This interview is an abridged version of a broader conversation with executives from Bosch Rexroth Canada, Stahlin, and Fabcon. To listen to the full interview and others in the Progressive Manufacturing Roundtable series, click here. Innovate or fade away. That is the choice facing many manufacturers as they struggle to compete with rivals in lower-cost, offshore locations. Figure out how to make your products better, faster, cheaper, or watch your customers go elsewhere. But how can you light a fire under your organization and get it to take the right risks and try new things? Recently, Managing Automation Executive Editor Jeff Moad connected with executives from three manufacturing organizations to discuss these issues. But these weren't just any manufacturers. All three — Bosch Rexroth Canada, Stahlin Non-Metallic Enclosures, and Fabcon — were recognized last year as Progressive Manufacturing 50 winners for their achievements in innovation. Bosch Rexroth Canada, for example, was recognized for its digital prototyping project, which ensured that mechanical designs could be manufactured effectively and function properly. The project resulted in fewer errors, shorter lead times, and 50% shorter design times. Here's what Jim Lambert, design manager in the hydraulics business unit at Bosch Rexroth Canada; Mike Jackson, engineering manager at Stahlin; and Jason Hensley, research and development director at Fabcon, had to say about keeping the innovation fires burning. Q: What business pressures have pushed your companies to focus on improving innovation? Lambert: Our market, the motion control market, is very competitive. If you're going to stay involved, you have to continue to be innovative to survive. In order to get new business, you have to look beyond the boundaries of what you deem normal or familiar and then transform those ideas or concepts into a new creative process or a service or product. I think the most important thing, for us anyway, is we had to be willing to grow our portfolio of products and services as technology changes. If you don't do that, you're going to cease to exist. Jackson: In our case, we were driven by market dynamics. Our markets were telling us that we needed to develop new and different materials, but they had to be tailored to our specific product lines, and it was difficult to find other companies that could do that. So we looked at it internally and said that if we're going to participate in this market, we need some process or material that can satisfy that need. Hensley: Technically speaking, we're a manufacturer, but we're also a construction company. The late '90s for construction was insane. We were turning away as much work — if not more — than we were actually taking on, so it was easy for us to get fat and sloppy (for lack of a better word). But a recession kicked in in '01 and we realized that if we're going to survive, we've got to tighten up quite a bit. We started looking for ways to do that. And [improving the] tolerances and the geometric properties of our panels was a way we could save money across the board. Q: Is innovation simply a reaction to market forces or can it be pursued as part of a broader corporate strategy? Lambert: Well, sometimes it takes a large project, like one we did for the St. Lawrence Seaway, to take you out of your comfort zone. We had been using 2D [design tools] for quite a few years, but realized that if we were going to win this very large civil project, we had to move beyond our comfort level. So we picked up on digital prototyping. We went in with the understanding that it was going to be just as much a risk for us as our customer. Jackson: [Regarding] comfort level and associated risk, there are two routes that you can take. You can just stay within your comfort level, but that's not being that innovative and you're not moving things forward; you're just simply doing the status quo. We recognize that there is inherent risk with being innovative in anything you do. But, in our view, being innovative and aligning ourselves with the corporate strategy, the ultimate result of that is what value is it going to bring to the customer and our company as well? Q: To what extent do any of you use a formalized planning approach for innovation projects — for example, a portfolio planning approach? Lambert: I think you almost have to take that type of approach, diversifying what trends and technology, what markets you want to invest in. You've got to be flexible enough to change those plans as the market changes. What we've found [is that] manufacturing in Canada has been drastically changing. Large OEMs that we've done business with over the last 20 years are closing their doors, sometimes without any warning. We've also found that when times are tough, customers that we had for the last 20, 25 years, customers' loyalty based on historical relationships doesn't go very far. So you have to be careful not to place all your investments in one customer and one market — to coin a phrase: diversified innovation, if you want to call it that. Q: What approaches and tools do you use to enable collaboration in innovation initiatives? Lambert: We migrated to 3D design for all of our hydraulic systems work in 2003 and that was around the same time that we started getting involved in this large St. Lawrence Seaway project. So tools like Autodesk Inventor, Vault, Productstream, Design Review, and Freewheel were, and continue to be, an integral part of our workflow. Without these tools, we simply wouldn't be as innovative and effective in our business. We've been able to leverage that 3D technology, which we were forced to develop based on market demands, for our own engineering department down to the customer level. We've been improving our internal design reviews of new products as well as the customer approval process by leveraging digital prototyping. Jackson: Jim mentioned the rapid prototyping — we found that to be extremely effective, especially when you're evaluating products — once they've gotten past the initial design phase and you want to see, is this going to work? Is my customer actually going to want this? A lot of times, it's a touchy-feely kind of thing where they want to touch it, feel it, see what it looks like, and it gives us an opportunity to see how it's going to function without all the costs of molds and high capital costs. Q: So you're finding these tools helpful in communicating designs and changes not just internally, but also to customers and partners? Lambert: Oh, absolutely. From an internal standpoint, I can think back to several years ago when we would have a complicated project and we wanted to get everyone ... within production and manufacturing to buy into the idea of the design. This process could take several weeks. Using a digital prototype now, we can review the design in a matter of hours. The same goes for our outside customers, as well. Jackson: We can communicate with customers worldwide via quick e-mail [so that] within a day or two, we've gotten full approvals electronically and we make sure we keep track of that. Going forward internally, we're going to a completely electronic system whereby even the production people out on the shop floor will have direct access to the most current revision level of any given product, be it a standard product or some customized product. Q: What will your companies focus on next in terms of pushing innovation? Lambert: We're excited about a couple new technologies: One we're developing here, internally — it's a configuration tool for our salesmen ... We want to be able to give our salesmen tools whereby they could actually — through a configurator right in front of the customer — select certain criteria, application data, and then have it spit out automatically to them the 3D model, the drawings, quotation — everything. The second thing we're really excited about — and we're partnering with Autodesk on this — is Web-based, clientless design collaboration. In other words, for a customer in a remote area, we could upload the 3D model to a Web site and then we could collaborate on the Web live and record any changes, and it would be recorded like a meeting session online and available for download at any time. These are things that speed up the production process and allow us to provide innovative driving control solutions to customers more quickly than ever before.