Daily Archives: April 28, 2017

In the 1950s, Clayton Landis built his business traveling throughout rural Montgomery County, fixing farm equipment for families with well-known names like Clemens and Moyer.

Matt Landis, manufacturing manager at CHL Systems, looks through the hole in an industrial sprocket he's holding at the company's Franconia plant.

As those companies grew into the food processing giants they are today, the Clayton H. Landis Co. grew, too. And as their businesses changed, so. too, did the Landis company.

Today, the Landis' Franconia company is known as CHL Systems. And while it still repairs equipment, its largest business is making systems that are designed to help its customers automate.

"We provide an overall solution," said Mike Giagnacova, CHL's chief operating officer. "They'll have a problem, and we'll go in and become experts on what they're doing, and provide engineered solutions to solve their problem."

The rising demand for automation in manufacturing is giving a boost to local companies, like CHL, that design and build such systems. From complex robotics to massive conveyor belt systems that are built to move boxes, companies say automation makes it easier for manufacturers to compete on a global scale.

Matt Landis, manufacturing manager at CHL Systems, catches an empty box that traveled on a conveyor belt at the company's Franconia plant to demonstrate how quietly and smoothly the belt system operates.

That technology has been one of the driving forces behind the changing nature of American manufacturing.

A study earlier this year by Ball State University's Center for Business and Economic Researchestimates that roughly 85 percent of the 7 million manufacturing jobs lost over the past four decades has been lost to technology, not overseas trade as some have said. And productivity has continued to rise even as jobs have decreased, the study by the Indiana university found.

Some call it a technology tsunami.

And while researchers at Oxford University, for instance, predict technology could replace 47 percent of all American jobs over the next decades, others believe technology will create new jobs while replacing some older ones. https://qz.com/904285/the-optimists-guide-to-the-robot-apocalypse/" target="_blank">They point to companies like Amazon, which has doubled its employee headcount over the past two years, all while increasing its use of automation and robots in its distribution centers.

More than 70 percent of respondents to Horsham accounting firm Kreischer Miller's annual manufacturing survey said new equipment would lead to an increase in profitability, with 12 percent saying it would have a major impact.

For Waste Gas Fabricating Co., automation has led to growth, said Kyle Cloman, president and CEO of the Falls Township steel fabricator.

"In the industries we're in, it's always whoever can give the best quality, and make it the fastest, wins the contract," he said. "The days of a guy sitting there and cutting everything by hand and hand grinding it, those days are gone. Now everything's cut by lasers and plasmas (cutting tools) and punches. Parts we would make 30 years ago that would take 15 minutes, we now run in 30 to 40 seconds."

The employee-owned company has 85 workers -- up from about 60 five years ago -- who serve nearly 500 customers in a wide range of industries, from transportation to heavy equipment manufacturers.

"If anything, (automation has) grown our labor force," said Cloman. "It's allowed us to grow as a company, because we're getting more work in the door."

Stephen Maund hears similar stories from his clients.

"With today's outsourcing to the Pacific Rim and Central Americas, the competitiveness of the domestic environment makes it very difficult for current manufacturers to be able to compete with that labor structure, as well as the other surrounding costs that are in the United States," said Maund, president and CEO of Demco Automation in Milford. At the same time, "Processes are more complex than they used to be. Reliability requirements are higher than they were previously."

"Automation is critical in the current times to keep manufacturing here because of the complexity of the products, the complexity of the processes, and the overall costs in our industries today," he added.

President and CEO Stephen Maund holds one of the many products produced by the high-tech robotics at his Demco Automation business in Milford.

Demco, which recently moved to a larger facility, builds robots that can automate a wide variety of tasks that could be time-consuming -- and even impossible -- for humans, such as placing tiny stoppers not much larger than a pencil point into the tops of specimen tubes.

"Simpler processes have moved offshore," Maund said. "What we have today is an increase in complexity that requires automation."

For Demco, that means robots. For CHL Systems, it means large-scale systems that help speed packaging and other processes for customers.

