America’s manufacturing evolution is also the story of Ft. Collins-based Forney Industries. Founded in 1932 by James Forney, the company has evolved from primary manufacturer to a distributor of goods made by others, much of it offshore. Today Forney sells industrial goods procured from a global supply chain to thousands of U.S. retail outlets like Ace Hardware.
That Forney successfully adapted where others did not is noteworthy. Hundreds of manufacturers weren’t as fortunate, or skilled, in dealing with the offshoring wave.
Yet Steve Anderson, Forney’s grandson and President and CEO today, is looking forward, and like many, sees opportunity again for U.S. manufacturing and related business. He and chief operating officer Kyle Pettine have a clear view of the factors driving manufacturing back to the U.S., like rising overseas wages, lower domestic energy costs, quality-control, and simply a desire to do more business locally. Manufacturing has momentum.
For Forney Industries, a growth surge might translate into a growing industrial business as manufacturers increasingly look for locally made products and goods, for raw materials, fashioned parts and high-tech components. Goods that Forney will distribute in the U.S. market.
“The industrial market is one we’re starting to pay attention to,” Anderson says. “It’s a $400-$450 billion market, and we’d like to be a bigger part of that. To do that we have to go out and get involved with manufacturers and the distributors who sell to manufacturers. We’re going to start in Ft. Collins and branch out from there.”
Forney’s experience gives Anderson a unique perspective, though, and he and Pettine see nothing inevitable about a flood of new manufactured products changing the U.S. economy overnight. The challenge? Workforce. For U.S. industry to bounce-back and power innovation and development in a bigger way, a new generation of industrial employees must begin to materialize to power America’s new ‘maker economy’.
‘We’re almost starting over,” Anderson, says, drawing on the firm’s manufacturing roots but also its front row seat to a sector that changed radically in the last half of the 20th century. “For the past decades we’ve asked others to do the work for us. That means we have to start educating kids now – we’re behind.”
Pettine adds, “From my perspective we’re getting to a critical point – we’ve got a gap in our workforce as the baby-boom generation is retiring. There isn’t a next-generation manufacturing workforce.”
He puts a sharp point on what’s at stake. “Would we buy American if we had the option? Of course,” Pettine says. “So would our customers.”
So a generation or so removed from manufacturing but committed again to filling more orders with American-made products, leadership at Forney is working to fill the labor pipeline that would juice a new manufacturing surge. A new manufacturing coalition has formed in northern Colorado. Anderson’s on an education committee. He’s honest about the scale of the challenge, of labor enabling the next iteration of his family business.
“The baby-boomers want their kids to be doctors and lawyers – but unfortunately doctors and lawyers represent a small percentage of our workforce. Few parents today see their kids working on a CNC machine (basically, computer-guided machine tools), and that’s wrong. But we’ve done it to ourselves. We’ve taken shops of out the high schools; kids don’t have to work with their hands.
“Our goal on the manufacturing side of things today is to get kids back to having some interest in what a manufacturing career would be,” Anderson says, “and what’s happening here is that manufacturers are creating that curriculum that should be taught in the schools but don’t have any way to share it. We’re trying to get that knowledge off the shop floor and to educators at the community college level.”
What Anderson and others would acknowledge though is that community colleges aren’t enough. For one, some community colleges are overwhelmed today with vocational demand. It’s not uncommon for colleges to have wait lists for classes like welding.
But even if the community college talent pool improves – and grant money pouring into the system and legislative focus can’t help but improve the system’s poor showing in manufacturing – Anderson believes universities will have to play a bigger role.
“At Forney we support the supply-chain management program at Colorado State University, but there aren’t a lot if any courses in how to control process or manufacture goods today. Or what it’s like for a business to be ‘lean’ (a manufacturing production practice). We’re pulling a lot of kids from the supply-chain track at CSU – but have they had any exposure at all to what it takes to manufacture? Probably very little. We need more kids exposed to the possibilities of a manufacturing career.”
In the end, industry – manufacturers – will have to lead the way. As Anderson and Pettine point out, industry knows best which jobs-of-the-future will materialize. In many cases they are leading. Wolf Robotics, a Forney neighbor in Ft. Collins, runs a 30-intern program with CSU that continually develops the talent Wolf needs. Others operate similarly.
Even so, according to Anderson, universities can play a more active role. “CSU should really be reaching out…to manufacturers, to say, ‘tell us about your story; tell us about what you need.’ That would help tremendously.’
Will a U.S. manufacturing resurgence write a new chapter for the company? For Kyle Pettine, it would be mean less flights to China and more to San Diego, or Michigan, a prospect that seems to appeal to him primary because it would be mean more dollars staying in the U.S.
Whatever the case, Forney Industries seems capable of adapting to whatever the future holds.
Contact Steve Anderson at (970) 494-6806, and Kyle Pettine at (970) 494-6839.
