Made in Tennessee Launches New Website

Be sure to check out the new Made in Tennessee site at www.madeintn.org

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Industry Update: Tennessee Named a Manufacturing Leader

When it comes to economic growth, building momentum is important… and this is especially true in the manufacturing sector. With a renewed focus from consumers to buy products Made in the U.S. and a preference from organizations to work with local suppliers, the Tennessee manufacturing industry is continuously building momentum!

Tennessee License Plate

Our momentum is best captured by a recent article by CNBC called The Top Ten States for New Manufacturing Jobs which highlights our state’s successes. Tennessee was named the 9th top state in the nation by adding an estimated 20,600 jobs between December 2009 and March of 2013. The article goes on to explain how manufacturing comprises 8.8% of our state’s economy and the earnings from jobs in our industry exceed $20.7 million. What an impact! Furthermore, Tennessee is 8th in the nation for automobile production. Impressive!

When discussing the top states in the nation for manufacturing job creation, the author noted that the leaders offered “products and services that range from autos, furniture, tools, computers, computer software, toys, plastics, food, liquor, machinery, piping, chemicals, oil and gas.”

Industry Week published a slideshow of the top ten states recapping manufacturing statistics. When they highlighted our state, they used the Made in Tennessee program logo! If you’re a manufacturer in Tennessee and you haven’t signed up yet, that should be some motivation. You could have looked at Industry Week online and said, “I’m a part of that program!” And don’t forget, it’s free to sign up!

Other studies are also showing that the manufacturing picture is improving. The Manufacturing Purchasing Manager’s Index is viewed as a gauge for growth in our industry and registered at 50.9 percent last month. Anything over 50 percent indicates growth, so this is a positive number.  Although we had a brief “hiccup” the previous month when the number showed contraction, every other month in 2013 has been above 50 percent.  A recent Industry Week article also noted that manufacturing profits were up $6.0 billion in Q1 this year compared to Q1 of 2012.

So the question is – as the manufacturing sector continues to build momentum, are you prepared for growth? Ask yourself:

  • Do you have a set plan in place to develop new business?
  • Have you obtained certifications that are important in your industry?
  • Are you operating with lean principles to reduce excess costs?

UT-CIS can help local manufacturers address these keys areas. Click here to see a list of our services or for more information, contact your local rep!

Image credit: SumnerTN.com

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Get Started With Lean Manufacturing by Using 5S for Workplace Organization

5S and Lean Manufacturing5S is a technique for organizing a workplace that helps to streamline processes. Tennessee manufacturers can adopt Lean manufacturing principles with the help of 5S.  By using this proven method, Tennessee manufacturers can create safer, cleaner and more organized workplace arrangements.

Getting Started with 5S 
The hardest part is getting started. Lean manufacturing works to eliminate waste in processes and materials, and this is where “5S” can lead the way for a budding new program.

Sort 
Assess the items used in the workplace and sort the necessary from the unnecessary. Unnecessary items crowd your workspace, and then it’s harder to find the materials that are needed. Pinpoint outdated equipment, dispose of broken tools and clean out the junk. Safety and productivity will immediately improve with the extra space and improved organization.

Set-in-Order
“Set-in-Order” involves placing the useful items in carefully planned locations based on frequency of use and where they are used. For example, if a certain tool is used in the same area of the facility, move those tools to that area. Be logical about where items and equipment are placed. Now workers can essentially turn themselves around and grab what they need instead of walking across the room 10 times every day. Make a goal of retrieving all needed items in less than 30 seconds.

Shine 
Determine a thorough program for cleaning and maintenance. Cleaning of equipment and production areas each day significantly reduces maintenance costs and exposes possible issues before they become a full-blown breakdown.

Standardize 
The next step, Standardize, builds on the “Shine” cleaning program. Using a team approach, create standardized procedures for both safety and production. Once the standards are in place, make plenty of signs and labels for the equipment and work areas so that inspecting and operating machines can be conducted quickly. This makes onboarding of new employees much smoother. Anyone on the shop floor should be able to recognize when equipment is unsafe or malfunctioning when this task is completed.

Sustain 
No process or program should ever be considered perfect or “finished.” The basis of the 5S philosophy is constant review and improvement. The team should schedule regular appraisals of the newly cleaned and organized work area to ensure that the new standards are maintained and improved.

The 5S Program does a great job of kick starting a Lean manufacturing program, but don’t be mistaken – it’s more than a big cleanup. It’s a structured program that will give the operation immediate and dramatic results and sets the stage for a significant culture shift.

Bring in an expert 
Although the 5S Program is a simple methodology to understand at a basic level, an experienced Lean manufacturing expert can bring all of these steps into focus with guidance on organizing your workplace and implementing changes to the culture. Bringing in an expert is an idea worth exploring.

