Gene Haas Foundation Invests in Pine Bush High School and its Students
Earlier this year Pine Bush High School became the first high school in the world to receive a naming grant from the Gene Haas Foundation. Haas Automation is an industry-leading machine tool manufacturing company headquartered in California. Their foundation supports career and technical education programs across the nation and has donated $250,000 in support of Pine Bush’s STEAM program.
The grant will help renovate and expand space at the school for the program. Four new classrooms and an addition outside of the building are included in the construction plans. Renovations will begin in July with a two-year timeline for completion.
Expanding the space means more students can participate in the program. There will be more space for machines for training, and the design lab and woodshop will receive upgrades as well.
A Unique School
“For [Hass] to want to invest a quarter million dollars in support of our program shows the level of commitment that we have to our students and the quality of program that our teachers are producing,” says Aaron Hopmayer, Pine Bush High School Principal.
Expanding the STEAM program means a much larger demographic of students will have opportunities, explains Kenny Marshall, Secondary STEAM Coach at Pine Bush. The school has expanded its reach so that a wide range of students can train. “From the most at-risk student to the valedictorian–they are in these programs and they’re working together. It’s a great level playing ground for everyone,” he says.
The school is composed of 1,800 students with about 300 taking STEAM courses.
In March 2020, Pine Bush became the forty-sixth high school in the country with a program sponsored by SME PRIME (Society of Manufacturing Engineer’s Partnership Response In Manufacturing Education). The Council of Industry helped connect Pine Bush with SME. Hopmayer and Marshall expect the number of students in PRIME to increase as the STEAM program expands.
The program has allowed students who choose not to pursue post-secondary education to find job placement in manufacturing companies.
Multiple Paths
The program has allowed students who choose not to pursue post-secondary education to find job placement in manufacturing companies. Two students were recently hired at CreoDent and other local companies have directly asked for Pine Bush students. In the past several years, students have received $35,000 in scholarships alone from Haas.
Pine Bush Student Amy DeSena working on an aluminum turners cube for her Haas mill certification.
Pine Bush has a partnership allowing its students to collaborate with RPI students in their senior capstone manufacturing. Students have also worked with RPI by creating parts for mechanical pencils to send to RPI students. The high school seniors learn on the same machines as RPI seniors.
“I haven’t seen many high schools at the level of Pine Bush and the dedication that they put into the program,” says Marty McGill, VP of Allendale Machinery Systems, who is working alongside Pine Bush and Haas. McGill emphasizes the mutual benefit to students and the Hudson Valley: students will graduate from high school with training experience and local manufacturers will have access to skilled candidates. “Pine Bush has a great program. The students are very, very lucky to have a school and people who are willing to make it happen,” he says. Hopmayer explains that the program allows students to learn about different sectors before having to commit to a specific career path. “We try to expose kids while they’re in high school to all these different career opportunities. College is an expensive way to learn,” he says.
“Expanding the STEAM program means a much larger demographic of students will have opportunities.”
– Kenny Marshall, Secondary STEAM Coach at Pine Bush
What’s Next
In the future, Hopmayer and Marshall look to partner with businesses to expand the reach of their program. Additionally, they plan to tweak some course curricula to align with the Council of Industry apprentice requirements, so students can enter the apprenticeship program in an advanced place. They also want to refurbish all the STEAM programs and update space and machinery. They look to have more students involved with STEAM and eventually open more opportunities for extracurricular activities, such as an afterschool program or late night program opened to adults and the public.
(Left to Right) Pine Bush Principal Aaron Hopmayer, Secondary STEAM Coach Ken Marshall and Allendale Machinery Vice President Marty McGill have worked together to build the school’s highly successful Manufacturing and engineering program.
To learn more about how you can support or become more involved with Pine Bush’s STEAM Program contact:
Aaron Hopmayer, Pine Bush High School Principal. aaron.hopmayer@pinebushschools.org
THE FUTURE IS FREEZE DRYING: How Millrock Tech is Revolutionizing the Industry
Brian checks the electrical system on a laboratory freeze dryer
Millrock Technology, Inc. (Millrock Tech) designs and manufactures freeze drying equipment for the pharmaceutical industry. Freeze drying is a liquid removal process that can be used to preserve the shelf life of certain materials, many of which are essential ingredients in life saving products. By extending the shelf life of these key products, they become easier to store and ship, more stable, and less expensive to administer.
The Kingston-based company began operations in 2005 and is among the world’s freeze-drying technology leaders today. In response to the COVID-19 crisis, Millrock Tech has ramped up production to help supply key equipment for diagnostic kits and vaccine production helping to win the battle against SARS-CoV-2.
“Our machines are built with a knowledge and expertise that enables our customers to produce the best products for their customers.”
What Freeze Drying Is and How Millrock Tech Does It
Freeze drying became mainstream in the early 20th century for its uses in penicillin and polio vaccine production, and as serum for blood plasma used in the world wars. Many products, such as vaccines, required water to be removed for stabilization before being shipped across the country. To reconstitute the vaccine, water would be added back into freeze dried material and be ready for use. In the case of serums, the blood would be centrifuged to remove the red blood cells. The remains, called plasma, could be freeze dried, shipped to war zones and reconstituted. Those injured could be infused to raise blood pressure after sustaining blood loss and other injuries. As technology progressed, the pharmaceutical industries took reign over these processes.
Millrock Tech prides itself on being a cutting-edge innovator in the pharmaceutical freeze drying industry, making machines for over 800 clients at its 24,000 sq. ft. facility. The company provides solutions to customers and specializes in equipment that are pharmaceutical grade, meeting the highest standards. Millrock Tech primarily services the pharmaceutical, biotech, and active ingredient companies. “We make custom freeze dryers for sophisticated applications and we tailor equipment to satisfy specific needs. Our machines are computer controlled and built to the highest pharmaceutical standards,” Millrock Tech President and CEO T.N. Thompson says. “Our machines are built with a knowledge and expertise that enables our customers to produce the best products for their customers.” Some of those products that clients have freeze dried include bone and tissue, cements for broken bones and teeth, injectables for eyes, reagents for test kits, ingredients for pharmaceutical manufacturing, collagen for wound care, and veterinary vaccines, among many others.
T.J. inspects the shelf stack of a production freeze dryer
Responding to COVID-19
Currently, equipment for companies that produce diagnostic kits is a major portion of Millrock Tech’s business. These kits are used to detect illnesses like HIV, flu, and COVID-19. As the pandemic worsened, a major increase in demand for the kits meant a corresponding demand for equipment and an immediate spike in orders. Thompson says this big opportunity came to them because of their strong reputation in the industry, built up over time by focusing on quality and customers. “If we didn’t already have the business, there was no way someone would come to us to respond to COVID testing demands. We have a good relationship with a lot of companies, and we’ve become their go-to vendor. These new opportunities are significant,” he says.
Roadblocks to Vaccine Distribution
The traditional FDA regulatory process for approving new pharmaceuticals is generally lengthy and difficult. In the case of vaccines, for example, there are steps from formulation development to clinical trials that typically take years to complete. For COVID, the process has been fast-tracked.
One of the biggest challenges in distributing the COVID-19 vaccine is its shelf life. Made out of the protein mRNA (messenger RNA) the vaccines need to be kept in a frozen state to keep from degrading. Once thawed, the vaccines only have a couple hours before they expire. If they are not injected within this time frame, they must be discarded. “It’s a huge problem in the distribution system for COVID vaccines,” says Thompson. Vaccines are biologics, meaning they are made from living organisms and their products. Biologics can be stabilized using freeze drying, to eliminate the need for cold storage. Once freeze dried, they can easily be shipped across the globe and reconstituted to their original state without sacrificing their efficacy.
The development time for producing a freeze dried version of the vaccine for the first round would have delayed release. In the future, however, the COVID vaccine manufacturers are pursuing freeze drying. The benefits of freeze drying are greatly rewarding. The current COVID vaccines must be stored in ultra-low temperature freezers. Freeze drying would allow them to be shipped and stored at room temperature without any need for refrigeration. Once ready for use, saline solution would be added to the vile. The vaccine would reconstitute to its original state and become injectable. In the longer-term, freeze drying could shift the process for major manufacturers and make distribution more accessible and efficient.
Once a freeze dried version of the vaccines is approved, there will be additional hurdles to production. Vaccines are made in large batches and would require large freeze dryers. Constructing new production freeze dryers could take 14 to 18 months. Once the equipment is installed, it must undergo a validation process. It could take two to four years between ordering the equipment and making it usable to produce vaccines. Therefore, it is more likely that current production freeze drying capacity will be used. The result could be shortages in other freeze dried pharmaceuticals.