Rockies owner offers false choice to fans, business supporters
/in General/by Bart TaylorMost business owners have little in common with Charlie Monfort of the Colorado Rockies. For one, owners rarely fail in major league baseball, or in the NFL, NBA, or NHL. No one loses money. It’s fantasy-business.
Real companies often fail and those that succeed do so in conditions that are at times impossibly hard.
Sure, in major professional sports, teams occasionally suffer financial losses year-to-year. And Donald Sterling self-immolated. But an owner’s asset nearly always appreciates at a rate that offsets any short-term loss. Moreover, the rules of this fantasy economy help owners who’ve underperformed relative to their peers. Make a few bad hires or personell decisions? You get first dibs on the best future talent in the market to help right the ship.
The sad truth is that the owner of the Rockies is failing in a business rigged for him to win.
I’ve interviewed Charlie Monfort and like him, and this likeability serves Monfort well in his defense of the Rockies’ operations. But as Rockies owner he offers fans a false choice: retain management failing at their jobs or sacrifice the Rockies family-like culture. One does not follow the other. In real life only a successful business, managed and staffed by overachieving employees, provides the culture for families to prosper. Insisting his organization stand pat is tone deaf; fans and the business community that support the Rockies know better.
By one important metric, Monfort’s operation is succeeding. Fans continue to favor the Rockies entertainment value despite its won-loss record. Not surprisingly, the party-deck has been a hit with fans.
But again, few businesses have the option of failing in their primary endeavor, only to prosper because the community in which they operate provides lift – in this case MLB’s popularity offers a safety net.
As well-intentioned as he is, Monfort must make changes in his organization because that’s what well-managed businesses do. Until he does, not only will the Rockies be seen as a loser in baseball circles, respect for the brand will deteriorate in the business community. The Rockies may be a financial success, but they’re also a case study in how not to run a real business, a brand attribute Charlie Monfort should work to remedy.
Stage is set for manufacturers to advance their interests
/in General/by Bart TaylorAs we’ve chronicled the past ten months, manufacturers have begun to take important steps to organize to advance their interests. Not only must industry see these through, more is needed to address challenges like workforce development, local procurement, and public policy support that vex the manufacturing economy.
Think about health care, technology, law, banking and finance, real estate, and hospitality. They’ve developed cohesive, active communities that support industry trade events, media, lobbying, and education. They use dollars and alumni to influence higher education. The outcome is a conveyer belt of qualified graduates from colleges and universities. Their brightest stars occupy the highest elected offices and dot the political landscape. Collectively, these sector ecosystems shape America’s business dialogue. Their community institutions pave the way.
Certainly there’s refined organization in some of manufacturing’s silos. In Colorado, bioscience and medical, natural foods, craft beer, snow sports, software, clean-tech and other groups have developed member organizations that pay significant dividends. And regional trade groups like CAMA, the Colorado Advanced Manufacturing Alliance, are developing member-driven agendas that attempt to cross sectors to address common challenges.
Yet even CAMA’s leadership would likely acknowledge the unique challenge facing so diverse and broad a community as manufacturing. Until recently, a medical device maker may not have seen a meaningful connection with a fledgling apparel maker or industrial manufacturer. Furthermore, organizations that once defined manufacturing’s most powerful silos have fallen into disfavor – think automotive’s polarizing labor unions.
But today the industry attributes and challenges that bind the disparate manufacturing silos are more clear. Finding a qualified CNC operator to shape and cut metal on an industrial shop floor is more an equivalent challenge to locating tech-qualified workers for a bioscience clean room. Sourcing a local firm instead of one in China to extrude plastic, for example, may be a shared goal for companies from any number of manufacturing sectors.
Moreover, the appeal of a cool manufacturing job – and the region has many including making beer and food – is a great jumping off point to promote maker careers in other industries. This generation want more options. Entrepreneurship is once again in fashion. The broad manufacturing economy offers increasingly compelling options.
Business leaders here should take important next steps to promote their interests, to build on what’s been done. I’ll describe the options being discussed – or not being discussed but should be – next month.
The manufacturing renaissance is more an awakening. Here’s why that’s OK.
/in General/by Bart TaylorAs if unconvinced and seeking guidance from readers, each week now the national business press sort through the question of whether the U.S. is in the midst of a ‘manufacturing renaissance’. An article in last week’s Wall St. Journal, ‘Why US Manufacturing is Poised for a Comeback (Maybe)’, was a good example. Today, a column in the Detroit News was less equivocal. “For those who know what manufacturing is like today, there’s no doubt that we’re enjoying a bona fide renaissance,” the author opined.
We’re clearly intrigued by the possibility that manufacturing is ascending. But does the evident desire to build more stuff here, and the growing awareness of what was lost in the massive offshoring of U.S. manufacturing prowess, equate to a full on comeback?
As we’re always glad to help out other manufacturers (yes, newspaper and magazine publishers are manufacturers) the answer is, not yet.
A more apt description of what we’re experiencing is a manufacturing ‘awakening’. Business, economic development and government are waking up to the appeal of a resurgent manufacturing economy.
