Business Operations

The Innovation Research Interchange has announced the finalists for this year’s IRI Innovation Excellence Awards.

What’s going on: The honors given by the IRI—the NAM’s innovation arm—pay tribute to organizations and individuals whose outstanding vision and tireless pursuit of excellence are having a positive impact on lives today and shaping the industries of tomorrow. Honorees come from companies of all sizes and industries.

The categories: Awards are given in five categories, three to companies and two to individuals. They are as follows:

• IRI Innovation Leadership Award (individual)
• IRI Promising Young Innovation Professional Award (individual)
• IRI Excellence Award for Innovation in Sustainability (company)
• IRI Excellence Award for Outstanding Innovative Culture (company)
• IRI Excellence Award for Digital and Technological Innovation (company)

Who participates: Each year, nominees comprise innovators who are leveraging technology to enhance operational performance at their companies or sustainability and fostering a collaborative workplace culture that celebrates innovation.

• High-performing leaders who drive sustainability initiatives are also recognized, and consultants and university partners working on exciting innovation projects with a company are eligible for nomination, too.

Why they’re important: In addition to building team unity and encouraging executive leadership to invest further in innovation, the awards give companies the chance to revisit the successes, challenges and lessons learned throughout their innovative projects.

• Selection as a finalist shows customers, prospects and partners that a company or individual is at the forefront of innovation.

Attend the celebration: Winners will be announced May 16 during the Innovation Celebration and Reception at the Innovators Summit in Boston. Celebration admission is included with summit registration.

About the IRI: The IRI offers insights, case studies, research, benchmarks and strategic connections—all built around a set of innovation growth drivers as determined by members annually. Learn more about the IRI here.

It’s been nearly a month since a cargo ship hit the Francis Scott Key Bridge in Baltimore, Maryland, resulting in six deaths, the destruction of the bridge and the shuttering of an important East Coast port.

• But thanks to hard behind-the-scenes work by Norfolk Southern railway since the accident, customers aren’t feeling the supply chain pinch the way they otherwise would.

What happened: NAM President and CEO Jay Timmons, along with an NAM delegation, visited the Port of Baltimore last Friday to tour Norfolk Southern’s operations there. The port is the largest for vehicle shipping in the U.S. and was the 17th biggest in the nation by total tonnage in 2021.

• On March 26, the day the Singapore-flagged Dali cargo vessel hit the Key Bridge, Norfolk Southern—which moves 7 million carloads of cargo annually—began strategizing ways to support increased shipping volumes on behalf of its customers. And it’s been doing that ever since.
• “We often say the weight of the world moves on rail … and it’s true,” Norfolk Southern Chief Marketing Officer and NAM board member Ed Elkins told the NAM during the site visit. “Our ability to serve the market through temporary disruption is really a demonstration of our strategy in action, where we leverage the experience of our railroaders and the strength of our franchise to find a Better Way to provide safe, reliable service.”

Quick adaptation: Norfolk Southern’s strategy for adapting to the closure of Baltimore’s port has included:

• The launch early this month of a dedicated new service to move freight between the ports of New York and New Jersey and Baltimore’s Seagirt Marine Terminal;
• The facilitation by the railway’s Triple Crown Services Inc.—a door-to-door East Coast truckload transit network—of a dedicated intermodal service for cargo owners who require door-to-door service;
• The use of “Go Teams,” groups of employees ready for rapid response service and created by Norfolk Southern during the pandemic; and
• Regional collaboration with the Port of Virginia to leverage service points including the Virginia Inland Port and others.

Reopening: The Port of Baltimore could be back to full functionality by the end of May, the U.S. Army Corps of Engineers said earlier this month.

• “The NAM will stay in close coordination with our members regarding supply chain impacts stemming from the collapse of the Francis Scott Key Bridge,” said NAM Director of Transportation, Infrastructure and Labor Policy Max Hyman. “We also remain engaged with leading federal officials on recovery efforts and will continue to support critical infrastructure projects such as the Port of Baltimore.”

The Port of Baltimore could be reopened fully by the end of May, according to POLITICO.

What’s going on: “The U.S. Army Corps of Engineers said it is aiming to reopen the channel leading to the Port of Baltimore by the end of May, a timeline [Maryland Gov. Wes] Moore confirmed Sunday [on CBS’ “Face the Nation”] is ‘realistic.’”