"Automation is a lot broader than what people look at," said CHL manufacturing manager Matt Landis. "It's not just a robot."

Stephen Maund, president and CEO of Demco Automation in Milford, shows one of the high-tech robotics his company uses.

CHL, which employs about 140 people and is growing, provides a wide variety of automation solutions to the food and pharmaceutical industries, creating systems out of steel, stainless steel and plastic, said Matt Landis. Its warehouse is filled with giant conveyor belts, packaging systems and other products in various stages of assembly.

"In our economy today, everybody's trying to be more efficient," said CHL's Giagnacova. "Automation is an opportunity to become more competitive."

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As demand for automation grows, so do automation manufacturers - Bucks County Courier Times

Forbes

Top Ten Skills To Beat Automation Forbes Automation is changing the workplace, and it is changing it in unprecedented ways that determine how companies are organized to compete effectively in the market place. It's something workers, managers, and investors should keep a close eye on.

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Top Ten Skills To Beat Automation - Forbes

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Boxed, the eCommerce startup that sells mainly household goods, has spent tens of millions of dollars on a new automation system that the company is hoping will keep costs down.

According to a report inBloomberg News, the new automation system will triple the output of its warehouse in Union, New Jersey, without the need for more space or to hire more employees.

By having a smaller number of products, Boxedcan get stuff out the door more cost effectively by reducing the warehouse footprint and the complexity of the operation, saidClint Reiser, director of Supply Chain Research at ARC Advisory Group, in an interview with Bloomberg. It becomes a competitive advantage.

Boxedcurrently has warehouses in New Jersey, Dallas, Las Vegas and Atlanta and offers customers bulk-sized products similar to those found at big warehouse retailers like Costco Wholesale. Boxed told Bloomberg the company had sales of roughly $100 million last year, which is up from $50 million in 2015.

According to the report, the average order size for Boxed is $100 and includes 10items. Orders have to meet a $50 amount to get free shipping. Our strategy is to not chase Amazon, Boxed Founder Chieh Huangsaid in the report. We have to build our business our own way.

One way Boxed has stood out and pleased both brands and shoppers is by putting free samples in orders and suggesting smaller items, including chewing gum and mints, at checkout to increase the order size and not incur more shipping costs.

Where does impulse go when you shop online? said Rick Zumpano, Boxeds vice president of Distribution, in the report. A lot of our partners count on that in retail stores, so we offer something similar.

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Boxed Lowers Costs With Automation - PYMNTS.com

In recent months, pickers in the New Jersey fulfillment center for the online wholesaler Boxed have loaded home goods into colorfully branded boxes in the shadow of the machines and conveyor belts that many analysts say will one day completely replace them.

But even as the machines begin to pack up toothpaste, toilet paper, and bottled water and then carry the packages down two miles of belt, not a single Boxed employee will be searching the classifieds.

I need every one of these guys, says Rick Zumpano, VP of distribution and an automation veteran by way of Lowes and BJs Wholesale. So Im going to transition them from picking, to picking. I wont lose any of them for automationsimply to support our growth.

Boxed, started out of CEO Chieh Huangs garage in 2013, has typically relied on pickers walking up and down serpentine rows of palates, looking for items and then grouping them in bins per each customers order, to later be loaded into boxes and shipped.

Boxed has an automation plan that flips that process: smaller items will be brought to the pickers by a warehouse-scale vending machine, who will then transfer them to a bin on a conveyor belt. That bin snakes down the two miles of belt, and larger items are placed inside by other pickers who stand beside specific items and load bins as they pass by.

Really what weve done is eliminated the need for travel, Zumpano says. Those pickers in the old world still pick.

Employees will also be switching to an audio-based information system, where items and order numbers are called through a headset. If the automation does mean some employees are no longer needed on the picking line, they will be retrained to help service the machines, or in customer service, Huang tells Quartz.

And by turning the workflow around, the fulfillment center expects to see a 300% gain in productivity.

