Innovation and Technology

Recent changes to the U.S. tax code are threatening manufacturers’ continued success—and they need to be reversed now, Winton Machine Company CEO and NAM board member Lisa Winton told U.S. lawmakers at a recent hearing.

What’s going on: Winton, whose 25-year-old company designs and manufactures machines used in tubular part and coaxial cable fabrication, testified before the House Ways and Means Committee at a hearing last Friday on the state of the American economy.

• Winton spoke about the challenges facing manufacturers and highlighted the impact of two recent changes to the tax code that increase the cost of financing machinery purchases: the phaseout of immediate expensing and limitations on deductions for interest on business loans.
• “While I would like to double the size of my facility, the cost of doing so has risen fourfold over the last several years,” said Winton, whose business is one of approximately 244,000 small manufacturers in the U.S.

Why it’s important: “These changes are like a tax on manufacturing growth,” Winton said.

• Winton expressed concern that “these changes will force our customers to keep using older pieces of equipment, rather than purchasing newer or additional ones, or they will buy cheaper equipment from Asia.”
• In addition to these two harmful changes, Winton spoke about another recent revision requiring businesses to deduct or amortize their R&D expenses over a period of years. This makes R&D more expensive because businesses “can [now] only recover a small portion of those costs each year.”
• In sharp contrast to this treatment, China currently allows a “super deduction” for manufacturers, Winton noted.

More to come: There are more harmful changes on the way. The 20% pass-through deduction is set to expire in 2025, “at the same time that tax rates for pass-through entities like ours go up across the board,” Winton said.

• In addition, a scheduled change to the estate tax could force family-owned businesses to sell off pieces of their companies. 

The last word: “None of these tax changes are fair to our employees, their families [or] our communities,” she said. “We need to fix them so we’re not making it harder to do business in America.”

The energy and enthusiasm of the night were fittingly high for the occasion: a gala to honor 130 standout women in manufacturing.

What went on: The Manufacturing Institute’s 2023 Women MAKE Awards—formerly the STEP Ahead Awards—took place Thursday evening at the National Building Museum in Washington, D.C., following the two-day Women MAKE Leadership Conference. (The MI is the NAM’s 501(c)3 workforce development and education affiliate.)

• The gala—which featured a live performance by violinist Ezinma and was sponsored this year by BASF, Trane Technologies, Amazon and others—is held each year to honor women in manufacturing who exemplify leadership in their careers.
• This year the awards recognized 100 honorees and 30 “emerging leaders,” women under the age of 30 who have achieved unique accomplishments.

What was said: MI President and Executive Director Carolyn Lee delivered the night’s opening remarks, telling audience members she was humbled to be in their midst.

• “We have women who have launched entire product lines,” she said. “Women with dozens of patents to their name. Women who oversee the production and distribution of millions of products every day … women who constantly exceed expectations.”
• Carolyn Lee touched on the MI’s year-old 35×30 campaign, which aims to raise the percentage of women in manufacturing from 29% to 35% by 2030, and said the women honored at the gala serve as inspiration to young women considering manufacturing careers. “Because if you can see it, you can be it,” she said.

“The opportunity”: WMA Chair and Cornerstone Building Brands President and CEO Rose Lee underscored the importance of filling the current shortfall of manufacturing workers.

• If the shortage continues unchecked, the number of missing workers could exceed 2 million by 2030, she said, citing a study by the MI and Deloitte.
• “Therein lies the opportunity to engage an untapped, underutilized pool of women talent in the vitally important manufacturing sector,” Lee continued. “This is the collective work we need to pursue, and the honorees and emerging leaders here tonight are advancing this work by demonstrating the myriad ways in which women can achieve professional success in the manufacturing industry.”

Thank you: MI Board Chair and NAM President and CEO Jay Timmons thanked the honorees for showing the next generation what’s possible.

• “Thank you for being role models—including for my daughters and my son, the many families we have in this room and the people you impact every day,” Timmons said. “The ripple effect you can have is incalculable.”

