Business Operations

As supply chain bottlenecks and materials shortages continue to challenge both the U.S. and the world, companies in the semiconductor industry are working hard to meet high-quality standards, achieve strong technological innovations and keep up with the growing demand.

To meet these goals, chip producers as well as all their suppliers are continuously investing time and funds into new products, technologies and facilities.

SGL Carbon, a global manufacturer of products derived from carbon and graphite, is part of this supply chain for chip producers.

Heavily invested: The company, which has its North American headquarters in Charlotte, North Carolina, has been investing significantly in its semiconductor-related production while working hard to meet demand and keep pace with the ever-shifting market.

• Over the past four years, SGL Carbon invested approximately €30 million into enhancing its production capacities and a modern clean-room environment in St. Marys, Pennsylvania, the home of its main North American operations related to the semiconductor industry.

Smaller size, bigger impact: The semiconductor market is a dynamic sector, and its applications are now more essential than ever to everyday life, according to SGL Carbon Vice President of Marketing and Sales Doug Garda. As chips get smaller, their efficiency and performance are getting bigger—and so is the global appetite for them.

• “We’re seeing more and more demand globally, and the infrastructure that exists in the industry isn’t sufficient to meet those demands,” Garda said. “Especially with the Internet of Things, e-mobility, LED lighting and automated production, there are so many more applications and high-performance variants of chips required for the future. We need to meet that very steep demand curve.”

Global shortages: While in development, semiconductor chips can cross international borders 70 times before the end product reaches a consumer, fueling significant complexity in the manufacturing process and supply chains.

• With the onset of the COVID-19 pandemic, labor challenges, shifts in consumer needs and general unpredictability have fed worldwide supply issues.

High demand: In the midst of these shortages, the market for silicon-based wafers, used for regular chips, is expected to grow by 5% annually over the next five years. However, the market for special silicon-carbide-based wafers, used for high-performance chips, is expected to grow by 30% or more annually over the same period.

A critical market: Sometimes described as the “brains” of electronic devices, from automobiles to home appliances to personal electronics and medical devices, semiconductors are critical components for all sorts of manufactured products. A shortage in semiconductors creates ripples all across the manufacturing industry.

• “The semiconductor market is a key component to any region’s manufacturing needs right now,” said SGL Carbon NA Network Operations Manager Tom Detsch. “It’s one of the most important opportunities of our time—and we’re of course also looking for funding options to further grow.”

Eye on Congress: The U.S. House of Representatives and Senate have both considered legislation designed to strengthen the U.S. semiconductor industry, but differing bills have left Congress with varying approaches.

• The House passed a bipartisan CHIPS Act in the National Defense Authorization Act authorization last year, but it lacked funding. The funds were instead included in subsequent legislation, the America COMPETES Act.
• Meanwhile, the Senate passed its CHIPS Act funding through the United States Innovation and Competition Act of 2021 (USICA).

“The question remains: what’s next?” said Detsch. “These markets are growing. How much is going to be in the United States, and how much will be outside? There’s government funding being looked at here in the U.S. and abroad. That’s something that would be interesting for us in the U.S. if something like that were to be available.”

Our take: The NAM is strongly supporting efforts to increase domestic chipmaking capacity here in the United States and is urging the federal government to help make that goal a reality.

The last word: “We’re a solutions provider, and demand for our graphite products has expanded rapidly,” said Garda. “Without graphite-based equipment, no semiconductors could be manufactured. Thus, this will be a growing market for us and for North America in general for a long time.”

When Russia invaded Ukraine, Sukup Manufacturing knew it couldn’t stand by. The Iowa-based company—which manufactures grain storage, drying and handling equipment—has a European counterpart located in Denmark, Sukup Europe, that partners with the Grain House Company in Ukraine. As Russian troops threatened Ukraine, President and CEO Steve Sukup immediately greenlit the effort to help Grain House’s personnel and families get to safety.

“When Russia invaded Ukraine, we immediately said, how can we help?” said Emily Schmitt, Sukup’s chief administrative officer and general counsel. “We called the CEO of Sukup Europe, and his response was, I’m really glad I work for a company where I’m able to say I can help and do what’s needed.”

