M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P CWA Conference April 2010 NIST MEP Saving Local Jobs Through Proactive Business Retention and Layoff Aversion Mark Troppe, NIST MEP Cheryl Slobodian, CMTC

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP CWA Conference April 2010 The Opportunity  MEP -- Workforce system collaboration  Wide range of issues faced by at-risk companies requires wide range of expertise  Specific expertise brought by different partners in the “early warning” frameworks described earlier

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Warning Signs  Financial problems  Quality problems  Supply Chain issues (both directions)  Market issues  Ownership problems  Disinvestment  Declining sales and/or declining employment  Mismanagement  Duplicate capacity  Management instability  Business “climate” complaints  Changes in land use  Inadequate research and development  Changes in management behavior  Removal of equipment  Cash crunch/irrational cutbacks  Unusual bargaining positions  Unidentified visitors and/or cosmetic improvements  Decreased utility use NIST MEP CWA Conference April 2010

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P States With a Track Record  Oklahoma, Missouri, Pennsylvania, New York, Michigan, Indiana  California - EDD Information Notice WSIN09-47 (3/2/10) - “…the wide range of lay-off aversion options available through rapid response…” - Includes “consultation with at risk businesses to explore refocusing or retooling a company to serve new markets…” - “…Establishing contracts with business intermediaries…to conduct prefeasibility studies and implement business intervention strategies…” NIST MEP CWA Conference April 2010

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP CWA Conference April 2010 Missouri--The Business Retention Team  Composition - WIB staff (i.e., designated BRC) - Local economic development representatives - Community/technical college representatives - MEP staff - Local utility company representative - Other interested organization reps (business associations, Chambers, SBDCs, etc.)

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Layoff Aversion Missouri Layoff Aversion Results (two regions) NIST MEP 6 CWA Conference April 2010 Year Total # of companies engaged Jobs retained Jobs created Sales Increases $ 3,454,000 $ 27,973,112 $ 10,825,000 $ 42,252,112 Sales Retained $ 7,208,000 $ 14,321,000 $ 3,855,000 $ 25,384,000 Cost Savings $ 8,371,392 $ 22,595,212 $ 10,257,659 $ 41,224,263 Investments $ 1,770,200 $ 3,182,715 $ 1,753,535 $ 6,706,450 Impact as reported by clients on surveys at the end of the project - estimated or anticipated.

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP 7 CWA Conference April 2010 VISION MEP is a catalyst for strengthening American manufacturing – accelerating its ongoing transformation into a more efficient and powerful engine of innovation driving economic growth and job creation. VISION MEP is a catalyst for strengthening American manufacturing – accelerating its ongoing transformation into a more efficient and powerful engine of innovation driving economic growth and job creation. M ISSION To act as a strategic advisor to promote business growth and connect manufacturers to public and private resources essential for increased competitiveness and profitability. M ISSION To act as a strategic advisor to promote business growth and connect manufacturers to public and private resources essential for increased competitiveness and profitability.

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP 8 CWA Conference April 2010 The MEP Program in Short...  Program started in 1988, 1+ center in all 50 states by 1996  59 centers with over 440 field locations - System wide, Non-Federal staff is over 1,550 - Contracting with over 2,300 third party service providers  Partnership Model – Federal/State/Industry  MEP System budget ~ $300M - 1/3 Federal, 2/3 State and Industry (fees for services)  Address “market failures” (access to information, technical expertise and cost). NAPA Study in 2003 reconfirmed.  Emphasis on performance – program and center – impact of center services on client firms.

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP 9 CWA Conference April 2010  Focus on meeting manufacturer’s short term needs, but in context of overall company strategy  MEP Center areas of common strength -Engineering Services for products and processes -Growth Services – new or expanded market opportunities -Lean Manufacturing -Quality Systems -Environmental Services -Workforce Development  Reach nearly 33,000 manufacturing firms and complete over 10,000 projects per year* *Based on FY2009 MEP Center reported performance data. What MEP Does

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP 10 CWA Conference April 2010 Client Impacts Resulting from MEP Services FY2008  New Sales$3.6 Billion  Retained Sales$5.5 Billion  Capital Investment$1.7 Billion  Cost Savings$1.4 Billion  Jobs Created and Retained52,948

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P NIST MEP CWA Conference April 2010 Benefits  Preventive measures to promote economic health for businesses, employees and communities  Stabilize operations then connect to growth opportunities (i.e., JOB CREATION)  Proactive approach improves business perception of workforce and economic development  Forges new mutually beneficial economic/workforce development relationships  Leverages complementary core competencies

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Two MEP Centers Serve the State Northern Cal Manex – Southern Cal CMTC NIST MEP CWA Conference April 2010  California has nearly 45,000 small manufacturers, more than TX & NY combined  MEP Centers in every state, 2 in California  Mission to serve small manufacturers  Partnering is critical California manufacturers are being hit hard – 28% of jobs lost since 2001 (543,000) CMTC  Southern California  Approx 31,000 Small Manufacturers MANEX  Northern California  Approx 14,000 Small Manufacturers

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P CMTC – WIB Manufacturing Sector Initiatives 7- step Plan for Lay-off Aversion & Business Assistance Services NIST MEP CWA Conference April 2010  CMTC & WIB Partners utilizing 7 step plan 1.Well defined program requirements and regional partnerships 2.Joint awareness and outreach to manufacturing sector 3.Discovery meetings utilizing Business Scan™ and Early Warning Checklist review for business viability 4.Custom business assessment to identify needed assistance 5.Gain customer commitment to job retention & agree to scope of services/implementation 6.Customized on-site lay-off aversion training & implementation 7.Independent 3 rd party survey for satisfaction, impact & jobs

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Current WIB Funded Partnerships with Manufacturing Sector Focus NIST MEP CWA Conference April 2010

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Orange County WIB Layoff Aversion – Business Assistance Cosmotronic  Printed Circuit Board Manufacturer in Irvine CA  Employs 82 and 15 are currently at risk of layoff due to turbulent economy, eroding customer base and increasing off-shore competition  Declining sales from $12.9m in 2008 to 2010 forecast of $9.4m  Business assistance: Lean manufacturing implementation from order processing through manufacturing and shipping to increase operational efficiency, reduce production costs and retain workforce  Project started late March 2010 and company forecasts retention of the 15 employees based on implementation plan and forecasted outcomes NIST MEP CWA Conference April 2010

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Verdugo WIB Layoff Aversion – Business Assistance Center Point Manufacturing Company  Since1966 precision machining components used in a variety of applications for Aerospace & Defense  Employs 23 and all 23 are currently at risk of layoff due to potential loss of key clients Allied Signal, Raytheon, L3  Without implementation of an AS9100 Quality system they will not qualify as a supplier  Business assistance: Quality system implementation and development of AS9100 quality process with workforce  Project start date April 2010 and company certification for AS9100 targeted for July 2010 meeting customer requirements and retention of business. NIST MEP CWA Conference April 2010

M A N U F A C T U R I N G E X T E N S I O N P A R T N E R S H I P Questions & Contact Information Manufacturing Lay-off Aversion Services NIST MEP CWA Conference April 2010  Questions?  Contact: Brent Meyers (Northern California)Cheryl Slobodian (Southern California) Manex CMTC Toll Free: MANEXToll Free: CMTC Phone: Phone: