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Manufacturing’s Evolution

Published Monday Apr 1, 2024

Author Scott Merrill

Vicky Jandreau has observed an evolution with manufacturing processes throughout her more than 30-year career. She entered the world of manufacturing in 1987 as a floor operator in Bristol. Today, she serves as senior vice president for Freudenberg-NOK Sealing Technologies, an international company focusing on sealant technologies.

Back in the late 80s, the scene was exactly what most people think of when imagining a factory, Jandreau says. “The shop floor was filthy,” she says. “We were there punching the clock, and you were basically a number. You were there to make parts, and it was a typical manufacturing company.”

That changed when the company was acquired by Freudenberg in 1989. Following the acquisition, the company began adopting a continuous improvement and lean manufacturing culture in all its North American facilities, and by 1992, it had established its GROWTTH program, which guides the company’s practices today. GROWTTH stands for Get Rid of Waste Through Team Harmony.

For over 30 years, Freudenberg has employed the Kaizen methodology, a Japanese philosophy and practice for continuous improvement, emphasizing small, incremental changes over time. Kaizen translates to “change for the better” and focuses on making ongoing improvements in all aspects of an organization, from processes and products to employee engagement and workplace culture.

“It really depends on what you’re trying to solve, what type of waste you’re trying to eliminate,” Jandreau says. “We employ all of the tools of the Toyota production system and the five lean principles: define, specify value, identify the value stream, make the product and information flow in a way that’s understandable, and always seek perfection.”

Federal Investments
As the industry continues to evolve, federal investments, such as the Creating Helpful Incentives to Produce Semiconductors Act (CHIPS) of 2022, have opened new opportunities for production for companies like BAE Systems, which produces and designs a wide range of products for defense and aerospace as well as commercial industries. BAE Systems employs approximately 6,000 people at its four NH facilities in Nashua, Hudson, Merrimack and Manchester. Globally, revenue for BAE was $25.4 billion in 2022. A CHIPS grant last year brought $35 million to a BAE Systems facility in Nashua to modernize their microelectronics center and increase chip production for defense programs, including F-35 fighter jets. And in Manchester, over $100 million in federal grants have been issued to the biofabrication industry.

New Approaches
Understanding the manufacturing landscape and its evolution, experts say, requires looking at lean practices, quality measures, as well as supply chains and value chains; and understanding the reciprocal relationships that are evolving between large and small companies.

Like Jandreau, Dan Jean has been in the manufacturing industry since the 1980s. Today Jean is director of operations for BAE systems in Hudson, where he has worked for 32 years. “I’ve been in operations for the whole time [that] I’ve been here and there have been a lot changes,” he says, explaining that 25 years ago products were designed and then handed directly to manufacturing. Now “we embed people from the manufacturing side with the design team personnel to ensure that products can be built to satisfy customer needs,” he says. This includes everything from the development of tooling, floor layouts and purchasing capital equipment.

On the other end of the manufacturing spectrum is Microspec Corporation, a company in Peterborough that employs 105 people, manufactures high-precision custom medical tubing, and has been investing more in automation as it continues to struggle with a workforce shortage.

Microspec President and CEO Tim Steele says his company employs several lean manufacturing principles but says his biggest problem isn’t waste, but a lack of employees. “People don’t seem to want to work,” he says, adding that the company needs eight to 10 more employees. And if a $9 million contract proposal he recently submitted goes through, he will need another 10 on top of that.

“When you don’t have people, you need to find ways to get work done, and the only way to do it is to create machinery or automation to do what a person would do,” he says. The problem with this is cost. “It’s not cheap. Even though machines don’t need life or health insurance, custom machinery is expensive.”

Microspec employs a small engineering department that works full time to automate processes. “We do this to stay competitive because that’s a commitment we have to make. We don’t have a choice. Either we do it, or someone catches up.”

Supply Chains and Value Chains
During the pandemic some companies experienced supply chain disruptions and lost control over key components they needed, says Ben Armstrong, executive director and a research scientist at MIT’s Industrial Performance Center. That has led to manufacturers shifting to more vertical integration of their operations. “Some companies, to gain back control, have brought production in house,” Armstrong says.

Vertical integration refers to a company taking more control over different stages of its production process instead of relying on external suppliers or contractors. Armstrong says vertical integration can help alleviate some supply chain bottlenecks.