• The port has been closed since March 26, when a Singapore-flagged cargo ship hit the Francis Scott Key Bridge, destroying the bridge and killing six construction workers.
• While Gov. Moore did not give an estimate of the cost to rebuild the bridge, the closure is costing the port about $15 million a day in economic activity, the Baltimore Sun reports.
• And business analytics group Dun & Bradstreet has estimated the weekly economic impact of the closure on trade at about $1.7 billion, according to The Wall Street Journal (subscription).

“Absolutely committed”: The governor’s remarks came just days after the Office of Management and Budget urged Congress to authorize covering the full cost of rebuilding the bridge, according to Punchbowl News.

• “My administration is committed—absolutely committed to ensuring that the parties responsible for this tragedy pay to repair the damage,” President Biden said during a visit to the site of the bridge on Friday. “But I also want to be clear: We will support Maryland and Baltimore every step of the way to help you rebuild and maintain all the business and commerce that’s here now.”

The NAM’s view: “The NAM applauds the bipartisan efforts of federal and state officials to reopen the Port of Baltimore and rebuild the Key Bridge,” said NAM Director of Transportation, Infrastructure and Labor Policy Max Hyman. “It’s important to note that reforming our broken permitting system would significantly speed up projects such as this, returning much-needed economic activity and jobs to communities throughout the U.S.”

If you’ve been affected: Manufacturers affected by the bridge collapse and port disruption can access vital resources at the new online Resources and Info Hub of NAM state partner the Maryland Chamber of Commerce.

• The chamber and its partners are committed to helping manufacturers navigate this disruption and get on the path to recovery.
• Share your thoughts on the disaster and recovery efforts by filling out this survey.

If the Honda Automotive Labs of Ohio facility is a marvel of technology and design, it is also a $124 million testament to the role of cutting-edge engineering in automobile manufacturing.

• “When I started 30 years ago, few really cared about aerodynamics,” said Honda Development & Manufacturing of America Full-Scale Wind Tunnel Lead Mike Unger with a wink. “Now everybody wants to talk to me.”

New interest: Though wind tunnel testing dates back many years, the increasing emphasis in recent years on greater fuel efficiency has brought a new wave of interest in the field.

• Honda owns three full-sized wind tunnels near its global headquarters, as well as several smaller test facilities around the world for examining scale models.
• But in 2015, Honda—which for decades had been sending its U.S.-based people, cars and tools all over the world for wind tunnel testing or else booking time at third party-owned facilities in America—began mulling constructing a North American wind tunnel, too.

Behold, HALO: The result was HALO, unveiled in 2022 in a 110,000-square-foot facility in East Liberty, Ohio.

• To make it, the company had gathered its “wind tunnel road warriors”—Honda team members who boasted decades of combined experience in the world’s most advanced research facilities—and asked them how they’d do it better.
• Among their top requests was the need for better, faster communications with the designers and builders of the cars they were testing. To facilitate this, HALO was strategically located just across from a Honda development center and a mere 10-minute drive from two manufacturing plants (including the Marysville, Ohio, facility where Honda has been building automobiles since 1982).

Wind-tested, Honda approved: Every new Honda passenger vehicle model undergoes extensive aerodynamic and acoustic testing during its design phase, and further changes are often made during the manufacturing process. Race cars, meanwhile, are tested primarily with an eye to managing the downforce caused by passing air.

The new digs: Now, instead of hashing out design challenges across oceans, everyone sits side-by-side in the same control room.

The state-of-the-art site also boasts a fully outfitted machine shop, custom loading bays and a car wash (the last a recommendation of Honda engineers who had more than once found themselves outside a wind tunnel with a dusty test car and a bucket of soapy water).

• “Absolutely everything was designed with intention,” said HALO Business Strategy Lead Chris Combs.

The details: The tunnel itself is an elaborately engineered circuit. It comprises a settling chamber, a heat exchanger the size of a movie screen and a safety grill to catch any debris that might come loose and threaten HALO’s pulmonary system: a colossal, 6,700-horsepower fan with 12 hollow carbon fiber blades that are 26 feet long each.

• Turning at 250 rotations per minute, the fan drives air through the tunnel and into an anechoic chamber.
• On a recent day, that chamber held both a race car (for downforce testing) and an SUV from the plant across the field (for acoustic work).

