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Take Me OUT OF the ball game?

By Russell Ethridge

I like baseball. I’m not one of those folks who keep box scores or who can tell you offhand a pitcher’s earned run average, but I enjoy the subtleties of the game and the tension that builds in the park in the bottom of the ninth with the winning run at the plate. If only I could watch it from my $39 seats! My complaint isn’t about the sight lines or an obstructed view. I usually score lower deck seats just outside the first base line that provide a great view of the infield and the action at first. But unless I’m near the front rows, I can’t see much of the game because of the constant parade of people up and down the aisles who apparently can’t sit in their seats for more than a few minutes before deciding they need some other form of stimulation to stave off the boredom of what is admittedly a slow paced event. I’m not complaining about the people I stand up for who are leaving my row, although they are part of the problem. Their obstruction is temporary and brief. But if you’re next to an aisle that runs between you and the action, watching the game is like trying to look at a sandlot game through a picket fence as you drive by, only you’re sitting still and the fence is the constant stream of humanity looking for another beer or in today’s parks more sushi.

Baseball IS slow, and Major League Baseball struggles to think of ways to speed it up. There are long moments of no action followed by bursts of activity which, even if you miss them, are captured for replay on large screens. Who needs to pay attention? You hear the roar and look up at the big screen that probably provides a better view anyway. “Let’s get something to eat” you say to your date, and maybe you have another 16 ounce $10 beer that will inevitably find its way through your urinary tract resulting in yet another trip up and down the aisle. Multiply these three or four trips by the number of people sitting in seats below you and you’ve got a river of humanity between you and the action. Just looking at a ballpark reminds me of the physics phenomenon called Brownian motion that describes the constant movement of all molecules. No one can sit still unless, of course, they have a smart phone. If the game can’t keep people in their seats, at least their phones do.

When you have the distraction of a smart phone, you’re less inclined to entertain yourself by shopping and dining on the concourse. Instead, you can miss the action by taking selfies and communicating with people who you MUST share the immediate moment of the game you paid to watch. But then you totally miss important moments because you are screwing around with your phone. Next time you watch a baseball game on TV, just look at the crowd behind home plate. At least half the folks have their heads in their phones. I don’t care if those people want to spend their time and the price of admission playing with their phones. At least they’re sitting still with their heads down.

Hockey, at least in Detroit, has addressed the stream of humanity issue. Those arriving late or returning from the concourse with beers and a pizza are held at the top of the aisle until there is a stoppage in play. In addition, since the venues are generally smaller and the aisles steeper, the site lines are usually more direct and less subject to obstruction. I’m not sure such a policy would work at a baseball game, but I’d like to see something done to reduce the traffic up and down the aisles. One friend says it is never a problem for him at Comerica Park because he has upper deck club seats with catered food, a bar, his own restroom, and a living area with multiple TVs where his guests can watch the game just like from home. I guess for the tens of thousands of dollars you pay for a suite, you get to have all your friends watch the game on TV in a place that is not your living room and where other people prepared your food. Another friend says it isn’t a problem for him because he’s in the upper deck cheap seats where the crowd is less dense (unless we’re playing Boston or Cleveland) and the people can’t afford the exorbitant food and beer prices.

The institution of baseball has done many things to remain relevant in an age where we have the attention spans of gnats. Interleague play, big replay screens, giveaways, and historical figures or giant sausages racing around the bases all attempt to keep us entertained. When I go to a sporting event, however, it is because I want to see a game, not a circus, and baseball owners need to remember not to continually distract or obstruct us.

Question: Do you prefer your sports on TV or at the Stadium?

Russell Ethridge is a prominent attorney in the Detroit area and longtime contributor to Today’s Machining World.

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Machine Tool Jenga

By Lloyd Graff

IMTS is coming in a couple of weeks, so it is a good time to assess where the industry is right now.

It is apparent in retrospect that $100 oil was a bubble. It enabled a fracking boom in the United States and an oil sands boom in Alberta. Both have crashed and deflated, giving the machine tool industry a mega migraine.

Oil has rebounded from a low of $33 a barrel to almost $50 now. But the competition for market share between Saudi Arabia and Iran, two of the few producers who have extra capacity and can afford to sell at low prices, has kept prices down and discouraged new drilling in the U.S. and Canada. Big Oil’s offshore projects are starting to be played out, but Big Oil is just learning how to frack. The rig count (oil rigs in use) is rising slowly now, but not enough to move the needle much in the machine tool world.

