VIDEO: TOOLING UP–Assessing the Health of U.S. Manufacturing

Narrator: Welcome to Tooling Up, a series by MSC Industrial Supply Company that provides real-world insights brought to you by leading industry experts and aimed at improving the efficiency and productivity of your operations. Through Tooling Up, you'll gain access to our knowledgeable in-house specialists and experts from our most trusted partners and suppliers along with some exclusive innovative offerings from MSC. From metalworking and MRO supplies, services and expertise, to inventory management solutions and to the safety and well-being of your team, we are dedicated to working side by side with you to make your operations better.

Goettler: Welcome to MSC Industrial Supply's video series Tooling Up. My name is Jamie Goettler. For this inaugural episode, we are really pleased to have joining us from Oak Ridge National Laboratory Dr. Tom Kurfess, Chief Manufacturing Officer, and Dr. Scott Smith. Scott is the team leader for intelligent machine tools at Oak Ridge's manufacturing demonstration facility. Gentlemen, thank you for joining us today. What we're going to talk about today and how we're going to kick off this series is essentially to draw a line. We're going to draw that line at late 2018. An executive order was issued called Executive Order 13806 and it assessed the health of manufacturing in America. What I'd like to do is start with Dr. Kurfess and ask you Dr. Kurfess what was the purpose for the assessment to be created in the first place, if you wouldn't mind starting there.

Kurfess: Sure Jamie, and really the purpose for the assessment is to take a look at what's happening in the United States. You know you clearly people see that it's really important to have manufacturing for the economy. I mean it's very important for the nation's economy, but also you often hear about national security. Look, I mean the bottom line is and it's not even about oh we can make a, you know, the latest generation combat aircraft but even the ball bearings that move with every one of those jet engines or cars and so forth. Manufacturing is critical not only for the economy but for national security and we have to make sure that we have not only great manufacturing capability but the latest technology in manufacturing.

Goettler: Excellent, and if I recall correctly, it's about a 150-page assessment, very detailed in its work and Dr. Smith from your side I'd love to understand what were some of the findings, what do you take from the assessment and what did you learn when that assessment was published?

Smith: Sure Jamie, thanks for having me first of all. The report in response to Executive Order 13806 is publicly available and you know really if you haven't read it, go look for it. It's a really interesting read, it's a very well done report, but eventually they determined that there were five big macro forces that were driving some of the changes that we've seen recently in manufacturing. Now some of that had to do with reliability of federal funding for defense-related activities. You know if we operate on continuing resolution all the time, that seems like that's a problem. But a really big one of course is the decline in the U.S. manufacturing capability and capacity. You know there was for quite some time we looked at the possibility that we were going to be a post-industrial society and we thought it was a good idea if we let manufacturing go to low-wage countries and that has had an impact on the resiliency of our supply base. Certainly federal government business practices played a role in this problem. You know you can't turn manufacturing on and off, there are people and skill sets and you know that kind of a business thrives on a more even demand right. You can't just ask for a big supply and then ask for nothing for years and then all of a sudden ask for a big supply again. A fourth macro force is the economic and industrial policies of our competitor nations. Do they value manufacturing sector, do they respect intellectual property? Those things are concerns obviously and then of course this is all connected, but a fifth major driving force is the diminishing U.S. STEM skills.

Goettler: Absolutely, and Scott you know reading that I feel a lot of the same way that you do and took a lot of the same out of it. Now what was interesting to me is that both you and Tom joined Oak Ridge shortly after the assessment was published, I believe if I remember correctly in January. Did the assessment, Tom, did the executive order give you somewhat of a road map of what to work on and if it did, what are some of the improvements or some of the projects that you're working on at Oak Ridge that you can share that are addressing that competitiveness, that agility, that resiliency, the skills gap and other things. What are some of the things you guys are working on Dr. Kurfess?

Kurfess: Sure, well Jamie, so yeah the bottom line is that came out and it really did give us some some great direction and really what it's all about is about innovation and our unofficial mantra is innovating faster than the competition can copy. And it's not just about hey, let's try something out, we have a good idea, but let's get that idea out into production. So rapidly get an idea, whether it's a new product or whether it's a new process capability, let's get it out into production. So it's a combination of this type of effort with our background of working closely with our industrial partners that really allowed us, we brought that together, so yep we can scale up the technology but if nobody's going to use it, you know then it doesn't do the United States any good.