Saving time: At most wind tunnels, switching from aerodynamic work to acoustic testing takes nearly two hours. At the HALO wind tunnel, however, technicians swapped the Indy car for the SUV and reconfigured the test chamber in about 20 minutes.

• When it designed the facility, Honda focused on “simple things like that—things that really promote efficiency,” said HALO Operations Manager Jimmy Przeklasa.

Quiet and furry: HALO’s test chamber is lined with acoustic tiles and “teddy bear fur,” a soft, sound-absorbing material.

• Even with the wind blowing, the room is so quiet that technicians working inside must don harnesses to prevent them from stepping into a gale they can neither see nor hear.
• A software system translates the wind noises into visuals, similar to the way a weather radar displays a moving storm.

Complex but simple: Technologically and visually dazzling, the HALO wind tunnel can seem like a futuristic fever dream: color-coded maps of the whistling wind, a two-story fan more finely tuned than a jet engine and a scale capable of sensing a breeze.

• In fact, from its inception, the goal of creating the HALO wind tunnel was simple: make cutting-edge aerodynamic and acoustic research as easy, intuitive and cost-effective as possible. And Honda’s done it.

The last word: “This is the latest and the greatest,” Unger said. “This place is unmatched.”

If the Honda Automotive Labs of Ohio facility is a marvel of technology and design, it is also a $124 million testament to the role of cutting-edge engineering in automobile manufacturing.

• “When I started 30 years ago, few really cared about aerodynamics,” said Honda Development & Manufacturing of America Full-Scale Wind Tunnel Lead Mike Unger with a wink. “Now everybody wants to talk to me.”

New interest: Though wind tunnel testing dates back many years, the increasing emphasis in recent years on greater fuel efficiency has brought a new wave of interest in the field.

• Honda owns three full-sized wind tunnels near its global headquarters, as well as several smaller test facilities around the world for examining scale models.
• But in 2015, Honda—which for decades had been sending its U.S.-based people, cars and tools all over the world for wind-tunnel testing or else booking time at third party-owned facilities in America—began mulling constructing a North American wind tunnel, too.

Behold, HALO: The result was HALO, unveiled in 2022 in a 110,000-square-foot facility in East Liberty, Ohio.

• To make it, the company had gathered its “wind tunnel road warriors”—Honda team members who boasted decades of combined experience in the world’s most advanced research facilities—and asked them how they’d do it better.
• Among their top requests was the need for better, faster communications with the designers and builders of the cars they were testing. To facilitate this, HALO was strategically located just across from a Honda development center and a mere 10-minute drive from two manufacturing plants (including the Marysville, Ohio, facility where Honda has been building automobiles since 1982).

Wind-tested, Honda approved: Every new Honda passenger vehicle model undergoes extensive aerodynamic and acoustic testing during its design phase, and further changes are often made during the manufacturing process. Race cars, meanwhile, are tested primarily with an eye to managing the downforce caused by passing air.

The new digs: Now, instead of hashing out design challenges across oceans, everyone sits side-by-side in the same control room.

The state-of-the-art site also boasts a fully outfitted machine shop, custom loading bays and a car wash (the last a recommendation of Honda engineers who had more than once found themselves outside a wind tunnel with a dusty test car and a bucket of soapy water).

• “Absolutely everything was designed with intention,” said HALO Business Strategy Lead Chris Combs.

The details: The tunnel itself is an elaborately engineered circuit. It comprises a settling chamber, a heat exchanger the size of a movie screen and a safety grill to catch any debris that might come loose and threaten HALO’s pulmonary system: a colossal, 6,700-horsepower fan with 12 hollow carbon fiber blades that are 26 feet long each.

• Turning at 250 rotations per minute, the fan drives air through the tunnel and into an anechoic chamber.
• On a recent day, that chamber held both a race car (for downforce testing) and an SUV from the plant across the field (for acoustic work).

Saving time: At most wind tunnels, switching from aerodynamic work to acoustic testing takes nearly two hours. At the HALO wind tunnel, however, technicians swapped the Indy car for the SUV and reconfigured the test chamber in about 20 minutes.

• When it designed the facility, Honda focused on “simple things like that—things that really promote efficiency,” said HALO Operations Manager Jimmy Przeklasa.