The oil drop, and subsequent drop in machine tool sales in North America has once again demonstrated that the economy is like a huge Jenga game. Take one piece out of the infrastructure and the entire building can collapse.

Of all the machine tool builders Doosan of Korea may have been hit the hardest by oil’s fall. Doosan’s parent company has major financial problems in its home country and has finally sold the machine tool division, its most salable piece, to stay afloat. Several deals had broken down but a Korean venture capital group finally closed a deal in May.

Doosan has continued to build stock and has an enormous pile of machines in Long Beach, California. Some sources say they have 1000 machines sitting there, which explains their discounting. Doosan’s glut of machines naturally affects its competitors who have also suffered from the oil and gas downturn and price cutting.

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The auto industry has thrived over the past two years with gas prices hovering around $2 per gallon. Low interest rates and aggressive financing have buoyed sales around the magic 18 million per year mark. At the moment sales are trending down a bit, though light trucks and crossovers are still strong. The auto industry is not adding more plants here. Production in Mexico for cars and components is booming, but that is not helping the U.S. machine tool users much.

Medical manufacturing in America is decent, but the medical device excise tax is pushing some items offshore, particularly to China.

Homebuilding should be thriving in America now with 1.55% 10-year Treasuries but it isn’t because family formation is slow, young people are paying off college debts, and lending institutions are very tough about extending mortgages. The crash of 2007-2008 still overhangs the market and seems to affect every lending decision. We continue to hover around 1,150,000 annual housing starts, which means a mediocre market for fasteners, furniture and floor cleaners, thus fewer lathes and presses being sold.

Big companies have a lot of liquidity but they seem less focused on plant expansion and more on mergers and trimming costs. If one looks at the great business success stories of the last 10 years, few if any are in manufacturing. Amazon, Google, and Facebook do very little manufacturing. Apple makes almost everything in China.

The self-driving car appears to be coming soon. It will mean some changes in the way autos are made. Hopefully it will make for fewer accidents, which will mean fewer repair parts are needed. Unfortunately it also means less manufacturing.

Put it all together and it is not bad, but not really bullish for the machine tool industry in North America headed into IMTS 2016.

Maybe you have a different view?

Question: Do you prefer oil prices to be high?

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Back to School

By Lloyd Graff

It’s back to school week in my neighborhood, which means later meals and parents waiting in our living room.

My wife Risa will be practicing her profession in our home. She is an Educational Therapist, helping kids develop optimal learning skills and self-sufficiency in their educational careers.

Risa has been developing her own skills in this profession for over 40 years, though she looks no older than 40 to me. Because she teaches outside of the school systems she has the freedom to develop her own unique teaching techniques and style.

She likes to play educational board games with her students like Pass the Pigs and Chocolate Fix. With the games she engages even the angriest and most recalcitrant students to think spatially and strategically. A puzzle game called Rush Hour teaches kids to plan ahead, pause to think and explain what they’ve learned.

The games used by Risa also help her students develop learning stamina and persistence. Surviving and developing as a learner is so hard for a lot of kids. Risa used to say that she was in “the make school easier business,” but she no longer uses that phrase. Her life’s work has now evolved into a more holistic approach. There are a myriad of factors in a student’s environment that affect whether he or she will succeed.

Risa Graff giving a presentation on the use of games at Association of Educational Therapists Conference.

She tells parents at the beginning of a new school year that her objectives include the following:

• Developing a positive mindset about one’s capacity for learning.
• Learning to become mentally engaged in all kinds of tasks.
• Developing persistence even when a task is perceived as difficult.
• Finding joy in learning.
• Learning to set personal academic goals and monitor progress.
• Learning the power of pausing to reflect and to plan ahead.
• Learning to monitor thinking and work production while in the process of doing the task.
• Learning a variety of strategies and which to choose for a specific task.
• Gaining a sense of empowerment by beaming more aware of strengths, needs and emerging skills.
• Learning how to transfer a positive mindset and specific executive functioning skills to skill tasks, employment and life skills.

Through the years I’ve seen kids with wicked Learning Disabilities (LD), Attention Deficit Disorder (ADD) or Attention Deficit Hyper Activity Disorder (ADHD) tame the devil of disorganization and frazzledness to become stars in school, get into the Marine Corps, go to college or occasionally end up with a Doctorate. Not long ago, when I was at a doctor’s appointment at the University of Chicago with a specialist in neuro-ophthalmology, I was shocked to run into a former student of Risa’s who was on rotation at the U of C Medical School.

