-shoring !!!

TBM

PPP 0.81
slide-43
SLIDE 43

1/31/2014 43

86

CANADA / US $ EXCHANGE

(Appreciated) 75 cent $ 0.5 1.0 100 cent $ 1985 1990 2000 2010 RESOURCE ESCALATED

Many Factors will determine Reshoring

(Resource & Product Transfers)

87 Low Cost Country Global Trade

Localized Trade

Oil /transport price increases Emerging Economy Price Inflation Public and industrial Pressure Interest Rate Normalization Re-evaluated Balanced Sourcing Models Corporate taxation adjust Complex Supply Chain Costs Import/Export Re-balance Re-shoring! Local Re-Capitalization! Re-Hiring! / Re-training! Government budget Re-balance High Loonie! The Globalization Purist! Our Inability to Understand And Take Action!!! M Close proximity to customer IP protection issues Ease of doing business
slide-44
SLIDE 44

1/31/2014 44

88

Questions?

89 IT WILL BE A CHALLENGE BUT SOME MANUFACTURING CAN RETURN IF WE TAKE IT BACK
slide-45
SLIDE 45

1/31/2014 45

But….Are WE Ready???

TBM

M

?

WHY NOT?

  • We have our futures and Kids here
  • We have our consumers here.
  • We already have the resources here
  • We have our investments here
  • We still have the know-how and skills????.

WE LIVE HERE!!!

91 M
slide-46
SLIDE 46

1/31/2014 46 TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M IMPROVE Balance IMPROVE POLICY IMPROVE & Mobilize

TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M IMPROVE POLICY
slide-47
SLIDE 47

1/31/2014 47 TBM

Government

TBM – The 3 Parallel Imperatives

M
  • Provide MORE support for Manufacturing
  • Embrace Waste-Free Forms of Globalization
  • Focused POLICY and PLANS
  • Avoid duplicated policy and support organizations
High Waste and Transportation Volatile Labor and Wealth Transients Improved Productivity and Less Waste Balanced Local Economies INNOVATION IP KNOWLEDGE SKILLS Equitable IP / Knowledge Trade Limited Transfer Materials and Products GLOBALIZED MANUFACTURING

TBM Take Back Manufacturing

WWW.SME-TBM.ORG
slide-48
SLIDE 48

1/31/2014 48

Policy support for TBM

FISCAL POLICY
  • Fix Canadian Dollar to get to the same “tipping point” with the USA
  • Adjust Ultra low Interest Rates to a “normalized” level
  • Lower taxes for investments on new products / technologies / equipment and skill training.
  • Install a Global based carbon tax to reduce waste/usage of energy and combat global ineptitude
TRADE POLICY
  • Embrace a return toward a Localized TRADE bloc. (Ensure all trade deals are FAIR not FREE trade based)
  • Reduce Non-North America IMPORTS via Controls and better support Strategic EXPORTS
  • Participate in a Knowledge Based Economy .. BUT with Improved IP controls
  • Improve Canada-US border and regulatory differences
INVESTMENT POLICY
  • Re-deploy capital Investment into local value adding industries.
  • Simplify industry Incentives (SR&ED etc)…. hold industry 100% accountable for results
  • Encourage innovation and the commercialization of new products and technologies
EDUCATION / INFRASTRUCTURE / ENERGY POLICY
  • Implement Industrial Education/Training via an Integrated Apprenticeship system
  • Fix our declining infrastructure (Energy/logistics/communications)
  • Improve regulatory efficiency. (Make it easier to do business..safety/legal/human rights etc)
  • Simplify product and process compliance requirements, remove wasted efforts.

Define BOLD Policies to …Take Back Manufacturing. TBM

Government

TBM – The 3 Parallel Imperatives

M
  • Provide MORE support for Manufacturing
  • Embrace Waste-Free Forms of Globalization
  • Focused POLICY and PLANS
  • Avoid duplicated policy and support organizations
Consider a change to the policy making process Hold a Policy Blitz process!! In Ontario alone we have 18 different policy groups feeding off the public trough Issuing independent reports without integrated review and closure. Put them all in one room!.. Come out with one plan!
slide-49
SLIDE 49

1/31/2014 49

Questions?

98 IT NEEDS … A DELIBERATE ACT OF NATIONAL LEADERSHIP AND PLANNING.

TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M

?

The Current Skill Mix Is In Disarray And Misaligned.
slide-50
SLIDE 50

1/31/2014 50 TBM

North-American Manufacturing Prosperity for all.

