Innovation, ideas, process and talent were recurring themes for woodworking companies attending this year’s EBC gathering.
The 2013 Executive Briefing Conference was held in mid-April at the Q Center in St. Charles, Ill. The annual EBC has asked what’s new and what’s next for more than 10 years and has been held in a number of cities around the United States during that time. This year, attendees saw a number of high-quality presentations on key subjects and had many opportunities to network in the Q Center’s college campus-like setting.
Process for innovation
Companies need to develop a process for innovation, explained keynote speaker Robert Tucker of The Innovation Resource. Executives need to identify what gets their creative juices flowing, he said, and they need to collaborate with customers and develop a culture of risk taking.
Designate a person to develop a process for innovation, and make innovation the business of everyone in the company, Tucker advised.
Nate Young of NewNorth Center further defined innovation and what makes it difficult. “Learners inherit the earth, while the learned find themselves equipped to deal with a world that no longer exists,” he said.
Attendees took part in a large graphic exercise in which blocks were placed on tables to represent their largest challenges. “Process” and “talent” won out as the top priorities, with “technology” and “materials” also important.
When Ikea talks, the wood products industry listens, and a presentation by the retail giant's Niklas Petersson was followed closely. While brandishing a $4.99 small table, Petersson explained how to create satisfied customers. Sustainability, availability, price development and quality all contribute. Petersson told attendees that North American suppliers produce 23 percent of what is sold in North America. There are currently 40 suppliers, and Ikea wants to increase their share to 50 percent.
Should manufacturers continue to consider making products in Asia or is it time to move manufacturing back to North America -- to reshore? The math is changing, and reshoring as well as producing closer to the customer is becoming more attractive, said Harry Moser of the Reshoring Initiative.
The potential for reshoring is huge – 500,000 new jobs in the U.S. or more. Some 50,000 jobs have reportedly returned since January 2010. Labor costs in China, the initial impetus for much of the offshoring, are rising quickly. Reshoring should be a priority for U.S. companies, but not all labor-intensive work should come back.
“It’s better for the U.S. to be part of the winning team than all of the losing team,” Moser said.
Moser suggests that many U.S. manufacturers are not looking at the overall cost of offshoring, including high scrap rates, shipping problems and quality issues.
More information can be found at reshorenow.org, along with Total Cost of Ownership software that helps companies determine the costs and benefits of reshoring. An online archive of articles and a case study template are also available.
Innovative millwork company
Speaking of case studies, the EBC once again offered an onsite live interview with a woodworking company. Glenn Ripley and Mark Scianna of Mission Bell Manufacturing Inc. in Morgan Hill, Calif., were interviewed by Mike Carson. This company is one of the largest millwork companies in the Bay Area, with many technology companies as customers.
Ripley explained how a new Bargstadt Intellistore system is being used to handle, store and retrieve every sheet that is used in the process, making small stacks for each job.
Scianna discussed the implementation of an ESOP program for employees, and how Mission Bell has gone from batch production to lean methods, defining one-piece flow as one room or one elevation at a time.
Talent and technology
No matter what the unemployment rate is, getting and retaining good quality employees is a top-level challenge. It requires an ongoing commitment. Blum Inc. has provided an example that you can “grow your own” employees. The Stanley, N.C., company’s Apprenticeship 2000 program has been successful in attracting good employees to the company’s hardware manufacturing. Blum’s Karl Rudisser and Andreas Thurner discussed how Blum partners with other Charlotte-area manufacturers, has set up an internship program and is working with a Charlotte community college.
After five years of apprenticeship, 80 percent of participants are still working at Blum. Part of the mission is to establish relationships with high school counselors and show parents that the stigma against manufacturing is not applicable.
A regular at past EBCs, Gary Wernlund of Stiles offered a good summary of new panel technology, including wood panel processing methods, new edgebanding technology, veneer sanding and panel alternatives. Wood-textured melamine may meet customer needs, he said. Wernlund also discussed painted surfaces, high gloss finishes, manual contour edgebanding and a few select equipment features.
Also at the EBC, Tim Northup of Stiles discussed return on investment in depth, inviting attendees to take a closer look at how they calculated ROI. Northup offered different methods of determining ROI, explained time study, allocating indirect costs, and the status of bonus depreciation (still available in 2013) and other possible deductions. What’s the best way to define ROI? Define the entire investment vs. all costs, he told attendees.
Speaking of costs, Chris Lewandowski of ifm efector talked about vibration analysis and reviewed machine monitoring techniques as a way to reduce operating costs. Joe Thiel of Hybratech discussed the energy benefits of LED lighting, not for products, but for woodworking operations themselves.
What’s the state of the woodworking market? Stiles executives at the press conference were seeing recovery in all market segments and all regions. But the recovery is not based on volume, and fashion and design are driving new business. Also, onshoring is contributing to business growth. (See accompanying story about a press conference that preceded the EBC.)
Alan Beaulieu of ITR Economics is always an informative and entertaining speaker on what can be an uninteresting subject. Times are good, he pointed out, although he expects a mild recession in 2014. After that, Beaulieu believes that there will be several strong growth years in 2015-2017.
One specific recommendation was to invest in people and training in the coming years. If you need to borrow money, do it now, he said. Expect taxes to increase in the future. And hardwood lumber prices will relax in 2014.
“We are in a growth mode, not recovery,” he said. “Enjoy the present.”
Attendees at the 2013 Executive Briefing Conference received plenty of actionable information that will help them make the right decisions so they can enjoy the present –- and the future.
Have something to say? Share your thoughts with us in the comments below.