From one to many: Rounding out the night’s lineup was event Vice Chair and Caterpillar Inc. Group President of Resource Industries Denise Johnson, who told the audience it was “remarkable” to be in a room with so many other women in manufacturing.

• “There have been many times throughout my career when I’ve been the only woman in a room, the only woman on a project,” she said. “What an incredible change of pace this is. I … am overwhelmed with gratitude and pride for how far we’ve come. Congratulations to all of you.”

It’s no easy feat to transform a struggling family business into a thriving digital enterprise, but that’s exactly what Cooley Group President and CEO Dan Dwight is doing.

Change for the better: Cooley Group was formed in 1926 as a family-run textile manufacturer in Rhode Island. In 2011, Dwight, a member of the NAM Board of Directors, joined the company as president and CEO to navigate the ship through a new age of manufacturing and market demands.

• Today, the private equity-backed extrusion and textile manufacturer is the leading global maker of polymer-coated textiles. Applications range from single-use blood-pressure-cuff materials, to proprietary urethane combat raiding crafts for U.S. special forces, to liners and covers for some of the world’s largest water reservoirs.

How they did it: “As a family-run business, Cooley inherited aging equipment and an aging workforce,” said Dwight, who also serves as vice chairman of the Manufacturing Leadership Council’s Board of Governors. (The MLC is the NAM’s digital transformation arm.)

• “We not only modernized our equipment and infrastructure to compete in the digital age, but also revolutionized our culture. Hierarchies slowed us down.”
• “Digital transformation isn’t only beneficial for the advancement of our physical technologies; it’s also critical to develop a more collaborative company culture that empowers employees at all levels to take action.”

Starting small: “Digital transformation—the integration of digital technology into all facets of an organization—can seem daunting at first,” Dwight said. “But that can’t deter an organization from jumping in.”

• “I advise companies, particularly mid-sized manufacturers like Cooley Group, to approach digital transformation incrementally,” he said. “Don’t expect the cultural, institutional or technological benefits of digital transformation to manifest overnight as some mega-solution.”
• “Think strategically about the areas of your business that are the first movers. Once one aspect of the business is modernized, the digital insights and team’s enthusiasm for change will build momentum to push the remaining pieces into place.”

Gaining momentum: The transformation of this firm of 300 people is ongoing. “Ten years ago, we had trouble keeping our equipment operating for any period of time,” Dwight said. “Now everything in all our factories is digitally [Manufacturing 4.0]-driven across a single operating platform.”

• The company plans to do the pilot phase of an artificial intelligence implementation later this year.

Figuring it out: The MLC was key in Cooley Group’s remarkable transformation, according to Dwight.

• “I’m not sure we would have figured it out on our own,” he admits. “I’m an avid reader; I was born excited to build things. I read a lot about manufacturing and leadership. But even if I could have figured out M4.0 strategy, actually implementing it on the plant floor would have been difficult without the support of MLC members to share best practices and to encourage the Cooley team to embrace transformation.”

Get involved: Companies can jumpstart their own digital transformation by attending Rethink, the MLC’s premier event for manufacturing executives, in Florida on June 26–28. Check it out here.

“It is up to us to shape our future,” Rose Lee advises women in manufacturing.

Women should “take the opportunity to lead and do it in your own way with the outcomes you know you’ll be able to produce so others will see you as an example of diversity,” continued the President and CEO of North Carolina–based Cornerstone Building Brands and member of the NAM Executive Committee. “There is not just one way of doing it, even in the manufacturing environment.”

This year, Lee is serving as chair of the Manufacturing Institute’s Women MAKE Awards, which will honor more than 100 outstanding women working in the industry. We spoke to Lee ahead of the awards ceremony, and here’s what she had to say.

Finding your passion: Lee describes herself as someone who derives a lot of satisfaction from the work she does—and wants to ensure others can do the same.

• “In our company, we are part of creating things that are part of the most important things in your life: your home, your shelter,” said Lee, who holds degrees in aeronautical and mechanical engineering as well as an M.B.A. “I find that very meaningful.”
• But her focus extends beyond the tangible, too. “There’s the content of what is done, but then there’s the opportunity that can be created for others … [which] increases the probability that they can find passion and enjoyment … like I had the opportunity to do.”