When Risa first saw him he was on the verge of being kicked out of high school because he was hopelessly disorganized. Underneath his chaos of lost notebooks was a brilliant kid. Risa and “Hal” worked very hard together for a year and half to help him develop the strategies he needed to access his amazing brain and allow him to demonstrate it to his teachers and himself.

Not every kid with learning or behavior problems flourishes like “Hal.” Some kids can’t pull it together and parents can sometimes sabotage the program, but Risa continues to see each new school year as a huge opportunity to make a difference in her students’ lives.

I learn about her students indirectly, through dinner conversation or by observing them concentrating on a jigsaw puzzle in our living room.

For so many kids, school is a torture. Risa makes a difference for a handful of fortunate ones every year.

Question: Are you happy with the education your kids have received?

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The Summer of ’61

By Lloyd Graff

Lloyd is on vacation this week. Below is one of his favorite summer blogs he wanted to share with you again. It was originally published in August 2015.

Summer jobs for younger people used to be common and highly desirable. Twenty years ago almost two thirds of high school kids found paid summer work. Today the statistics say only one out of three hold summer jobs.

Many factors have contributed to this fading away of summer employment. Unions are blamed for vetoing non-union hires in some plants and offices. Minimum wage increases make summer hires less attractive because employers have to pay inexperienced people more than they deem them to be worth. Wealthier parents often push their kids to volunteer or take enrichment courses or summer school makeups to help them get into selective colleges. Physical challenges like Outward Bound trips are seen as character building exercises.

But the old fashioned summer job, like unloading a Pepsi truck or testing urine in a lab, or cleaning filthy machines, can be a character builder with a lot of value, especially for young people who have lived in relatively sheltered environments.

I remember my first summer job, when I was 16 years old. I put a $6 ad in the Chicago Tribune classifieds, under “situations wanted.”

I advertised that I had writing and journalism skills, which was accurate, even if it was for the sports department at the high school paper.

Amazingly, I got a call from a man named Hadley who owned a bulletin board publication called the Civil Service News and was trying to build a magazine named Midwest Ports.

Teenagers de-tasseling corn. A traditional summer job in the rural midwest.

He interviewed me at his office in downtown Chicago in the building next to the Schubert Theater, a live performance venue near State and Madison. I guess I passed inspection, because he hired me.

The job was an education for me, but not for the journalism. Hadley was a curmudgeon who had a drinking issue. He wore sunglasses in his office. I soon realized that Midwest Ports was a boring magazine that nobody was going to read, but the Civil Service News was a sought after rag that people coveted because it carried all the fresh job openings.

Things went quite well for about a month and then suddenly, without notice, Hadley fired me. He gave me no explanation. He just said, “kid, you’re fired, get out of here.”

I was aghast and perplexed. I asked the secretary who had befriended me in the office what I had done wrong. She motioned for me to leave the office and go down to Wimpy’s restaurant on the first floor where she met me a few minutes later.

She told me point blank that Hadley had found out I was Jewish (how, I don’t know) and fired me “because he hates Jews.”

This was 1961, I was 16, and my cool summer job was over. Boom.

I had made a few bucks, enjoyed the excitement of taking the Illinois Central train into downtown Chicago, and got a dose of anti-Semitism that I had only known about from my parents’ occasional stories.

I think that kids who don’t do summer jobs, no matter how menial or nasty, miss out on something important. They need to learn how to navigate the work world with its rigors and nasty folks. For the elite kids headed to fancy colleges it is a chance to work with the people they may have to fire one day in a managerial position. It’s part of the critical seasoning process everybody needs to be successful.

Despite it’s rude ending, I cherish that first summer job.

Question: What was your most memorable summer job?

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Flipping the Script

By Noah Graff

I just listened to a fantastic story on the National Public Radio podcast, Invisibilia.

The episode began with a story about a group of friends sitting outside in the backyard having dinner and drinking wine on a beautiful night. All of a sudden a man broke into the yard, pointed a gun at them and demanded money. Unfortunately, none of the people at the dinner party had any money on them so they all began pleading with the man to spare their lives. After a while one of the women asked the burglar if he wanted a glass of wine. The burglar was stunned by the offer, but he decided to take a glass. He sat down, took a drink and then said something like, “Damn, that’s a really good glass wine.” He put his gun in his pocket, drank some more wine, ate some cheese and then said, “I think I’ve come to the wrong place.” Everyone sat in silence for the next few minutes until he suddenly asked if someone would give him a hug, so several of the guests hugged him. Then he asked if everyone could do a group hug, and they indulged him on that request as well. After the group hug he told everyone he was sorry, got up with his glass of wine and walked out of the house. Later on in the evening the dinner guests found his wine glass neatly placed on the sidewalk.

