Innovation and Technology

Innovation isn’t just one of many priorities at transportation systems manufacturer Wabash—it’s at the center of everything. Instead of having a traditional R&D function in the product development department, the company has reorganized its hierarchy so that innovation is considered in every major decision, from hiring to investments and more.

“It’s not possible to have innovation siloed in the engineering world; that wouldn’t allow us to achieve the scale of innovation that customers need,” President and CEO Brent Yeagy said.

As the manufacturing supply chain becomes increasingly intricate in a complex world, Wabash is staying ahead of the game. In a recent interview, Yeagy explained how the company does it.

The big picture: This “full reimagining” of the company occurred in response to broad forces reshaping the manufacturing industry, said Yeagy.

• Within the past decade, e-commerce has totally disrupted the logistics model of the previous 30 years, he pointed out.
• Meanwhile, digital technology has enhanced the speed and precision of the industry, which has also increased the complexity of its logistics needs.
• On top of that, the pandemic altered manufacturers’ thinking about lean inventories, lead times and the domestic supply chain infrastructure, sparking a system-wide transformation that isn’t over yet.
• And that’s all before we get to the possibilities of artificial intelligence, autonomous vehicles, and new sources of clean energy—all of which could bring profound and unpredictable changes to the industry.

The response: Watching these changes unfold, Yeagy and his team knew they had to take dramatic steps to keep up.

• “We restructured the entire organization away from standalone divisions,” prioritizing collaboration instead, Yeagy said. This involved “aggregating R&D and business development,” which had previously been spread out over 11 different departments.
• This shift also reflected a change in the company’s philosophy. Innovation could no longer be incremental, Yeagy determined, but had to be audacious.

The internal system: Such advances are only possible if the company has a flexible, fast-moving core of innovators who are always looking for the next opportunity, Yeagy told us.

• Instead of creating an innovation strategy that “sits on a shelf” for a year or more, Wabash updates its strategy on a weekly or monthly basis.
• While the company’s R&D and corporate development teams have strict objectives, they can also challenge the strategic direction and introduce fresh ideas—such as new technologies that might give the company an edge.
• This system also requires the right people for the job. Team members must have not only the technical qualifications for the work, but also the capacity to trust, collaborate and be vulnerable when sharing ideas, Yeagy said.

The successes: The company’s new structure has led to industry-leading innovations like Wabash’s subscription model, which allows clients to “subscribe” to a certain level of fleet capacity, instead of managing a fleet of trucks themselves.

• Wabash manages the fleet and maintenance, Yeagy explained, guaranteeing a certain capacity every day to its customers, while offering a range of rental models to suit their needs.
• In another victory for its innovative corporate development team, Wabash found a swift solution when it discovered it didn’t have sufficient distribution capabilities for aftermarket parts. It created a joint venture with a competitor company that had ample warehouse space across the country—going from the idea stage to nationwide operations in a mere six months.

Military influence: Yeagy’s service in the Navy shaped his leadership throughout the company’s transformation, he told us.

• “The military is based on a mission orientation,” he explained. “If everyone understands where we are supposed to go and why, it allows them to be agile and overcome obstacles” in the field, where the unpredictable happens.
• “Officers live to complete the mission by taking care of their people, preparing them mentally, physically, operationally,” and then allowing them to operate on their own. “We have to do that too,” he concluded.

A word of advice: Yeagy advises manufacturing leaders that truly experimental teams require “a safe place to fail and learn how to be comfortable with failure.” He admits that “It’s very hard to take a manufacturing company that doesn’t want to fail, and to teach them,” so leaders must strive to be “immensely” empathetic. It’s clear from speaking to Yeagy that this is his top priority.

U.S. scientists have achieved a net energy gain in a nuclear fusion reaction for a second time—this time, with a higher energy yield, according to Axios.

What’s going on: The federal Lawrence Livermore National Laboratory in California announced Sunday that in an experiment on July 30, a fusion reaction produced more energy than it consumed, and more than a similar experiment produced last December.

• The December reaction used 192 lasers to produce a net gain of 1.1 megajoules of fusion energy, enough to power an average-size home for about half an hour, according to Extreme Tech.
• The July reaction is said to have netted even more, though specific figures for it are not yet available.