The mission: Managing Director of Sukup Europe Jens Erik Iversen and Co-Founder of Grain House Company Andriy Semenovych worked together on the effort, gathering the resources needed to make the 1,200-mile journey from a pickup point in Ukraine to a community in Denmark. Sukup’s Iowa headquarters coordinated with its counterparts, offering financial support and even leveraging business connections on the route between Ukraine and Denmark to help move refugees safely out of the country. Determined to overcome any last-minute obstacles, Iversen himself rode in the bus to meet the Ukrainian families at the border—bringing food and clothes and helping to provide asylum assistance.

Since that first caravan, Sukup has organized multiple trips to the border. Through their efforts, they have been able to bring 64 people in more than 20 families to Denmark.

• “Being a family business is not where family ties stop here,” said Schmitt. “It’s really ingrained in Sukup to give back. Every employee isn’t just an employee—they’re family. And their families are our families as well.”

The way forward: Today, Sukup is focused on making sure there’s a continuous and reliable community effort to support the refugees in Denmark. It is working with Danish officials to ensure that the Ukrainian refugees can remain in the country and with the U.S. government to secure temporary work visas that could allow the Ukrainians to go to Iowa. It is also working through the Sukup Family Foundation to continue providing food, clothing and other resettlement resources to the Ukrainian families they’ve evacuated.

The last word: “We’re hearing that there’s upwards of four million refugees coming out of Ukraine now—so this is one grain of sand on the beach,” said Sukup Chairman and NAM Board Member Charles Sukup. “But we’re so proud our people stepped up and did it so rapidly and efficiently. This was the epitome of our history of taking care of each other.”

How will the 5G transition affect manufacturing? If you ask Ericsson Senior Vice President Åsa Tamsons, enormously.

5G will help drive global transformation, innovation and sustainability in our sector, Tamsons recently told the NAM’s Manufacturing Leadership Council. She sat down with MLC Co-Founding Executive Editor and Senior Content Director Paul Tate at Ericsson’s new 5G Smart Factory in Lewisville, Texas, to tell us more.

About Ericsson: Founded in 1876, Ericsson Inc. is a leading provider of information and communication technology. The company is now a $25 billion global enterprise with 100,000 employees serving clients in 180 countries.

About the Lewisville plant: Ericsson describes its Lewisville plant, which opened in March 2020, as a “5G-enabled, digital native” facility.

• “We wanted to be able to obtain data from every single source, device, machine and person operating in the facility, both now and in the future,” she said. “One part was implementing 5G, but we also needed a data architecture to secure that and to use equipment that is able to extract both production data and operational status.”

Development process: In its journey to Manufacturing 4.0, Ericsson used a particularly agile development process.

• “We had a mission to develop 25 use cases within a year,” Tamsons said. “In the first eight months, we launched seven of those 25 use cases. In the remaining four to five months, we launched the other 18. It just shows the power of doing that groundwork, while also demonstrating that you can launch end-to-end solutions in rapid time. Then you really start to have platforms that you can scale.”

Measuring impact: The Lewisville facility serves one of Ericsson’s biggest and most important markets in the world—yet it is operated by just 100 people.

• The plant delivers 2.2 times more output than similar sites that don’t have the same degree of automation or technology in place.

Lighthouse status: Lewisville is also one of the world’s first manufacturing plants to achieve Global Lighthouse Network status under the World Economic Forum’s new sustainability category.

•  A combination of recyclable and reused materials, renewable energy, an ideal location close to a major airport and advanced manufacturing technologies supported this award.
• “Innovation is not all about technology,” Tamsons said. “It’s about how you apply it and how you can use the best of technology to create better solutions that are also more sustainable.”

What’s next: The Lewisville plant has plans for further innovation.

• “We’ll continue to build out the data structure and cloud capability, really focusing on how we can scale up the value of existing use cases and applications and on what the next use cases will be,” she said. “We’re continuing to invest in upgrading our manufacturing sites to develop a reliable, sustainable, global supply chain, not only in Lewisville, but across the world.”