The benefits are tangible. Maker companies build wealth by returning dollars from product sales back the community. Jobs are relatively high paying. And it’s a sector that drives innovation and the practical application of technology pouring out of higher-ed and industry incubators.
But until industry can fill thousands of positions that go unfilled due to a lack of qualified workers, or find workers at all, qualified or not, a ‘renaissance’ will remain a goal not reality. Manufacturers jammed a room at Mike Bristol’s innovative brewery in Colorado Springs last week to hear Tom Neppl, CEO at Springs Fabrication, explain why he’s leading a charge to form a new industry partnership in the region. “If I go down to the college and say I need a machinist, they’re not going to listen. If 15 of us go down there, it’s a different story,” Neppl said of industry’s need to align with higher education.
Jan Erickson, founder of Janska, a Colorado Springs-based apparel manufacturer, can’t find labor. “We need more sewers. Something has to be done,” she said at the event, referring specifically to immigration reform that would enable her to import more labor.
And we’re not close, really, to a point where youth value a manufacturing career. We’ve taught our best and brightest the opposite. Nor are we challenging enough undergraduates to aspire to build businesses that build stuff.
However slowly we’ve come around to the notion, there’s nevertheless widening consensus that our economy needs more maker companies. That the benefits are often inherently local. That successful industry clusters like natural food in Boulder, bioscience in Denver and cycling in Odgen are models that can be emulated with great success.
More lifestyle industry seems the low hanging fruit. We advertise to put skis on the hill, boots and wheels on the trail and tourists in the wineries of Mesa County. Promoting the region as a home for the light industry who would make our lifestyle tools and toys seems an easy and effective extension of our brand efforts. As I’ve written, Ogden’s the latest example of leveraging a lifestyle brand with industry efforts.
The industry clusters that result arc across the economy. They involve a breadth of service businesses – architects and designers to contemplate new maker spaces, builders to build them, tech companies to enable them, financiers to capitalize and professional service firms to support them. An entire economy engaged.
Challenges like workforce can be overcome. What was needed first was awareness of the possibilities.
Why the effort to rebrand manufacturing continues to miss the mark
/in General/by Bart TaylorA Washington Post business article published last week, headlined, “There are some jobs now in manufacturing. Kids just aren’t interested in taking them”, was noteworthy on two counts. For one it summed up the workforce challenge in manufacturing without losing sight of the sector’s albatross: a more qualified workforce may be slow to materialize unless the perception of a manufacturing career profoundly changes.
Also of note was that mainstream business media covered the story at all. Certainly in Denver, in Colorado, one’s hard pressed to find any coverage of manufacturing issues.
The irony is that for the manufacturing economy to make a comeback that some forecast, the sector would benefit from more media visibility. Today’s maker economy is a couple generations removed from industrial-only sector of the mid-to-late 1900’s, but for some the imagery of hard hats and welders continues to define the sector. The challenge is how to change the public’s perception of manufacturing.
Two features published in today’s CompanyWeek convey a different look. Eldon James and Hope Foods, companies in different market sectors, are compelling examples of the tech-driven, modern manufacturers who are less often seen but very prevalent. It’s become conventional wisdom that to change the manufacturing brand, images of bending, shaping, fabricating and cutting must fade away.
But it’s a mistake to tell only part of the manufacturing story or demean the blue-collar component that’s built-in to the fabric of the maker economy. Some of the most compelling stories we publish are of companies that build stuff, big stuff. Check out today’s Wazee Companies profile.
Certainly technology has changed manufacturing. Jobs are less dangerous, less dirty. But other differences are more meaningful and inform today’s manufacturing brand in a positive way, including the breadth of the what’s now being made in the U.S., the growing prospects for collaboration between makers as a result, and the shifting perceptions of the value of today’s university degree. Young, smart people are beginning to realize that launching and owning a business, for example, is a fantastic option. Entrepreneurship is again cool – especially in those sectors at the intersection of lifestyle and business. (Or as my friend Chuck Sullivan likes to say, “of lifestyle and commerce.”)
Manufacturers are also connecting in surprising ways, borrowing products and processes for use in new applications. Eldon James is leveraging technology and products perfected in bioscience for use in making beer. “What we found is that our antimicrobial tubing that has been accepted very well in medical…is very effective at inhibiting bacteria that spoils beer, and also wine spoiling bacteria, “ says Marcia Coulson, president and co-founder of the company. An EJ beverage division was launched this year.
Hope Foods is likewise managing bacterial contamination – with technology that’s been around for decades but just know becoming mainstream in food preparation.
We may be aspiring to rebrand the wrong stuff. The tale of manufacturing today is one of large and small companies, of brewmasters, designers, and organic growers alongside machinists, welders and equipment operators, fueled by technology and inspired by innovation that’s jumping from one industry sector to another.
This isn’t necessarily how industry, its trade groups or government or media, tend to view the issue. Here, maker groups and government efforts tend to align vertically, by industry. Or, by company size: larger businesses able to buy memberships or pay for lobbying. Or, by geography.