But billion-dollar companies aren’t going to manufacture all the products themselves and are looking to partner with smaller local companies that can provide the quality they want, says Tony Fernandez, president of the NH Manufacturing Extension Partnership (MEP), which assists NH manufacturers with implementing lean practices, automation and quality control programs as well as understanding how to manage and hire employees and other “nuts and bolts of manufacturing.”

Another way MEP helps manufacturers is connecting them with potential manufacturing partners through its national network of suppliers. Fernandez says a hybrid approach to vertical manufacturing is emerging where larger companies find local smaller manufacturers to make parts they need at a “reasonable price,” rather than sourcing from overseas partners.

For Jean, finding and maintaining quality in the supply chain and in the manufacturing process is crucial. BAE employs close to 700 people just in this area. “Quality is near and dear to my heart. I’m a firm believer, as is every production line operator and director, we own quality, and it starts with the products we build.”

On the supply side, Steele says all the custom tubes Microspec produces need to be highly precise and require plastic resins, including nylon and polyurethane that come primarily from Texas. Lead times for the resins are currently over a year and this can cause problems for production schedules, he explains. “It is getting somewhat better, but it used to be that we got what we needed in three or four weeks,” Steele says, adding that another issue has been the cost of resins. “In the past, there was a tiered pricing system. Now we’re seeing the same price point for 10,000 pounds as for 10 pounds, and that hurts.”

Microspec is playing a role in the value chain, but Steele says longer lead times for products cause delays down the line for the larger companies he is selling to. “Freudenberg is a customer of ours, as well as Teleflex and many other big medical device manufacturers, and when our lead times go to eight to 12 weeks, that can mean delays for them,” he says, explaining smaller companies don’t have teams of supply chain professionals or commodity managers.


Manufacturing Employment on the Rise but Still Below its Peak


Manufacturing remains one of the chief economic drivers in NH with 69,946 workers employed in the sector in 2022, according to the NH Department of Employment Security, ranking it the third largest employment sector in the state.  Only health care and social assistance (with 92,146 workers) and retail trade (with 89,046 workers) employed more people in the state.

Manufacturing accounted for 11.9% of total private (non-government) employment in NH, above the national average of 9.9%. In 2022, NH ranked 16th nationally for highest share of manufacturing workers.

Although manufacturing employment in NH increased in 2022, it remained approximately 1,500 workers below 2019 employment. Nationally, manufacturing jobs are far below their peak of 19.6 million jobs in 1979 when they represented 22% of total non-farm employment, according to the Bureau of Labor Statistics. Forty years later, by 2019, that number declined to 9% while employment in service-providing industries grew.



Investing in the Future
A study by Deloitte and the Manufacturing Institute finds that as many as 2.1 million manufacturing jobs will go unfilled in the U.S. by 2030. Those missing jobs could potentially cost U.S. companies $1 trillion in lost revenue by 2030.

Armstrong of MIT says while the labor shortage is a problem, it is not one that will go away any time soon. “The demographics are not going away in the next 20 years and much depends on immigration policies,” he says.

His research traces many of the growth challenges in manufacturing back to low risk tolerance and says the real challenge is a “willingness to take risks.”

Ultimately, manufacturers who will grow are those that invest in vertical integration, research and development, as well as product innovation.

Jandreau says maintaining efficiency and quality requires looking at the entire value stream by using numerous tools. And this is happening at Freudenberg through recruitment and the hiring process. “We don’t want to waste human potential,” she says. “People want to be involved. We’re not just hiring people for their physical work. We also want to utilize their mental capacity to help us solve problems.”

To that end, Freudenberg’s Ashland facility partnered with professors and students at Plymouth State University last year, launching hands-on manufacturing robotics demonstrations for the university’s junior and senior robotics students.

Recruiting talented workers is crucial, says Ben Learned, Freudenberg’s HR manager at its Ashland facility.

“New Hampshire may not have the most people in the nation, but we do have amazing people of all ages, particularly the university students who are so gifted,” he says.

In 2023, PSU received a $1 million grant from the National Institute of Standards and Technology to invest in its robotics laboratory and program. The laboratory has robots and other industrial equipment that robotics students can use while they finish their education.

“We’ve been able to partner directly with some of those classrooms and to invite students back here for extended studies and senior projects, and in some cases, internships and job opportunities,” Learned says. “This is where they can connect what they’re learning in the classroom to real life—automation and manufacturing and industry—on our shop floor here in New Hampshire.” 



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