Why it’s important: “Scientists have worked for decades to develop nuclear fusion as a source of effectively limitless clean energy,” Axios reports.

• However … “Scaling up the technology to support the electrical grid will require increasingly powerful lasers—and more of them,” according to Extreme Tech.

The last word: “The net gain of fusion energy—for a second time, and in a larger amount—is a tremendous milestone,” said NAM Director of Domestic Economic Policy Brandon Farris. “It is further evidence of the enormous potential of nuclear power to help us meet our energy needs and energy-security goals.”

After an aggressive campaign by the NAM, the U.S. Securities and Exchange Commission has scaled back a damaging cybersecurity proposal that would have been deeply problematic for manufacturers. Yet, the final regulations still impose compliance burdens on publicly traded companies. Here’s what manufacturers can expect now that the rule is finalized.

The background: Last year, the SEC proposed a new set of cybersecurity disclosure requirements for public companies. The centerpiece of the rule was a mandate to disclose cybersecurity incidents to the public within four days. The proposal also would have required detailed reporting on companies’ policies and procedures for responding to cybersecurity threats.

The problem: Requiring detailed public disclosures about cybersecurity incidents and processes could provide a roadmap to potential hackers, and sharing information about ongoing incidents could compromise efforts to stop an attack.

The NAM response: The NAM urged the SEC to make commonsense adjustments to protect manufacturers from attacks and give companies the flexibility to respond to cybersecurity incidents appropriately.

The result: The final rule is more tailored than the initial proposal, reducing the risk that companies will be forced to expose sensitive information. But its requirements still impose new compliance burdens on manufacturers.

Incident reports: The rule still requires companies to report cybersecurity incidents publicly within four days, but companies will be able to request that the attorney general grant a 30-day extension to protect public safety or national security—a top priority for the NAM. The extension could be lengthened by an additional 30 days (for public safety) or 90 days (for national security) if warranted.

• Thanks to the NAM’s intervention, the SEC will require the disclosure of only limited information about an attack’s circumstances and impact, whereas the original proposal would have forced companies to disclose extensive details, including potentially sensitive data.

• In addition, a provision requiring companies to track, aggregate and disclose the impact of minor cybersecurity incidents—which the NAM opposed—was struck from the final rule. 

Risk management and governance: Companies will be required to disclose information on cybersecurity oversight by their board and management, as well as how cybersecurity is incorporated into their overall risk management strategy.

• These disclosures must include “sufficient detail for a reasonable investor to understand” a company’s cybersecurity risk management—but will no longer include information on a company’s specific prevention and detection activities.
• A provision effectively requiring companies to have a cyber expert on their board, which the NAM strongly opposed, was not included in the final rule.

Our take: “The NAM is committed to a smart, flexible disclosure approach that ensures manufacturers—and their customers and shareholders—can stay protected from cybersecurity threats,” said NAM Senior Director of Tax and Domestic Economic Policy Charles Crain.

• “Manufacturers were glad to see that the SEC made some adjustments to its rule, but more must be done. The SEC and the Department of Justice must grant companies the flexibility to delay incident reporting to prevent threats to public safety and national security.”

Get protected: Every manufacturer should have the tools they need to protect themselves against cyberattacks. Check out NAM Cyber Cover—an exclusive cybersecurity and risk mitigation program for NAM member companies and organizations.

The U.S. and Europe are working to address “China’s accelerated push into the production of older-generation semiconductors,” Bloomberg (subscription) reports.

What’s going on: Last year, the U.S. imposed restrictions on the export of certain advanced technologies to China. Beijing has reacted by investing heavily in building facilities making older chips that do not face such U.S. restrictions.

• Legacy chips—those produced using 28-nanometer-and-larger equipment—remain critical in the global economy as components of everything from electric vehicles to military devices.
• China is on track to build 26 semiconductor factories through 2026, while the U.S. is forecast to construct 16 facilities “that use 200-millimeter and 300-mm wafers.”

Why it’s a problem: “Senior EU and U.S. officials are concerned about Beijing’s drive to dominate this market for both economic and security reasons, [sources] said. They worry Chinese companies could dump their legacy chips on global markets in the future, driving foreign rivals out of business…”

• If that were to happen, Western firms could become reliant on China for the chips, the sources say, and that could pose a national security risk.