For their part media are in a strategic retreat, limiting not expanding their gaze and largely incapable of rebranding anything that’s not to do with the service-related advertising dollars we incessantly chase.
A more practical plan to rebrand manufacturing would be to bring together companies and visionaries from different industries, in media and in person, to share ideas that will drive more innovation and collaboration. The companies that benefit will be a magnet for kids who want high- paying jobs out of college, not an extended stay in the parent’s basement.
Let’s showcase the entire breadth and impact of the new maker economy – hardhats, kitchens, cleanrooms and cranes.
And read about in the Washington Post.
State of the Coors brand: Craft brewers lead the market sector Coors once invented
/in General/by Bart TaylorIt’s been decades since Coors was Colorado’s most influential beer brand, but coattails from earlier times are long. Last week IndustryWeek published an infographic entitled the ‘Corporate States of America’, depicting each state’s ‘archetypal’ business brand, and Coors was picked as the brand that ‘best represented’ the state. Over half were manufacturers.
If beer drinkers here were asked the same question Coors might be hard-pressed to crack the top 10 – in its own category. The company might fare better with the general business community. But Colorado’s craft brewing artisans and entrepreneurs are now the face of the region’s beer sector. Among them, the Ft. Collins craft giants New Belgium and O’Dell are arguably among the most important new U.S. brands in the past 25 years. Collectively the sector helped energize a national maker movement. They’re a global business phenomenon.
What then qualifies a brand to be highly influential, to best represent a state or region? The random criteria used to select Coors was “a brand that a) has ties to that state and b) is still in business (as of 2013).”
Craft brewers and other innovators like those in Colorado’s high flying natural food sector would likely agree that the attributes of a successful brand would be more exacting, like: a meaningful connection to ‘place’, where lifestyle or community provide inspiration and foundation for company culture (read today’s Madhava profile); a commitment to sourcing locally when possible – workforce, raw materials, IP; an embrace of technology and other disruptive processes that drive innovation; and openness to share, to support others even competitors where possible; and of course providing a customer experience that reinforces all of the above.
Does Coors meet the standards? Yes. The company is a major consumer of regional ag products – they source locally. Certainly there’s a profound connection to place; the Coors family legacy remains powerful here.
But from a corporate standpoint, it now co-exists beside John Molson’s even richer Canadian beer dynasty: the MolsonCoors site points to seven generations of Molson’s compared to Coors’ five. Coors maintains the largest single beer making operation in the U.S. in Golden, but its connection to the region now filters through Toronto, first, Chicago and Europe.
For consumers, the upstart crafters have fully wrested the mantle of innovation and inspiration not only from Coors but from other mega-producers in the sector. And while the craft sector still commands a small percent of the overall market, between 10 and 15 percent, it would be hard to find any informed observer to bet against a projection one craft executive made to me, that 20-25 percent of the market is now a reasonable forecast in the coming years.
Ten years ago Pete Coors graciously agreed to an interview after losing his Senate bid to Ken Salazar. It was a highlight for me. He was honest and introspective. I remember asking if he had any regrets. Only one, he said, that he wished he’d run his own race. I assume he meant that his campaign towed national GOP talking points and that leaning on his long-standing connection with the community and locally-inspired wisdom would have served him better.
It’s a lesson the Coors Brewing Company might do well to revisit. Is a divestiture with Molson and Miller possible? Nah, but it would be fascinating to watch Coors reinvent itself as a local company, inspired by place and built from the ground up with community and innovation at the heart of its brand effort.
Once, it did.
Forney Industries’ next chapter may pivot on a new MFG workforce – and higher-ed’s role
/in General/by Bart TaylorAmerica’s manufacturing evolution is also the story of Ft. Collins-based Forney Industries. Founded in 1932 by James Forney, the company has evolved from primary manufacturer to a distributor of goods made by others, much of it offshore. Today Forney sells industrial goods procured from a global supply chain to thousands of U.S. retail outlets like Ace Hardware.
That Forney successfully adapted where others did not is noteworthy. Hundreds of manufacturers weren’t as fortunate, or skilled, in dealing with the offshoring wave.
Yet Steve Anderson, Forney’s grandson and President and CEO today, is looking forward, and like many, sees opportunity again for U.S. manufacturing and related business. He and chief operating officer Kyle Pettine have a clear view of the factors driving manufacturing back to the U.S., like rising overseas wages, lower domestic energy costs, quality-control, and simply a desire to do more business locally. Manufacturing has momentum.
For Forney Industries, a growth surge might translate into a growing industrial business as manufacturers increasingly look for locally made products and goods, for raw materials, fashioned parts and high-tech components. Goods that Forney will distribute in the U.S. market.
“The industrial market is one we’re starting to pay attention to,” Anderson says. “It’s a $400-$450 billion market, and we’d like to be a bigger part of that. To do that we have to go out and get involved with manufacturers and the distributors who sell to manufacturers. We’re going to start in Ft. Collins and branch out from there.”