The COVID pandemic has brought a major supply-chain issue to the forefront: many of the ingredients required to produce a vaccine are manufactured abroad, primarily in India and China. To be able to respond better to public health crises, the U.S. will need to focus on improving domestic capabilities to produce the necessary materials for self-sufficiency.
Aric and Shane put the finishing touches on a custom designed system
Climbing the Ladder
Thompson’s father and grandfather both owned their own freeze drying manufacturing companies, making Millrock Tech the only third-generation freeze drying company in the world. Thompson has been surrounded by business his entire life. Originally from New Paltz, he attended University of Colorado at Boulder to pursue engineering. He explains the competitiveness of the program and the unlikelihood of completing it. “They sat us down the first day we got to school. They put all of the freshmen into the auditorium and said, ‘Look to your left. Look to your right. One of you will be here at the end of the four year period.’ I was the one. I wasn’t a great student. I played tennis and skied and struggled through college. It took me five years, but I finished.”
Upon graduating, Thompson returned home to New York (“Nobody else would hire me!” He joked) and began to learn the trade at his father’s business, FTS Systems. Before computers were widely accessible, Thompson faced the grueling task of logging data from the machines minute by minute. “My father was phenomenal about teaching. I had to do everything that nobody else wanted to do to learn the business,” he said. He would join his dad in the office to learn the production side of the business. Sitting in on phone calls with customers, sales people, patent attorneys, and lawyers taught him the work that went into sales, marketing, and sustaining the company. “It was like an MBA on steroids,” says Thompson.
Above all, Millrock Tech seeks to do work that can positively impact lives.
After his father sold his company, Thompson was determined to create another company and focused on improving the equipment and process technology knowing it would be beneficial. The timing was right, with the projection that the aging population in the U.S. would drastically increase and healthcare would become more prominent. Thompson decided to start his own freeze drying company.
With a loan from his father, a computer, a small office space, a self-developed website, and a single college intern for his staff, he started Millrock Technology. On January 1, 2005, he launched the company’s website, right on the cusp of Internet commerce becoming more widespread. His family’s freeze drying pedigree gave his company an edge in terms of credibility, and gradually, the company grew. Mastering freeze drying has allowed the company to create new product features and significant improvements in the freeze drying process. He continues his family’s legacy of successful freeze drying business owners. In the time since starting his company, he has built his own path while upholding the values and effort put forth by his predecessors.
Millrock works closely with the engineering departments at premier educational institutions like Purdue University, University of Connecticut, Politecnico di Torino, and SUNY New Paltz to push the boundaries of technology. Millrock Tech’s multiple patented technologies and several more pending patents are just one way the company is paving the way to innovation in manufacturing and redefining the future of freeze drying.
T.N. and crew in front of an R&D system being used for testing new technologies and software
Company Culture
Millrock Tech emphasizes an attitude-over-skills approach for its employees. “We like to hire self-starters who are confident in what they do, able to communicate, and have a positive attitude. I’ll take a person with a positive attitude over a person with skills any day of the week. When we talk to people it’s not just what you know, it’s how you interact.” Thompson recognizes a difference in technical skills that are taught in higher education versus those taught internally. The lack of skills in younger applicants makes filling positions difficult. “The hardest thing to get is new employees who know how to use tools and that can systematically troubleshoot problems,” he says. Schools do not teach many of the basics used regularly at Millrock Tech. He has become a firm believer in the hands-on approach. He recounts an employee’s success story with learning internally. When an employee who had previously been an auto mechanic, then a service technician, became interested in going back to school, Millrock Tech offered him the opportunity to learn skills in another department and learn the trade first-hand instead. “One year into it and he’s one of our best programmers,” Thompson says.
The manufacturing sector has a need for skilled employees willing to work on a team and learn on the job. Thompson acknowledges the changes in manufacturing and making innovation in the field more understandable and appealing. “Many people think manufacturing is a Ford Model T coming off an assembly line. That’s not what manufacturing is today, and people don’t want to work in manufacturing if that’s what it is. We have to change the perception of what it is.”
With over 100 years of freeze drying experience across three generations, Thompson has seen firsthand the importance of creating strong relationships with customers and a positive work space for employees. “Our philosophy is customer first. If you can keep your customers happy, they’re going to come back in the future,” he says. He speaks on his appreciation for smaller companies and the relationships he has formed with his team. “Nobody here works for me. I work for them. I call it a big family. When this whole COVID thing hit we talked through it and figured out what to do. Now, our management team meets every Monday to review each other’s priorities. Everybody knows what the objective is. That’s what I love about small companies. That’s our culture.”
Above all, Millrock Tech seeks to do work that can positively impact lives. Thompson recognizes how far his company has come and the ability his business has to make a difference. “Luck is where preparedness meets opportunity and we’re very lucky right now. Business is a series of challenges that you need to respond to and it changes everyday,” he says. “My entire focus was to provide a solution to a problem that had a positive effect on humanity. Our freeze drying technology and products ultimately end up saving lives.”
Taylor Dowd is Communications Coordinator at the Council of Industry. She is a journalism graduate of SUNY New Paltz.
As technology continues to expand and become more widely used in manufacturing, automation is at the forefront of shifting production across the U.S. Put simply, automation means using control systems and equipment to conduct production processes with minimal human intervention. Today, automation has become more widespread than ever and one thing is clear: it is here to stay.
AUTOMATION: A HISTORY
Some of the first recorded uses of automation in machinery date back to the 11th century when miners drained underwater tunnels using waterwheels. The Industrial Revolution indicated the beginning of modern automation, as automated tools and production processes increased productivity. In the 1920s, the introduction of electricity quickened factory floor production. Feedback controllers used across the industry were a pivotal step taken in the 1930s-1940s.
The term automation, which referred to the automatic handling of metalworking in factories, was coined by Ford Motor Company in the 1940s, according to Britannica. World War II sparked a race for development to increase output and meet high demand for supplies, according to the Robotics Industries Association. Several decades later, during the ‘80s and early ‘90s, American companies began investing more in automation. After seeing the efficiency of competing Japanese auto manufacturers, General Motors first invested in robotics and automation in the ‘80s. Automatic processes allowed companies to focus on niche applications. Business-owners realized machines would be more effective and less costly than paying laborers to complete work. Manufacturing was one of many sectors that introduced automation. Retail, pharmaceutical, and consumer goods industries also adapted automation technology to improve production, according to Sasken. In the late ‘90s, automation systems saw a decline in deployment, but eventually rebounded with advanced innovative technology.
THE RISE
Industrial robots play a significant role in the increase of automation systems. In 2017, the International Federation of Robots (IFR) reported a 30% increase in annual robot sales. Over 381,000 robots were sold to production industries. An IFR report predicts there will be nearly 4 million robots at work in the manufacturing industry by the end of 2021. Every new development in automation provides better jobs and opportunities for companies, allowing U.S. manufacturers to compete with other nations, including China. More companies have begun investing in automation to gain an edge over competitors and adapt to a new production system. In the past several years, automation has seen some of its greatest developments. Now more than ever, both smaller and larger companies are implementing automated systems.
BETTER JOB OPPORTUNITIES
As automation and robots become more common in the workplace, some voice concern over the consequences for laborers who may lose jobs to machines. However, Marty McGill, Vice President of Allendale Machinery, says automation does not simply eliminate jobs: it transforms the duties of the roles and creates better opportunities for employees. “Anywhere you can bring automation into a facility is going to make your job easier and more profitable,” he says. “Automation provides better paying jobs with more benefits and opportunities.” McGill makes clear automation does not mean manufacturing employees will not be out of work; rather, he suggests the requirements of roles will gradually shift. Allendale Machinery provides industry-leading technology, tooling, engineering and automation expertise to its clients. McGill says clients are able to create more parts for less money by using automation. “It can be as simple as adding a bar feeder to a lathe, using multi-station vises on a mill, fixturing to process more parts per cycle, or add rotary tables to eliminate the multiple handling of parts,” he says.
