JOHN G. ROWLAND – Industry facing changes
In an effort to keep manufacturing companies within Connecticut and national borders, several firms are joining together with a boost from the federal government.
The state Department of Economic and Community Development and the Connecticut Economic Resource Center have been approved to receive $600,000 in federal aid from the Economic Development Administration to provide technical assistance to Connecticut manufacturers.
“We are pleased to receive national support for strengthening Connecticut’s manufacturing-related clusters via this grant at a time when this industry is facing dynamic changes in the marketplaces, locally and globally,” said Governor John G. Rowland. “Our next steps will bring serious attention to our manufacturing base and focus on building upon the competitive position of the industry.”
The grant will fund three initiatives: a progressive manufacturing pilot program, the exploration of a unique manufacturing center and the development of a plan addressing university/industry collaboration.
The first element, the Progressive Manufacturing System, will combine advanced production processes and technologies, as well as workforce development training, aimed at markedly increasing productivity levels of small and medium-sized manufacturers. The second element involves study and planning for a Manufacturing Technology Center, which primarily will help small companies adapt best practices and address new technologies. The third initiative addresses technology transfer and commercialization, with a goal of producing a more vibrant relationship between Connecticut’s industries and universities.
The three initiatives will be undertaken as part of Connecticut’s nationally recognized Industry Cluster Initiative led by the Governor’s Council on Economic Competitiveness and Technology. Two advisory boards of the council will play major roles in directing aspects of the project.
“The involvement of the Governor’s Council and members of the Industry Cluster Initiative will help to ensure that these new elements are market-driven and respond to the needs of Connecticut’s manufacturers and other key clusters,” said James C. Smith, chairman and chief executive officer of Webster Bank and co-chairman of the Governor’s Council.
‘Global Competition’
Aerospace components, metals and plastics are the primary clusters that will be involved in bringing leadership, commitment, industry knowledge and matching investments from their companies to the project. In addition to DECD, CERC and other cluster groups, collaborative support for the project is being provided by the Connecticut State Technology Extension Program and Central Connecticut State University’s Institute of Technology and Business Development.
“The state’s support, along with federal funding, validates the need for creating some solutions to address the manufacturing crisis – solutions that may be short-term, but are part of a larger picture for the overcoming the crisis,” said Doug Rose, president of AeroGear and chairman of the Aerospace Components Manufacturers.
“There certainly is a crisis going on in manufacturing, both here in Connecticut and nationally,” said Rose. “I think that there are several things going on. Large manufacturers are closing plants and moving their operation overseas in order to lower labor costs. There’s also an awful lot of global pressure on pricing and unfair trade practices going on. There’s no question that the manufacturing sector is being bombarded by global competition and even some governmental policies.”
Rose added, “What really happens is that other countries have developed strategies to attract business, and industry works with the government in that process. Over here, we’re just giving business away. It’s very upsetting.”
On a positive note, small and mid-sized manufacturing companies are hanging on, and they’re hopeful that future growth is just around the corner. One way this is going to be accomplished is through government/industry partnerships, and various manufacturers will have to join forces.
“In Connecticut there’s been a shift away from large to smaller, agile, competitive, successful small to mid-sized companies. But, they need some support to remain successful,” said Rose. “So what prompted the initiative with the EDA was our clusters, or networks of companies working together, that have embraced the latest progressive manufacturing practices. We’ve found that these clusters are beginning to work well and beginning to help with our success, so if we continue to form into networks and share resources and work together, it can only have a positive effect.”
Rose noted that, from his experience, those companies that have networked together are managing to survive, while those who have chosen to go alone are floundering. He believes that the pilot program will eventually turn into a five-year program and help other like-minded manufacturers join together to pool resources and keep Connecticut’s manufacturing sector alive.
“We need to form more small networks of manufacturing companies and help cost share and promote progressive manufacturing techniques. If that’s successful, hopefully we can build this into a longer-term initiative,” said Rose.
By definition, large manufacturing firms have the depth and wherewithal to employ world-class consultants to help plot their business strategies. However, at smaller firms, those opportunities aren’t as common, and the price tag of some consultants is simply too much for them to afford. But with a pool of small companies working together, the cost is much easier to swallow.
“If you’re a 50- or 100-employee company, without collaboration you just don’t have the ability to hire consultants of world-class quality,” said Rose. “We’ve been working collaboratively with other companies and are now able to get consultants from Japan and Europe to help us. Collectively, we can do it.”
Consultants will be shared with other companies. They will spend a week in the area and delegate two hours of time a day between manufacturers.
“What’s interesting is that, in the network, we’re still competitors but we’re not knocking heads. Today, your direct competition isn’t the guy next door, it’s Poland and Singapore and Shanghai. So we need to join together to offer customers some more,” said Rose. “We need to band together to survive.”
According to Rose, the state government has been very helpful in the process and, in fact, was the entity that initially contacted him to start pooling resources.
“They have just been wonderful and very progressive as far as helping facilitate pulling clusters together, and I give a lot of credit to the DECD. It’s great when you’re a mid-sized company and the state government approaches you. You think, ‘wow, they’re here to help us.'”
“These efforts will join together state resources with individual companies, resulting in better efficiency, lean productivity and success in globalization for Connecticut’s manufacturing industry,” said Ray Seeley, president and chief executive officer of PTA Corp. and president of the plastics cluster.
The project, totaling a budget of $1.2 million funded by EDA along with matching state and private investments, will operate statewide.
