SME Toronto WWW.SMETORONTO.CA Nigel Southway SME Chair 2012/2013 - - PDF document

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SME Toronto WWW.SMETORONTO.CA Nigel Southway SME Chair 2012/2013 - - PDF document

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11/14/2013 Toronto Chapter SME Toronto WWW.SMETORONTO.CA Nigel Southway SME Chair 2012/2013 Toronto Chapter www.sme.org. About SME: The Society of Manufacturing Engineers Premier source for manufacturing knowledge, education and

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SME Toronto

WWW.SMETORONTO.CA

Nigel Southway

SME Chair 2012/2013

Toronto Chapter

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

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Automated Manufacturing & Assembly Identifies and pursues advancing technologies and techniques in automation and assembly. Forming & Fabricating Concentrates on key metal forming and fabricating technologies. Industrial Laser Promotes laser technology in North America with high intensity by educating the market and advancing the laser technology base. Machining & Material Removal Discusses, explores and advances ideas related to cutting processes and machining systems.

SME Technical Community Networks (8)

Manufacturing Education & Research Advances education and research in manufacturing, career and professional development, and the manufacturing enterprise's need for a skilled workforce. Plastics, Composites & Coatings Addresses the manufacturing processes of plastics, composites, and finishing and coatings technology. Product & Process Design and Management Discusses, investigates and advances ideas related to the design and management of products and processes, as well as lean manufacturing concepts and certification. Rapid Technologies & Additive Manufacturing Concentrates on the technologies and processes that help conceive, develop, test, improve and manufacture new products to bring them to market faster and more cost effectively.

LEAN Certification

http://www.sme.org/leancert
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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

CANADA MANUFACTURING

6

The future of Manufacturing in Ontario’s economy.

A NORTH AMERICAN PROBLEM

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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

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TBM

Take Back Manufacturing

www.SME-TBM.org A Forum Dedicated to Restoring

  • ur Manufacturing Sectors.
25 Technical Associations 3 Trade associations 5 Educational policy makers 7 Media experts 3 Local government reps 5 Industry experts

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

10 M

TBM

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TBM…Our Ultimate Goal

11

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

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

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

Professional Engineers Ontario

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15 Take Back Manufacturing on TVO The Agenda Marie Laird … Past Chair SME Toronto 16
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WHY?..Take Back Manufacturing

FOR OUR KIDS!!

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TBM Take Back Manufacturing

WWW.SME-TBM.ORG

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

This is NOT a game!!!...

? ? ? ?

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GLOBALIZED MANUFACTURING GLOBALIZED MANUFACTURING

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GLOBALIZED MANUFACTURING

? ?

Moved Off-shore…..

22

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

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23 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

What happened?

24
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  • 1% GDP
25

OUR BIG BROTHER

(US GDP 2010=14000B)

USA

Globalized Trade
  • 1% GDP
26

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

USA

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

USA

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(GDP=1350B)
  • 10% GDP

CANADA

  • 1% GDP
  • 2% GDP

Worse than USA numbers!!!

Canada/World 29
  • 1% GDP
30 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!
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Ontario Economic Performance

How has Globalized Manufacturing Affected our Province?

M 13% GDP & 15% Employment ONTARIO Reduction Intensity Gap
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Offshore content has increased Reduced Manufacturing intensity Declining Capital Investment (70% LESS) Reduced Investment trends will mean 25% further decline in the next decade
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SERVICE JOBS????

? ? ? ?

Significant “out-shoring” in some of these sectors

(1 Manf Job = 3 Service Jobs)

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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)
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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

So what’s next?

41

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

THE GAME CHANGER! A 2nd Chance?

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GLOBALIZED MANUFACTURING

? ?

TBM Positional Paper on the Waste in a Global Supply Chain 43

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

PURE WASTE
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44

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

45 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

We will not run out of Oil… but …. We will run out of Oil we can afford to burn!!

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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???

GLOBALIZED MANUFACTURING

? ?

START THINKING LEAN & GREEN

?