Attend a plant tour: Join the MLC in Texas for the Ericsson Lewisville Plant Tour on Oct. 4–5 to see Ericsson’s 5G-enabled digital native, double Lighthouse award-winning plant for yourself. Save the date and watch for more details.

A group of world-class manufacturers and their leaders have been recognized for their achievements by the 2022 Manufacturing Leadership Awards.

About the awards: Presented by the Manufacturing Leadership Council, a division of the NAM, the awards recognize excellence in digital manufacturing. Since the program’s founding in 2005, more than 1,000 high-performing projects and individual leaders have been honored with an award. Winners represent companies of varying sizes in a wide array of industries.

This year’s awards were given in nine project categories and two individual categories. Some project categories include AI and Machine Learning, Digital Supply Chains and Digital Network Connectivity. Judging is done by a panel of industry experts, many of whom are past winners themselves.

Why it matters: The movement toward smart factories allows manufacturers to leverage data to become more efficient, productive, sustainable and competitive. In the difficult business conditions that many are experiencing, data-driven operations can mitigate disruptions and even predict them before they happen.

“This year’s winners are exemplary for their compelling use of technology, innovative approach to problem solving and overall commitment to furthering the progress of Manufacturing 4.0,” said Manufacturing Leadership Council Co-Founder, Vice President and Executive Director David R. Brousell.

Gala coming in June: Winners will be honored at the Manufacturing Leadership Awards Gala on Wednesday, June 29, 2022, at the JW Marriott Marco Island Beach Resort in Florida. The gala will also feature the announcement of this year’s Large Enterprise Manufacturer of the Year, Small/Medium Enterprise Manufacturer of the Year and Manufacturing Leader of the Year.

Select winners will present their projects at Rethink: The Manufacturing Leadership Council Summit, the industry’s premier event focused on Manufacturing 4.0.

See the complete list of winners here.

In 2012, Vermeer management realized it had been hearing the same refrain from team members for some time: There was a shortage of available, high-quality child care in the Pella, Iowa, area, and it was complicating parents’ work schedules.

Workers’ challenges are the company’s challenges: Rather than respond with a collective shrug, the company recognized there was a problem—and it vowed to find a solution.

• “Especially with early morning shifts, you heard a lot about people leaving their children at a neighbor because parents had to be at work before the bus came or school started,” Vice President of Operations Mindi Vanden Bosch, a third-generation Vermeer family member, recalled.
• “We put a task force together and brainstormed. Over the next year and a half, we built the Yellow Iron Academy, Vermeer’s early childhood education center. Every answer from employees since has been, ‘It’s been a game-changer.’”

Not just care, but education, too: The Yellow Iron Academy, which gets its name from the company’s yellow products, isn’t just a nod at child care. With day-to-day operations run by award-winning third-party child care services provider Bright Horizons, it is a full-fledged center led by qualified professionals, and it aims to ready children for academia—and eventually, careers.

• “We’ve had teachers say, ‘Wow, these Yellow Iron kids are coming in with a strong readiness to learn,” said Vermeer Vice President of Human Resources Kate Guess, whose own children attended the center. “Yellow Iron Academy is taking the first steps to encourage kids to consider STEM careers like those in manufacturing,” Guess said.
• During Engineering Week, Vermeer professionals come in and talk to the center’s older kids about their jobs as engineers. The kids take regular field trips “across the road” to Vermeer’s facilities to see its museum, equipment and Global Pavilion. “It’s a place where they get excited about all the disciplines of STEM,” Guess said.

Meeting a community’s need: The center, which remained open throughout the COVID-19 pandemic, has achieved its intended goal of providing parents with top-of-the-line supervision and education while alleviating worry about having to cobble together care solutions for the next shift.

• Yellow Iron Academy isn’t just for Vermeer kids, though. While Vermeer team members and others with a connection to the company (grandparents, for example) receive discounted care rates, the center “is for the whole community,” Vanden Bosch said. “There is a need for child care in the area and across the entire state.”
• Out of the approximately 130 kids at Yellow Iron Academy, about 75 have Vermeer connections, Guess added.