For us, its more about capacity. We need more capacity to fill the orders, rather than saving every last penny, Huang says. But even so, were taking that as an opportunity that its not about bottom-line profits all the time, its sometimes about those people who produce those results.

Boxed has in the past gotten press coverage for the unusual fringe benefits the company offers workers, like kicking in $20,000 to help pay for weddings, or footing the bill for the college education of employees children. Huang doesnt see the retention and retraining of staff as a benefit per se, but an extension of caring for the employees that have helped build the company.

Its people first. The folks that got us to this point built shareholder value. And now that were automating our fulfillment centers, from a person perspective its unfair that we kick them to the curb and say, Thanks for your service, but now weve got Mr. Roboto to do your job.'

Economists and analysts often say that just like the loom and automated weaving machines didnt completely eliminate workers from the textile industry, industrial robots wont wipe every warehouse or fulfillment center job off the map. But just as often, the experts have pointed out that its unclear what jobs will actually be created. The question is pressing, given that Boxed, Amazon, and others are committing to automation, threatening to transform an entire industry.

What ended up happening with the looms was a lot like the story told by Huang. Some workers were still needed, and others had to be educated into new roles driven by the specifics of the machinery. Wages increased for the skilled workers.

Huang agrees that the lesson of the loom applies here: Education will be the key that allows people to remain employable in an increasingly automated workforce.

There will be pain, but as a society well get past it, Huang says. If the conversation surrounds profits only, there will be a lot more pain than if folks considered the human impact.

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An Amazon competitor is showing that automation doesn't have to mean the end of human jobs - Quartz

"CBS This Morning" is launching a new partnership this morning with LinkedIn called "Work in Progress."

Technology available today could automate 45 percent of the jobs people are paid to perform across all occupations. By the early 2030's, 38 percent of current jobs in the U.S. could be automated and one industry could be hit particularly hard.

Since at least the industrial revolution, Americans have worried abouttechnology taking their jobs. Past inventions have ended up creating new jobs, not just destroying old ones, but economists worry that this time may be different, reports Tony Dokoupil.

In Maplewood, New Jersey, Tim Jianni works the register of his family-owned convenience store just as he has since high school.

"Here, we know all of our customers by name and I have papers or candies, I know what they get. I put it right there so that it is ready for them, and it makes them feel good," Jianni said. "I just, you could see when they come in they have that smile on their face."

One day, Jianni hopes to pass the job to a new generation, keeping it in the family or at least keeping it human.

Other retailers have a very different dream. For example, an autonomous, multilingual robot is designed to help customers at the home improvement chain, Lowe's, to get their shopping done as quickly as possible.

"You can talk to it and it talks back to you," said Kyle Nel, the executive director of Lowe's innovation labs.

"It's basically doing indoor mapping and figuring out where it is. Where you are," Nel explained. "It will actually help you find the thing you're looking for."

The machine is one of 22 that the company is proudly testing in Northern California. "Oh my gosh, there is an autonomous robot inside of a Lowe's, awesome," Nel said.

But what may look "awesome" for Lowe's and many of the nation's other businesses could spell anxiety for American workers.

For decades, automation has eaten up more American jobs than global trade, according to economists, who warn that the job losses may be poised to accelerate.

"I don't think we've begun to grapple what that would mean for the economy if these jobs start to really go away in vast numbers," said LinkedIn managing editor Chip Cutter.

Cutter, who has been studying automation, says cashiers and retail workers may be the hit hardest and comprise the single biggest job category in America.

When asked by Dokoupil whether these jobs could go away in the next two decades, Cutter responded, "That's the fear.'

At a Stop and Shop in Bayonne, New Jersey, customers can be their own cashiers - scanning, bagging and swiping their credit cards.

Customer Kelsey O'Donnell says she recommends scanners to others,

"This is a lot easier to get out the store a little quicker," O'Donnell said.

At an Amazon concept store in Seattle, sensors allow customers to shop, walk out and pay via a wireless account. "That's the technology that a lot of people say may more resemble the future that we are gonna see," Cutter said.

But many of the cashiers and retail workers of the world aren't buying it. They think the robot revolution is overblown.