Sean Hamilton, Director of Operations at Putnam Precision Products, Inc., voices a similar sentiment: “We are reducing turnover as employees are embracing the growth opportunities that innovation always provides. No longer bored by the tedium of machine tending, workers are embracing the growth opportunities that automation affords.” Putnam Precision is a leading full service contract manufacturer serving the medical, computer, and aerospace industries. Hamilton, who has been with the company since the late 70s, says automation has always played a role in the history of manufacturing. “We are always innovating and embracing the next degree of automation,” he says. One change from automation Hamilton has noticed is a decrease in need for machine tending: the robots simply take care of it themselves. Instead, he sees an increasing need for people who design for manufacturability and know how to keep the robots and machines running. Automating with robots leads to consistent quality, more efficient work, and increased production in a safer work environment. “Robotic machine tending is a continuation of the long history of innovation that drives productivity, precision and accuracy to the world market in which we compete,” he says.
A CHANGING WORKFORCE
Automation undoubtedly changes the ways in which a company operates. The pressure is on for companies to remain competitive and find employees who can take on the changing responsibilities in an automatic production space. Aaron Phipps, Vice President of Manufacturing & Engineering at MPI Systems, has seen automation developing at his company since he began working over 15 years ago, though he says it has become most mainstream within the past two years. “At this point if our high-end customers are not automating, they’re going out of business because they can’t keep up.” MPI is the worldwide leader in wax-room equipment and provides automated solutions to clients. MPI focuses on high level precision in machines and simplifying processes so even entry level technicians can program them. “We specialize in taking a low-volume, high-complexity part and automating that process,” Phipps says. “We put all the knowledge in how to run a part and you walk up to the machine, select the recipe and put it in. The machine remembers how it does it from the previous time.” One issue in manufacturing is the lack of skilled laborers.
Aaron Phipps says, “Partnering with the STEM initiatives and the Council of Industry’s NYS Apprentice programs are essential to our long-term success.”
Phipps foresees automated technology becoming more user-friendly, but struggles to find employees who understand the processes or are interested in learning. “My biggest challenge is I don’t have people with hands-on experience. It’s hard to tell a robot what to do when you don’t understand what to do,” he says. MPI Systems continues to invest and expects to further automate the company in the future. Hamilton acknowledges similar opportunities in developing the workforce of tomorrow. “While pressure to grow is always a challenge many gravitate towards continuation of their own professional growth. This is where partnering with the STEM initiatives and the Council of Industry’s NYS Apprentice programs are essential to our long-term success.”
Manufacturers look to introduce new automation systems to improve their modes of production. Steve Pomeroy, President of Schatz Bearing Corporation, a ball bearing supplier serving the aerospace industry, says automation technology can be used in areas including machine tending, inspections, vision systems, packaging and QA. Pomeroy says the company looks to find an investment that will benefit multiple areas of production to ultimately become a more competitive supplier. “If you don’t take advantage of this technology, it’s going to be very hard to compete,” he says. Pomeroy notes the uncertainty of automation’s role in the future of manufacturing, but expects steady change in the years to come. “It’s very hard to predict exactly what will happen with automation. The one thing I can say is there will be a lot of change,” he says. “There’s a renaissance going on in U.S. manufacturing. Change is continuing and accelerating. I can’t think of a reason why automation wouldn’t just blossom. It’s an exciting time,” says Pomeroy.
MPI, Inc. machine operator programming the APAS (Automated Pattern Assembly System).
THE FUTURE
Hudson Valley manufacturers–and others across the globe–agree that automation is the future of manufacturing. Though the ways in which automation will alter production systems across the sector remain unknown, it is clear that automation will streamline processes, create safer and better job opportunities, and increase profitability. As production continues to shift in a heavily technology-reliant world, manufacturers will reenvision their businesses as they look to adapt to the changes automation will undoubtedly bring.
Taylor Dowd is Communications Coordinator at the Council of Industry. She is a journalism graduate of SUNY New Paltz.
RETHINKING SUPPLY CHAINS FOR STRENGTH & RESILIENCE
Strategies to improve your manufacturing business’ supply chain and to position it to be a key component of your customers’ as well.
The supply and demand upheaval brought on by the COVID pandemic is forcing Hudson Valley manufactures–and manufacturers everywhere–to reassess their supply chains. The pandemic laid bare many of the long-standing vulnerabilities and risks lurking in organizations’ supply chains. In some cases, it has caused companies to take a hard look at their processes and their business models. In others, it has opened new opportunities for innovation, growth, and competitive advantage in the post pandemic world.
This article looks at some of the supply chain best practices and thought leadership that has been done since the global pandemic began and condenses it into some common themes and actions manufacturers can take to strengthen their supply chains, build resilience and manage risk – without sacrificing competitiveness.
The COVID-19 crisis has shown the need to have a diversified approach to sourcing.
SUPPLY CHAINS IN THE POST PANDEMIC WORLD
For the foreseeable future, manufacturers will face pressure to increase domestic production, grow employment in their home countries, reduce their dependence on risky sources, and rethink strategies of lean inventories and just-in-time replenishment, which can be crippling when material shortages arise.
Beyond the immediate economic and operational challenges created by the COVID-19 pandemic, Adam Mussomeli, Supply Chain & Network Operations lead for Deloitte believes that “despite the profound shifts we’ve experienced over the past year, the future of supply chains doesn’t look all that different from how we previously imagined it—we expect to simply get there much faster.” He argues that the supply chain world was heading toward greater integration prior to the pandemic and, like many existing business and societal trends, COVID-19 has accelerated that movement.
POSITIONING YOUR SUPPLY CHAIN FOR RESILIENCY AND OPPORTUNITY
Understanding these trends and strategies can help your manufacturing business strengthen its supply chain and position it to be an integral component of your customers’ supply chain strengthening strategy.
Build capacity and inventory buffers.
Buffer capacity is the most straightforward way to enhance resilience, whether in the form of underutilized production facilities or inventory in excess of safety stock requirements. The challenge is that buffers are expensive, capital intensive and are often times difficult to justify.
Leading companies use buffers in the form of surge capacity for new product launches or expansions into new growth areas. Organizations can also create buffer capacity by using contract manufacturers strategically for their surge needs.
Develop multi-sourcing, diversification and nearshoring.
A decade ago, the Fukushima disaster in Japan disrupted supply chains across the world and exposed companies’ reliance on single sources of supply. In the automotive industry, nearly finished cars could not be shipped to customers because of missing, and often inexpensive, components. Multisource is an obvious way to mitigate this risk. To craft a multisource strategy, supply chain leaders must be able to categorize suppliers not just by how much they spend with them, but also by revenue impact if a disruptive event occurs.
In response to the U.S.-China trade war, many companies have begun to diversify their sourcing or manufacturing bases. For some, this has meant switching to new suppliers outside China, or asking existing partners to supply them from elsewhere in Asia or in countries such as Mexico.
Fukushima and COVID–19 are glaring examples of supply chain disruption but not the only ones. In fact, disruptions to supply chain operations have intensified in the past few years. This means that the cost of retaining multiple supply locations can be seen less as an inefficiency and more as a cost of doing business. By mapping the full extent of your supply network and identifying both direct and indirect sources, you can then determine how quickly those most vital to your operation could either recover from a disruption or be replaced by an alternative. Address the vulnerabilities by diversifying your suppliers or stockpiling essential materials.
Beyond multi-sourcing, some companies want to reduce geographic dependence in their global networks and shorten cycle times for finished products. Nearshoring, or creating regional or local supply chains, can be more expensive because they add more players and complexity to the ecosystem, but they allow for more control over inventory and move the product closer to the end consumer.
Build in sustainability.
Every supply chain has its environmental and social consequences. From the carbon emissions of transportation networks to the industrial waste from factories, to the ethics practiced by suppliers, all the issues surrounding sustainability do not go away during times of global disruption. Indeed, sustainable supply chain practices are even more relevant in a world where resources may be harder to come by.
The best strategy is to embed principles of sustainability in your supply chain, using them to guide decisions ranging from product design and factory floor configuration to sourcing and logistics. Sustainability and a healthy bottom line are perfectly compatible, even in the toughest of times.
Ecosystem partnerships
The COVID-19 crisis has shown the need to have a diversified approach to sourcing. At the same time, however, collaboration with strategic raw material suppliers and external service partners is also vital to ensure better preparedness and resilience for the future. For companies without the scale to support multiple locations on their own, strong relationships with contract manufacturers, and global third-party logistics providers (3PLs) can be vital in diversifying production and distribution to different countries.
Sustainability and a healthy bottom line are perfectly compatible – even in the toughest of times.
The economic turmoil caused by the pandemic has exposed many vulnerabilities in supply chains and raised doubts about globalization. Managers everywhere are using this crisis to take a fresh look at their supply networks, taking steps to understand their vulnerabilities, and actions to improve resilience and strength. They can’t and shouldn’t totally back away from globalization; doing so will leave a void that others—companies that don’t abandon globalization—will gladly and quickly fill. Instead, leaders should find ways to make their businesses work better and give themselves an advantage. It’s time to adopt a new vision suitable to the realities of the new era—one that still leverages the capabilities that reside around the world but also improves resilience and reduces the risks from future disruptions that are certain to occur.