Forney’s experience gives Anderson a unique perspective, though, and he and Pettine see nothing inevitable about a flood of new manufactured products changing the U.S. economy overnight. The challenge? Workforce. For U.S. industry to bounce-back and power innovation and development in a bigger way, a new generation of industrial employees must begin to materialize to power America’s new ‘maker economy’.
‘We’re almost starting over,” Anderson, says, drawing on the firm’s manufacturing roots but also its front row seat to a sector that changed radically in the last half of the 20th century. “For the past decades we’ve asked others to do the work for us. That means we have to start educating kids now – we’re behind.”
Pettine adds, “From my perspective we’re getting to a critical point – we’ve got a gap in our workforce as the baby-boom generation is retiring. There isn’t a next-generation manufacturing workforce.”
He puts a sharp point on what’s at stake. “Would we buy American if we had the option? Of course,” Pettine says. “So would our customers.”
So a generation or so removed from manufacturing but committed again to filling more orders with American-made products, leadership at Forney is working to fill the labor pipeline that would juice a new manufacturing surge. A new manufacturing coalition has formed in northern Colorado. Anderson’s on an education committee. He’s honest about the scale of the challenge, of labor enabling the next iteration of his family business.
“The baby-boomers want their kids to be doctors and lawyers – but unfortunately doctors and lawyers represent a small percentage of our workforce. Few parents today see their kids working on a CNC machine (basically, computer-guided machine tools), and that’s wrong. But we’ve done it to ourselves. We’ve taken shops of out the high schools; kids don’t have to work with their hands.
“Our goal on the manufacturing side of things today is to get kids back to having some interest in what a manufacturing career would be,” Anderson says, “and what’s happening here is that manufacturers are creating that curriculum that should be taught in the schools but don’t have any way to share it. We’re trying to get that knowledge off the shop floor and to educators at the community college level.”
What Anderson and others would acknowledge though is that community colleges aren’t enough. For one, some community colleges are overwhelmed today with vocational demand. It’s not uncommon for colleges to have wait lists for classes like welding.
But even if the community college talent pool improves – and grant money pouring into the system and legislative focus can’t help but improve the system’s poor showing in manufacturing – Anderson believes universities will have to play a bigger role.
“At Forney we support the supply-chain management program at Colorado State University, but there aren’t a lot if any courses in how to control process or manufacture goods today. Or what it’s like for a business to be ‘lean’ (a manufacturing production practice). We’re pulling a lot of kids from the supply-chain track at CSU – but have they had any exposure at all to what it takes to manufacture? Probably very little. We need more kids exposed to the possibilities of a manufacturing career.”
In the end, industry – manufacturers – will have to lead the way. As Anderson and Pettine point out, industry knows best which jobs-of-the-future will materialize. In many cases they are leading. Wolf Robotics, a Forney neighbor in Ft. Collins, runs a 30-intern program with CSU that continually develops the talent Wolf needs. Others operate similarly.
Even so, according to Anderson, universities can play a more active role. “CSU should really be reaching out…to manufacturers, to say, ‘tell us about your story; tell us about what you need.’ That would help tremendously.’
Will a U.S. manufacturing resurgence write a new chapter for the company? For Kyle Pettine, it would be mean less flights to China and more to San Diego, or Michigan, a prospect that seems to appeal to him primary because it would be mean more dollars staying in the U.S.
Whatever the case, Forney Industries seems capable of adapting to whatever the future holds.
Contact Steve Anderson at (970) 494-6806, and Kyle Pettine at (970) 494-6839.
CompanyWeek turns 100. What’s been learned – and what role maker-media?
/in General/by Bart TaylorCompanyWeek began reporting on regional makers and manufacturers last September. We’ve profiled 100 companies since then – writing about their products, leadership, business strategy, challenges, needs, and more.
What’s been learned, and importantly, has the hype of CompanyWeek been warranted? Does the market need maker-economy media?
It’s clear the factors driving a manufacturing surge are real and Rocky Mountain makers are benefitting. As Brian Burney, CEO of Oliver Manufacturing in told me, “it’s a good time to be a manufacturer.”
Colorado’s maker community is booming, in high-profile categories like technology, software and media, craft beer, distilling, natural foods, and aerospace. Metrics and anecdotes bear this out. Catalysts for offshoring — among them cheap labor and lower operating costs — are also giving way to equally compelling reasons to reshore jobs and build more stuff here here, in the U.S.
Economic interests supporting business also favor maker jobs. The build wealth, as the adage goes. They return dollars to the region from products sales around the world. There’s also a discernable, positive cultural impact. Communities home to companies that make stuff seem inherently more stable, more cycle-resistant. And they demonstrably enhance middle-class prosperity. They pay more.
But will all this translate into a so-called manufacturing renaissance?
Maybe.
By some measures manufacturing continues to lag relative to other sectors in the economy. There’s nothing meteoric about job growth in the sector. Macro-industrial output is sluggish. In relative terms, manufacturing is still in recovery mode.
