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The President’s Secret Manufacturing Innovation Agenda

Obama and Jet disc SOURCE: AP Photo/Pablo Martinez Monsivais President Barack Obama looks at an aircraft component during his tour of the Rolls-Royce Crosspointe jet engine disc manufacturing facility in March 2012.

The Obama administration has embraced an innovation policy to strengthen U.S. manufacturing. But you rarely hear about it in this election year noise.

After losing nearly 6 million manufacturing jobs in the last decade and closing down over 50,000 manufacturing facilities across the U.S. in the recent economic downturn, many said, accurately, that manufacturing in America was on the ropes.

But today, we’re adding hundreds of thousands of new manufacturing jobs—half a million since 2010.

Why the sudden reversal?

One reason is that President Obama publicly recognized the vital importance of manufacturing to our nation’s economic future, and took some gutsy steps to save it.

Everyone by now has heard about how the auto industry bail out saved thousands of small part suppliers across the Midwest from bankruptcy, despite being politically unpopular. This intervention saved an estimated 45,000 jobs across nearly every country in Ohio, and more than a million manufacturing jobs nationally. The President also set a high-profile goal of doubling exports, which we are now on track to exceed.

What has Obama done to actually fulfill this political goal? He’s put in place a plethora of under-the-radar public-private partnerships that are helping small and mid-sized manufacturers innovate and compete globally. The National Digital Engineering and Manufacturing Consortium, or NDEMC, is one such partnership program.

Craig Carson, the CEO Jeco Products, a small manufacturing company in Plainfield Indiana, just landed a multi-million-dollar contract to build and export large plastic shipping pallets for a large automotive company—and he attributes a significant part of the success to the Obama administration’s NDEMC initiative.

More than 300,000 small and mid-sized manufacturers like Carson’s company make up 50 percent of our nation’s manufacturing GDP and employment. But little companies like Jeco often lack access to 21st century design and optimization tools that allow larger firms to innovate and compete.

To address this, the NDEMC helps firms like Jeco leverage the digital assets and research capabilities of universities and larger firms to accelerate innovation, improve their products, and compete globally.

The program allowed Carson’s 25-person company to develop and test a sophisticated digital model of his product on a high-performance computing platform and optimize the design to meet the international customer’s needs in a matter of days, rather than months. With a new and improved version of his product, Carson was able to increase the purchase order from $500,000 to $2,500,000. Before Jeco, the product had been manufactured in—you guessed it: China.

“Our customer is so impressed with the design of the pallet that they want to file a joint patent with Jeco,” says Carson. “And we will hire an additional six personnel as a result of this job as well as purchase additional capital equipment.”

The story of Jeco and the NDMEC program is emblematic of the Obama administration’s partnership-driven approach to economic growth. This public-private partnership brings together numerous stakeholders in the region—from Purdue University to Ohio Super Computer Center to larger industrial partners like P&G, John Deere, GE, Lockheed Martin and Boeing—to collaborate and democratize access to digital tools used for innovation in manufacturing—especially for small companies.

Tom Lange, a director at P&G-Cincinnati, explained it best in his analogy between wine and innovation tools: “today only ‘vineyard owners’ have been able to enjoy ‘wine’—because of the scale barriers to use high performance computing, software and special expertise. NDEMC was founded to explore and develop business models that lower the barriers for small companies to access ‘wine by the barrel, bottle or glass’—as their manufacturing and business needs dictate.”

Dr. Ashok Krishnamurthy, Senior Director for Research at the Ohio Super Computing Center noted “NDEMC is bringing Modeling Simulation and Analysis to the large pool of smaller manufacturers in the Midwest, who form a vital part of the manufacturing supply chain. Over 20 small manufacturers are a part of the program, and initial results show great promise for creating a self-sustaining model that can provide access to these tools for manufacturers across the country”

And NDEMC is not alone. Initiatives like this have been popping up all around the country to the close the innovation gap between science and manufacturing across the country. In the past few months alone, the administration announced 17 new and similar manufacturing consortia across the country. Looking forward, the administration has put forth a plan to invest in a network of 15 Manufacturing Innovation Institutes over the next two years to help transition scientific research into U.S-made products.

These are just a few examples of how the president’s we-are-all-in-this-together approach to innovation and economic competitiveness is working for small manufacturers in Ohio, Indiana, and across the country. Thanks in part to these smart investments to help the little guys and grow the economy from the bottom-up, manufacturing in America is gaining momentum.

Sridhar Kota is a Professor of Mechanical Engineering at the University of Michigan, Ann Arbor. This article reflects the views of the author and not those of the University of Michigan.

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