This rethinking of supply chains creates opportunities for small and mid-sized manufacturers. Positioning your business to be the buffer, nearshoring, diversification, multi-sourcing, and/or sustainability solution to a customer or potential customers’ supply chain challenge can mean long term and sustainable growth.
Strategic Human Resource Management for Competitive Advantage
The human resources function is a key contributor to an organization’s success. Simply put, effective strategic human resource practice is having the right people, with the right skill sets, in the right place in the organization, at the right time in the business cycle. To accomplish this, clear connections should be made and maintained between the overall strategic goals of the organization with all the major human resource functions on a daily basis.
Too often in the past, the human resources function was not a strategic planning consideration. Organizations formulated their strategic plan without the involvement of the top HR officer of the organization, and then the human resources function was expected to act on the organizational plan which they had no input towards formulating. Given the critical human component in an ever increasingly technologically dominated workplace, the human resources function becomes of critical strategic importance.
The Strategic Planning Process
While many books have been written on this topic, a simple yet effective way to think about the strategic planning process is to construe the organization and its long term success as a system that interacts with its environment. All organizations are embedded in an environment that presents the organization with strategic demands or challenges – industry competitive challenges, legal-political challenges, socio-cultural challenges, and ecological challenges, among others. One of the key issues in strategic planning is to recognize and identify these challenges, determine whether or not an organizational response is warranted, and if so to enact that response. While this process acts out, organizations bring certain “input” into the organizational system– raw materials, financial resources, and human resources. This input is transformed by the organization through the application of a mix of technology, people skills, the organizational structure and flow of work through the policies and procedures put in place to create the organizations “output” – products, services, or knowledge. It is a simple model, but one that many organizations have difficulty in accomplishing effectively.
Human Capital as a Strategic Input
Identifying organizational needs for human capital acquisition is one of the critical roles effective human resource practice plays in this process. An effective recruitment and selection function is the ‘life’s blood” of any organization’s success. What skill sets are needed where and at what times in the business cycle? How and where are individuals with these skill sets identified so that organizations can develop an appropriate applicant pool? How effective is the screening and interview process of the organization and how does it reflect and enact the overall strategic needs of the organization? The acquisition of human capital that meets these criteria is as essential to organizational strategic success as is the acquisition of financial resources or raw materials. Without a quality human capital component to the organizational operations, overall achievement of strategic organizational goals may be jeopardized.
Managing Human Capital Effectively
Effective strategic human resource practice is more than just human capital acquisition, however. Effective strategic human resource practice also involves curation of the human capital after it is acquired. To be truly strategically effective as an organization, each department within the organization should be able to see how what they do contributes to the overall strategic goals of the organization. Every employee within that department should be able to see how their department’s functioning and the performance of their individual job duties contribute to the overall success of the organization. Connecting these dots within the organization can create a synergy that can push an organization to greater strategic heights of productivity and profitability.
These connections can be facilitated through effective employee communications, training and development, employee coaching, application of market competitive compensation and benefits packages, and thoughtful motivational programs designed and administered by the human resources function of the organization. Training and retraining current human capital to reflect continuing organizational skill set demands is crucial to keep the staff of an organization “cutting edge” with industry competitive demands.
Organizational Change Management
An essential step in the strategic planning process is recognizing the need to engage in organizational change management, given the challenges being presented to the organization as input in the iterative business cycle. Constant scanning and analyzing in this strategic domain and fashioning appropriate responses is another area where the human resources function and the overall strategic success of the organization dovetail. Does the organization have the proper technology in place to be industry competitive? Are new generations of technology coming down the line to make current technology obsolescent or obsolete? Will the new technology require new human capital skill sets? If so, does that require retraining of current employees or the acquisition of new employees with the desired skill sets? Will artificial intelligence technology make some human capital redundant? If so, how will the human resources function handle outplacement?
Larger organizational change management questions flow from this analysis, such as how do internal organizational policies and procedures need to change to reflect the new technology? How do specific positions need to be redesigned to reflect these changes? The enactment of this type of organizational change should be accomplished through a unified approach that reflects the organization’s strategic goals. Communications to employees should reflect and emphasize this over-arching connection to the strategic mission of the organization. Change management programs often fail, or at least fail to meet projected results, when they are done in a piecemeal fashion and the connections to overall organizational needs are not articulated for employees.
A Holistic Approach to HR
Too often, human resource initiatives are put in place without overall consideration of the strategic implications of the new program or procedure. Key to effective strategic human resource practice is a more integrative, holistic approach to the human resource function. Often this is accomplished through a human resource planning process in which the area questions what the present and future needs are of the integral human resources functions and how those needs are reflective of, or can be synthesized with, the overall strategic mission of the organization. The overall flow of the analysis and design of work, recruitment and selection of human capital, training and development of both new and current employees, performance review management so that every employee can see how they contribute to the overall success of the organization, compensation and benefits package design and administration so as to motivate employee work towards organizational success, employee relations and employee communications, should all be clearly connected for all employees to see and understand.
This sort of holistic approach to human resources management can best be accomplished by having the top HR officer of the organization “at the table” in the organizational strategic planning process. In this manner, the HR function can be infused into the strategic thinking of the top organizational executives and a key input in the strategic planning process can be a forethought rather than an afterthought when the strategic plan of the organization is developed.
Dr. William S. Brown is a tenured faculty member at the Marist College School of Management where he teaches courses in human resource management. Prior to entering academia, Dr. Brown held world headquarters human resources positions at the Prudential Insurance Company of America, Philip Morris, Inc., and Mutual of New York (MONY). He is the author of over 65 articles, book chapters, and conference papers.
by Michael Oates, Hudson Valley Economic Development Corporation
LEARNING FROM THE PANDEMIC
Strengthening the Hudson Valley Manufacturing Sector
Maybe your orders dried up. Your supply chain was interrupted. And government mandates, designed to safeguard communities, temporarily shut your doors.
For Hudson Valley manufacturers, the COVID-19 pandemic was disruptive, challenging, unprecedented. At the same time, however, it highlighted to policy makers and the public what those who work in, or with, the sector have long known. Hudson Valley manufacturing is advanced, vital, and essential.
A Vital Economic Engine for Recovery
Governments – locally, regionally, statewide, and nationally – will rely on manufacturing to resurrect economic strength in communities. There is a unique opportunity for a real chance to reimagine the U.S. manufacturing industry in the post-pandemic future. As the National Association of Manufacturers American Renewal Action Plan states, “Growing the manufacturing base is vital not only for America’s economic strength and job creation but to prepare for future health crises.”
The question now before us is how we can seize this new-found respect and appreciation to help Hudson Valley manufacturers thrive today and into the next decade. The toolbox we develop to answer this question must include foresight, agility and public policy which correctly addresses the needs of the new reality. Identifying and supporting a skilled manufacturing workforce, targeted incentives and focusing on economic development to support manufacturing can cement a metamorphosis. Investments in data, automation and e-commerce also may drive future success but without strong public policy focused on infrastructure, these changes will not attract and retain business in this new economy.
Positioned for Growth
In the Hudson Valley region, we already have in place many of these tools and are uniquely positioned to strengthen and grow the manufacturing sector.
Our manufacturers are some of the most innovative and creative in the world. We have clusters of companies that include world leaders manufacturing in future friendly fields such as biotech, semi-conductor, and quantum computing. Our educational institutions – particularly our network of community colleges – are among the best in the nation. Our region has increasing political clout in Albany and Washington D.C. with Senator Stewart-Cousins heading the majority in the New York State Senate and Senator Chuck Schumer the United States Senate Majority leader. And, (this is still important even post pandemic) we neighbor New York City, arguably the most important economic engine in the world.
Hudson Valley manufacturers may have to move away from just-in-time, low-inventory models and focus instead on diversifying and optimizing their supply chain to increase agility and resilience, accepting a little more cost in exchange for reducing some risks.
A Pro-Growth Industrial Policy, Incentives, Infrastructure and Focusing on Workforce Development
The COVID-19 pandemic has prompted debate about how involved the government should be in the U.S. economy. Industrial policy refers to government efforts to support industries that are considered strategically important, including manufacturing. To remain competitive in the global market, a focus on industrial policy has been renewed. Essential manufacturing should be the focus of policy measures designed to stimulate the economy. These measures could include protective tariffs, direct subsidies, tax credits, public spending on research and development (R&D) or government procurement.
