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Manufacturing Leaders Take Aim at Collaboration

by Mark Halper, ME Editorial Staff

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Posted on Wednesday, June 11, 2008 10:50:00 AM

Abstract: At the Progressive Manufacturing Summit in Las Vegas, manufacturers large and small emphasize the need to collaborate in order to succeed.
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LAS VEGAS — To thrive in an ever-more competitive world, manufacturers will need to engage employees from across the enterprise and orchestrate systems and processes across multiple locations, industry experts said today.

That was the message from the panelists and speakers at Managing Automation’s fourth-annual Progressive Manufacturing Summit, a gathering of manufacturing leaders that kicked off here today. As companies move into a world where soaring energy prices and global competition are the norm, they’ll have to rely on intelligence from research, the factory floor, the supply chain, marketing efforts, and elsewhere to get better at making things, said the Summit’s presenters.

Craig Giffi, vice chairman at consulting firm Deloitte & Touche, likened the challenge to the way a cruise missile works — changing its course as it encounters obstructive objects like mountains. “The cruise missile is an adaptive process,” Giffi said on a panel entitled, “The Leadership Mandate: What Manufacturing Executives Need to Focus On.” Manufacturing companies likewise have to be nimble enough to change course in their strategies in an unpredictable world, he said.

Panelists agreed that company-wide collaboration will have to include the factory floor, which famously resists integration with enterprise IT. “That’s going to be a major challenge,” said Eric Mittelstadt, CEO of manufacturing industry organization NACFAM. “They’ve got to be able to collaborate and innovate as well.”

One company that advocates collaboration is pharmaceutical giant Pfizer. Kelvin Cooper, senior vice president of the company’s research group, Worldwide Pharmaceutical Sciences, said in the Summit’s keynote address that last year, Pfizer jettisoned its old way of getting ideas from research to manufacturing. In the past, “We hurled it over the wall and manufacturing picked it up and tried to run with it,” he said in a morning presentation dubbed, “Orchestrating Research and Manufacturing in the Pharmaceuticals Industry.” Now, Pfizer brings many divisions of the company into the development process, including individuals responsible for drug formulation, analysis, supply chain coordination, and other tasks.

One change that Pfizer hopes to implement is to switch from making large batches of a drug at one time to making drugs in a continual process. Currently, Pfizer keeps many more drugs in supply than it needs, because, as Cooper noted, “if you have a patient on a cancer drug, you cannot afford to run out.” A continual manufacturing process “should help us reduce inventory and be much more responsive to demand,” he said.

But he cautioned that the switch would take a long time, possibly 10 to 15 years, because the company is steeped in many years of batch processing, and because the switch will entail many regulatory hurdles.

Executives on the leadership panel this morning noted that the goal of implementing collaborative innovation clashes with another imperative, cost cutting, because new forms of research and development add to those budgets.

But they agreed that innovation has to remain a top priority.

“Innovation applies to growing the business — you can’t not do that,” said Deloitte’s Giffi. Mittelstadt recalled how when he was CEO of robotics maker Fanuc, he cut all budgets other than R&D during a severe industry downturn. “The only way we’re going to succeed is to be more innovative,” he said.

Bruce McKay, executive vice president of Livingston & Haven, a maker of hydraulic, pneumatic, lubrication, and automation systems and 2007’s Progressive Manufacturer of the Year, cautioned that too many companies are currently over-emphasizing production issues while cutting R&D. “Eventually they’re going to pay a price for that,” he said.

In a later presentation, Tim Opitz, director of production operations and support & services for Boeing’s 787 program, echoed the collaboration theme. Such collaboration must begin with a strong champion, he noted, which in Boeing’s case is the CEO. Asked to reveal the biggest lesson learned from the company’s push to bring the 787 to market, an initiative that has been plagued by delays, Opitz said the collaboration driver has been a key.

“The single biggest thing we’re trying to figure out is how we do that integration” of people across the company and outside its walls. “They don’t naturally come together,” he said.

The Progressive Manufacturing Summit is being broadcast live on ManagingAutomation.com.