Filling in school gaps: One of the most appreciated aspects of Yellow Iron Academy is its offering of before and after care, or programs prior to and following the school day.

• The center opens at 5:30 a.m. and is a pick-up and drop-off point on local school bus routes, so Vermeer team members don’t have to worry about school transportation for their children.

Other Vermeer team member benefits: Vermeer offers its team members several other differentiated, highly sought-after benefits. These include an onsite health care clinic and pharmacy, where both doctor visits and prescriptions are more cost effective than they are elsewhere, and a chaplaincy program.

• Both team members and their dependents are eligible to use the clinic and the pharmacy (features Vermeer has offered for 25 years) and many do.
• Vermeer has multiple chaplains across the company’s locations. These chaplains are available 24 hours a day, seven days a week to “support the emotional needs of the team,” Vanden Bosch said. “It is without question one of the things our team members most value.”

Child care advice for other manufacturers: “Child care is hard right now,” Vanden Bosch said. “Businesses have to go into it with the belief that it’s an investment in the workforce of today and tomorrow, knowing that there will likely be some costs they won’t recoup. But it’s one of the most viable ways to create a workforce.”

Manufacturers have been eager to help those affected by the humanitarian crisis in Ukraine, with many even lending a hand on the ground.

What manufacturers have been doing: They’ve raised millions of dollars through their own charities and funding vehicles, donated parts of their own profits, provided free legal support and phone calls to Ukraine, given medications and food, coordinated the shipping of relief supplies and more.

• Some manufacturers with operations in Ukraine have helped employees and their families flee the country and find temporary homes elsewhere in Europe.

Shared values: “Manufacturers have a proud history of standing firm in support of democracy, and we stand with the Ukrainian people,” NAM President and CEO Jay Timmons said recently, following the unanimous vote by the NAM Board of Directors to denounce Russia’s invasion of Ukraine.

Partnering to help: To help the people of Ukraine, the NAM’s Emergency Response Committee has partnered with Project HOPE and is engaging with other members who are donating through this and other channels.

• These efforts are providing channels for manufacturers to support efforts on the ground. For example, advanced materials manufacturer Greene Tweed recently donated $25,000 through the NAM–Project HOPE partnership.
• Project HOPE, an international health care and disaster relief organization, has emergency response teams in both Ukraine and neighboring countries that are giving health and humanitarian assistance to refugees and internally displaced persons.
• The ERC is a volunteer-led group that works to provide resources and information to manufacturing leaders before, during and after crises, both domestic and international. In addition to its partnership with Project HOPE, the ERC is also working with domestic partner Good360 on Ukraine relief.

The NAM says: “Manufacturers are truly at the forefront of aid efforts to Ukraine,” said NAM Senior Director of International Trade and Regulatory Affairs Ryan Ong. “Collectively, they’ve raised tens of millions of dollars for food, shelter, medicine, health care and more for the people of Ukraine. They’ve stepped up to help those in need, just as they do as a group in any time of crisis or hardship.”

Those wishing to donate to Project HOPE can do so here. To get more information about NAM efforts or share what your company is doing, contact the ERC at [email protected].

In just nine months in 2020, Pfizer pulled off a scientific feat few were betting on: It produced an effective vaccine against the COVID-19 virus, an illness that at the time was contributing to thousands of deaths a week in the U.S. alone.

A ray of hope: Pfizer Chairman and CEO Albert Bourla shares the astounding story in his new book, “Moonshot: Inside Pfizer’s Nine-Month Race to Make the Impossible Possible,” out today. Part best practices, part personal memoir, “Moonshot” is at its heart a story about a manufacturer on a mission: to be part of something larger than itself and help the world.

Here, we share some of the highlights.

Tremendous sacrifice: “Pearl River, New York … where we had research labs, was also a community hot spot for the virus,” Bourla writes on page 87. “More than 350 people a day came into the Pearl River site in the middle of the pandemic. They were diligent with precautions—masks, handwashing, social distancing, protective gear—but they were coming in for long hours and through weekends.”

