The
2024 BizTimes Manufacturing Summit focused on how businesses in the region can thrive through innovation and leverage technology to achieve operational excellence.
Held on Sept. 30, the main panel in the program featured executives from local companies discussing investments they have made in technology and lessons learned from those projects. Topics included deciding where to invest, the pros and cons of software, using data more efficiently and considering the turnaround time.
You can find a summary of the discussion here.
The full program and breakout session is available here.
The program included questions from the audience and while some of those questions were incorporated into the panel, there was not enough time to address all of the them.
The panelists –
Sara Sina, president of
The Howard Company; Rob Ewing, president of
Wenthe-Davidson Engineering Co.;
Todd Zakreski, president of
Husco Automotive, and
Thomas Carney, president of
Royal Basket Trucks, each answered a selection of the questions via email. Their responses are shared below:
How do you prioritize cybersecurity in your manufacturing operations and business as a whole?
Sara Sina: “We work with an outside managed service provider who keeps our firewall up to date, checks our infrastructure for vulnerabilities, and monitors for cyberattacks (and they have caught several). We still have work to do on training our internal staff to be more vigilant in upgrading our servers.”
Rob Ewing: “Cybersecurity is a primary task of our IT team. We do utilize some outside assistance in testing and providing the latest solutions. Our customers have been targets of attacks. Incoming data through EDI is very filtered as well.”
Todd Zakreski: “We have a director of information security + business systems and he has a global team/organization reporting to him. Collectively they manage our cybersecurity work. Dedicated resources that are focused on keeping our systems secure and current to the latest global threats.”
How have you set up your operations to support a new workforce equipped with next level manufacturing, such as integration of AI and further technology skills?
Ewing: “We have increased our tuition reimbursement, modified schedules of employees to accommodate schooling, added new positions, hosted training with suppliers of equipment, and reviewed wages and descriptions to remain competitive.”
Today, what percent of your investments are made with the objective of cutting costs versus increasing revenue/flexibility? How do you see that changing going forward?
Sina: “I would say 80% of our investments are made with the objective of increasing revenue, 10% are for employee improvement (making it a better place to work), and 10% are towards cost cutting, but we are not an equipment heavy manufacturer with a lot of capital equipment. Most of our investments are in software to make business processes more efficient.”
Ewing: “We look at the cost in process variation and scrap first. These will impact cost. We also look at technology that can reduce tooling need and increase flexibility. When it comes down to it, companies still require ROI analysis for approval. There are just many more factors than speed, but technology also drives that.”
Zakreski: “Roughly speaking, 15% of investments associated with cost reduction/cost increase mitigation; 85% focused on new business opportunities.”
Tom Carney: “100% are cost cutting except for new molds.”
As you continue to invest in automation at your facilities, how are you addressing the increased utility costs that are coming along with it, along with the increased regulations for companies to become more sustainable/environmentally friendly? For instance, are there energy management initiatives in place - that you are employing at your facility - getting employee buy in on sustainability initiatives to help fuel business growth and increase sales at your facilities?
Sina: “We have not addressed this so far, but do have a project on our cap ex wish list to investigate solar for our roof to become more energy independent.
Ewing: “We look at the cost in process variation and scrap first. These will impact cost. We also look at technology that can reduce tooling need and increase flexibility. When it comes down to it, companies still require ROI analysis for approval. There are just many more factors than speed, but technology also drives that.”
Zakreski: “Besides purchasing a significant percentage of our energy from renewable resources (Badger Hollow Solar Park), we always are looking at ways to reduce energy consumption in our operations – examples – high efficiency motors on our production test stand pumps, LED lighting across the factory, etc.”
Do you have customer forms for product direction and quality?
Sina: “Not sure what is meant by product direction – but we do have quality check sheets that are completed for finished product and retained for 6-12 months in case a customer comes back with a complaint. We also take photos of our finished product before it leaves in case customers contact us about something missing.”
Ewing: “Scorecards are prevalent in manufacturing to show quality, delivery, and cost information from customers. We find direction comes best from relationships and direct person to person contact with customers.”
What are some of the next generation technologies you are looking into for your business? What’s attractive about it and what are your concerns about it?
Sina: “AI tools for lead generation & prospecting on the sales end. We are hoping this will make it easier to get to people that are actually looking for the product we sell, vs. just cold calling without knowing buyer intent. Concerns are that some of the AI tools may cause privacy concerns for our customers (some of the tools track their online activity in terms of keyword searches so it may come across as creepy when we reach out to them on something they have been searching for).”
Ewing: “Automation… AI… the biggest concerns are on having people that can program and implement it.”
Zakeski: “With regard to our manufacturing processes, we collect a significant amount of data – there are many opportunities to use this information to further improve our proactive response to manufacturing variation. Reducing (and managing) variation in a process leads to more consistent product performance, reduced warranty, better quality, lower costs, higher customer satisfaction, etc. AI, new software developments, etc. are technologies that can significantly improve today’s automation solutions thru further reduction in variation.”
What ways do you support and drive innovation mindsets on your teams?
Sina: “Quarterly brainstorming events with product development and sales to come up with product and service ideas. These typically generate as many as 100+ ideas, and then we talk about which 3-5 are the best fit for our business to pursue.”
