Using technology to differentiate our products and services is essential.
American Manufacturing has always led the world in innovation and technology. Since it is pretty evident that we can’t compete on cost, using technology to differentiate our products and services is essential. There are some good examples of small and midsize manufacturers (SMMS) who are successful innovators and users of technology which should serve as inspiration for other SMMS worried about the future.
For instance, Engineered Machine Products of Escanaba, MI looked at how they could redesign engine products that had been made the same for 100 years such as water pumps and oil filters. David Allen, Vice President of product development, first looked at the water pump and asked himself what does an engine need other then pumping water? His answer was a high efficiency award winning design that was a high tech water pump. The company now has 11 patents all of which are innovations of standard parts.
Founded in 1983 as a manufacturer of rigid polymer lining systems for the transportation industry, American Made and its subsidiary, U.S. Liner Co., have built their business on new product development. Mike LaRocco, American Made’s founder and owner, is an entrepreneur who does his customer homework.
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He began by doing research on various types of new plastic and glass materials. A small article in a trade journal led him to a trade show to meet a company that had just developed a brand new, high strength fiber material.
Mike and his design team experimented with the new fiber product and figured out how to build a very hard (but very light) panel that was stronger than steel. He called this new composite product Bulitex because it would stop a 45-caliber bullet fired from 20 feet.
Once the product was tested, he began to design the process and machines to build the panels. The manufacturing process takes a multi-layered woven fiber material and processes it through a heating – compression – and a cooling stage, to create a final rigid panel.
The new Bulitex panel turned out to be the most impact resistant material available. It is water-resistant, will withstand extreme temperatures and eliminates cracking, splintering and snagging, resulting in significant savings to the users.
Job shops can also find ways to differentiate themselves using technology. Frank Jones, Vice President of TTM&S in Mentor OH, helped the company build a solid reputation for producing precision parts from the most difficult to machine materials, such as Waspalloy, Hastelloy, Iconel, Stellite, Cobalt Chrome, stainless steels, and implant grade titanium. The company produces components using advanced equipment such as 13-axis Swiss-type lathes and 5-axis multitasking machines in cells.
In addition TTM&S has invested in being vertically integrated rather then using multiple vendors. Bringing technology processes in house such as passivation, electro polishing, heat treating, laser marking, electrochemical etching, welding and packaging services, have also helped give them competitive advantages in their markets.
Nimet Industries is a 65-person job shop in South Bend, IN, that offers proprietary anodizing and electroless nickel finishes. One of their primary strategies is to offer proprietary processes in finishing. Nimet has developed a family of NiTuff products: a PTFE (Teflon) impregnated dyed black hard anodize as well anodizing in clear, blue and red.
They also offer NiCoTef, which is a co-deposition of nickel and PTFE. Both proprietary processes provide them a significant competitive advantage in the marketplace. They plan to continue the development of these special processes and expand their current twelve product lines.
Nimet Industries has expanded their branding strategy to the international scene. They first licensed Nimet’s proprietary processes to the Swiss company Altefco. Nimet’s president, Jim Abbott, attributes this rapid gain of awareness to the early proprietary branding strategy that still exists as a core marketing competency today.
What About Future Technologies?
The good news is that there are many new advanced materials that have been in R&D for many years and will eventually become available to small and midsize manufacturers (SMMS). Some of *these technologies are very technical and difficult to explain but I will try to simplify the descriptions.
Advanced stainless steel and “superalloys”- Some of these alloys withstand tremendous heat while spinning in a turbine engine. Some have exceptional strength and hardness, while others withstand flexing, are impervious to corrosion or have desirable magnetic or electrical properties. The latest of these alloys are called “6 Mo superasutenitics.” Nickel based alloys are used in steam and gas turbines because they can withstand temperatures up to 2,200°F.
Advanced ceramics and superconductors - In comparison to the traditional ceramics the advanced ceramics crystalline substances have highly engineered microstructures. This opens up ceramics to many new applications such as substrates, capacitors, transformers, inductors, piezoelectric devices, and sensors.
Carbon nanotubes - Nanotubes resemble small rolled tubes of graphite except they can be made to sizes down to .8 nanometers. They have very high tensile strength and can be used as conductors or semi conductors. The current markets for nanotubes are in catalytic converters, durable materials for the aerospace industry and armor for field suits for the Army.
Nanopowders - Nanopowders are metals or metal mixtures with particulate sizes in the micron range. Nanopowder coatings possess more tightly packed structures then other coatings. One use is to mix them with paints to make the paint rock hard, fireproof, and scratch resistant.
Advance coatings - Advanced coatings are related to polymers and can be organic or inorganic. Some of them are used for thermal barriers, some are anticorrosion metallic coatings, and some are multifunctional “smart” coatings. The latter performs a number of operations – anticorrosion protection, conduction, electro magnetic shielding, and thermal protection- simultaneously and in an interactive manner. Some of these nanocoatings are used on contact lenses, sunglasses, binoculars, rifle scopes and camera lenses.
Thin films - Thins films include polymers, metals, and polycrystals that are layered as thin as a few tenths of an angstrom. They can coat glass, acrylics, steel ceramics, silica and plastics. They are used in electronics, advanced sensors, laser devices, bio medical devices and implants.
Bioplastics - These are new polymer feedstock’s based on renewable natural substances. They can be used in bio-resin compounds, colorants, additives, films, foams and packaging. Their biggest feature is that they can reduce dependence on oil and natural gas.
Advanced high strength steels (AHHS) - These new steels are being used by most automobile manufacturers to reduce the weight of the cars. According to the research firm Ducker Worldwide, the average weight of a 2009 vehicle is 163lbs lighter then 2007 models.
Nanosize sensors and generators - Nanogenerators are tiny power plants that use mechanical energy from the body, vibrations, ultrasonic waves, noise, and other sources to generate energy in millivolts. There main applications are to be used to power MEMS (micromechanical systems.). Nano sensors are only a few nanometers in size (nanometer= one billionth of a meter). They can be implanted in the body for a variety of applications such as monitoring glucose levels in the blood. They could also be used as strain gages on bridges and other structures that need to be continuously monitored.
I have only mentioned some of the advanced technologies that are likely to be use by SMMs in new products and services. There are also new technologies coming along in biotechnologies, pharmaceuticals, and chemical and energy industries.
The good news is that the applications and markets for these new technologies are going to be pioneered by SMMs. The large corporations are more risk averse and want to focus on short term profits. They would rather license their technologies or fund small firms to do the work of commercializing these technologies and finding the new customers and market niches.
In his new book The Advanced Materials Revolution, Sanford Moskowitz says, “Recent research testifies to the expanding role played by SMEs in creating and diffusing the new technologies that drive economic progress. In the 1970s, less then 30 percent of the SME’s spearheaded new materials innovations. By the 1990s this number grew to over 50 percent. It is forecast that by 2030 SMEs (I call them SMMS) will be responsible for 70 percent of such innovations.”
I think there will be at least three opportunities for small manufacturers to use these new technologies. First, there is an opportunity to purchase the new materials and improve their current products. Second, they may be able to add new lines or services by licensing the technologies. Third, there will be opportunities to create start-up companies. With any of these opportunities there will be risks.
My suggestion is for those who want to pursue these technologies develop a business plan that:
- Defines the technology very carefully.
- Defines the potential applications.
- Defines the customers and potential markets.
- And assesses how much capital will be needed.
Mike Collins is the author of Saving American Manufacturing. his website is www.mpcmgt.com.