The title of this episode was “Flip the Script.” It featured several stories that demonstrated the powerful effects of when an individual or group reacts to an adversary’s negative behavior with an opposing positive behavior, also called non-complimentary behavior. History has shown that when hate and cruelty are met with positive reactions such as empathy and restraint it has the power to catch aggressors off balance and move people, as was demonstrated by the nonviolence movements led by Martin Luther King Jr. and Ghandi.

One story in the show took place in Aarhus, a town in Denmark where 34 Muslim boys had run away to Syria to join Isis in 2012. The desperate parents of the disappeared boys went to the town’s police for help to find their children.

Anti-war demonstration in front of the Pentagon 1967 (Courtesy of humanrightsdemocracy.com)

At that time, Denmark was ranked second on the list of European countries with a homegrown terrorist problem. Other European countries such as France and England introduced harsh polices to combat domestic terrorism. They severely punished people who went to fight in Syria or who showed suspicious behavior, locking people up and confiscating passports. But two white Danish police officers in Aarhus, Allan and Thorleif, decided to take the opposite strategy. They believed that many of the young Muslim men in the town who exhibited suspicious behavior, or even people who went to Syria, were angry and confused but they were not all terrorists. They argued that some people may have gone to Syria to work as medics or just to see what it was like. They also thought that if you label people as terrorists, if they are not terrorists yet, they will become terrorists. So rather than combating the Muslim boys with hostility, they decided to approach them with love and caring.

When one of the 34 runaway boys returned to Aarhus from Syria, Allan and Thorleif met him. He told them that he had been volunteering as a medic. There was a good chance that he was actually a fighter rather than just a medic but the police officers told him they believed him and took him to a hospital to treat a gunshot wound. They listened to his frustrations and why he was inspired to go to Syria. Then they helped him get his life together and set him up with a mentor, a successful Muslim man. This boy made a call to another boy who had gone to Syria, telling him how he had been treated, and then that boy came back. Since that time, 18 of the 34 boys have returned to Aarhus, 6 have been killed and 10 are still in Syria. More importantly, the program set up by Allan and Thorleif has prevented hundreds of Muslim boys from leaving for Syria by seeking them out early when they exhibit hostile behavior.

When I reflect on these stories of non-complimentary behavior I can’t help but think of our current Republican presidential candidate. It appears that non-complimentary behavior is not in Donald Trump’s DNA. He has demonstrated an inability to react to an adversary’s hostility with humility. He can only respond with matching hostility, even when it is a counterproductive option. When confronted with hostile criticism from the Muslim parents of a fallen American soldier Trump had the opportunity to flip the script. He could have turned the other cheek to the insults and shown respect for a Gold Star family, which would have shown a human side of him. But Trump seems incapable of responding to hostility with empathy; his only instinct is to portray himself as a victim and sling mud back. He needs to learn that sometimes a good passive defense is the best offense.

I was trying to think back to a time in my own life that I flipped the script, and I recalled a salsa dancing party I threw for my birthday last year. A week before the party around 50 people had RSVP’d, and I was very psyched. Then I received a blunt email from my neighbor who lived above me who happened to have a two-year-old. My neighbor wrote to me that it was wrong for me to have a party that lasted so late into the night (2:00 or 3:00 a.m.), which he said would displace his family. Prior to that party I had thrown two others. I had warned him before the first party that it would be loud and end late, so his family stayed at his in-laws that night. The second party he decided to test how bad it would be and by 1:00 a.m. he was sending me desperate texts for me to turn the music down. I understood why he didn’t want the upcoming party to go late—keeping a 2-year-old up late at night can have bad consequences. But I was pissed. I wanted to reply that I was only throwing parties once or twice a year and that it was my building too, so he should just suck it up and deal with one late night. But after pausing to think for a moment I decided that response would not get the outcome I wanted. Perhaps I could just ignore his complaints and do as I pleased, but I liked my neighbor and felt some empathy for him, and it’s not good to make an enemy of a neighbor. So instead of going off at him in a hostile email, I wrote to him that it would be my pleasure to pay for he and his wife to stay at a hotel in downtown Chicago. I doubted that he would accept this offer but I figured I had nothing to lose by trying it. The next day my neighbor texted me that he and has wife liked the hotel idea and said he had found a deal on a hotel for a mere $130. I texted back and told him I would drop off the money in cash under his door mat that day. The party was fantastic. People stayed at my condo making lots of noise past 4:00 a.m. We even broke out some musical instruments. A few weeks later I ran into my neighbor’s wife, and she told me that the hotel getaway was wonderful. She said it was great to get away from their house and have some private time. (They dropped off their two-year-old at her parents’ house.) I had successfully flipped the script. By reacting to hostility with generosity the scenario changed from one of tension and resentment to a win-win outcome where everyone felt great afterward. We had the same arrangement for the following party, and I hope we agree to do it for my party next week. The $130 party expense was worth every penny.

