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Making Parts in Hoosier Land

February 9th, 2012

News Coverage:

Making Parts in Hoosier Land

By Noah Graff on February 9, 2012

 

 

OrthoVation Center at Micropulse

In mid-December I trekked 3 hours from Chicago to Northeast Indiana for a tour of manufacturing companies put on by the Northeast Indiana Regional Partnership and Indiana Michigan Power. On paper the trip didn’t exactly have the same allure as my last two traveling assignments for Today’s Machining World (to Japan and France), but the people and the companies I encountered on the trip may have been the most genuine, shrewd and successful out of the three destinations.

Turns out, when it comes to manufacturing Indiana is where it’s at. Over 40 percent of Indiana’s workforce is involved in manufacturing. A variety of industries have thrived there because of the state’s low taxes, its educational system which encourages young people to train in technical skills, and a culture which keeps manufacturing in vogue.

Many Indiana job shops such as C & A Tool in Churubusco invite students and teachers of a wide range of ages to come to their facilities to learn about factory equipment. C & A for instance shows teachers how to use comparators so they can demonstrate to their students practical applications for geometry. The Northeast Indiana region is also currently starting up what are known as New Tech Schools, which focus on teaching students creative problem solving and working in groups on practical technical projects.

I encountered another interesting spin on education when we visited Fort Wayne Metals, a thriving 500 employee company specializing in the production of wire for medical devices. The company’s CEO Scott Glaze offers to pay for a baccalaureate degree for every company employee. Employees are allowed to study any subject they choose, from history to the culinary arts. Glaze himself got a history degree many years after working in the family business and then felt it was important to have a well rounded educated workforce.

Micropulse was another impressive company we visited. President and CEO of the company, Brian Emerick, recounted the story of his company’s evolution from a small job shop in 1988 that produced for a variety of sectors to become a 200 employee operation which today produces parts almost exclusively for the medical industry. The company prefers to focus on producing medical implants because medical instruments are more of a commodity product, making them much less lucrative. Micropulse has also in recent years created incubator companies housed in its own facility, in an area it calls the “OrthoVation Center.” Micropulse provides resources for the startups such as administration, accounting, information technology, product design, testing, prototyping, distribution and inventory management. After the new companies have developed a specialized niche, Micropulse spins them off and then can become their exclusive supplier.

Unlike Micropulse, C & A Tool prefers to serve a diverse group of sectors in addition to medical, such as aerospace, fuel systems and automotive. Our guide from the company, Rob Marr, told us that C & A never wants to turn down jobs because producing parts for a variety of sectors strengthens the skills of the company. The company believes that knowledge gleaned from running one type of job enriches its abilities to run other types. During the downturn, the company even cross trained its less busy employees in programming by teaching them to make custom license plates.
 

Custom License Plate Made at C & A Tool

We also visited Steel Dynamics, the fifth largest steel company in the U.S. Kieth Busse, the CEO and founder of the company who just retired at the end of 2011, is one creative, shrewd Hoosier. According to Busse, the labor cost at Steel Dynamics is about .25 man hours (15 minutes) per ton of steel, while it takes around two man hours per ton at U.S. Steel. Busse came from working at Nucor and implemented a non-union, incentive based model for paying employees similar to Nucor’s. However, Busse told us that the incentive system of Steel Dynamics differs from that of Nucor because Nucor rewards employees mainly for how many tons of steel they produce, while Steel Dynamics uses a formula that figures in the actual cost effectiveness of the employees’ work. The employees are rewarded for increasing the company’s profits by reducing waste, rather than being paid just for steel they churn out. They also receive stock options and bonuses based on the company’s profit, which further instills a sense of ownership, unity and loyalty. Steel Dynamics is the only steel company that paints its own steel, an idea which one of its employees came up with.

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