Elected Officials are Trying to Translate this into Effective Public Policy.
• Manufacturing accounts for nearly two-thirds of all US private sector R&D, yet as a nation, we lag far behind other advanced economies when it comes to tax incentives that encourage it. With incentives scheduled to shrink further next year, Washington may be motivated to act quickly. Senate Majority Leader, Chuck Schumer (D-NY) is pushing the Endless Frontier Act, which would invest $100 billion in research. Other bills in play call for investments in cybersecurity, semiconductors, and personal protective equipment. These would certainly help our regional manufacturers to further develop their already cutting-edge technologies.
• The Biden Administration has pledged economic-stimulus assistance, now being negotiated in Congress, even as it works to conquer COVID-19. The American Rescue Plan recently signed into law provides resources to help the economy and manufacturing as a whole. Talk of a national infrastructure bill includes improvements in roads, bridges, water, sewer, rail, airports, and high-speed internet – all critical to manufacturers. In Albany, Gov. Andrew Cuomo has pledged a “Reimagine, Rebuild, Renew” agenda promising a New Deal-style program to invest in infrastructure, including air, rail, and road projects as well as housing. These investments will help Hudson Valley manufactures get their product to market faster and more reliably.
• There has been renewed interest among policymakers across the aisle to assess and help mitigate supply chain vulnerabilities. President Biden has ordered a review of U.S. supply chain vulnerabilities, a significant issue that was exposed during the COVID-19 pandemic. Designing tax policies and offering some support to encourage supply chain resiliency is critical if we are to minimize those vulnerabilities. Hudson Valley biotech, chip fabrication and pharmaceutical firms are likely to benefit.
• Perhaps the most significant issue that has to be addressed through policy and incentives is a focus on workforce development. The “skills gap” is a major hindrance in the post pandemic manufacturing world. Many Americans lack the specialized training necessary for a modern manufacturing job. It is imperative that public policy address this issue to establish stable pipeline for the sector as a whole. Some current initiatives focus on providing funding for costs associated with training, subsidizing “earn and learn” apprentice models, and reducing tax liability for employees participating in such programs. By using these incentives, manufacturing companies, large and small will be able to educate, train, and hire a skilled workforce that will be adaptable for the future of manufacturing. The regions that get this right will be the ones best able to help their existing manufacturers grow and attract new ones as well.
Overall, the new landscape for manufacturing is taking shape. Opportunities are there. Bold thinking, investment and a willingness to transform can guide success. Support for public policy, incentives and workforce development that embrace the post-covid manufacturing arena is crucial for not only manufacturing, but for the future of our economy.
Federal and State Action, however, is not enough. Manufacturing firms themselves have to step up to this opportunity and, here again, Hudson Valley manufacturers are ahead of the curve. To attract and retain talent, manufacturers will need to invest in their workforce – both in terms of compensation, and training. To compete globally, they will need to commit to a culture of innovation and invest in the technologies that will improve productivity as well as employee safety and health. Though already at the forefront of multiculturalism they will have to continue to welcome and incorporate diversity into their workplaces.
In terms of supply chain (see page 25) it will mean that Hudson Valley manufacturers may have to move away from just-in-time, low-inventory models and focus instead on diversifying and optimizing their supply chain to increase agility and resilience. Accepting a little more cost in exchange for reducing some risks.
A strong, vibrant manufacturing sector will drive economic growth in other sectors and is essential to our national security and to mitigating the dangers of future disasters like the COVID-19 pandemic. With focused leadership and smart, targeted policies and public/private collaboration, Hudson Valley manufacturers will thrive.
UNDERSTANDING THE POTENTIAL IMPACT OF THE CLCPA ON NEW YORK BUSINESSES
On July 18, 2019, Governor Cuomo signed into law the Climate Leadership and Community Protection Act, or CLCPA, the nation’s most aggressive climate law. Among other goals, the CLCPA requires statewide greenhouse gas emissions to decrease by 60% of 1990 levels by 2030 and 85% by 2050. With respect to power, the CLCPA requires that renewable resources provide 70% of the State’s electric needs by 2030 and that the electric system be zero-emission (no carbon-producing generation) by 2040. These goals are very aggressive and will require a massive investment of dollars to achieve. Every business in New York State should be aware of this law and its ramifications.
The CLCPA created the Climate Action Council, or CAC, whose task is to decide the implementation details. The CAC is a 22-member committee comprised primarily of State agency heads or their designees. The CAC is supported by two working groups, seven advisory panels, and other outside groups. Currently, the working groups and advisory panels are meeting regularly to formulate recommendations that will be advanced to the CAC by March 31, 2021. The CAC will take the recommendations and analyze them to select the ones that satisfy the goals of the CLCPA. Ultimately, the CAC must submit a Draft Scoping Plan to the Governor by January 1, 2022, that meets the requirements of the CLCPA.
Responsibility for reducing emissions from the electric generation sector falls squarely on the New York State Public Service Commission, or PSC, the agency responsible for regulating the gas and electricity sectors. By June 30, 2021, the PSC will establish a program that ultimately must result in all electric generation to be “zero-emission” by 2040. By July 1, 2024, the PSC also must establish a program to procure approximately 18,000 MW of renewable generation resources by 2030. These procurement programs are expected to cost New Yorkers billions of dollars in incentives and long-term contracts that exceed market prices.
The CLCPA will result in significant other costs as well, as the Legislature has passed other laws to complement the CLCPA. One such law mandates new electric distribution and transmission upgrades to move renewable energy from upstate regions to load centers downstate. Furthermore, the Commission has a broad portfolio of policy proceedings, many predating the CLCPA, that have been expanded to achieve CLCPA goals. Examples include the Clean Energy Standard, whereby that State’s electric utilities and other commodity providers are required to subsidize renewable energy projects and nuclear generation plants, the costs of which are recovered from consumers. There is a complementary proceeding to procure significant amounts of offshore wind – with the costs again borne by utility customers. Substantially increased investments in energy efficiency and electric vehicle infrastructure also will be recovered from New York consumers.
There is no denying that the costs of addressing climate change and enacting the CLCPA, either directly or indirectly, will be enormous. Renewable energy development is expensive, and New York energy consumers have already contributed billions to its development in the form of subsidies and increased transmission investment. Moreover, the cost of these initiatives frequently are recovered on a per-kilowatt-hour basis, thereby placing an extra burden on larger consumers such as businesses.
In addition, there are major plans to electrify the transportation and building sectors, which account for approximately 66 percent of GHG emissions in the State. Transmission and distribution infrastructure to support the movement of renewable energy to customer load centers, and the electrification of the transportation and building sectors, will cost many tens of billions of dollars more. For example, the CAC has discussed aggressive targets for purchasing electric vehicles, and possible approaches that would provide additional incentives for purchasing them, and/or instituting penalties and/or taxes for not purchasing them. The CAC also has discussed targeted regulations to phase out fossil fuel-based heating and cooling in buildings, as well as increased spending for energy efficiency.
While efforts to reduce GHG emissions should be pursued, each program and policy that the CAC adopts will come at a cost, and, depending on how the CLCPA is implemented, the cumulative price tag might very well be prohibitive for New York businesses. In response to several requests for a comprehensive study of the cost of CLCPA compliance by Multiple Intervenors (see below) and others, the Co-Chairs of the CAC recently responded, stating that the total cost of the recommended measures to achieve the CLCPA goals will be a key component of an “integration analysis” that the CAC will employ as it develops the Draft Scoping Plan. The integration analysis will evaluate total societal costs and benefits.
Ensuring that the analysis of the cost of CLCPA compliance is thoroughly and evenhandedly addressed in the CAC integration analysis should be a priority for all NYS consumers. In addition, it is noteworthy that the advisory panels are addressing which NYS industries should be defined as “energy intensive and trade exposed,” and what protections should be afforded to this group of customers to prevent job losses and other economic harm that might result from implementing the CLCPA.
Finally, the future reliability of electric and gas service could be impacted by CLCPA compliance efforts. Reliable utility service is paramount for most New York businesses, and increased dependence on intermittent generation raises questions about whether electric supply will reliably meet demand when those resources are not available when the system peaks. Recent events in California and Texas provide stark reminders about why reliable electricity service must be preserved.