Importance of legacy chips: The global pandemic demonstrated that older-model semiconductors remain important, as chip shortages hit companies’ bottom lines.

• The U.S. and Europe have been trying to expand their own chip production to avoid a repeat. Efforts have included the 2021 CHIPS and Science Act, which set aside $52 billion to bolster domestic semiconductor manufacturing in the U.S.

​​​​​​​A problem to solve: “Commerce Secretary Gina Raimondo alluded to the problem during a panel discussion last week at the American Enterprise Institute. ‘The amount of money that China is pouring into subsidizing what will be an excess capacity of mature chips and legacy chips—that’s a problem that we need to be thinking about and working with our allies to get ahead of,’ she said.”

After an aggressive campaign by the NAM, the U.S. Securities and Exchange Commission has scaled back a damaging cybersecurity proposal that would have been deeply problematic for manufacturers. Yet, the final regulations still impose compliance burdens on publicly traded companies. Here’s what manufacturers can expect now that the rule is finalized.

The background: Last year, the SEC proposed a new set of cybersecurity disclosure requirements for public companies.

• The centerpiece of the rule was a mandate to disclose cybersecurity incidents to the public within four days.
• The proposal also would have required detailed reporting on companies’ policies and procedures for responding to cybersecurity threats.

The problem: Requiring detailed public disclosures about cybersecurity incidents and processes could provide a roadmap to potential hackers, and sharing information about ongoing incidents could compromise efforts to stop an attack.

The NAM response: The NAM urged the SEC to make commonsense adjustments to protect manufacturers from attacks and give companies the flexibility to respond to cybersecurity incidents appropriately.

The result: The final rule is more tailored than the initial proposal, reducing the risk that companies will be forced to expose sensitive information. But its requirements still constitute new compliance burdens on manufacturers.

For the details of the final rule, ​r​​​​ead the full story.

Every manufacturer should have the tools they need to be protected against cyberattacks. Check out NAM Cyber Cover—an exclusive cybersecurity and risk mitigation program for NAM member companies and organizations.

With increased pressure from customers, regulators and even shareholders, sustainable business practices are no longer optional for manufacturers. From reduced energy and materials consumption to lower emissions and ethical sourcing, manufacturers are expected to meet ambitious new goals. Luckily, the Manufacturing Leadership Council has established a new member working group devoted to helping manufacturers reach these objectives.

Support set-up: With five virtual meetings each year, the M4.0 Sustainability and Net Zero Decision Compass Group will explore key issues, best practices and challenges related to creating sustainable, compliant and environmentally friendly operating strategies.

• At the first meeting, “Next Steps in Manufacturing 4.0 Sustainability,” on March 10, attendees heard from 3M Senior Vice President of Environmental Strategies and Fluorochemical Stewardship Dr. Rebecca Teeters and Lexmark International Chief Sustainability Officer John Gagel. Both speakers are also MLC board members.

Why the new group: The MLC decided to create the group after a survey of their more than 3,300 members revealed sustainability was a top member business concern.

• “We decided that given the intensity of interest in sustainability and related subjects, such as net zero and the circular economy, this was an opportunity to dedicate a whole new group to the topic,” said MLC Co-Founder, Executive Director and Vice President David Brousell.

Good for business, too: While manufacturers have been discussing and working toward sustainability for decades, recent growing concerns about climate change and other environmental issues are making the matter increasingly urgent.

• Manufacturers that take on sustainable business practices are seeing competitive advantages ranging from cost savings to higher product quality to increased shareholder and employee satisfaction.

Lessons from manufacturing peers: The new Decision Compass group will share sustainability strategies, the real-world achievements of manufacturing companies, knowledge about the use and application of advanced technologies and timelines for implementation.

• Participants will also be able to see how they stack up against other manufacturing companies.

Get involved: The MLC offers resources to help manufacturers improve their operations and learn about digital manufacturing. To learn more about the sustainability group or find out about MLC membership, email [email protected].