TBM – The 3 Parallel Imperatives

Educators

We have become an Over-educated / Under-trained /Redundant Workforce!!!
  • Education must better serve its citizens
  • Ensure it is value adding to the economy
  • Re-Balance Education versus Training
  • Integrated Industrial Apprenticeship System
101
slide-51
SLIDE 51

1/31/2014 51

Industrial Apprenticeship System

102 Take Back Manufacturing (TBM) Will demand the availability Of a future manufacturing workforce that Is both well- educated and well-trained with industry experience. The Development Of The future Industrial Workforce Has Suffered A Decline. The Current Skill Mix Is in Disarray and misaligned. We Need Significant Re-Planning And Action Now To Avoid An Increasing Shortage Of Experience, Knowledge And Skills When We Try To Rebirth Most Manufacturing Sectors. This Will Require An Integrated And multi-grade Apprenticeship System! Will Demand TOTAL Involvement From Industry Sectors, Educational Institutions with strong leadership from both federal and Local Governments.
  • Integrated & Scalable Career Pathway
Apprentice Journeyperson Technician Technologist Engineer
  • Industry Recognized Skills and Education Development Progression
  • Apprenticeship Pool From The Best, the Brightest And The Most Talented
  • Become The Learning/Occupation Destination Of Choice for High School Students
  • Must also support the re-training of the existing mature work-force!!
  • Apprenticeship Courses Transferrable And Articulated To Other Post Secondary Colleges And Universities, Supporting
Lifelong Progression In Learning As Shown In Career Pathway Above
  • Industry must lead on driving and installing this system. (Integrated support from All Governments and Educators )
  • The Integrated education and training must provide a highly flexible workforce.
  • DO IT!...... Before we loose the Industrial Experience of the Baby Boomers!!
Trade Technician Technologist Engineer Eng Degree Eng Diploma Tech Certificate Trade Certified High school Manufacturing needs YOU !

Integrated Industrial Apprenticeship System

TBM

slide-52
SLIDE 52

1/31/2014 52

The Plan………… Joint Industrial Apprenticeship Board

Mature Students Dual Path Approach For Youth + Mature Students Skills & Competencies Academic Workplace Industry Technical Personal Effectiveness Apprenticeship Outcomes Fully Certified/Licensed Industry Qualified Fully Employed

Questions?

105 We need A formal system to change the Industrial learning system in our Nation. TBM has formed a sub committee to work on this system.
slide-53
SLIDE 53

1/31/2014 53 TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M

?

Let’s Mobilize!!! & Let’s WIN!!!

TBM

TBM – The 3 Parallel Imperatives

Educators

Industry

  • Use BALANCED SOURCING…. Run the numbers!!
  • Reinstall a “MINDSET” for Continuous Improvement
  • Install New Technology and Capital Re-investment
  • Gain a Vision & Aptitude for all forms of “INNOVATION”
  • Re-build Strong LOCALIZED Manufacturing Communities
  • Improve the Image of Manufacturing for every-one!
North-American Manufacturing Prosperity for all.
slide-54
SLIDE 54

1/31/2014 54

108 Material DIRECT OVER HEAD OH

Balanced Source Landed Cost Comparison

LOCAL Material OFFSHORE Transportation Other Duty Inventory costs Support costs COPQ Material OFFSHORE 2015 DIRECT OH DIRECT 10% 20% 30% Material DIRECT OVER HEAD LOCAL 2015+ +TBM 5% + + + + + +?? 2012 2011 IMAGINE IF WE IMPROVED BY 5%? 109 Our main competitors are inside NAFTA!!!!

Productivity performance needs review and understanding!

Many of us believe these numbers and trends do not mean anything and need further review
slide-55
SLIDE 55

1/31/2014 55

110 Low value adding 111 Scale + Utilization
slide-56
SLIDE 56

1/31/2014 56

112 Utilization? More R than D Incl SRED 113 Gap is real-estate, infrastructure and distribution
slide-57
SLIDE 57

1/31/2014 57

Impact of Poor Economic footprint (Auto sector)

  • Canada (Ontario) at 0.95 dollar

$76/hour

  • US North

$85/hour

  • US Mid West

$67/hour

  • US South

$49/hour

  • Mexico

$18.5/hour

114 At a 0.81 dollar and a competitive business environment would be at $55/hour

Reshoring will force some geographical location changes

Loaded labor rates 115

Balanced Source Landed Cost Comparison

Material OFFSHORE 2015 OH DIRECT Material DIRECT OVER HEAD LOCAL 2015+ +TBM 5%+ + + + + + +

Local Advantage?

slide-58
SLIDE 58

1/31/2014 58

116

Balanced Source Landed Cost Comparison

Material OFFSHORE 2015 OH DIRECT Material DIRECT OVER HEAD LOCAL 2015+ +TBM 5%+ + + + + + +