Increasing diversity: When it comes to diversifying the job pipeline in manufacturing, candidates themselves can often play a bigger role in their own success than they may realize, Lee said.

• “It starts with awareness that there are these opportunities. Then, [candidates should seek] the training, exposure and knowledge that are critical for these roles.”
• Meanwhile, “those of us who have the opportunity [must] make our voices louder,” she added. “Reach out to help people understand more clearly what is required and how you can advance yourself.”
• “We should all think about what more we can do ourselves and what more we can do together to welcome more women into manufacturing.” she continued.

Workplace flexibility: The same goes for manufacturers seeking to increase the number of women in their workforce, Lee added.

• “There is no magic solution,” Lee said. “But it’s important for companies and organizations to have a supportive structure, whether by providing [varied] job content, time off or additional flexibility in the work environment that [allows women to] balance things better.”
• “Supporting great initiatives that prioritize recognition, mentoring, education, skills training and networking are powerful ways to build a much stronger pipeline of women in manufacturing.”

Letting it go: Lee also knows a lot about having a rewarding career in manufacturing while being a caregiver at home—because she’s learned it firsthand.

• “Just remember that you can’t be everything to everybody all the time,” said Lee, a mother of two daughters. “It’s OK; let it go. Your kid doesn’t have to look like they’re in their Sunday best all the time.”
• Nor does the parenting style or career path that works for someone else have to work for you, she added. “You’ve got to design [being a working parent] so it’s bespoke to your life.”

Making history: Last year, when Honeywell International added her to its board of directors, Lee became the first Korean American woman to sit on the board of a Fortune 100 company. She regards the position as an opportunity to accomplish even more.

• “The building materials space doesn’t live in isolation,” Lee said. “Having a connection to a broader space, under global dynamics, helps [create] connectivity. We are continually deepening our knowledge.”

It might be hard to believe, but there are “more possible staff solutions than particles in the universe” for the typical factory, according to D-Wave Vice President of Quantum Business Innovation Murray Thom.

Yet thanks to quantum computing—or computers that employ the effects of quantum mechanics to operate more quickly and efficiently—D-Wave can help its customers solve this sort of knotty problem, whether they are trying to organize pallets, piers or people.

We spoke to Thom recently about the advantages of quantum as well as one of the company’s big successes, a collaboration with software company SavantX to increase the efficiency of Pier 300 at the Port of Los Angeles. Here’s what he had to say.

The future of computing is hybrid: When does it make sense to look beyond classical computing methods and add in quantum? As Thom explained, “Classical computers have to break things down into simpler steps—addition and multiplication.”

• However, a lot of logistical problems involve immense complexity. For example, let’s say you have boxes of components that must be shipped all over the country at different times. Thom puts it, “This box is going on this truck or that truck, [and that decision] affects other decision-making. It’s that cascade that makes this difficult for classical computing.”
• By contrast, quantum computers can take a huge volume of possible solutions, compare them all quickly and come up with a usable schedule.
• Marrying classical with quantum computing—called quantum-hybrid technology—provides the best of both options and delivers robust solutions, said Thom.

The Port of LA: In 2018, SavantX was hired to improve the efficiency of Pier 300, which processes millions of containers every year.

• To juggle the many factors involved—trucks, containers and cranes that load the containers—and to model their movements inside a confined space, SavantX would need a lot of computing power. That’s why it brought in D-Wave.
• SavantX modeled the whole system using a digital twin of the pier, Thom explained. The digital twin allowed SavantX to run all types of simulations, some of which would never occur in the real world.
• Quantum-hybrid technology was then used to “ingest the whole problem” and configure it all at once “like a Rubik’s cube”—simulating an impressive 100,000 cargo-handling runs to find the best algorithm.
• And thanks to D-Wave’s proprietary cloud platform, no one at SavantX had to get “a degree in quantum physics,” Thom added. Instead, “the platform let them configure a solution, while D-Wave handled the complexity.”

The solution: SavantX discovered that the key to greater efficiency was repositioning the rubber-tire gantry cranes.