"A robot is just, they are not going to give you that personal interaction," Jianni said. "That's what people want." Judy Rubashkin works down the street at Words bookstore.

"People still like to talk to somebody. I don't think you can replicate that," Rubashkin said.

While Nel is excited about the future of their robot -- or "Lowebot" -- he says the store has no plans to replace human workers. "Honestly and truly the robots are just a support system," Nel said.

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How will automation affect the retail industry - CBS This Morning ... - CBS News

SINGAPORE Foreign precision engineering firms are investing more in Singapore, drawn by strong semiconductor demand and government incentives aimed at re-tooling an economy short of skilled labor.

The city-state is running programs worth billions of dollars to support productivity, automation and research, attracting global chipmakers including U.S.-based Micron Technology Inc and Germany's Infineon Technologies.

This investment rush into electronics helped the technology sector log 57 percent output growth on average in October-February from a year ago, and kept Singapore from recession late last year.

"I've lived in Europe, I've lived in Japan, I've spent a lot of time in Taiwan and other countries. From a proactive standpoint, Singapore is about as good as it gets," said Wayne Allan, vice president of global manufacturing at Micron, adding the Singapore government's long-term vision was key to Micron expanding its investment.

Taking advantage of government grants, Micron is investing $4 billion to make more flash-memory chips in Singapore. It increased output by a third in the second half of last year and expects similar growth in the first half of this year.

Linear Technology Corp, a maker of analog integrated circuits, has opened a third chip testing facility in Singapore, and will produce 90 percent of its global test equipment in the city-state.

All this has created something of a virtuous circle in the semiconductor supply chain, with chip testing equipment supplier Applied Materials reporting record shipments to Singapore last year, said its regional chief, Russell Tham.

It's unclear how much of this revival in Singapore's $40 billion chip industry is due to a so-called ultra-super-cycle in the global memory chip sector, and Singapore remains a smaller player than South Korea and Taiwan.

"It is vulnerable to a pull-back," said Nomura economist Brian Tan. "If there's a turnaround in the semiconductor industry ... it becomes a lot more apparent that the underlying growth momentum is not great."

-For graphic on 'global memory chip market forecast' click: tmsnrt.rs/2k8LOqk

-For graphic on 'Singapore's semiconductor industry performance' click: tmsnrt.rs/2oLaZOi

MOVING UP

However, there are real signs that the targeted government incentives are helping firms move up the value chain.

One of the larger programs is the Productivity and Innovation Credit, where Singapore has budgeted S$3.6 billion ($2.6 billion) for 2016-18. Another S$400 million automation support package is aimed at small firms, and a S$500 million Future of Manufacturing plan encourages testing new technologies.

The Ministry of Trade and Industry says it encourages manufacturers to "embrace disruptive technologies" such as robotics. "These measures will help ensure the manufacturing sector in Singapore remains globally competitive," it said, attributing the strong semiconductors performance partly to demand from China's smartphone market and improved global semiconductor demand.

For Feinmetall Singapore, whose products are used for testing semiconductor wafers, grants covered about two thirds of the $100,000 cost of a needle-bending machine it needed to help overcome an island-wide labor shortage.

"If we use the same methods as before ... I don't think we can expect any growth," said Sam Chee Wah, the company's general manager, noting Feinmetall Singapore struggled to retain some workers for much longer than a year, even after nine months of training.

GlobalFoundries Singapore, a wafer maker, has spent $50 million on 77 robots, each able to perform the tasks of 3-4 workers. This has helped the company move up the value chain into parts for self-driving cars and security-related chips for credit cards and mobile payments, says general manager KC Ang.

Singapore now has about 400 robots per 10,000 workers, the world's second-highest density after South Korea. Most robots are used in electronics, according to the International Federation of Robots.

And further developments are in the pipeline.

AUTOS, IOT

At its Singapore manufacturing hub, Infineon is developing productivity tools such as robotics and automated guided vehicles which it hopes to deploy to other production sites. Dutch chipmaker NXP Semiconductors is also developing vehicle-to-everything technology, enabling vehicles to communicate with each other and roadside infrastructure.