Local Advantage? NAFTA

Suggested Manufacturers Game-plan

  • Run a Balanced Sourcing model…Include all cost factors …
  • Rethink sourcing plans across NAFTA…. US/Canada/Mexico
  • Strategize manufacturing closer to the customer… global reach.
  • Strategize manufacturing closer to the supply… if a primary resource..
  • Develop shorter supply chains where possible (NAFTA + Global)
  • Invest in a strong local supply base … work harder at local relationships
  • Encourage local government to provide “business easy” infrastructure
  • Plan to minimize exposure to high energy costs
  • Embed into all your plans:
– LEAN Thinking…. Re-invent and combine with business continuous improvement culture – Integrated Business systems … Get your key providers to provide an “Integration plan”. – New process technology… Flexible Automation + Additive Manufacturing and Rapid Tooling
  • Strive to retain/train/stabilize/mobilize/nurture your workforce.
117
slide-59
SLIDE 59

1/31/2014 59

Manufacturing has an IMAGE problem!!

Most manufacturing-based businesses are beyond dispirited…. Our Politicians/Government/Population have little understanding of business and manufacturing…We must EDUCATE them!! Manufacturing is deemed:

Dark, Dirty, Dangerous, Deafening and Difficult….

118

….. And Smelly!

M And…. Highly unstable as a career!

?

119

TBM

EXCITE the NEXT GENERATION

Change ….

The Image of Manufacturing

Let’s Make Manufacturing

slide-60
SLIDE 60

1/31/2014 60

120

TBM

EXCITE the NEXT GENERATION

Change ….

The Image of Manufacturing

Let’s Make Manufacturing

Via… Student days at Trade shows Student Chapters Plant open days JOB Fairs Key public events

Questions?

121 Industry needs to improve both Its performance and Work on its image!
slide-61
SLIDE 61

1/31/2014 61 TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

IMPROVE POLICY Hold a Policy Blitz process!! IMPROVE Balance Formal Integrated Apprenticeship systems IMPROVE & Mobilize Undertake Evolution plans
  • Use BALANCED SOURCING…. Run the numbers!!
  • Reinstall a “MINDSET” for Continuous Improvement
  • Install New Technology and Capital Re-investment
  • Gain a Vision & Aptitude for all forms of “INNOVATION”
  • Re-build Strong LOCALIZED Manufacturing Communities
  • Improve the Image of Manufacturing for every-one!

THE TBM ROADMAP

123

Our Support to Industry

TBM Take Back Manufacturing

WWW.SME-TBM.ORG
slide-62
SLIDE 62

1/31/2014 62 TBM SURVEY

THEN PUSH HERE

Do You Care About Manufacturing in CANADA?? TBM Self Positioning Survey

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

WWW.SME-TBM.ORG

TBM Survey Results

Presented at the SME TORONTO Monthly Meeting 22nd Nov 2012 From an ongoing online survey on the www.sme-tbm.org website

TBM Take Back Manufacturing

WWW.SME-TBM.ORG
slide-63
SLIDE 63

1/31/2014 63

How many people are in your business?

TBM SURVEY RESULTS 60% 12% 20% 8% 478 participants 72% are “Small” 20% are “Mid sized” 8% are “large” “large” “Mid sized” “Small”

Size of manufacturing facility

78% of manufacturing sites design own product. 45% approx. are below 20,000 sq. ft.
slide-64
SLIDE 64

1/31/2014 64

0% 2% 4% 6% 8% 10% 12% agricultural equipment appliance manufacturing building componensts construction materials metal extrusions mining equipment
  • il and gas equipment
pulp and paper security equipment solar equipment steel making commercial parts Food & Beverage material handling equipt medical equipment packaging software aerospace electrical HVAC equip pharma treatments and finninshing plastics electronics furniture industrial equipment fabrications machining tooling automotive Manufacturing participants only by sector (389 Participants)

SUMMARY OF TBM SURVEY RESULTS.

87% concerned about being global competitive 73% Are very concerned about the high (non competitive) Canadian dollar 75% concerned about economic demand 82% concerned about the decline in the manufacturing supply base 66% believe they can still compete 60% dissatisfied with federal support 59% dissatisfied with local guv support 87% concerned about skill mis-match/shortage 62% feel they are under capitalized How do they feel?
slide-65
SLIDE 65

1/31/2014 65

SUMMARY OF TBM SURVEY RESULTS.

65% Suggest we need focus on workforce training and development 68% Want to focus on Productivity Improvements What type of Improvement strategies are they looking at? 60% Lean thinking technologies (Cycle-time/Waste reduction etc.) 53% Information/education on new technologies 50% Innovation methodologies and systems for products and processes 50% New Product Introduction commercialization and Six Sigma systems 27% Productivity through computerization (ERP/CAD etc.) 50% Want help to undertake Balanced Sourcing (Reshore) decision process What do they need?

The Competitive Edge!