You know complementing what Scott just said about STEM–science, technology, engineering and mathematics–I mean the bottom line there is also it's not just about oh here's the technology, you've got to learn how to use it, you have to know how to really move it forward and really leverage it, and so these are the things that we're looking at and then we're working with a number of our different university partners and so forth and industry partners and some of the national societies and so forth not only get the technology out but to get the ability to use that technology out there as well. So I mean that's the way we're focusing on. A couple of quick hits in terms of the things we're looking at. One of them is I think we all think about 3D printing. Well, we're actually now looking at 3D printing with metal. Now I mean that's not a new thing but it really is starting to get to commercially viable, and in particular hybrid machines where you have 3D printing inside of a 5-axis machine and so forth and now I mean so to me that's the ultimate look and again what we had in the past you got Scott Smith and his team who are just the experts. I mean you know nobody comes close to him in machine tools and now we're integrating metal additive in there and what a powerful combination. The new and, sorry about this statement Scott, and the old right you know or let's say the new and the well-established Scott, but I think that's the reality and that's really what we're looking at here. And this is what makes America really move forward you know at a very fast pace.

Goettler: Tom, that's fantastic and thanks for sharing. Scott, anything that you would add or respond to some of the things that Dr. Kurfess shared with his response and some of either the part of the road map that maybe Executive Order 13806 provided or you know some of the projects and work that's being done at the manufacturing demonstration facility that you're excited about that will address some of those areas for improvement?

Smith: Sure, so you know one of the things we talked about the macro forces that are driving the behavior of companies in the U.S. and you know, let's talk a little bit about what those macro forces led to. I think it was a surprise to many people who read the report for 13806 how much we are reliant on supply chains that involve competitor nations and you know that seems like a problem, and you know that's a problem for the DOD obviously. You know if we can't make the things that we need when we need them, we need to fix that. But you know what's true for the DOD is true everywhere right. We, you know, all sectors of the economy are dependent on manufacturing and so I think one of the real drivers for me is trying to answer the question what can we do to make U.S. manufacturers more competitive right now with the equipment that they have on their floor right now because realistically if we recognize that there's a wage difference and we don't want to be in the business of racing to low wages, we want to maintain a wage difference, then we're going to have to maintain a productivity difference. So how can we use our existing installed machine base better but even more than that, how can we make those existing installed machine tools more accurate? How can we draw on the accumulated knowledge? I mean, you know, realistically we got to a place now where we can make measurements of all the cutting operations that we do inexpensively, quickly and the hard part is to make sense of that data and make good decisions based on it. We're in a place where every time the tool touches a workpiece, it's an experiment. We can learn from that, we can be better, if only we can present that information to the people who need it at the time and place that they need it.

Kurfess: So Scott, of course he leads our machine tool group and so forth, but I think I wanted to really highlight something that Scott said. We're going to make the systems better, we're going to make the equipment better, but we're also going to make the people better you know. And that's not about next generation workforce, it's about current generation workforce, how do we take them and make sure they're viable? We are not replacing people. I mean people are awesome, you know, I mean I know Scott's talking about sensors and all that sort of stuff and the whole bit, but man oh man, right, I mean you know people are still driving all these cars. You know you get a haircut, would you let a robot cut your, well maybe your hair, I don't know but not my hair right? But I mean the reality is people are awesome and we just need to make sure that we can leverage the heck out of people and make sure that they're doing things that are engaging to them. It's like the F-18 pilot right, you've got all the heads-up displays and technology, you don't want to cognitively overload the person right so you use all sorts of automation to help them out, but they're still flying the plane right and they're still making those decisions. Same thing with machine tools. People are not going away from those things.

Goettler: If people in technology are really the answer Tom, I couldn't agree with you more. You know really to close out the first episode and summarize for the viewers that'll have the opportunity to watch this and learn from you guys, what I find interesting and Scott touched on this a little bit, are the very things that serve to improve STEM, homeland security and the skills gap and so on happen to be the very same things that improve the profitability of commercial businesses in America. It improves their capacity, their efficiency and maybe even helps them in the short term with the skills gap and wondering what you guys think of the similarities, the irony and that those improvements helping both nationalistic and a commercial view. Scott, I'll turn that one to you.

Smith: Sure, I think one of the really important things that came out of the report in response to 13806 is that manufacturing and innovation are inextricably linked and innovation is what drives the profitability of the U.S. companies right. Innovation is deflationary. You get you more for what you spend when you can create new things. It's inextricably linked to manufacturing and one of the real dangers when you allow the manufacturing base to move overseas, you allow the manufacturing base to decline domestically, is that you also lose the innovation base. So I think we are well on the way to fixing this problem. I think we have challenges in front of us certainly, but it's a very exciting time for manufacturing.

Goettler: It really is. Tom, as we close out this episode, anything that you would add here regarding the executive order and the work that we're doing today?

Kurfess: So I'll just add on to what Scott was saying. Look, critical for manufacturing. Manufacturing is the backbone of the economy and if you take a look at the small and medium-sized enterprises, the mom and pop shops, the machine shops that are out there making 85, 90, 95, it's a big percentage of our manufacturing ecosystem. I mean the bottom line there is not only is important on the manufacturing side, but you know what, this is the cornerstone for the middle class. So I see manufacturing it's great for the economy, it's great for you know technology, national security, it's great for basically the American way of life and it's going to give us a strong middle class for many years to come, there's no doubt about it. 

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