Top Predictions from the American Chemical Manufacturing Summit
Tuesday marked the opening day of the 2013 American Chemical Manufacturing Summit, bringing players from the agrochemical sector to pharmaceuticals to discuss the state of the industry. And while many of the keynotes, panels and workshops catered to unique challenges faced by chemical manufacturers, a number of key delegates voiced predictions that will affect the whole of the manufacturing industry.
In one of the event’s opening keynotes, Andrew Jones, VP of Chlor-Alkali and Vinyl at The Dow Chemical Company got the ball rolling with a case study exploring the potential to be tapped from shale gas. And while this is a chemical concern on the outside, the energy savings that shale gas could offer manufacturers throughout the industry makes it a universal concern, as Jones pointed out as in referencing General Electric and Boeing’s use of the alternate energy source.
Tapping Potential in Shale
Dow is backing this bet on the future of shale gas with $4 billion in new U.S. facilities that the company estimates will employ 4,800 workers during peak construction and support over 35,000 jobs in the broader U.S. economy over the next five to seven years.
Turning back on the company’s previous position, and to the surprise of some audience members, Jones expressed that Dow is not opposed to exporting shale gas from the U.S.
We followed up with Harry Moser, Founder and President of the Reshoring Initiative to discuss the role shale gas could soon play in revitalizing the sector, and how it influences the greater reshoring movement.
For Moser, shale gas could represent a tipping point that, for many companies, will plainly lay out that not only are the benefits of reshoring more attractive than offshoring, but the total cost is lower as well. His reasoning is this: when taking into account the energy costs of manufacturing, particularly in the chemical sector, Moser said that switching to shale gas in many cases could cut expenses in half, making any advantages held overseas thanks to low wages irrelevant.
Moser explained that while the trade deficit has reached a plateau since its peak in 2010, it sits at about $550 billion per year, and with it has come a plateau in offshoring at roughly 3 million jobs. One inescapable problem facing reshoring efforts such as Moser’s is that transitions such as these take time—even if every company were to use the Reshoring Initiative’s TCO Estimator tool today and elected to bring their operations back to the U.S., it would take upwards of 7 years for many of these companies to actually make a change, particularly those that have recently invested in large, expensive factories and infrastructure overseas.
“It took us 60 years to get to where we are based on offshoring,” said Moser. “The Japanese started it, say, in the 50’s, and it’s probably going to take 30 or 40 years to get most of it back.”
Social Media for Manufacturing
On the factory level, Larry Maynard, plant manager for Valspar noted in a panel discussion that he expects the social media revolution to soon spread to factory floors for all types of manufacturing. Citing the growing popularity of Facebook, Twitter and even Pinterest, Maynard explained that at the heart of each medium is a tool that can help factory workers to be more engaged in day-to-day operations.
This may not happen immediately, but what Maynard argued was that as the next generation of workers enters the workforce, they will bring with them so much experience with these social media interfaces that they will prefer these familiar methods of delivery to traditional methods of information sharing on the factory floor.
There, instead of using Twitter as a sort of personal soap box, next-generation employees will tweet their daily goings-on. Meanwhile, a tool such as Pinterest could become much more than a repository for wedding ideas and DIY home improvement tutorials to instead house and organize a manufacturer’s information archives.
Of course, there are a couple of serious obstacles that have kept these websites from flooding into the workday (at least on an official level). Right now, companies are shying away from these tools due to the risk of having intellectual property vulnerable to the wandering eyes of their competitors—a risk that, according to Maynard, remains unsolved.
At the top of list for Bill Seaton, vice president of U.S. operations for Sigma-Aldrich, was machine-to-machine communications, followed closely by rapid prototyping. And given all the attention that both technologies have received from industry and consumers alike, this doesn’t come as much of a surprise.
Seaton explained that for chemical manufacturers, rapid prototyping is key for developing stronger, more efficient nozzles and other equipment necessary throughout a variety of chemical manufacturing processes. But Seaton wasn’t all optimism, which he explained as he referenced the boom and bust of some stereolithography companies in the 80’s.