For gas, as a result of the CLCPA, the State has a de facto policy of no new gas pipelines because of natural gas’ contribution to climate change. A new gas planning proceeding will determine how gas service will be largely eliminated in the future, and the cost and reliability of gas service during the phase out is likely to adversely affected as the number of customers is systematically reduced. For example, what will businesses that rely on gas service for processes or environmental compliance do if that service becomes unreliable as the gas system is phased out?
What should you do? Stay informed and seek to provide input on how CLCPA compliance might affect your business. A cost-effective way of participating in the process would be to join Multiple Intervenors, which is a member-supported association that advocates on behalf of approximately 60 of commercial, industrial, and institutional customers in New York State to ensure that their electric and gas services are fairly priced and reliable. Multiple Intervenors is actively monitoring the relevant meetings of the CAC and its advisory panels and will participate in associated regulatory proceedings at the PSC and elsewhere to ensure that the voices of NYS businesses are heard, based on the following principles: CLCPA compliance must be achieved as cost-effectively as possible; reliability of the electric and gas systems must be maintained; and the impacts of the CLCPA must be accurately quantified, reported, and understood. For more information about Multiple Intervenors and its efforts tracking implementation of the CLCPA, please contact Michael Mager at mmager@couchwhite.com or 518-320-3409.
Mike Mager is a partner at Couch White, LLP and a member of the Firm’s Energy practice group. Mike represents Multiple Intervenors and other large energy consumers.
Craig Busby and John Rickert, Co-CEOs of Pawling Engineered Products
IS CEO A TWO-PERSON JOB?
By dividing their responsibilities and focusing on each other’s strengths and interests Co-CEOs Craig Busby (L) and John Rickert have successfully led Pawling Engineered Products through challenging times.
It is rare for any organization to have co-leaders, and even more rare for a manufacturing business to employ the strategy. It is easy to envision where pre-determined boundaries might blur, where conflicts could arise, and decision-making stall. Salesforce.com, SAP, and Oracle had all abandoned Co-CEO structures within the last year, though Netflix announced this summer that it was elevating chief content officer Ted Sarandos to Co-CEO, sharing the title with founder Reed Hastings.
In an article in the Harvard Business Review from last September, however, John Gerzema and Will Johnson posed the question: “is CEO a two-person job?” Their conclusion is “it can be.” Our conclusion, after a wide-ranging interview with Pawling Engineered Products Co-CEOs (and brothers-in-law) Craig Busby and John Rickert, is a resounding yes.
HV Mfg: This is our first time interviewing Co-CEOs and we are looking forward to it. Let’s start with some background: how did you come to work in manufacturing?
JR: I grew up on Long Island and when I graduated from high school, I went to Carnegie Mellon University, where I received a degree in industrial management. I started out by taking a few courses related to production and manufacturing and it resonated with me. The owner of a printing company located over in Danbury was on CMU’s advisory board for a relatively new program that focused on printing, so I ended up interning with them for two summers and then working for them full time when I graduated.
HV Mfg: CMU—that is impressive—how did you end up there and how did you end up here at Pawling Engineered Products?
JR: I wasn’t sure where I wanted to go to college. I was a pretty good student, but I didn’t really know what I wanted to study. My guidance counselor recommended CMU partly because it offered a variety of options in terms of what I could study. It was a bit of a stretch for me to get in, so I applied early decision and ended up being accepted, which ended up working out great. I really enjoyed my experience there. It was tough, but I certainly learned a lot. As for ending up in Pawling, I married Craig’s sister, Andy, in 1996 and given my background in manufacturing, it seemed like a natural fit for me to join the family business. It was Craig’s uncle, Roger Smith, who brought me in and mentored me. Shortly after I joined the company, I found myself in charge of the Custom Mixing Division, which mixed about 20 million pounds of compound a year. I was only about 31 at the time, so it was a lot of responsibility for someone that age, but Roger spent a lot of time mentoring me and teaching me about the business. I certainly couldn’t have done it without him.
HV Mfg: Craig, this is your family’s business—did you always know you would end up here?
CB: No, not really. I was certainly familiar with the business. My dad and uncles worked here but I was the sixth of 11 grandchildren and none of the older ones had entered the business. I grew up in Pawling, and then studied geology and history at Colgate. After college, I became a teacher at Trinity-Pawling, and did that for a bit. That was a fabulous experience; I learned a lot about public speaking, presenting, and communicating. When I was younger, I did go on a number of customer calls with my dad, who was in charge of sales and marketing, but really never thought it would be a career for me. After T-P, however, I thought I should give the family business a chance and, like John, it was my Uncle Roger who mentored me. He encouraged me and then cobbled together a leadership training program for me. I spent two years working in all of the company’s divisions, learning all aspects of the business.
HV Mfg: This is before the company split in two, correct? Maybe you can put on your teacher hat and give us a quick history lesson?
CB: Sure. The original company was founded by my great uncle, Smith Johnson, who, with his father (my great grandfather) had started Johnson Rubber in Middlefield, Ohio. Smith was a classic entrepreneur and master “tinkerer”. To this day, we still use the equipment he designed and built. The company first started as a division of Johnson Rubber, then spun off into its own company which was called Pawling Rubber. My grandfather eventually joined the company and took over as President. In the beginning, we manufactured compression seals for military ammunition cases and household appliances. Remember when coffee makers were made in the US? Then, as the business grew, it became more vertically integrated. We began mixing our own rubber and added several product lines, such as floor matting and wall protection systems. A few years later, the company acquired Presray Corporation, a company that made highly technical lifting devices that used inflatable rubber seals. We started selling these inflatable seals into other industries, such as nuclear power, food processing, and powder bulk manufacturing equipment.
After my grandfather retired, my father, Bob, and his brother-in-laws, Roger and Stephen, grew the business to nearly $60 million in annual sales by the late 1990s with close to 400 employees. Almost 10 years ago, we split into two separate companies. My cousin Jason runs Pawling Corporation. They are now located a few miles up the street in Wassaic. Our business is Pawling Engineered Products, and we are still located in Pawling.
Silicone seals being spliced for the semiconductor industry.
HV Mfg: And what do you make here?
JR: We make specialty rubber and plastic products—inflatable and compression seals, gaskets, clamps and other items for applications in nuclear energy, aerospace, defense, life sciences, food processing, bio-tech—a wide range of industries.
HV Mfg: Can you give us a few examples of the products and how they are used? Where might we use or see them?
JR: Any time an industry needs a tight seal or to hold something securely in place, our products can be used. A simple example is in the nuclear power industry. Our seals are used on large airlock doors to seal out the radiation in nuclear power plants. We make about 10 to 20 of these seals per year, so the volume isn’t high but there is a high degree of customization. We also began working with a large tier one supplier in aerospace, who makes composite fuselage sections. Our product is called a “stringer bladder” and is used as part of the manufacturing tooling for these large structures. Some of these parts are over 60 feet long with extremely tight tolerances.
HV Mfg: Are these standard product lines or customized?
CB: It’s a little bit of both. Much of what we do centers around a “mass customization” model. We have base product lines that can be customized to meet the customer requirements without the need for tooling. We work with them to help them understand what they need as well as what is possible.
HV Mfg: How has the pandemic affected your business?
JR: We were definitely affected negatively. The aerospace industry got hit hard and they are a significant portion of our business. That sector was off about 50%, but we are highly diversified and other sectors have picked up a good amount of that slack.
CB: We also have a strong relationship with our customers. For some, it was my father who originally developed the account over 20 years ago. Currently, our sales team does a great job of making sure our customers are well taken care of. They have a lot of experience and continue to build and maintain strong relationships. Those relationships have definitely helped as we have navigated the past 12 months or so.
JR: I would add that all of our team here have been tremendous. We were an essential business and remained open. Many people who were able to do their jobs remotely did so, but most of us came to work and worked safely. We implemented social distancing rules and procedures, required mask wearing and figured out a way to safely get our product out the door. For those of us working on site, we went to a split-shift arrangement in order to minimize some of the risk of exposure. The early shift came in at 4:00 a.m. and worked until noon. Then, we made sure everyone left the property before the afternoon shift arrived at 12:30 p.m. and then they worked until 8:30 p.m. It was a lot to ask, but everyone was really terrific about making the adjustment.
Craig and I are really proud of how the team pulled together and did what was needed to get the job done during this tough time.
A seal finisher blending joint lines to ensure a quality product.
HV Mfg: Co-CEOs: it’s not very common. How does it work?
CB: It works great.
JR: I agree it does work great, it’s smooth, seamless.
