This week at the GMA Executive Conference in Colorado Springs, CO USA, Eric Spiegel, President & CEO of Siemens Corporation, led a panel of chief executives including Bill Gisel, CEO of Rich Products, Richard K. Smucker, CEO of J.M. Smucker, Jeff Ansell, CEO of Sun Products, and Daniel Meckstroth, Chief Economist of the Manufacturers Alliance for Innovation and Productivity (MAPI). The title of the session was "Reinvigorating North American Manufacturing: Will Food & Beverage companies be part of the North American manufacturing renaissance?", essentially exploring the best practices for driving manufacturing growth. The discussion included ways to optimize productivity and energy efficiency, innovation across the value chain, making old plants new, and developing a high performing workforce. With the CEOs of two different food & beverage companies, the CEO of a consumer goods (non-food) company, and the chief economist from a manufacturing research firm, the discussion provided a wide range of perspectives on achieving manufacturing excellence. Eric Spiegel provided the groundwork for the discussion by discussing the focus many of our customers have, despite the challenging economic environment, on growing their manufacturing operations by improving productivity and energy efficiency within existing, and in some cases, new plants. This focus on productivity becomes even more important when you consider challenges such as the recent draught, and the continued rise in commodity prices. Here’s a recent blog piece and video of Mr. Spiegel on the topic of manufacturing.

Dan Meckstroth from MAPI showed research on the current state of manufacturing in the food & beverage and consumer products market: he cautioned that although manufacturing is projected to grow 3% in 2013, there are caveats that could limit this growth, such as regulation and fiscal policy.  While regulation is necessary in any industry, Mr. Meckstroth said, the number, and hence cost of regulation has skyrocketed in recent years compared to manufacturing or the general economy. And North American manufacturers across all industries, not only in food & beverage and consumer products, are looking at the potential of a “fiscal cliff” (as defined by US Federal Reserve Chairman Ben Bernanke), where taxes are raised and funding for certain government programs declines.  The natural reaction to these prospects could be for manufacturers across all industries to reduce spending on the business – hiring, capital expenditures, etc.

Bill Gisel from Rich’s and Jeff Ansell from Sun Products spoke about the importance of innovation, not only with new products and packaging but also within older plants by adopting new manufacturing systems, and sustainable manufacturing - from solid waste, to energy and water.  In fact Rich’s is a recent customer of Siemens energy and environmental services, leveraging our energy and water audits to improve the efficiency of their plants - here’s a recent press release on this.We’ll have more on the improvements in sustainable manufacturing that the organizations on this panel have made, in a future blog post.

Another key driver of manufacturing productivity and efficiency that the panel discussed was improved manufacturing work process, and workforce development.  Richard K. Smucker talked eloquently about the importance of embracing complexity in his business through better education and training for his employees.  The end result across his organization, he has found, is increased job satisfaction and a higher performing workforce. At Siemens, as Eric Spiegel addressed, we enhance our workforce development efforts in part through community college partnerships, and hiring military veterans through programs like Joining Forces.

The concept of “making old plants new” was a theme referenced throughout the discussion. And all of the aforementioned themes referenced in this post support this: operational efficiency, workforce development, advanced technologies, and sustainable manufacturing.  Mr. Smucker talked about the investment J.M. Smucker Corp recently made to upgrade one of their plants in Ohio, and the excellent efficiency they already can see; Rich Products, Mr. Gisel said, also has seen improved speed and flexibility by modernizing their processes, supply chain, and technology - for example implementing robotics at an ice cream plant in Connecticut; Sun Products, as Mr. Ansell explained, was formed in recent years through the combination of old Unilever and Clorox plants, thus also has had a strong focus on improving plant operations through technology and sustainability improvements, as well as instituting common metrics for OEE, safety, and quality.

This lively discussion could have gone on far longer than the allotted 75 minutes, but alas, we had a reserved table at the “Leadership Luncheon” waiting for us.  If you would like to read and hear more on the topics we discussed during this panel, such as improving productivity and sustainability in manufacturing, please visit our GMA Executive Conference microsite.

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