Wyoming is partnering with Battelle Energy Alliance to “‘collaborate in the research, development, demonstration and deployment of advanced energy technologies and approaches,’” including nuclear power, according to The Casper Star-Tribune (subscription).

What’s happening: Wyoming Gov. Mark Gordon intends for the state to “establish a nuclear industry and a sophisticated and advanced manufacturing capacity using Wyoming uranium, Wyoming technology and Wyoming workers,” according to a statement.

• Wyoming is the chosen home for the planned Natrium project, an advanced nuclear reactor to be developed by TerraPower.
• Battelle operates the Idaho National Laboratory.

Memorandum of understanding: A five-year memorandum of understanding between the Wyoming Energy Authority and the Idaho National Laboratory “specifies 14 shared areas of interest,” many of which are related to nuclear and hydrogen power.

Common goal: “According to the memorandum, the shared target is to ‘collaboratively develop a path to global leadership in a carbon-constrained economy ’ and place the state ‘at the forefront’  of the advanced energy sector.”

The Manufacturing Institute’s 10th annual STEP Ahead Awards took place in Washington, D.C., last week, honoring some of the most impressive and inspiring women in the manufacturing industry today. The Awards are part of the STEP Ahead program, which is designed to help advance women’s achievements in the fields of science, technology, engineering and production.

• The event highlighted the 2022 STEP Ahead Honorees (100 women who are leaders in manufacturing) and the 2022 STEP Ahead Emerging Leaders (30 women under 30 years old who have already had a significant impact on the industry).

The awards ceremony took place on Thursday night, with hundreds of guests in attendance at the National Building Museum and hundreds more viewing the ceremony online. The program featured:

• 2022 STEP Chair and former 3M Senior Vice President Denise Rutherford;
• 2022 STEP Vice Chair and Cornerstone Building Brands President and CEO Rose Lee;
• MI President Carolyn Lee;
• MI Vice President of Strategic Engagement and Inclusion AJ Jorgenson; and
• NAM President and CEO and MI Board Chair Jay Timmons.

Sponsors included an all-star roster of manufacturers, including Arconic Foundation, BASF Corporation, Cornerstone Building Brands, PTC, Trane Technologies, ABB, Molson Coors, Novelis, Rockwell Automation, SABIC, Sherwin-Williams and Toyota.

What they said: Carolyn Lee lauded the Honorees and spoke about the importance of closing the skills gap by bringing more women into the manufacturing industry.

• “My hope is that 10 years down the line, when we meet here for the 20th anniversary of these awards, the young women we will honor won’t have even heard of the glass ceiling, because it’ll be ancient history,” said Lee.
• “And that will be thanks to the support system, the mentorship and the sterling examples set by the women in this room and the support from our allies.”

Rutherford spoke about leaders’ opportunities to work together to make important progress.

• “Throughout my career, I’ve learned that being a great leader, as an individual or as a company, means that we don’t go it alone,” said Rutherford. “True change only happens when we work together as trusted allies, advocates and sponsors.”

Rose Lee laid out the qualities that all the Honorees showed and highlighted their shared successes.

• “The STEP Ahead Awards recognize women in science, technology, engineering and production who exemplify leadership within their companies and within their communities,” said Lee. “Tonight is their night to celebrate their accomplishments.”

Timmons praised the STEP Honorees and called on allies to continue supporting women in the manufacturing industry.

• “Your achievements, your success and your dedication are showing women what’s possible in manufacturing,” he said. “If you can see it, you know you can be it.”

35×30: Carolyn Lee and Jorgenson spoke about the 35×30 initiative—a program designed to close the skills and talent gap in manufacturing by adding half a million women workers to the industry, increasing women’s representation in manufacturing from 29% today to 35% by 2030.

• The campaign will train more than 1,000 women mentors, build new tools and resources and work with manufacturing leaders to deploy proven strategies to attract and retain female talent.
• It will also support young women throughout their education by offering best-in-class leadership development programming and creating a STEP alumnae-funded scholarship.
• “Tonight, we are done with waiting for other leaders to ‘change things,’ to make society better, more equitable,” said Jorgenson. “We are the leaders. So, tonight, we ask you to join us, to lead.”