CB: We have divided our responsibilities pretty evenly and focus on each of our strengths and interests. I work primarily on the sales, marketing, and new product development — the “outside” stuff. John works primarily on the operations side or “inside” stuff. He excels and really enjoys working with the production team, building and improving systems. I like the customer-facing side of things.
HV Mfg: There must be times when a conflict arises, perhaps a disagreement on strategy or investment?
CB: Not really, no. We are very much on the same page as to the direction of the company and how to get there. I also think—and maybe this is because we are brothers-in-law and friends—that we are constantly communicating and know each other’s minds.
JR: I agree. We each have pretty wide latitude to work in our designated areas. We trust each other. If there ever is a time when one of us thinks what the other is doing is a really bad idea, if we feel strongly about that, then we won’t do it. It is a form of consensus, I guess.
HV Mfg: Thinking about the next two to three years, what are some of the opportunities for the company and what are the challenges?
CB: I think the opportunities lie in the aerospace side of the business and continuing to bolster our engineering and operational capabilities. From 2017 to 2020, aerospace was growing rapidly, and while COVID hit it hard, we anticipate it recovering in 2022. We want to be ready when it comes back.
JR: We do see that business returning and it will present opportunities when it does. We want to be ready. As far as challenges go, it is attracting and retaining talent. On the one hand, we require some pretty unique skills, while on the other, we really need reliable, interested and engaged people. When we find a person like that, we work hard to train them and keep them.
CB: Along those lines, we are concerned about succession in key positions. I think it will be important to transfer any “tribal” knowledge they have to the next generation. I think that is true for our entire organization.
Inspectors measuring the bladder’s profile to verify conformity.
HV Mfg: How would you describe your leadership styles?
JR: I try to lead by example. I think it is important to set a good example and “walk the walk.” I have a tremendous amount of respect for all of the people who work here, and I wouldn’t ask any of them to do anything I wouldn’t do myself. During some of the busier times, like the end of a shipping period, I try to go out onto the floor and help with some of the simpler tasks like finishing seals, making boxes, packaging parts and bringing them to shipping, things like that. When COVID hit and we needed to get product to our customers, Craig and I both spent a lot of time on the floor helping out. We always made sure we were wearing a face covering—again, not asking our team to do something we are not prepared to do ourselves. We have 137 people who work here and a friend of mine was surprised that I know everyone by name. To me it would be surprising not to. I interact with just about everyone on our team weekly if not daily. How could I not know their names?
CB: John said it. My father and uncles set a good example in how they treated the employees, each other, their work ethic, and the legacy they left. They left us this company and the opportunities and responsibilities that go with it. I take that seriously and it is a big part of everything we do. I think that is one reason for our success. We have a company that feels more like a family—at least we try to make it feel that way. I’m sure some management consultants would say that we are too “in the weeds,” but for me, for us, that is the type of company we want to have.
HV Mfg: Do you have any leaders from history or industry that you admire or try to emulate? Maybe even someone you worked with?
JR: Well, since you included someone you worked with, I have to say Roger (Smith). I really always admired his intelligence, his demeanor, his ability to think strategically. He brought me into the business and made feel like a part of it. He gave me tremendous responsibilities as a young man, and he gave me enough room to learn but not to fail.
CB: I would have to say both my dad and Roger. My dad was a great example and taught me a lot about sales that is integral to what I do every day. My Uncle Roger was everything John said, and I will add just a great person—smart, funny, and kind.
Another figure—and maybe it’s a bit obvious—but I have always admired Abraham Lincoln. Especially given the division in the nation today, his strength and courage, perseverance and wisdom through the Civil War years has always inspired me.
HV Mfg: We too had the privilege of knowing and working with Roger and fully understand your admiration of him.
HV Mfg: This company has been a member of the Council of Industry for the better part of 60 years. What programs or services do you find the most valuable?
CB: First, let me say how valuable the information you have been providing us since the pandemic hit last year. Things were moving pretty quickly, and we always felt informed and up-to-date thanks to the Council. We also appreciate the wage and benefits data, the training and just knowing there is a group of like-minded people out there who understand our business and our challenges. That brings us plenty of value.
JR: I think the training is important and the connection to other manufacturers in the region as well. I also appreciate all the workforce development the Council is doing, including the apprentice program.
HV Mfg: Thank you both for your time. We hope you are proud of all you are accomplishing here.
NY Fed Empire Manufacturing Survey:
Activity Expanded at a “Solid Clip”
Business activity grew at a solid clip in New York State, according to firms responding to the March 2021 Empire State Manufacturing Survey. The headline general business conditions index climbed five points to 17.4, its highest level since last summer.
New orders increased modestly, and shipments were up substantially.
Delivery times continued to lengthen, and inventories were somewhat higher.
Employment levels and the average workweek both increased modestly. I nput price increases continued to pick up, rising at the fastest pace in nearly a decade, and selling prices increased significantly.
Looking ahead, firms remained optimistic that conditions would impro ve over the next six months, anticipating significant increases in employment.
OECD More Than Doubles US Economic Growth Forecast
The Organization for Economic Co-operation and Development (OECD) has more than doubled its gross domestic product (GDP) growth forecast for the U.S. economy since making its last projections in December. At that time, the OECD said it expected real GDP growth of 3.2% in the US in 2021, but now it expects the U.S. economy to grow 6.5% this year. The OECD also upgraded its global growth forecast for 2021 to 5.6% from 4.2% in December. But, the biggest upgrade on a national basis was made to India’s GDP forecast, which the OECD now pegs at a blistering 12.6%, up from its forecast of 7.9% three months ago.
Survey: 88% of Manufacturers Optimistic About 2021
Most U.S. manufacturers are positive about growth in 2021, according to a new survey released by the National Association of Manufacturers.
A majority, 87.6% of 450 respondents, of small, medium and large businesses reported feeling at least somewhat positive about their company’s outlook in the first quarter of 2021, compared to the dismal 33.9% optimism low in the second quarter of 2020. Optimistic responses broke down into 27.3% of respondents who said they were “very positive” responses and 60.22% who were only “somewhat positive.” For many respondents, the specter of COVID-19 as a pressure on income is largely behind them: 32.9% of respondents, a plurality, said revenue at their company returned to normal before the current quarter. A smaller group representing 20.6% of surveyed manufacturers expect things to be back to normal by the second half of the year instead.
A “Once-In-A-Generation” Opportunity for US Manufacturers And Policymakers
Writing in Forbes Lisa Caldwell writes that while the crisis is far from over, there is now an incipient window of opportunity. A chance for firms to be reimagined and, crucially, for the U.S. manufacturing industry to take its place at the forefront of a postpandemic future.
Naturally, this opportunity must be seized not awaited. Yet responsibility for doing so shouldn’t rest solely with manufacturing companies. Yes, there are some things they – both individually and collectively – must do to grasp the nettle, particularly when it comes to attracting fresh talent and closing the skills gap. But it also requires decisive action from the government to make the U.S. a more attractive investment proposition for manufacturers at home and abroad. In the words of NAM’s chief economist, Chad Moutray: “We have to understand we’re in a global competition here. The dollars will flow to where the market is best.”
ENVIRONMENT SAFETY AND HEALTH
OSHA to Ramp Up Coronavirus-Related Inspections
The Occupational Safety and Health Administration (OSHA) launched a national emphasis program (NEP) March 12 in response to President Joe Biden’s Executive Order on Protecting Worker Health and Safety during COVID-19. The NEP means OSHA will focus enforcement efforts in the coming months on coronavirus-related inspections. In a press release announcing the NEP, the agency made clear it will prioritize companies that put the largest numbers of workers at serious risk of contracting the coronavirus and employers that retaliate against workers who exercise rights protected by federal law or make complaints about unsafe or unhealthy conditions.
OSHA Proposes HazCom Standard Changes
The Occupational Safety and Health Administration (OSHA) has proposed a new rule to update its Hazard Communication Standard (HCS) to bring it into alignment with the latest version of the United Nations Globally Harmonized System of Classification and Labeling of Chemicals (GHS). OSHA’s proposed modifications to the standard include codifying enforcement policies currently in OSHA’s compliance directive, clarifying requirements related to the transport of hazardous chemicals, adding alternative labeling provisions for small containers and adopting new requirements related to preparation of Safety Data Sheets (SDS).
U.S. Formally Rejoins Paris Agreement as Biden Rolls Out Ambitious Climate Program
One of President Biden’s first directives confirmed his new administration’s intention to formally rejoin the Paris Agreement on climate change. This will occur on February 19, 2021 in a landmark move designed to reshape global climate policy for years to come. The U.S. re-adoption of the key goals set by the United Nations Framework Convention on Climate Change (UNFCCC) is widely seen as an opening to Biden’s USD 2 trillion clean energy program and environmental leadership drive, which were promised during his election campaign and have since been outlined in an executive order.