Instead of trying to compete with high-volume producers such as China or Malaysia, Singapore has shifted to higher-end products, said Jagadish C.V., head of Systems on Silicon Manufacturing, another firm making semiconductor wafers.

"So you do the products which others can't do so easily," he said, adding his firm had shifted most of its output to specialized products, such as chips used in smartphones.

CK Tan, President of the Singapore Semiconductor Industry Association, noted the global chip industry is automating faster than other sectors because of cost pressure, a need to eliminate or reduce error, and have a consistent process control.

"In Singapore, it's even more important for us to ... look at how to speed up or increase the level of automation because of the lack of skilled resources," he said. "The industry has recognized it has to move upscale. The government incentives play a part to allow the manufacturing side to be relevant, to be at least cost competitive."

The Ministry of Trade and Industry said first-quarter growth in manufacturing - up 6.6 percent year-on-year, while overall GDP was up 2.5 percent - was due mainly to output expansion in electronics and precision engineering.

Integrated circuits were Singapore's biggest export product among non-oil domestic exports in January-March, topping S$6 billion ($4.29 billion), according to trade agency IE Singapore.

($1 = 1.3972 Singapore dollars)

(Additional reporting by Christine Kim in SEOUL, Jessica Yu in HONG KONG and Orathai Sriring in BANGKOK; Writing by Marius Zaharia; Editing by Ian Geoghegan)

Alphabet Inc's non-advertising business, which houses its cloud unit, Pixel smartphones and the Play store, has long been sandwiched between Google's advertising juggernaut and its moonshot ventures that have captured popular imagination.

Apple Inc asked the state of California to make changes in its proposed self-driving car policies, the latest sign the company is pursuing driverless car technology.

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Singapore's automation incentives draw tech firms, boost economy - Reuters

Klaus Grohmann, founder of the German firm Grohmann Engineering which specializes in automated manufacturing acquired by Tesla late last year, was just ousted after clashing with the electric carmakers CEO, Elon Musk, Reuters is reporting.

Grohmann reportedly disagreed with Musk over how to handle his firms legacy clients, according to the news wire, which included Tesla competitors like Daimler (parent company of Mercedes-Benz) and BMW. Musk wanted the German manufacturing facility to focus solely on building Tesla vehicles.

It was only six months ago that Tesla acquired Grohmann Engineering, with the firms founder agreeing to head a new division within the automaker called Tesla Advanced Automation Germany. The acquisition was the linchpin in Teslas plan to add an additional 1,000 engineering and technician jobs in Germany, on top of Grohmanns existing 700 employees, over the next two years. This was to happen parallel with the companys aggressive plans to ramp up electrical vehicle production at its Fremont, California, factory. Tesla has stated its goal is to produce 500,000 vehicles by 2018.

Before the acquisition, Grohmann worked with a number of other automotive manufacturers, as well as semiconductor and life science companies. At the time, Tesla said Grohmann would continue to work with outside clients, including those in the automotive industry. But over time, those directives apparently changed, leading to Grohmanns ousting.

A spokesperson for Tesla didnt immediately respond to a request for comment. But in a statement to Reuters, a spokesperson praised Grohmann Engineering as an incredible company, and said Teslas plans to expand its manufacturing operation in Germany would not be affected by his departure.

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Tesla's German automation expert reportedly ousted after just six months - The Verge

Lee Tschanz, vice president for North American sales at Rockwell Automation, thought a black employee he was coaching was too timid to advance. But Tschanz was feeling pressure from his bosses to help people of color and women succeed at the Milwaukee-based industrial automation and software company. He decided to try a different approach after learning in training about the distinct challenges faced by workers who arent white men.