Industry, conversely, points to an acute workforce need, and fully a third of the 100 growth companies we profiled struggle to find qualified workers, a finding underscored by state-gathered data that indicates over 15,000 manufacturing jobs went unfilled last year for want of qualified candidates. And in potential high-growth sectors like apparel and consumer-goods manufacturing, domestic labor remains overpriced relative to what’s available offshore.
Moreover, if manufacturers are to replace offshore suppliers or producers with local business partners, they need to locate them. It may not sound like much, but it’s a significant barrier to expansion of the sector. If manufacturers were effective self-promoters, they wouldn’t be manufacturers.
It’s unclear whether public-private partnerships designed to improve workforce readiness are getting traction. We’ll know a lot more soon. The coalition of industry, higher-education and government brought together last year by House Bill 1165, known as “career pathway legislation”, is beginning to report on outcomes from the five regional ‘summits’ convened to date. Jo O’Brien, an ‘industry pathway leader’ with the Colorado Community College System, briefed me recently on initial feedback from participants. (We’ll have much more on the outcomes of 1165-related processes in following weeks). The upshot is positive, in no small part because those who can make a difference are (finally) sitting around the same table.
When industry and higher-ed align, and a new generation of manufacturing employees begins to stream into the economy, can the manufacturing economy produce jobs at a higher rate?
In addition to workforce, growth may pivot on our ability to support entrepreneurs. Despite a generally positive spin here, in Colorado, about our collective exploits in birthing new companies, a recent study by the Brookings Institute suggests we’re struggling to keep them in business. From 1978 to 2011, the number of companies less than a year old in Colorado, as a percent of the total, dropped 51%, near the bottom of national rankings. Or as the Washington Post put it, “U.S. businesses are being destroyed faster than they’re being created”.
The findings track roughly with the steep drop in U.S. manufacturing jobs, and with financing woes related to the recession. Money’s needed to keep the small business in business.
What does all this mean for CompanyWeek? For one, storytelling has never been more important, if workforce and a more connected business community are keys to sustainability. Changing the perception of manufacturing is best done by reporting on those doing it; and media, at it’s best, connects people and companies to facilitate new business partnerships including those involving money.
Would this happen without a manufacturing-centric media voice?
In a hyper-local way, yes. But if broad outreach is what’s needed, and clearly the maker-economy will benefit from a thousand new business relationships, then CompanyWeek will play the important role of regional community-building. And compliment, not compete, with other storytellers.
We’ll revisit the proposition after the next 100. Stay tuned.
Side with the little guy in Cider Fight
/in General/by Bart TaylorWho best represents the interests of industry, upstart entrepreneurs who innovate and force change but often flame out, or established voices who’ve paved the way for those to follow?
The question frames not only the dust up between Tesla and the powerful dealer network that control auto sales in the U.S. (read Jeff Rundles overview from last week), but the fight that’s brewing locally between craft cider makers and national beer brands who see opportunity in the fast-growing, hip new beverage sector.
I’ll leave it to Ed Sealover of the Denver Business Journal to report the details, but the upshot of the cider kerfuffle is this: MillerCoors and Anheuser Busch have convinced two state representatives, Dan Pabon (D, Denver) and Frank McNulty (R, Highlands Ranch), to introduce legislation to eliminate a regulatory step that as a practical matter would lower the price consumers pay for MillerCoors and AB cider. Local makers would be strapped to meet the price break. Quoted in the DBJ, Brad Page of Colorado Cider (read the CompanyWeek profile here) sees it as a death-knell for small producers in the sector.
The Tesla situation is relevant and instructive here. Influencers from the powerful established auto dealer network are forcing Tesla, the most innovative, disruptive U.S. automaker in decades, to conform to a decades-old sales methodology, against its will. On the surface it seems self-defeating for an industry seeking to improve its global competitiveness to undermine a smaller, more innovative operator. Tesla strengthens America’s global auto brand.
Fortunately it looks like the sides are working toward a resolution. No surprise, Tesla may be leading the way. In New York, the automaker’s agreed that in the in future, dealerships will be the point of sale. And states who’ve been convinced to tell Tesla how to run its business, like New Jersey, seem to be coming to their senses.
Or more accurately, lawmakers lobbied into action may be coming to their senses. Those who would intervene on behalf of Coors and Anheuser Busch to the detriment of the small guy should think long and hard about the impacts. The craft beverage sector is a proven winner for Colorado and the region. If the bill hurts growth companies in the space, it’s bad policy.
The premise for reform is not without merit. Colorado’s liquor laws are outdated. Reforming the way beer, wine, cider (and the next beverage) are distributed and sold seems a worthy endeavor.
But as with craft beer, this fledgling maker sector can do great things for the economy if nurtured. So many positive things happen as a result of successful risk-taking and entrepreneurship in the maker economy – jobs, innovation, branding for the state, wealth-building – that it’s critical to support, not undermine, promising businesses like Colorado Cider. Or Tesla.