The University of Tennessee – Center for Industrial Services (UT-CIS) offers training and implementation assistance for 5S and Lean manufacturing. Consider using our expertise to your advantage. To find out more information, contact your local Solutions Consultant.

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The Benefits of Green Manufacturing for TN’s Manufacturers

Green ManufacturingYou’ve probably heard the phrase “going green” before. At first, you most likely heard about “going green” from celebrities… and they were often referring to taking quick showers or driving particular cars. But then, the manufacturing community learned about a different type of “going green.” This meant implementing more environmentally sustainable practices - initiatives that would help TN manufacturers realize many benefits!

As a manufacturer in Tennessee, you can do the following by embracing green manufacturing principles:

  • Appeal to more customers by improving your brand awareness
  • Manage energy costs
  • Reduce waste and save production costs by reusing materials
  • Improve production processes and efficiencies

In today’s competitive environment, green manufacturing is becoming an important business strategy for the manufacturing community. Customers and suppliers now weigh how “green” a company is when making a purchasing decision.

Manufacturers were initially hesitant to embrace green initiatives, as they were associated with higher production costs and an interruption to business. Now, manufacturers are realizing that there are simple, yet effective ways to tackle environmental issues with their existing products and practices.

If you’re a manufacturer, why pass on the opportunity to reduce waste, preserve energy and make processes more efficient? If energy, water and labor costs aren’t decreasing anytime soon, and green manufacturing initiatives help businesses control these expenses, why not invest in these initiatives for the long-term?

And let’s work in the “feel good” aspect of green manufacturing. While efficiencies improve and production costs decline, manufacturers can also rest easier knowing that their operations are reducing emissions and carbon footprint. Now let’s work in the “feel better” aspect. This is a key driving point for a manufacturer’s marketing team! Green practices can be promoted to attract new customers and enhance brand awareness. Bonus – when employees are educated on critical factors such as increasing efficiencies, they become more engaged and embrace a culture of continuous improvement.

Largely, taking the steps to convert to green practices is a worthwhile for any manufacturer in Tennessee. These efforts improve your public relations efforts and have tremendous potential to reduce waste and harmful emissions.

If you are interested in transitioning your company to green operations or are looking for other environmental solutions, The University of Tennessee – Center for Industrial Services (UT-CIS) is here to help. Our experts will help your company be more efficient, environmentally safe and more sustainable. For more information, click here or contact us at 888-763-7439.

Image Credit: The Natural Solution Store.

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Research and Development Drives Innovation

Manufacturers can achieve noteworthy results from innovation that’s driven by research and development. Research and development not only results in new products, but also brings updated efficiencies and processes to successful manufacturers regularly. It’s undeniable that the outcomes are critical to the growth of the manufacturing sector in Tennessee and all across the nation.

Tax Credits for Research and Development

Research and development tax credits have been available to manufacturers since 1981. These tax credits help manufacturers design products, refine processes, save money and reduce energy usage. Many people in the manufacturing industry may not be aware that the R&D activities taking place at their facility today are actually eligible for tax credits!

What Types of Activities Qualify for Tax Credits?

As most business owners have learned the hard way, tax credits aren’t widely advertised. It helps to have an expert to point you in the right direction. Understanding tax credits takes a full-time effort from an entire team.

The University of Tennessee Center for Industrial Services (UT-CIS) has staff specialists who can connect you with specialists that can help you dig out research and development tax credits thay you may be missing.  If your research and development efforts meet Federal requirements, there are extensive credits available. The credits can be applied to current taxes due or future tax liabilities.

Even better, they may be applied retroactively for three years in addition to the current year. They may even carry forward for as long as two decades!

Research and Development is Important

The significance of research and development, and by extension, innovation, cannot be accentuated enough. Competition and globalization push both small business owners and large corporate executives to continually reinvent their products and processes to compete. The bottom line is squeezed by changes in customer tastes, pressures of increasing material prices and energy costs. This all requires a creative approach and new ideas driven by good data that only comes from expert research and development.

Examples: Successful Outcomes from Expenditures that May have been Overlooked

  • An injection molder developed new product configurations and designs that led to a reduction in plastic used and increased production of multiple units simultaneously. For these efforts, the company received a tax credit of more than $385,000.
  • A rubber manufacturer worked to develop a new material that would be less permeable and 50 percent stronger than the existing material. The new fabric provided superior weather resistance and improved water-shedding characteristics. This group booked a $90,000 tax credit.

Research and development efforts result in innovation throughout the manufacturing industry. It’s easy to overlook some big tax credits without an extra set of eyes. UT-CIS helps manufacturers solve complex engineering problems and utilize technology to improve productivity and profitability. UT-CIS connects manufacturers with some of the most sophisticated engineering research and development resources in the country. For more information, click here or contact us at 888-763-7439.  