Details Slow to Emerge for New York Climate Law
The New York Climate Leadership and Community Protection Act’s renewable energy and other targets are among the most rigorous of any major economy in the world, according to Governor Andrew Cuomo’s office, but uncertainty remains regarding how those targets will be met. The law itself is a framework that outlines the state’s desired goals and creates a host of committees and working groups to develop the regulatory and other mechanisms that will achieve the goals. With important milestones coming due, the drastic redesign of the state’s power system envisioned within the law will start taking shape over the coming months.
For more details read Couch White’s Robert Loughney’s article on page 16.
LABOR AND EMPLOYMENT
NYS Time Off for Vaccine Law
Effective immediately, New York State employers must provide employees with up to four hours of paid time off per COVID-19 vaccination. The new law sunsets on December 31, 2022.
The new law provides that:
All New York employees must receive a paid leave of absence for “a sufficient period of time” not to exceed four hours per vaccine injection. In other words, employees may be entitled to up to eight hours of paid time off if receiving a two-injection COVID-19 vaccine.
This leave must be paid at the employee’s regular rate of pay.
Employers cannot require employees to use other available leave (such as sick leave or vacation time) before providing this leave.
The new law applies to both public and private employers, with potential carveouts for employees subject to a collective bargaining agreement.
COVID-19-Related Employment Litigation Affecting Manufacturing Industry
Manufacturing employers probably will continue to see an increase in COVID-19-related litigation affecting the industry. Keeping up with recent trends in COVID-19-related litigation can help manufacturers ensure compliance with the common bases of alleged violations. Nationwide, manufacturers have seen one to seven new COVID-19-related employment complaint filings a week since the beginning of April 2020. Such litigation is likely to continue to rise given the volume of filings over the past 10 months.
COVID-19-related litigation in the manufacturing industry generally fall into six categories:
Contract
Disability, leave and accommodation
Discrimination/harassment
Retaliation/whistleblower
Wage and hour
Workplace safety and conditions
Of these filings, nearly half fall under the “Disability, Leave and Accommodation” category.
Highlights of the Council of Industry’s 2020 Compensation and Benefits Survey
Completed by 31 Hudson Valley manufacturing businesses.
The survey was conducted with the support of Ethan Allen Personnel Group and Rose & Kiernan Insurance over parts of November and December 2020.
55% of the firms had between 51 and 100 employees, 23% between 101 and 250.
100% of the respondents offered their employees medical insurance.
75% of the respondents paid more than 75% of the total premium.
All but one firm offered a retirement plan with 401(k) plans, being by far the most common.
90% of the firms reported challenges hiring key positions.
Tool Makers, CNC Machinists, CNC Operators, Clean Room Technicians, and Maintenance Mechanic are the most frequently cited difficult to fill positions. Also mentioned are Electro-Mechanical Technicians, Engineers, and Scientists.
32% of firms offered an apprentice training program.
61% of these programs were recognized by the Department of Labor.
Entry level production workers can expect to earn $24,960 per year their first year in that role, and those workers average $31,243 per year.
Maintenance Mechanics can expect to earn $46,957 per year to start, increasing to more than $65,242 per year.
In all data was reported on 101 positions.
“The data in this survey reinforces what we know about careers in manufacturing – it confirms that these positions pay well and provide solid benefits,” said Harold King, Council of Industry President. “What it doesn’t necessarily show is how rewarding they can be. This year the pandemic helped us see how essential manufacturing is – from providing the food and technology we relied on during lockdowns to the personal protective equipment that kept us safe, to the laboratory equipment that helped produce the vaccines. People make those products, and they make them right here in the Hudson Valley.”
Council of Industry Teams with Ulster County to Fill Entry Level Manufacturing Jobs
Ulster County’s economic development and workforce development offices are working with the Council of Industry and the Small Business Development Center (SBDC) to fill the entry level positions at Ulster County manufacturing businesses. A portal on the Council’s Jobs Board, www.HVMfgJobs.com, will be created where positions will be posted.
The SBDC will counsel businesses on ways to make their positions more attractive. County officials will help candidates search and apply for the jobs as well as consider improving their skills at Ulster Community College. In addition to providing the portal on the jobs board the Council of Industry will promote its MIAP Apprentice program to both companies and candidates.
“Across the U.S., manufacturing activity is up, yet it is increasingly difficult to attract talent to our sector. Manufacturers need to do more if they are going to fix this problem including looking closely at their compensation packages, providing apprenticeships as well as other training and offering clear career paths.”
– Johnnieanne Hansen, Vice President Council of Industry
More than 77% of SMMs Expect to Continue Struggling to Identify Talent
Despite a dramatically altered labor market, manufacturers consistently suggest that they have trouble attracting and retaining sufficient workers. More than 77% of small and medium-sized firms expect to continue struggling to identify talent in 2021 and beyond, according to a new survey from The Manufacturing Institute and BKD, a national CPA and advisory firm.
“Across the U.S., manufacturing activity is up, yet it is increasingly difficult to attract talent to our sector.” said Johnnieanne Hansen, Council of Industry Vice President. “Manufacturers need to do more if they are going to fix this problem including looking closely at their compensation packages, providing apprenticeships as well as other training and offering clear career paths.”
COVID-19 has Boosted the Campaign Against Exams in American Schools
COVID-19 has put a wrench in school exams. With support from the Trump administration, all 50 states cancelled accountability testing last March, freeing 51m public-school pupils from the annual rigmarole. The SATs optional essay-writing section and separate subject tests were discontinued this year. The Program for International Student Assessment, an exam measuring the academic performance of OECD member countries, and the National Assessment of Educational Progress (NAEP), a nationwide exam administered to a sample of American pupils, have been postponed too.
Abandoning testing could be disastrous, warns the Fordham Institute, a think-tank, in a recent report. Cancelling tests again would make it hard to know how schools fared during the pandemic. “I would personally be in favor of more effort to get as many kids as possible tested, so that we know what is going on,” explains Cory Koedel, who co-wrote the report. “I think some kids are actually probably doing ok. And some kids are doing really terrible. And I don’t think we know exactly who’s who.”
BENEFITS OF PARTNERSHIP
Additional Online Training Opportunities for Council Members
The Council of Industry is partnering with its sister organization, the Manufacturers Association of Central New York (MACNY), to provide expanded training opportunities to our members. One change the pandemic has accelerated is the broad acceptance of remote and online learning. This newfound acceptance has created an opportunity for the Council of Industry to partner with other manufacturer associations to broaden the manufacturing centered training offerings we deliver to our members.
Beginning last month Council members can access several offerings from MACNY including Project Management, OSHA 10 and 30 Hour, ISO internal Auditor and many more. Watch your inbox for our weekly calendar which will begin to include these offerings alongside our own.
Harold KingFor many Hudson Valley manufacturers the past 14 months have been a rollercoaster ride of challenges and opportunities. The health and wellbeing of our employees and their families, supply chain issues, lost business, pivots to new products and customers, government interference and government assistance, have provided many ups and downs, highs and lows and twist and turns which have left us feeling at once exhilarated and exhausted.
In this edition of HV Mfg we attempt to look at the realities, opportunities and challenges that will exist for manufacturers in a post pandemic world. Taylor Dowd profiles Millrock Technologies, a manufacturer of pharmaceutical freeze-drying equipment that sees a bright future for their highly engineered products. Taylor also writes about how the trend toward automation in manufacturing was accelerated by COVID-19 and what that means for the sector. We take a look at supply chains and ways to strengthen them and make them more resilient. Marist College Professor Bill Brown writes on the need to include Human Resources in organizational strategic decision making. Hudson Valley Economic Development Corp President Mike Oates writes on the importance of manufacturing to our regional economy and how public private collaboration is key to helping it grow and thrive. We interview Pawling Engineered Products Co-CEOs Craig Busby and John Rickert about their uniquely effective partnership, their leadership styles and the future of their business.
This edition also includes a directory of Council of Industry members and Associate members. I would like to say once again that I am tremendously proud of all the members for the work they do every day to make the things that make our lives better and our nation great. I am also very appreciative of our Associate members who are always generous with their expertise and work with the Council of Industry to keep our members informed, compliant, safe and healthy.
Finally, a sincere thank you to all the advertisers in this edition. Your support helps The Council of Industry spread the important message that Manufacturing is “essential” to the region, the state and the nation.