MillerCoors and AB might argue the point. The regulation may be onerous. There’s a good case to be made for regulatory reform.
But did Colorado state representatives Pabon and McNulty wake up one morning and decide that providing MillerCoors and Anheuser Busch regulatory relief to help them sell more cider should be a legislative priority? Of course not.
Colorado’s business community must rally around the little guys at a time when the economy really needs them. Colorado legislators should slough off intervention and scuttle narrow reform in favor a well-planned and fully-vetted regulatory rework. Let’s send the right message at a pivotal time. Support new makers and manufacturers. Support the little guy.
Mesa County’s Western Colorado Manufacturing Alliance off to a fast start
/in General/by Bart TaylorThe drive east on I-70 from Grand Junction, at 6:15 a.m. on a Friday morning, is more stock car race than commute. The highway’s packed with mud-caked pickups and dualies, all in a mad dash to the oil and gas rigs around De Beque, Parachute then Rifle. The frantic pace seems an apt metaphor for the sector.
I’m heading back to the Front Range after attending the first Western Colorado Manufacturing Alliance Summit, and guessing the surging pack on I-70 is welcome but also a reason to pause for the farsighted leaders who’ve worked to pull this industry group together. Oil and gas have been great for Mesa County, but diversifying the economy’s an objective here. Energy’s boom pace is hard to sustain, at the expense of related sectors in down times.
The rush is also a reminder of the workforce challenge here for non-energy manufacturers. Oil and gas producers tap deeply into the labor pool. Wages are high. It makes it tough on companies who would hire and train a new generation of tech-savvy machinists and equipment operators, welders and brewmasters.
Of course energy producers are manufacturers of the first order, but WCMA has gathered a group of light industry firms, primarily, to network and determine what can be gained from building a more connected maker economy. It’s a mix of established industry players and smaller process and component manufacturers.
It’s a good showing – it’s the group’s first event – but it’s who’s not here that also makes this event and initiative promising. When they’re engaged WCMA will grow.
Only one winery from Colorado’s jewel of a maker sector attended the summit – Talon. It’s not a slight; the vision for a truly integrated maker community, with disparate industries collaborating to advance their interests, is relatively new. Plus some wineries need to be reminded they’re manufacturers.
Also in the building stages is a community of small tech-shop startups and entrepreneurs armed with 3D printers and CAD-enabled means just beginning to provide component prototypes, and increasing production-ready parts that enable small batch manufacturing. The foundation is here; Jon Maraschin’s Business Incubator Center is collaborating with others like Colorado Mesa University and Colorado SBDC to build from the ground up. Meaningful collaboration with Mesa County’s maker community should only grow.
I was one of the few east-slopers who made the trip west to the Summit without a bike. Attendees were peeling off after the last session to ride the Monument, or Rustler’s Loop or planning trail rides the following day. Mesa County’s an outdoor mecca. A push to attract light industrial makers in the lifestyle sector, to leverage and shape fitness tourism into a true cluster strategy with industry a core component seems here for the taking. Companies like Mountain Racing Products (profiled in CompanyWeek) and Loki are vanguards.
The event’s grassroots feel seems the right track here. It’s unclear though whether it’s aligned with the state’s economic development efforts. OEDIT, Colorado’s Office of Economic Development, and CAMA, the Colorado Advanced Manufacturing Alliance, were here, outlining efforts to support manufacturers, mainly from programs in pursuit of federal dollars aligned with national advanced manufacturing initiatives. Colorado’s well-positioned, to OEDIT’s credit. But it’s a high-stakes game with uncertain outcomes, often with long-lead times involving myriad grant applications and lot’s of moving parts.
The top-down push is also expensive. Karla Tartz, Deputy Director at OEDIT, mentioned here that two new deputy directors are being hired to manage program development in advanced manufacturing. Governor Hickenlooper’s economic development bureaucracy is already big; it’s nearly doubled in size since FY 2011-12. And it’s getting bigger.
It’s worthwhile if a payoff follows, if initiatives OEDIT’s pursuing such as the Colorado Acceleration Agenda, or COAA, bear fruit. The ‘Manufacturing Corridor’ envisioned in COAA would first be established along the Front Range, from Larimer County to Pueblo, but eventually include Mesa County and more regional destinations.
Next to this complex and ‘advanced’ approach to advance development, Mesa County’s support of entrepreneurship, of connecting business to enhance collaboration, and tapping its lifestyle attributes might sound inadequate. And Reynolds Polymer and other established industry players here must see also see the benefits of being part of a cross-industry maker community that pulls the same direction.
But if the maker economy here engages, if entrepreneurship is nurtured, and municipalities widen their view to the possibilities, WCMA’s first summit will be a preview of great things to come.
Along with a more casual morning drive along the Colorado River.
When industry comes to play: Utah’s recreation ‘brand’ getting a business push
/in General/by Bart TaylorBrad Peterson, director of the Utah Office of Outdoor Recreation, seems the right person for the job. “When I’m working around the Wasatch Front [in Salt Lake City and vicinity], I try to mountain bike the Wasatch Crest, rock climb up Big Cottonwood Canyon, ice climb up Little Cottonwood Canyon, or do a dawn patrol ski tour before putting on my suit and heading to the capitol by 8:30 a.m.”
