More than half of Wisconsin’s manufacturing companies are facing a change in leadership over the next five years, and twice as many companies have recognized the value of sustainability according to a summary of the 2011 Next Generation Manufacturing Study released by the Wisconsin Manufacturing Extension Partnership (WMEP). To download the study results, visit www.wmep.org
The 2011 study provides valuable insight into Wisconsin manufacturers’ response to economic pressures and their progress in adopting and implementing Next Generation Manufacturing strategies over the past three years, according to Buckley Brinkman, executive director of WMEP.
Brinkman noted that sustainability awareness has increased dramatically among Wisconsin manufacturers, with 67 percent of the companies surveyed indicating that sustainability was important or highly important. In 2008, 33 percent of companies surveyed reported that level of importance on sustainability.
“Wisconsin manufacturers have realized how important sustainable and green practices are to their bottom line and are making progress in implementing green practices,” according to Brinkman. “For our operations to remain competitive, it’s clear that more Wisconsin companies must commit to process improvements that also increase sustainability.”
The Wisconsin Economic Development Corporation (WEDC) has provided WMEP additional funding for the Profitable Sustainability Initiative to help small and midsize Wisconsin manufacturers implement sustainable practices in their businesses.
With more than half of Wisconsin companies facing a succession of leadership over the next five years and almost seventy percent of the CEO’s in Wisconsin are aged fifty or more, planning for retirements and developing younger leaders should be a strategy embraced by our Wisconsin firms to remain competitive,” according to Paul Jadin, CEO of the WEDC. “Strong leadership is necessary to attaining world-class status in the 21st century,” Jadin said.
“Next Generation Manufacturing refers to a framework of forward-looking strategies that drive manufacturing growth and profitability,” Brinkman said. “The next generation success strategies include customer-focused innovation, systemic continuous improvement, advanced talent management, global engagement, extended enterprise management and sustainable products and processes.”
Key Findings
• Fifty six percent of Wisconsin companies may face a succession of leadership over the next five years and almost 70 percent of the CEO’s in Wisconsin are aged fifty or more. Twenty six percent are over the age of 60, and almost 70 percent of the CEOs in Wisconsin are over the age of 50.
• Wisconsin manufacturers realize they must continue to be innovative. Progress toward achieving world-class customer focused innovation has improved since the study was done in 2008. Nevertheless, just ten percent of our companies innovate at the highest levels. It is likely that innovation has taken a back seat to financial survival over the past few years.
• The economy also affected companies’ investment in R&D. Eleven percent of Wisconsin companies invested less than 1% of their sales in R&D. On a positive note, Wisconsin companies are realizing the value of implementing systems that measure return from customer-focused innovation. Fourteen percent more companies have implemented some type of measurement system. More companies are also realizing the value of regular development review by operational and senior executives.
• Companies realize the importance of an engaged and trained workforce, but are not executing in this area. Sixty-six percent of our Wisconsin companies provide less than 20 hours of training annually to their workforce, which also explains the fact that two-thirds are experiencing suboptimal progress toward world-class human capital acquisition, development and retention.
• Human capital engagement and development also correlates to creating a culture of performance excellence. Our Wisconsin companies are making good progress toward process and process improvements and are doing a much better job of engaging their workforce in specific improvement methods than they were in 2008.
• Sustainability awareness has increased since 2008. In 2008, 33% of companies surveyed said that sustainability was important or highly important; today that number has risen to 67%. Companies are realizing how important sustainable and green practices are to their bottom line and are making progress in this area. For Wisconsin to remain competitive, larger numbers of manufacturers must make world-class progress in sustainable practices.
• There is an increased awareness of global engagement by our companies. Since 2008, there was a 12 percent decrease in companies stating that global engagement is not important to their success. Still, less than five percent are making world-class progress toward global engagement.
Manufacturing in Wisconsin
Manufacturing contributes $47 billion – 19% – to Wisconsin’s economy annually and supports about one in four private sector jobs. “Manufacturing is the driver of Wisconsin’s economy,” said Brinkman. “WMEP’s mission is to make Wisconsin manufacturing the best in the world. Next Generation Manufacturing provides a framework and focus that enables Wisconsin manufacturers to succeed in a volatile global economy. WMEP is uniquely positioned to provide innovative support and assistance across all the elements of Next Generation Manufacturing.”
A Scorecard to Measure Future Progress
The 2011 Next Generation Manufacturing Study was conducted by the Manufacturing Performance Institute (MPI) in collaboration with the American Small Manufacturers Coalition and the National Institute of Standards and Technology –Manufacturing Extension Partnership (NIST-MEP). Of the total 824 manufacturers nationwide who participated in the survey, 95 were from Wisconsin.
In 2008, the Wisconsin was the first state in the nation to undertake a manufacturing study focused upon Next Generation Manufacturing success. The study was subsequently driven nation-wide by the American Small Manufacturers Coalition (ASMC), the organization that sponsored the recent update.
About WMEP
WMEP is a private, nonprofit organization committed to the growth and success of Wisconsin manufacturers. Since 1998, WMEP has helped to generate more than $1 billion in economic impact and create and save more than 13,000 state manufacturing jobs, according to results documented by customers. WMEP receives financial support from the Wisconsin Economic Development Corporation and the NIST Hollings Manufacturing Extension Partnership. WMEP also partners with many public and private organizations to serve Wisconsin manufacturers.
For more information, visit www.wmep.org or call 1-877-856-8588.
Contact: Teresa Schell
shell@wmep.org
262.345.3381