Ewing: “Involve them early and often on the solutions. Send them to seminars and events to learn more about effective technology and solutions.”
Zakreski: “We have an advanced engineering team – they work with new technology advancements/opportunities pulling in engineers/manufacturing engineers, etc. to help them as they progress with a project. We also have all-employee meetings monthly where new technology projects are periodically shared with all.”
A question on workforce: Wisconsin has been known as a manufacturing state, and has historically attracted a workforce of people who want to work in manufacturing. How much is that changing over time, as companies continue to outsource production elsewhere in the U.S. (to locations with lower cost of living) or even overseas, which brings its own challenges? Are we seeing more onshoring?
Sina: “We have not experienced this as much in our business, partly because of the nature of our product which is big and bulky, and the cost to transport is expensive. We do see it a bit on the service side of our business (outsourced tech support), but that can come with challenges as well due to the language skills of international partners in dealing directly with our customers.”
Ewing: “We are seeing a resurgence of on-shoring in our industry. Unfortunately, most of the high-volume, low-mix items that are easiest to automate are the last to return. We are still a strong manufacturing economy and I see more high school graduates entering the workforce with an interest in skilled trades and manufacturing. We need to all help spread the word and showcase the ability of good careers and wages in these industries. Help where you can at a technical school and high school level.”
Zakreski: “There is certainly more onshoring to the U.S. especially as tariffs expand; but there is also product moving to southeast Asia (Malaysia, Thailand, etc.) as well as a large contingency of Chinese and European companies setting up operations in Mexico. These countries and the respective companies launching operations are serious threats to our manufacturing competitiveness.”
What steps or technologies have you implemented to compete and retain manufacturing employees vs. remote work and work from home?
Ewing: “Our process does not lend itself well to working from home. There are few roles that could and we believe in relationships with our employees and daily communication.”
Did you have to hire from outside or train internal EE to troubleshoot and maintain the equipment?
Ewing: “We train internally, but use some services as well. We also send employees through programs at WCTC for example.”
Zakreski: “Both.”
Carney: “Train from the inside after initial setup.”
Are there any pieces of technology that seem great in theory but in reality are a nightmare to deploy, keep running, train on, etc. that manufacturers should stay away from?
Ewing: “These usually drop off the list in proper research and review before purchase in our industry.”
Zakreski: “As with any technology, you have to have the right people to support it, maintain it, and continuously improve it. Treat technology as an ever-evolving entity – it could be obsolete tomorrow…”
It’s easy to calculate ROI on manufacturing equipment. How did you do it for CRM software?
Sina: “Looked at time it was taking to do certain tasks, estimating the number of work hours per year, and prioritizing the most time intensive tasks for automation. The harder part is that there are customer experience benefits that are not a direct ROI – but lead to customer retention improvements.”
Ewing: “Increased wins on bids and increased revenue.”
Carney: “We plan to capitalize and amortize over 5 years.”
What percent of your non-production staff work from home?
Sina: “Most office roles are allowed to work up to 2 days a week from home, they have to be in the office a minimum of 3 days. Some roles (like operations managers) do not accommodate this. Also, we have always stated that this is dependent on work performance, and have not allowed work from home for employees not meeting job expectations. Our leadership team also works in the office 5 days a week.”
Ewing: “Mostly zero.”
Zakreski: “Our current policy allows for people to use 1 day a week to work from home; only a very small percentage use the option.”
Carney: “Certain sales team members but they are required in person at least 2 days per week. Flexible with other employees.”
Can Husco AMG also do smaller, more manual assembly style solutions?
Zakreski: “Husco AMG has done $20k projects as well as multi-million dollar projects.”
How do you mitigate employee fears of being displaced by technology?
Sina: “We have always stated that it would not eliminate jobs, but would just affect future hiring or allow for more value added activities.”
Ewing: “Show them a heightened career path through education and experience on the new technologies. Also, many of our jobs will be difficult or cost prohibitive to automate. Communication is key.”
Zakreski: “Keep the flow of new business opportunities coming in– new business growth almost always opens up new job opportunities – be it outside hires or shifting to a new opportunity within our operations.”
Carney: "We have had no employee layoffs even if we get slow. That is part of our commitment to our team.”
How would you describe how the supply of qualified employees impacted your decisions/investments in AI or plant-level automation?
Ewing: “We need to use this to determine what we outsource or keep in house for implementation.”
Zakreski: “Certainly, the volatility of employee availability is driving our efforts to find more efficient automation solutions as well as investigate how AI can take on certain tasks that would reduce people’s workloads such that they can take on other responsibilities.”
Carney: “It is a consideration, but not the most important one. If we can increase productivity everyone wins.”
Is the presidential election a valid reason to “sit tight” or why business may “be slow” or, is it just an excuse?
Sina: “Just an excuse. Congress affects the economy more than the executive branch, with the exception of tariffs – and both parties are on board with tariffs so there isn’t much of a difference either way.”
Ewing: “I think this is the time to invest if you can afford to. There will be a bounce back and some will not be in a position to capture the opportunities. Whether it is an excuse or not, many decisions to purchase items are made based on comfort levels in the economy. Interest rates are a big driver.”
Zakreski: “No. Husco Automotive will always be aggressive and act with urgency to profitably grow our business around our customer's needs.”
Carney: “We are not sitting tight.”