Quiet and furry: HALO’s test chamber is lined with acoustic tiles and “teddy bear fur,” a soft, sound-absorbing material.

• Even with the wind blowing, the room is so quiet that technicians working inside must don harnesses to prevent them from stepping into a gale they can neither see nor hear.
• A software system translates the wind noises into visuals, similar to the way a weather radar displays a moving storm.

Complex but simple: Technologically and visually dazzling, the HALO wind tunnel can seem like a futuristic fever dream: color-coded maps of the whistling wind, a two-story fan more finely tuned than a jet engine and a scale capable of sensing a breeze.

• In fact, from its inception, the goal of creating the HALO wind tunnel was simple: make cutting-edge aerodynamic and acoustic research as easy, intuitive and cost-effective as possible. And Honda’s done it.

The last word: “This is the latest and the greatest,” Unger said. “This place is unmatched.”

More young people are choosing skilled trade jobs after high school, The Wall Street Journal (subscription) reports.

What’s going on: “Enrollment in vocational training programs is surging as overall enrollment in community colleges and four-year institutions has fallen. The number of students enrolled in vocational-focused community colleges rose 16% last year to its highest level since the National Student Clearinghouse began tracking such data in 2018. The ranks of students studying construction trades rose 23% during that time, while those in programs covering HVAC and vehicle maintenance and repair increased 7%.”

Why it’s important: The trades, including manufacturing, have experienced a worker shortage in recent years as the older generation of employees retires.

• Finding and retaining quality talent is consistently a top business challenge among manufacturers, according to the NAM’s Manufacturers’ Outlook Survey, a quarterly polling of the industry.
• But now, trade-apprenticeship demand is surging, perhaps a signal that positions will start to fill.

Perception change: For many years the vocational education wing of one high school in Sheboygan, Wisconsin, was called “greaser hall,” but lately that’s started to change, a counselor there told the Journal.

• “[B]usinesses have raised funds and donated new equipment, including robotic arms … [and] those classrooms now sit at the building’s main entrance. ‘There’s still a presumption that four-year college is the gold standard, but it doesn’t take as much work to get people to buy into the viability of other options,’ [he said].”

The last word: Indeed, the Manufacturing Institute, the NAM’s 501(c)3 nonprofit workforce development and education affiliate, is seeing significant growth in its FAME initiative, an earn-while-you-learn training program with more than 40 chapters in 16 states—and more forming all the time. FAME, which was founded by Toyota and is now led by the MI, is truly the American model of skills training, according to MI President and Executive Director Carolyn Lee.

• “FAME is training thousands of global best technicians nationwide and the number of program participants is on the rise,” she said. “This is good news for manufacturing, which sorely needs talent to continue to make the many, many things people use every day.”

Vessel traffic in and out of the Port of Baltimore—which contributes $15 million a day in economic activity, Business Insider reports—was suspended Tuesday after a container ship hit the Francis Scott Key Bridge in the early morning. The collision caused the bridge to collapse, sending at least seven vehicles and their occupants into the Patapsco River, according to the Baltimore Sun (subscription).

What’s going on: “Officials, who spoke amid a continuing and massive search and rescue mission, said the port was not shut down and remained open to process trucks inside terminals.”

• Other ports are likely to be able to absorb container ships headed for Baltimore, The New York Times (subscription) reports.

Why it’s important: “The port, which generates more than 15,300 direct jobs, had rebounded from global supply chain difficulties and disruptions during the coronavirus pandemic and hit records last year for handling cargo,” according to the Baltimore Sun. “It is the nation’s 16th busiest port, ranking first for volume of autos and light trucks, roll-on/roll-off heavy farm and construction machinery, imported sugar and imported gypsum.”

• Baltimore is the closest Atlantic port to major Midwestern manufacturing hubs.
• Truckers are concerned about increased congestion resulting from the closure, “particularly because deliveries such as hazardous material loads cannot travel through Interstate 895 or I-95 tunnels.” Trucking companies are already warning customers of delays for shipments going through the Mid-Atlantic, according to The Wall Street Journal (subscription).
• In addition to affecting consumers in the Baltimore area, the traffic stoppage is likely to affect jobs at the port.

In 2024, factories will just keep getting smarter. From product design to supply chain management, the sophistication of Manufacturing 4.0 (the current wave of technological evolution) will keep on growing. Here’s what manufacturers should know about these advances and how the NAM can help.