Tschanz told the employee he wanted to better understand his experiences as a black man at work. The employee then shared that his father and grandfather had always warned him not to challenge white authority. He said hed grown up in the South and could end up hanging in a tree if he did that, says Tschanz, a 24-year veteran of Rockwell. The frank exchange helped: The employee started speaking more at meetings with superiors and eventually was promoted to a management job. Up until this point, Id always thought I was fair and promoted the best people and didnt understand it isnt equal for everyone, Tschanz says.

Over the past decade, Rockwell executives have diversified what was a predominantly white male workforce. The current and former chief executive officers have made this a priority and part of managers performance reviews. White men are coached to understandand changeattitudes and behaviors that make women and minorities feel unwelcome and prevent them from advancing. The result: Rockwell isnt just recruiting more women and minority engineers and managers, its retaining more of them.

Last year about 25 percent of managers and 25 percent of senior leaders who report directly to the CEO were women, up from 11 percent in 2008. Theyre also 13 percent of engineers and 31 percent of other professionals. People of color made up 15 percent of managers and 21 percent of engineers in 2016. Overall, 10.8 percent of all Rockwells employees are black, Latino, or from another minority group, and 8.6 percent are Asians. These figures are significant at a time when competition for science, technology, engineering, and mathematics talent is steep and many executives in Silicon Valley say they cant find enough qualified black or Latino people and women for engineering jobs or even sales and other management positions. Black people and Latinos make up only 6 percent of technical professionals at tech companies; women, 17 percent. Those numbers havent budged in three years.

The gains at Rockwell have taken years, and parity for women and minorities remains elusive. We still have a way to go, says Ernest Nicolas Jr., vice president for strategic sourcing and supply management. Nicolas, who is black, is one of seven people of color among 53 vice presidents and regional directors. His experience has been positive and has kept him at Rockwell, as hes had opportunities for new experiences and to advance. Since joining the company in 2006, hes had five jobs, including an overseas assignment as regional director for Asia Pacific manufacturing.

Building diverse teams is crucial to Rockwells growth, CEO Blake Moret tells managers. This isnt a one-season fad for us, he says. Its something were investing in.

Rockwell is also notable for what it hasnt done. Unlike many tech companies and those in other industries, it never set hiring quotas or established formal mentoring programs. Instead, it focused on getting white male managers to change their attitudes. Most companies are looking to the women and minorities to fit in or to tell them how to fix things and leaving out white men, says Susan Schmitt, Rockwells senior vice president for human resources.

Tschanz says he was reluctant in 2008 to attend an off-site workshop called white men as diversity partners but went at Schmitts urging. Initially he was bored, he says. Then a lightbulb went off when the facilitator drew two boxes on a whiteboard, one marked men and the other women, and asked the group to describe each gender. We said words like strong, in charge, and macho for men, and soft and pretty for women, he says. And then the facilitator drove home his point, telling us that a woman who wanted to be a woman couldnt easily join our box, and if she tried to join us shed likely be judged too tough or bitchy. Suddenly I realized how much energy and time women and minorities spend just trying to fit in.

About 4,400 of the companys 22,000 managers and employees worldwide have attended workshops for white men. An additional 600 employees of both genders have received training in recognizing unconscious bias. Prospective employees are interviewed by teams that include women and minorities, and executives attend recruiting events. Customer and staff meetings now include wine tastings and cooking lessons, as well as more traditional events such as golf outings.

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Stephanie de Garay, who joined Rockwell in 1996 after graduating from college with an electrical engineering degree, was feeling stuck in her sales staff job at the York, Pa., office when she heard about the training nine years ago. She formed a networking group in 2009 for other women that now has about 550 members, including men. Its helped to ease womens isolation and raised their visibility with executives. I hadnt been on their radar before, she says.

De Garay has been promoted three times since 2010 and is now head of sales in southern Ohio, a $160 million territory with 50 employees. Her husband followed her; he cares full time for their three children. Now if you want to be promoted, you need to be engaged in something related to diversity and inclusion, and you cant fake it, de Garay says.

The bottom line: Unlike the tech industry overall, Milwaukee-based Rockwell is recruiting more women and people of color, and retaining them.

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White Men Can Change at Rockwell Automation - Bloomberg