• By reorganizing the trucks’ pickup times to match when the RTGs were available, and by distributing the containers more widely around the yard, SavantX greatly decreased waiting times.
• This solution resulted in “a 60% improvement in the amount of cargo they were handling, and a reduction in truck turnaround time of 12%,” Thom said.

Working with quantum: As quantum computing is still a new resource in the logistics and manufacturing industries, Thom explained to us how he works with new customers.

• First, he often talks to customers for an hour or more at the first meeting, to get a handle on how they understand the problem from the inside.
• The company’s work is “really about adapting the technology to suit the industrial challenge,” not the challenge to suit quantum computing, he explained.
• Next, D-Wave goes through “a discovery process, building out proof of concept and answering the high-level question,” Thom said. After that, its team “can build formulations and software for businesses to operate on their own systems, putting those quantum-backed applications into production.”

What’s next? D-Wave has a number of manufacturing-related projects in the works, spanning factory optimization, improvements in construction efficiency, carbon emission reductions and more. These include:

• A collaboration with ArcelorMittal to improve steel coils, and another with Johnson & Johnson to optimize the packing of pallets.
• A project with DENSO, an auto parts manufacturer, that aims to improve the safety of autonomous vehicles.

The last word: While quantum computing may sound both complicated and intimidating, “What people are delighted to find out is that it’s no more complex to use than any other technology,” Thom said.

It might be hard to believe, but there are “more possible staff solutions than particles in the universe” for the typical factory, according to D-Wave Vice President of Quantum Business Innovation Murray Thom.

Yet thanks to quantum computing—or computers that employ the effects of quantum mechanics to operate more quickly and efficiently—D-Wave can help its customers solve this sort of knotty problem, whether they are trying to organize pallets, piers or people.

We spoke to Thom recently about the advantages of quantum as well as one of the company’s big successes, a collaboration with software company SavantX to increase the efficiency of Pier 300 at the Port of Los Angeles. Here’s what he had to say.

The future of computing is hybrid: When does it make sense to look beyond classical computing methods and add in quantum? As Thom explained, “Classical computers have to break things down into simpler steps—addition and multiplication.”

• However, a lot of logistical problems involve immense complexity. For example, let’s say you have boxes of components that must be shipped all over the country at different times. Thom puts it, “This box is going on this truck or that truck, [and that decision] affects other decision-making. It’s that cascade that makes this difficult for classical computing.”
• By contrast, quantum computers can take a huge volume of possible solutions, compare them all quickly and come up with a usable schedule
• Marrying classical with quantum computing—called quantum-hybrid technology—provides the best of both options and delivers robust solutions, said Thom.

The Port of LA: In 2018, SavantX was hired to improve the efficiency of Pier 300, which processes millions of containers every year.

• To juggle the many factors involved—trucks, containers and cranes that load the containers—and to model their movements inside a confined space, SavantX would need a lot of computing power. That’s why it brought in D-Wave.
• SavantX modeled the whole system using a digital twin of the pier, Thom explained. The digital twin allowed SavantX to run all types of simulations, some of which would never occur in the real world.
• Quantum-hybrid technology was then used to “ingest the whole problem” and configure it all at once “like a Rubik’s cube”—simulating an impressive 100,000 cargo-handling runs to find the best algorithm.
• And thanks to D-Wave’s proprietary cloud platform, no one at SavantX had to get “a degree in quantum physics,” Thom added. Instead, “the platform let them configure a solution, while D-Wave handled the complexity.”

Read the full story here.

For small and medium-sized manufacturers, digital transformation can seem like an especially harrowing task. But smaller organizations can be uniquely positioned for success in implementing firmwide digital strategies.

Small but mighty: Just look at Graphicast, a 25-person precision metal parts company in Jaffrey, New Hampshire.

• “Because the cost of data collection and analytics is getting lower and lower, even as a small company we can collect data at a rate that gives us meaningful information we can act upon,” said Graphicast President Val Zanchuk. “For example, we created a linear programming model of our business. If we’re growing at a certain rate, I can use it to determine the most economical next steps, such as whether we should hire more people, work overtime or purchase more equipment.” 