• “It was a tremendous effort under challenging circumstances. During the pandemic, we saw thirty-four hundred Pfizer colleagues infected across the globe. Dozens were hospitalized. As of July 27, 2021, twenty-three colleagues and four contractors had lost their lives. When I would learn of grieving families and families in distress, I would personally call or email.”

 Innovation under pressure: “I remember vividly when [now Executive Vice President, Chief Global Supply Officer Mike McDermott] came to a meeting to present how he would increase production to three billion doses in 2021,” Bourla writes on page 92. “One of the … challenges would be that if we needed to increase the production capacity dramatically, we would need many replicas of … new equipment, and we didn’t have enough readily available space in our manufacturing sites.

• “‘I will have to build new formulation sites,’ Mike said, ‘and as you know, building construction takes years.’ And before I could ask him, ‘What you are going to do about it?’ he anticipated my question.”
• “‘But we have a solution. … We can order prefabricated modules that we can install in our Kalamazoo manufacturing site within months, not years. … [I]t can be done.’”

Lifesaving cold storage: “Led by a man who became known as the Ice Man, James Jean, our engineers designed a temperature-controlled thermal shipper that could transport and store the vaccine anywhere in the world,” Bourla writes on page 94.

• “We had been piloting the idea before COVID-19, but when the pandemic struck, we skipped the test phase and went straight to full implementation. The shipper, about the size of a carry-on suitcase, weighed about seventy-five pounds. It carried a minimum of one tray of vaccine vials and as many as five trays. Each tray had 195 vials, 6 doses per vial. So, a single shipper could carry as many as 5,850 doses.”

Manufacturers largely agree that technology will help workers, not displace them, speakers said at the Manufacturing Leadership Council’s recent virtual event, “M2030 Visions of the Future: Reflections on New Orleans.”

New Orleans readout: The webinar, which featured a panel of technology experts, was a recap of highlights from the MLC’s December 2021 Manufacturing in 2030 project event in New Orleans, which hundreds of manufacturers attended.

What the future holds: The recent online discussion was primarily about future technological trends in manufacturing, and three major themes emerged: Completely “lights-out” manufacturing (i.e., totally automated) is not a likely near-term reality for manufacturing; upskilling and reskilling will be crucial in attaining syncopation between employees and robots; and most manufacturers have some ways to go to achieve digital maturity.

Lights out? Try lights dimmed: There is a misconception that robotics, artificial intelligence and machine learning will replace human employees on the shop floor. The reality is that they all do best together.

• “I view it more as a ‘dimmer switch’ than ‘lights out,’ and the level to which you can dim depends on the kind of manufacturing you do,” said West Monroe Senior Manager of Consumer and Industrial Practice Alex Jay. Particularly when it comes to “complex materials, [manufacturers will] need a nuanced touch,” which will require more, not less, human interaction.
• “There will be a dimmer switch, a natural limit to how far you would automate,” said Infor Senior Vice President of International Strategy Andrew Kinder. “In the next eight years, we will see more use of technology on the plant floor. Is this a concern for employment? I think the World Economic Forum put that to bed when they said … technology will create 12 million more jobs than it will ever destroy.”
• EY Principal of Strategy and Transactions Rosco Newsom agreed. “[Manufacturers] don’t see ‘lights out’ happening in the near future.”

Upskilling and reskilling: The increased use of Manufacturing 4.0 technologies on the shop floor will only increase the need for skilled talent, the panelists agreed.

• First, “there is reskilling and upskilling required even to make those ‘lights out’” changes, said NTT Data Senior Director of Manufacturing Industry Solutions Baskar Radhakrishnan.
• Complex materials that need nuanced touch and geometric dimensioning and tolerancing “will need more human interaction,” not less, Jay said.

Maturity not yet reached: As was evidenced by questions from the webinar audience and comments from manufacturers during the New Orleans event, many manufacturers could use guidance when it comes to using more technology.