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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 48 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 49 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
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INSANITY

50 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 51 Dig Resources Ship resources Dock resources Use Resources Ship products Dock products Ship Store ship Sell Process

LEAN Review of Trading Models

CHINA/ASIA

Localized TRADE Bloc FUTURE

Cost Drivers

TBM

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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 52 Dig Resources Ship resources Dock resources Use Resources Ship products Dock products Ship Store ship Sell Process

LEAN Review of Trading Models

CHINA/ASIA

Localized TRADE Bloc FUTURE

Cost Drivers

TBM

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 53 Dig Resources Ship resources Dock resources Use Resources Ship products Dock products Ship Store Ship Sell Process

Localized TRADE Bloc

1000 km Each way MAX 1 week Transit Inventory Max $10/M cube to transport Max Few Transactions Minimal Inventory/Interest rate exposure

Short Supply Chains FAST RESPONSE to customers

LEAN Review of Trading Models

FUTURE

Cost Drivers 11% 16% 10% 10% 1%
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Canada USA 54 Process

Localized TRADE Bloc

1000 km Each way MAX 1 week Transit Inventory Max $10/M cube to transport Max Few Transactions Minimal Inventory/Interest rate exposure

Short Supply Chains FAST RESPONSE to customers

LEAN Review of Trading Models

Dig Resources Use Resources Ship Sell Local Manufacturing Strong Incubator for INNOVATION

FUTURE

Canada USA 55

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
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We have “Run the Numbers”

56

USED BALANCED SOURCING MODELS

Every Engineer should understand business costing and economics!!!

LEAN Review of Trading Models

TBM

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
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58 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 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

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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

GLOBALIZED MANUFACTURING

? ?

START THINKING LEAN & GREEN

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COMBINED OPERATIONS

Take Back Manufacturing

TBM

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
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90 70 10 50 30 40 20 60 80 % LABOR CONTENT POST LCC ESCALATION PERIOD BEST LCC PERFORMER

OFFSHORE VERSUS LOCAL MANUFACTURING BY % LABOR CONTENT

(SINGLE LEVEL COMPONENT) OFFSHORE OFFSHORE MIGRATE ALL OUR PRODUCTS TO THIS ZONE VIA AUTOMATION AND INNOVATIVE PROCESS PLUS SIMPLIFICATION TO REMOVE LABOR CONTENT TYPICAL EXAMPLE 64 Material Content LOCAL 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 65 Material Content LOCAL
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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!

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

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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

?

69
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  • 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!

71

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
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72

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
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Many Factors will determine Reshoring

(Resource & Product Transfers)

74 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

But….Are WE Ready???

TBM

M

?

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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!!!

76 M

TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M IMPROVE Balance IMPROVE POLICY IMPROVE & Mobilize
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TBM

North-American Manufacturing Prosperity for all.

Industry

TBM – The 3 Parallel Imperatives

Educators Government

M IMPROVE POLICY

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
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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

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.

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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!

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.
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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

Industrial Apprenticeship System

85 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.
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  • 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

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
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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.
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90 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%? 91 Our main competitors are inside NAFTA!!!!

Productivity performance needs review and understanding!

SME is reviewing Productivity … Session next Thursday 21st
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92 Low value adding 93 Scale + Utilization
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94 Utilization? More R than D Incl SRED 95 Gap is real-estate, infrastructure and distribution
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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

96 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 97

Balanced Source Landed Cost Comparison

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

Local Advantage?

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98

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.
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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….

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….. And Smelly!

M And…. Highly unstable as a career!

?

101

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

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THE TBM ROADMAP

102

Our Support to Industry

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

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

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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

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”
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Size of manufacturing facility

78% of manufacturing sites design own product. 45% approx. are below 20,000 sq. ft. 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)
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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?

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?
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TBM SURVEY

THEN PUSH HERE

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

TBM Take Back Manufacturing

WWW.SME-TBM.ORG

After the TBM Survey Register for an Evolution Plan (For SME members) Undertake an Evolution plan Self Assessment with support from the local SME Chapter
  • Performance Gap
  • Improvement Focus

The TBM ROAD MAP

111 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

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The TBM ROAD MAP

112 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 networking for success

SME Positioning Survey/Evolution Plan for TBM….. Self calibrating your capability. Emerging New Manufacturing Technologies… TRADE SHOWS SME Chapters and Technical communities….. MEET/KNOW/GROW.. GET INVOLVED! SME Student chapter symposium… let’s get the new blood involved.

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.
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The TBM ROAD MAP

114 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

After the TBM Survey Register for an Evolution Plan (For SME members) Undertake an Evolution plan Self Assessment with support from the local SME Chapter
  • Performance Gap
  • Improvement Focus

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!!
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116

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

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Take Back Manufacturing

FOR OUR KIDS!!!

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

TBM

Toronto Chapter

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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.

118

HELP US HELP YOU!!!