A workforce solution: Graphicast, which counts Fortune 100 companies among its clientele, has used cloud computing, AI-based systems and more to help it succeed, according to Zanchuk.

• The manufacturer is also looking into the use of collaborative robots as a potential solution to the labor force shortage.
• “When it comes to Manufacturing 4.0, we think about what our customers will be looking for from us in terms of digital collaboration,” said Zanchuk, adding that some of the business’s larger customers are “transforming at a different rate than we are.” That means it’s up to Graphicast to consider client expectations and see how best to meet them given “what’s financially and operationally feasible” for the company.

The MLC helps out: To aid in Graphicast’s digital transformation, Zanchuk joined the Manufacturing Leadership Council, the NAM’s digital transformation division.

• “The MLC is the only place I know where I can discuss broad industry trends in an open fashion, where small companies like mine and large companies like Ford or GM can all be involved in the discussion,” said Zanchuk, who serves on the MLC Board of Governors.

• “Being part of the MLC lets us know if we’re on the right track and how we can make adjustments,” he continued. “It connects us to a group of incredibly talented, intelligent and experienced people who are focused on many of the same operational challenges we face.”

From the first moment Caleb Cleveland visited Electrolux Group—a home products and appliance manufacturer in Springfield, Tennessee—he knew it was the place for him.

“I knew I wanted to work with my hands,” said Cleveland. “I didn’t want to be sitting at a desk in front of a computer screen. I loved this place from day one.”

Cleveland found Electrolux Group through the Federation for Advanced Manufacturing Education program, or FAME, which his guidance counselor recommended to him. Today, both he and his employer are thrilled he’s taking part.

The program: Founded in 2010 by Toyota and operated today by The Manufacturing Institute, FAME aims to help students become highly skilled, sought-after workers capable of meeting the unique needs and challenges of the modern manufacturing sector.

• It provides current and aspiring workers with on-the-job training and classroom education, leading to an associate degree and the FAME advanced manufacturing technician certificate.
• “This program is one of a kind,” said Cleveland. “I’m actually getting paid to go to school. I’m getting the classroom and training classes here at Electrolux Group. I’m learning from people at school and from experts here.”

The benefits: At a time when manufacturers are struggling with record high job openings and a lack of skilled workers, FAME is helping to bring in a new generation of employees.

• Cleveland will be the Electrolux Group’s first graduate of the program when he completes it in May 2024, and the company sees his success as both a point of pride and an investment in the future of manufacturing.

• “We are committed to continuous upskilling of our current workforce and this is a strong pipeline for new talent with digital skills,” said Electrolux Group Senior Manager of Learning Dan Caldwell. “Part of our strategy is to partner with the FAME program so we can not only bring in Caleb with his classroom knowledge, but also help him to learn and grow.”

Changing minds: FAME is also helping to improve perceptions of the manufacturing industry among young people.

• “In the past, manufacturing has had a dark and gloomy reputation, and we are changing that perspective,” said Electrolux Technical Trainer Eric Drake. “We want up-and-coming talent to know that there are people in manufacturing who care about their future and want them to succeed. We’ll provide the stepping stones for their journey.”

Off to a great start: According to Caldwell and Drake, Cleveland has been an enormous asset for the company already.

• By the end of his first semester, he was able to step in and do most of the work of a process technician, filling in at a time when the company was shorthanded.

• “Caleb is doing a knockout job,” said Drake. “Our objective is to make opportunities available for him.” Caldwell added, “We are incredibly proud of Caleb with the initiative he takes.”

The bottom line: “The program has exceeded my expectations,” said Cleveland. “When I first started I was worried about being seen as that intern who sticks to somebody’s hip. But at Electrolux Group, I found my own place.”

The Manufacturing Leadership Council—the NAM’s digital transformation division—has announced the finalists for the 2023 Manufacturing Leadership Awards, the industry’s premier awards program for achievements in digital manufacturing. You can read the complete list of finalists here.

The ceremony: The finalists will be honored at the Manufacturing Leadership Awards Gala in Marco Island, Florida, on June 28.