Peterson describes his morning regimen to me without a hint of pretentiousness, almost apologetically. There’s nothing modest though about Utah’s efforts to promote its outdoor brand. Peterson was hired after the Utah legislature established the position to support the state’s growing recreation-related economy.
Industry is at the heart of the effort, and it’s here that Utah’s program crosses over from just another tourism promotion to meaningful economic development initiative, one that Colorado and other western states with lifestyle-related business ambitions should watch.
“The recreation economy is one of six key industries that drive our economy, to the tune of about $5.8 billion dollars,” Peterson says. “Per capita, Utah has more recreation-related jobs than any other state in the country and we are continuing to expand that base every year.”
A push to attract recreation businesses is a part of the plan. “It’s hard to economically measure the number of people and companies who have moved to Utah as a result of our extensive recreational opportunities, but we know that as major companies like Black Diamond, Backcountry.com, Petzl, QBP, Skullcandy, and Hoyt Archery have moved their headquarters to Utah, other companies have followed,” he says, adding, “plus we know there’s a “halo” effect of non-outdoor related companies moving to Utah following the actions of outdoor related companies.”
Peterson was part of a Utah delegation that traveled to Taiwan in March to the Taipei International Cycle Show to recruit companies and promote the state’s cycling-related economy. Bicycle Retailer reported on the trip, including Ogden’s noteworthy push to develop a cycling business brand. Ogden’s bike-friendly mayor, Mike Caldwell, is leading a charge to support and attract companies to the area, including an event last September when the city hosted 25 Taiwanese executives from cycling firms on a multi-day bicycle tour of Utah’s national and state parks.
Peterson lauds Caldwell’s efforts. “He’s an enormous advocate to recruit cycling based companies to the state. And he’s doing it the right way. It’s about quality of life and the state’s recreational opportunities but the synergies from being clustered together in the outdoor industry are huge. We’re trying to recruit a large number of Taiwanese companies to headquarter along the Wasatch Front. Ogden’s a great indicator of how it can work.”
Sarah Lehman, CEO of ENVE, one of Utah’s signature cycling firms based in Ogden and global leader in carbon-frame technologies, agrees. “Utah is favorable from a business standpoint, but it’s also favorable in terms of the outdoor recreational focus,” she says. “We’re a bike company. It makes a lot of sense to be here surrounded by our peers.”
The idea of industry clusters isn’t new but the notion of building around recreation (to leverage a region’s world-class natural resources) and the momentum in the lifestyle ‘maker economy’ is, and it’s gaining momentum. In Bozeman, Montana, a group of city officials, manufacturers, and outdoor industry players have launched the Montana Outdoor Alliance to promote the state’s recreation business opportunities and attract lifestyle manufacturers. Montana State University is also at the table.
In Colorado, pockets of recreation industry have developed around the local inspiration of visionary athletes and entrepreneurs. Boulder’s lifestyle business community has long birthed world-class ski, running, and cycling businesses. In Colorado Springs, there’s a growing push to include industry in a possible brand campaign around its Olympic facilities — a ‘City of Champions’ moniker. In Steamboat Springs, the founders of Honey Stinger, Big Agnes, and Moots Cycling have laid a foundation.
Yet Colorado has failed to tightly integrate an industry cluster message with its international tourism push, and moving an inclusive initiative through the state’s painfully large development bureaucracy and polarized political landscape seems daunting. Efforts are still underway in the legislature to fight Governor Hickenlooper’s byCOLORADO program. If the lifestyle cluster strategy is to work here, it likely will be driven, supported, and promoted by local entities.
The benefit of consensus and a streamlined process at a high level isn’t lost on businesses in Utah. “There’s no bureaucracy,” ENVE’s Sarah Lehman says. “There’s no red tape. There’s just a group of individuals who are here trying to improve the workforce and the economic conditions that allow businesses such as ENVE to thrive.”
Brad Peterson of course agrees, and he is committed to keeping the Office of Outdoor Recreation out of political fights that might sidetrack his efforts. Asked about SkiLink, a proposal to connect Canyons with Solitude via a chairlift on Forest Service land that’s ruffling feathers, he said, “The Office of Outdoor Recreation does not and will not own those issues.”
Given the growing competition to attract new lifestyle industry it’s a commendable approach. Utah seems intent on wresting regional lifestyle leadership from its rival to the east. Yet as things are going, and Peterson might agree, how one state goes so goes the region. And if Utah, Colorado and Montana can each build dynamic and growing maker economies in the lifestyle and recreation space, the region as a whole will benefit.
‘Where Industry Comes to Play’. The Rocky Mountains, that is.
(Thanks to Bicycle Retailer, the ParkRecord, and Utah Governor’s Office of Economic Development for quotes in this story.)