New commitments: To help this new initiative along its way, Arconic Foundation President Ryan Kish and Ketchie CEO Courtney Silver stood up during the ceremony to pledge new financial commitments to the program.

The last word: The gala featured a stellar musical performance by award-winning singer–songwriter Rachel Platten, which left not a dry eye in the house. Inspired by the women of STEP, she surprised the audience by singing a new song she’d written for her daughters. It captures what the women leaders of today want to tell the girls who will someday be their heirs:

Girls, you were born to run. To reach the stars and chase the sun.

Girls, you’re wild and free. The wind is at your back, the world is at your feet.

Regulatory inertia on self-driving cars is putting manufacturers in the U.S. at a disadvantage, but Congress can help by expanding automakers’ ability to test and ultimately sell the vehicles, industry advocates said at a House Energy and Commerce Committee hearing Wednesday, according to ABC News.

What’s going on: “Currently [automated vehicle] manufacturers can deploy a maximum of 2,500 self-driving vehicles for testing, provided they have permission from the National Highway Traffic Safety Administration. AV advocates have complained that the limits represent a bottleneck that is holding back the growth of the industry at a crucial time.”

What’s being requested: One of the bills considered during Wednesday’s markup is an updated version of a 2017 measure on AV regulations that passed the House but stalled in the Senate.

• AV advocates point to data that shows reports of accidents involving these cars are exaggerated and the cutting-edge safety technology can be more reliable than human drivers in avoiding crashes.
• The issue of liability in case of an accident, however, remains a major point of contention in legislative progress. “Each one of these [crashes] is still going to be subject to a plaintiff’s lawyer, an insurance company and a defense lawyer,” Rep. Kelly Armstrong (R-ND) said. “And until we’ve figured that out, this is just a science project.”

Safety data: An analysis of the first 1 million miles of AV use by Cruise AV—the self-driving vehicle unit of General Motors—showed the cars to have a significantly better safety record than human drivers, CEO Kyle Vogt said on an earnings call this week.

• There were 54% fewer collisions and 92% fewer crashes in which the AV was at fault, Vogt said.

The last word: “The expansion of AVs into our national transportation system is an opportunity to lead by enhancing safety on our roadways, improving transportation mobility and increasing efficient goods movement across our strained supply chains,” said NAM Director of Transportation Policy Ben Siegrist.

• “Manufacturers are on the cutting edge of vehicle technology research and development, and improving the federal regulatory landscape is a necessary step to grow the American AV industry into a global economic engine.”

Bluffton, S.C. – Today, the Wisconsin Manufacturers & Commerce was honored with the 2023 Leadership Award from the Conference of State Manufacturers Associations, whose members also serve as the National Association of Manufacturers’ official state partners and drive manufacturers’ priorities on state issues, mobilize local communities and help move federal policy from the ground up in all 50 states and Puerto Rico. WMC was recognized for their work to attract and maintain the manufacturing workforce.

“We congratulate Kurt Bauer and the entire team at WMC for their incredible work this year to not only educate the next generation of manufacturing workers in Wisconsin, but also engage the business community at large to help spur investment in the state,” said Utah Manufacturers Association President and CEO, NAM board member and COSMA Chair Todd Bingham. “Their work shows the impact that we can all have to help make the United States the top destination in the world for manufacturing investment.”

The Leadership Award recognizes the achievement of a state manufacturing association that has developed impactful initiatives to support manufacturers and strengthen manufacturing in their state. Some of the initiatives that set WMC apart were their Coolest Thing Made in Wisconsin and Business World, which teach young people about entrepreneurship and free enterprise and promote manufacturing job opportunities in the state. Additionally, as part of WMC’s official mission to make Wisconsin the best place for business, the Future Wisconsin Project brings together diverse interest groups to identify and address the state’s long-term economic challenges and opportunities, including solutions to workforce challenges.

“The work of WMC to inspire the workforce of the future is a prime example of what’s needed to address the critical challenges that our sector faces today,” said NAM President and CEO Jay Timmons. “Under Kurt Bauer’s leadership, the WMC is advancing the solutions needed to make manufacturers more competitive and ensure manufacturing remains a key driver of Wisconsin’s economy.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.91 trillion to the U.S. economy annually and accounts for 55% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.