• For smaller manufacturers wondering where to start implementing Manufacturing 4.0, look to “labor-intensive, repetitive tasks,” Radhakrishnan said. “That’s where you start.”

The last word: Robotics aren’t going to put anyone out of a job. As Kinder said, “Tech seems to be a driver rather than a ‘retirer’ of employment.”

To help manufacturers navigate Manufacturing 4.0, the NAM’s Manufacturing Leadership Council launched the MLC Master Class Series. This series includes regular virtual events designed to explore new technologies, address pain points and showcase opportunities—all while connecting forward-thinking manufacturing leaders. Sessions in the series include interactive webinars, Technology Deep Dives and Tech Talks.

Webinars: With formats such as panel discussions, use cases and executive interviews, the Master Class webinars are especially beneficial to manufacturers who want to learn about the innovative technologies that have the potential to enhance their operations. These virtual sessions are a chance to hear directly from the digital manufacturing experts moving our industry forward. Content and discussions during these sessions provide insights on identifying, evaluating and implementing new technologies as well as providing strategies for leadership in the age of digital progress.

Deep dives: Deep dives are 60-minute interactive sessions that continue and expand the learning necessary to be successful with new technologies. They provide a more in-depth understanding of specific technologies, where they can be applied and how they can lead to new competitive advantages. Each deep dive also features short breakout sessions focused on either “How Do I Get Started?” or “How Do I Further Leverage?”

Tech talks: Tech talks are 30-minute candid conversations with subject-matter experts who provide insights into how specific technologies are designed to accelerate and drive the journey to Manufacturing 4.0. From purpose and adoption, to challenges with implementation and best practices on operations, MLC’s tech talks will enable you to stay abreast of new and evolving manufacturing technologies within the marketplace.

Master Class events take place throughout the year. Manufacturers at all stages of digital transformation are invited to participate in the entire series or choose individual events based on their needs and interests. To see upcoming classes and access recordings of past sessions, click here.

As the global supply chain, worker shortage and wage inflation challenges many had hoped were transitory dig in their heels, manufacturers everywhere are wondering how best to get around them.

Panelists at “Successfully Navigating Current Supply Chain Disruptions,” a webinar hosted by the NAM’s Manufacturing Institute, Manufacturing Leadership Council and professional services firm PwC, sought to answer that question.

We rounded up the speakers’ top tips for manufacturers seeking to sustainably and profitably maneuver the several sizable hurdles they still face going into 2022.

• Break down siloes. Now that manufacturers are having to replace traditional supply chain models, changing their company operations to have staff work across siloes is more important than ever, said PwC Partner Debjit Banerjee.
• Expect disruption. If it taught us nothing else, COVID-19 conveyed the importance of being prepared for the unexpected. Going forward, manufacturers would do well to not just plan for the possibility of disruption, but to assume it will come. To that end, preplanned “differentiated customer service” and disruption drills should become the norm, Banerjee said.
• Advance your supply chain planning. Increasingly, Nexteer Automotive, a global maker of steering and driveline components, is focusing on advanced supply chain planning, programs that help predict shipments, supply and demand for smoother operations, said Nexteer Automotive Vice President of Global Manufacturing Operations Dennis Hoeg. With it, “decisions can be made smarter, earlier.”
• Automate. Manufacturers should consider automating repetitive “transaction” work and reserving their employees for analytical tasks that only humans can do, according to Hoeg.
• Balance agility and resilience. Before the pandemic, “we were working on a strategy that was based on agility,” said Rockwell Automation Chief Supply Chain Officer Ernest Nicolas Jr. “Through the pandemic … we had to reprioritize. We had to take a step back to balance agility and resilience.” Manufacturers that want a better agility-resilience balance can do so “through data, process and technology” enablement, according to Nicolas.
• “Relentlessly prioritize.” Nicolas so believes in this advice that he ended his presentation with it. “There’s so much going on right now; we want to be certain we manage our priorities,” he said. “So, there’s a lot we’re saying ‘not now’ to …. but it’s not a matter of ‘no.’ It’s a matter of, ‘We’ve got to get these things finished so we can lay the foundation’” in this new normal.