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Utilize Lean Six Sigma to Improve Efficiencies

As Tennessee’s manufacturers see a comeback in U.S. manufacturing, it’s important for us to implement initiatives that increase our efficiencies. Manufacturers can increase profitability by eliminating excess waste, reducing unnecessary actions during production and decreasing costs. Lean Six Sigma is a successful way to accomplish this.

Lean Six Sigma is a powerful but flexible system that encourages a culture of continuous improvement within an organization. The methodology focuses on efficiency and speed and strives to identify waste. This isn’t exclusive to the production floor – it applies to all areas of a business including management.

Waste is a result of non-value added processes and steps. This could include an abundance of reporting requirements or personnel practices that limit or hold up more essential tasks. The goal is to eliminate this waste so that ultimately goods are produced faster and with fewer costs. By decreasing the length of time needed for a manufacturer to deliver goods to a consumer, customer satisfaction improves. The rule: longer cycle times mean higher non-value-add costs.

A critical part of identifying waste in all areas of a business requires employee buy-in. A “Lean Six Sigma culture” can only take place if employees drive it at all levels. This culture contains a staff that is consistently looking for ways to find non-value added activities. The Lean Six Sigma system is designed to encourage buy-in from employees and demonstrate its benefits to the entire organization.

There are numerous tools that manufacturers can use to keep cycle times down such as:

  • Value Stream Mapping – This graphical tool illustrates the flow of material and associated information as a product or service moves to completion.
  • Value-Add versus Non-Value-Add Analysis – This tool helps determine what the customer actually values. This helps a manufacturer increase capacity by preventing the production of things that customers don’t actually want.
  • 5S Program “Sort, Set-in-order, Shine, Standardize, and Sustain” - The 5S program develops a productive and safer work environment.

Also, a unique benefit of Lean Six Sigma is that it works to fundamentally change the culture and infrastructure of an organization. It is an ongoing pursuit to drive a Lean Six Sigma culture.

As we conclude the first business quarter of 2013, it’s vital for Tennessee’s manufacturers to reduce excess waste, shorten cycle times and improve efficiencies. Creating a culture of continuous improvement can accomplish this and The University of Tennessee – Center for Industrial Services (UT-CIS) can help you cultivate this culture. For more information, please click here

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Tennessee Manufacturers: Ride the Momentum of Industry Growth

Last year was pivotal for the manufacturing sector. The industry was at the forefront of our economic recovery, leading many to label 2012 as a “manufacturing resurgence.” Month after month, industry trends and trajectories were showing improvement in our field. Manufacturing has been roaring… but will it continue on this path?

The answer is YES!

Manufacturing GrowthAmerican manufacturing’s time to thrive is now and there are no signs of slowing down. There will typically be minor bumps in the road, but all major indicators are pointing to one thing: manufacturing is consistently improving.

Productivity and the trade deficit are two major indicators of how are sector is doing. Here are some recent industry reports painting a pretty picture for the manufacturing field:

  • While “inflation-adjusted GPD will expand by 1.8 % in 2013 and 2.8% in 2014,” manufacturing production will perform better than the remainder of the economy and is “expected to show growth of 2.2% in 2013 and 3.6% in 2014.”
  • “High-tech manufacturing production, which accounts for approximately 10% of all manufacturing, is anticipated to grow 4.3% in 2013 and 9% in 2014.”
  • “Exports are anticipated to improve by 2.5% in 2013 and by 5.1% in 2014.”
  • The trade deficit in December was down from the month of November and down from the previous year.

Statistics and studies about the strength of manufacturing are great… but what do they mean for Tennessee’s manufacturers?

Tennessee manufacturers should capitalize on the industry’s improvement and implement changes to support business growth – NOW. Operating with lean and efficient practices should always be a priority. However, maintaining “normal productivity” and doing “business as usual” shouldn’t be the only objective – companies need to develop new business!

Manufacturers can do this in numerous ways such as:

  • Conducting R & D to improve products and production
  • Increasing exports
  • Competing for government contracts
  • Investing in innovation
  • Engaging in market research to identify new customers

Manufacturing is making a comeback because this renewed sense of American pride is different this time. Our citizens want products made in the U.S. and our state’s residents want products made in Tennessee! There is an energy around U.S. manufacturing that we haven’t seen since the manufacturing boom of “the greatest generation.” In fact, a recent NBC news report showed that of the growing pile of American-made goods, an increasing number are made with recycled materials from the U.S. It’s easier to manufacture green products domestically because recycled materials including plastic are particularly abundant here.

If you are a Tennessee manufacturer, it is critical to invest in changes and initiatives to grow now. The University of Tennessee Center for Industrial Services (UT-CIS) can provide assistance in numerous ways. For more information, click here to check out a list of our consulting solutions.

Image by Industrial Process Designs.

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