Insight on Manufacturing

w w w.in s i g h t o n m f g . c o m November 2017 • /INSIGHT ON MANUFACTURING | 39 By Kelly Armstrong Director of Sector Strategy Development Wisconsin Economic Development Corporation From robust growth averaging 4 percent annually in the 1950s and 1960s, growth of the U.S. GDP has slowed down to about 2 percent. Similarly, the annual growth rate of U.S. manufacturing productivity now averages around 1.7 percent—well below the long-term annual average of 3.2 percent. Lagging productivity growth hampers economic expansion. Lifting Wisconsin's manufacturing sector out of this slump is the mission of the Transformational Productivity Initiative (TPI), a public-private partnership assembled to provide leadership for Wisconsin manufacturers on the challenges they face in achieving productivity growth. A recent study by McKinsey Global Institute, a private sector think tank, found that nearly 75 percent of the productivity growth required to reignite the economy can be achieved by closing the gap between best-in-class companies and those that lag behind—and that companies at the top are nearly twice as productive as those at the bottom. This means we have all the leadership we need right here in Wisconsin, and companies that wish to improve their productivity can learn from the practices of their peers. Productivity depends in part on the efficiency of workers, but a larger influence is technological advancement. With Industry 4.0, also called the fourth industrial revolution, companies are utilizing sensors and "smart" machinery to make their manufacturing processes ever more efficient. As the planning phase ends and we move into implementation, TPI is prepared to work with Wisconsin manufacturers to implement the ground- breaking productivity-boosting practices already in use by their peers, while facilitating a creative process that allows companies TRANSFORMATIONAL PRODUCTIVITY INITIATIVE seeks Wisconsin manufacturers to participate with already high productivity to improve further with the help of innovative new ideas. In this way, TPI aims to assist all Wisconsin companies in boosting their productivity and buoying the state's economy. It is our goal to help companies identify and close performance gaps relative to other companies in their NAICS code, and to support best-in-class firms in expanding the frontier through technology, operational and business innovation that will define the best practices of tomorrow. TPI will focus on five key factors relating to manufacturing productivity: LEADERSHIP AND STRATEGY ENTERPRISE EXCELLENCE HUMAN CAPITAL MANAGEMENT TECHNOLOGY GROWTH AND INNOVATION Throughout human economic history, technological innovation has always been a driving force that propelled some companies forward, with their peers forced to adapt or become obsolete. These cycles of innovation are becoming shorter and shorter in length, requiring companies and workers to stay abreast of the latest technologies or get left behind. With the help of TPI, our state's manufacturing sector can be a leader in pioneering productivity enhancements, giving Wisconsin companies a competitive edge in the global marketplace while raising living standards here at home. We are currently seeking companies to participate in TPI and receive an assessment of where and how productivity enhancements can be made within their businesses. We hope your company will consider participating and contact us to get involved. n Transformational Productivity Initiative In partnership: To learn more, visit transformationalproductivity.org — A D V E R T I S E M E N T —

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