What manufacturers should do: Manufacturers looking to make their factories smarter are focusing on four key strategies:

• Creating efficiencies to improve the bottom line with automation and other M4.0 technologies
• Leveraging smart factories to overcome challenges, such as the workforce crisis and supply disruptions
• Ensuring connectivity on the factory floor to allow for use of plant data to create new business models and revenue streams
• Using M4.0 technologies to improve quality control, speed time to market, enhance safety, boost profits, contribute to sustainability goals and engage employees

Expert opinion: Companies are increasingly investing in industrial connectivity, according to PTC Vice President of Market Development of IoT James Zhang.

• “Rather than approaching industrial connectivity with point-to-point integrations, companies are developing holistic, enterprise-wide strategies,” he explained.
• “This approach streamlines and standardizes data from heterogenous manufacturing environments to a single industrial connectivity platform to provide secure, reliable data for OT systems, including MES and SCADA, and IT systems, including data analytics and industrial IoT.”

Resources for you: Check out these NAM resources that will help guide you through these technological changes:

• The Manufacturing Leadership Council, the NAM’s digital transformation division, offers extensive advice and expertise on Manufacturing 4.0 technologies and how to use them.
• NAM Cyber Cover can help you protect your smart factories, as the increase in digitization also opens new avenues for cyber criminals.
• Check out this podcast from the Innovation Research Interchange (the NAM’s innovation division), which covers current research into the adoption of cutting-edge technologies.

Read the full 2024 trends report here.

Contract talks between dockworkers and their employer on the East and Gulf coasts have yet to begin, but tensions are already flaring, The Wall Street Journal (subscription) reports.

What’s going on: “The International Longshoremen’s Association … is already threatening a strike against shipping companies and port employers if a deal on a new multiyear contract can’t be reached before the current agreement expires Sept. 30.”

• The ILA, which represents more than 45,000 dockworkers “at ports from Maine to Texas, has told local chapters to resolve local work issues with employers by May 17 so that a coast-wide deal can be negotiated before the current contract expires. Formal negotiations would be scheduled once the local agreements are reached.”
• Talks began in late 2022 but stalled a year ago.

The background: In September, after 14 months of often-tumultuous negotiations and several walkouts and work stoppages, West Coast dockworkers reached an agreement with their employer, the Pacific Maritime Association.

• The Biden administration stepped in to help broker that deal.

Why it’s important: “Any walkout would hit the gateways in the middle of the busiest part of the shipping season, when retailers and other importers prepare for holiday consumer sales.”

• To avoid potential delays, East Coast importers are expected to bring in holiday-season goods early this year or send more goods from Asia to the U.S. via West Coast ports.
• The large wage increases ILA is said to be pursuing could prove difficult for carriers to sustain, given the post-pandemic decline in freight demand.

Some disruptions—like global pandemics—are just too unexpected to anticipate. As manufacturers consider the unknowns they may face in the years ahead, they are prioritizing general resilience instead of attempting to plan for everything. Here’s what you should know about this major trend in 2024.

What manufacturers should do: Manufacturers should focus on these four areas to increase their resilience, according to the NAM’s experts:

• Enhance cybersecurity to guard against new and emerging cyberthreats.
• View resilience as a necessary tool to protect business amid economic uncertainty.
• Shift leadership strategies to build a strong plan for future success, including establishing a path for development and cultivation of future leaders.
• Plan for more and as-yet-unknown disruptions in the future.

Expert opinion: Mike Lipinski, cybersecurity partner at Plante Moran, advises manufacturers concerned about the rising threat of ransomware. He points out how the dangers have evolved in recent years:

• “Manufacturing businesses that fall prey to ransomware can be attacked multiple times. Adversaries who breach your system sell other cybercriminals information about how they got in. The risk isn’t only data theft and access to information but also the criminals’ ability to create backdoors into your environment.”

Resources for you: Check out these NAM resources that can help companies bolster their resilience:

• Here is a useful guide that can guide you through dealing with disasters.
• Check out the NAM Shipping & Logistics program, which can help you cope with delays in shipments and funds in case the unexpected happens.
• If you’re facing legal issues, the NAM’s Legal Referral Service, powered by Meritas, can connect you to world-class legal talent in every sector of law.

Read the full 2024 trends report here.