• Also announced at the gala will be winners for all project and individual categories, winners of the Manufacturing in 2030 Award, the Manufacturing Leader of the Year, the Small/Medium Enterprise Manufacturer of the Year and the Large Enterprise Manufacturer of the Year.

Rethink: Certain award winners will also present at Rethink, the industry’s leading event for exploring manufacturing’s digital era, which will also take place in Marco Island on June 26–28.

The categories: The awards are divided into nine project categories to recognize company achievements:

• Artificial Intelligence and Machine Learning
• Collaborative Ecosystems
• Digital Network Connectivity
• Digital Supply Chains
• Engineering and Production Technology
• Enterprise Technology Integration
• Operational Excellence
• Sustainability and the Circular Economy
• Transformational Business Cultures

Additionally, individual leaders are recognized in the Digital Transformation Leadership and Next-Generation Leadership categories.

The last word: “As more manufacturers extend digital’s reach onto the factory floor and throughout their operations, we are witnessing transformative performance improvements that would have been unthinkable just a few short years ago—and that are improving life for employees and customers alike,” said MLC Co-Founder, Vice President and Executive Director David R. Brousell.

Alison Holland was almost predestined to be an engineer at General Motors. Born to an electrical engineer mother and a mechanical engineer father, both of whom work at GM, she grew up entirely familiar with the discipline and the company.

Today, she’s working to establish GM’s first-ever assembly operations for a new EV battery platform at Factory ZERO in Detroit-Hamtramck, Michigan. Recently named an Emerging Leader by the Manufacturing Institute’s 2023 Women MAKE Awards, which honor outstanding women in the industry, Holland spoke to us about her career, her work helping other young women find their footing and her goals for the future. 

Not your mother’s industry: As the daughter of a female engineer, Holland has a unique perspective on the role of women in the industry. How was her mother’s experience different from her own?

• Women were much more in the minority back then, Holland said, and her mother “had to work even harder to earn her way to the top.”
• Holland learned a great deal about managing her own career from her mother, a kind, patient parent who never missed her four children’s activities or let the pressures of work invade her home life.

Choosing manufacturing: While her parents’ example set her on the path toward manufacturing, Holland also attributes her comfort in the industry to her competitive nature.

• The former college soccer player says manufacturing has a similar feel to sports and is rewarding for those who want to excel in a “high-paced” environment.
• “I wanted a career where I could be challenged and see my efforts pay off with real-time results”—just as she did on the field.

A sustainable career: At GM, Holland is part of an exciting project: launching GM’s first battery assembly plant under the same roof as EV truck assembly at Factory ZERO. The battery, or Rechargeable Energy Storage System, is based on GM’s Ultium battery platform, which will increase the range, power and performance of a number of different vehicle types. She works with coordinators and engineers at different sites, making sure best practices are codified and shared throughout the company.

• Holland loves her work because “it’s a new challenge every day. I’m helping to reinvent the wheel when it comes to battery production. The small decisions we make will have a long-lasting impact.”

A young leader: Holland considers herself lucky to have had excellent female mentors, who helped her learn to “make her opinions heard.” Today, she helps other people, including many women, find support for their own goals.

• As part of GM’s early career development program for manufacturing engineers, Holland organized events like lunch-and-learns so that young workers could hone their professional skills together and build productive relationships. She also helped participants find and benefit from mentors who previously went through the program.
• Holland also provides coaching to women who are experiencing professional “firsts”—such as the first time they work on the production line, or encounter a new process, or lead teammates with unique backgrounds. Holland began this work while serving as a mentor in the early career development program and has kept it up as she leads her own team.

What’s next? When Holland looks ahead, all she sees are opportunities. “I am super interested in sustainability. I want more experience in other production departments, so I can understand all the other sides of the business. I want to have more cross-functional experiences, so I can better understand what people are asking of me.” 

The last word: Holland has simple but important advice for young women starting out in the industry. “Learn as much as you can. Take any opportunity to learn about the industry. That will boost your confidence. It takes some time and you’ll make some mistakes, but all of those experiences matter.”