131

The Edge

Government Plan to Nurture Manufacturing sectors with Economic controls Install an Integrated Industrial Apprenticeship system Coordinated drive to encourage LEAN Supply chain and balanced sourcing strategies Investments in strong Innovation and Commercialization tools Invest in new technology aka Rapid Additive Manufacturing etc.
slide-66
SLIDE 66

1/31/2014 66

The TBM ROAD MAP

132 SME networking for success Business Process improvement Strategic planning/Innovation New Product Introduction streamlining Balanced Global Sourcing Production Process excellence Distribution and Inventory management Manufacturing Technology Toolkits Business Systems Management technique upgrades Organizational learning systems

Organizing your : Thought-ware Software and Hardware…. ……For TBM advantage

SME Monthly TBM Journey………

  • January 2012
TBM Overview
  • February 2012
Innovation
  • March 2012
Balanced Sourcing
  • April 2012
Industrial Education and Training
  • May 2012
Computer Integrated Manufacturing
  • September 2012
Additive Manufacturing/Rapid Prototyping
  • October 2012
Survey results … TBM Roadmap
  • November 2012
TBM Roadmap Roll-out
  • December 2012
Productivity and Lean
  • January 2013
SME expanded chapter mission review
  • February 2013
Student Chapter planning
  • March 2013
TBM review
  • April 2013
Apprenticeship planning
  • May 2013
Product compliance and certification
  • June 2013
LEAN-ing Toward success!
  • September 2013
What is a Manufacturing Engineer?
  • October 2013
Continuous Improvement Implementation
  • November 2013
Productivity…. What’s the real problem? We are holding regular SME Chapter meetings with TBM as the central theme With one of the TBM imperatives discussed as a special topic each month.
slide-67
SLIDE 67

1/31/2014 67

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

2014

A revival year for LEAN

It must be combined with Technology and Innovation in all forms to make a difference It must be an integrated Evolution plan for a whole business Businesses of all sizes and sectors will need such a plan to survive!

AME LEAN World Conference Toronto October 2013

Ministry Economic Development Trade & Employment MEDTE

Ontario Government 2014 Initiative…

slide-68
SLIDE 68

1/31/2014 68

LEAN Certification

http://www.sme.org/leancert
slide-69
SLIDE 69

1/31/2014 69

Where We Are With TBM

  • Almost 2 years since we launched the initiative
  • Gained a lot of press and moral support (mainly inside the industry)
  • Provided some support to our Industrial membership
  • Limited penetration in public awareness..
  • Some attention span from government … some limited action ..FED budget..
  • Little attention at provincial level… Trapped in minority government mode
  • Some alignment with policy groups…… But still a mixed message environment
  • Some solid realization that globalization and free trade not working..
– Outsourcing of support jobs – Temp worker scandal – Garment industry third world employment mistakes – Significant contribution to pollution and maybe climate change
  • But….Not sure if they will connect the dots!!
  • Still need to stay in the fight!!!.... A huge challenge!!
1/31/2014 138 139

T B M

Government support & Focus New and BOLD policies Fix impact of Hi Cdn $ Tax supportive re-capitalization Rethink globalized manufacturing Balanced sourcing Local supply clusters Build factories of the future More innovation capability New technology Refocus LEAN / Continuous improvement Enhance business systems Fix energy/support infrastructure Integrated Apprenticeships Re-Engineer Manufacturing Image Reshore to NA/Canada Local trade bloc Balanced trade Balanced economy Rebirth business energy Recover jobs More career Stability/growth More prosperity via Value Jobs Improved legacy for our Kid’s

Let’s Re-engineer Our Economy to Work Again!

Toronto Chapter
slide-70
SLIDE 70

1/31/2014 70

140

Take Back Manufacturing

FOR OUR KIDS!!!

Let’s Re-engineer Our Economy to Work Again!

TBM

Toronto Chapter

THANKS

“Thumbs up” for TBM???

Study the Information package. (more at www.sme-tbm.org ) Sign up for the TBM Survey Get others who need help to sign up!!! Get the TBM Roadmap (SME Members only) Get your Society/Association to join TBM Forum.

141

HELP US HELP YOU!!!

slide-71
SLIDE 71

1/31/2014 71

142 Innovation and Creativity Computer Integrated Manufacturing Product & Process Design and Management Manufacturing Education Rapid Technologies & Additive Manufacturing Industrial Laser Forming & Fabrication Automated Manufacturing & Assembly Machining & Material Removal Plastics, Composites & Coatings SME Chapter Technical Communities Toronto Chapter More information at www.smetoronto.ca/information
  • n how to sign up to assist with these technical communities.
Email or call me at: nigel.southway@smetoronto.ca Tel 905 464-5517

Questions?

143 KEEP ASKING…. WHY?…
slide-72
SLIDE 72

1/31/2014 72

END

144