Question 1: Have you ever reacted to aggressive hostility with kindness?

Question 2: Is Donald Trump capable of restraint?

Listen to the Invisible podcast: http://www.npr.org/programs/invisibilia/485603559/flip-the-script

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Need a Parachute?

By Lloyd Graff

Damon Carson likes to tell stories about the goods he sells. He takes the discards of industry and government and reframes them as wonderfully useful products for those clever enough to realize their true value to them.

Damon calls his firm, “Repurposed Materials,” differentiating himself from scrap dealers and recyclers. He defines his company’s mission as taking products which still have value “as is” and finding that unrelated buyer who will buy them to use for a different purpose.

He has a deftly written email newsletter that he sends to 150,000 of his nearest and dearest. He claims a 20% open rate, which piques my skepticism, but more power to him if he nets even half of that. He sends it to a cross section of industrial and service businesses across America looking for the needles in the cumulative haystack who might envision the perfect usage for plastic beer kegs or 275 gallon liquid totes.

Damon is also excellent at re-purposing language. His warehouses have been dubbed “industrial thrift stores,” not factory rummage resale shops.

Damon freely shared his business model with me. He gets his merchandise for little or no money but has costs in freight, storage, handling and marketing. He related one of his latest coups to me with the relish that a used machinery dealer could appreciate.

Comcast was stuck with 100,000 pounds of precast 4’ x 4’ x 4” thick concrete pads – three semis worth. Mr. Carson gladly took them off Comcast’s hands and advertised them to his potpourri of potential buyers. He found a live one in a trucking firm that sends a lot of light loads through wind-swept Wyoming. Sometimes the crosswinds get so ferocious they can overturn a semi on a flat interstate, but the concrete pads serve as ballast. Freight could be carried right on top of them. The trucker took them all. It was the ideal solution.

Parachute used as a wedding canopy

One of Damon’s current hot sellers is military cargo parachutes. They had served the U.S. Air Force well, being used for dropping food pallets and generators into deserts and glaciers, but now they begged for a new purpose.

He has sold some to gold mines in Africa. The mines use them as temporary shelters for workers sweltering in the heat who need shade. In Fort Mcmurray, Alberta, oil tar sands country, he sold one of his largest variety, 100 feet long, to creative folks who draped it over heavy equipment, ran a Salamander heater underneath it and did their maintenance during the frigid winter in relative warmth.

Damon enjoyed talking about a deal he had with Boeing for high quality aerospace paint. It turns out that the airplane regulators will only allow paint to be used that is under 24-months-old. Boeing discards their 23-month-old perfectly good paint and Damon sells it mainly to pig farmers who find it super for their silos and metal barns.

Old firehoses are another desirable product he sells, going primarily to boaters for docking cushions. He also likes “skeletons,” the cutouts from heavy stamping steel, though I have no idea who buys them other than artists.

Damon stays away from electronic materials like the plague. No old cell phones or computers in his warehouses.

Repurposed materials. Cool idea in the hands of a talented storyteller.

Take a look at Damon’s web site here: www.repurposedmaterialsinc.com

Question 1: Do you have a repurposing story?

Question 2: How would you repurpose old screw machine cams?

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Do You Like to Drive?

By Lloyd Graff

I am all into the concept of self-driving cars. That does not mean I am ready to be a pioneer and buy one of the early iterations like the Tesla Model S with Autopilot, but I am a totally engaged fan of Elon Musk as he gambles on the sexiest new technology in his cars.

The inevitable happened on May 7. Joshua Brown, one of those risk-taking kind of guys who always wants the newest and hottest technology, put his Model S on Autopilot at 74 miles per hour next to a semi with a white trailer on a cloudless Florida day. The car’s navigation system drove the vehicle under the trailer as it turned into his lane on the highway, killing Mr. Brown. The Mobileye navigation system could not distinguish between the bright sky and the white tractor trailer.

Mobileye has now ended its deal with Tesla, but it is still heavily involved with GM, Nissan, BMW and Hyundai in developing autonomous driving applications.

The corporate dance we are now watching with Tesla, Mobileye, the National Transportation Safety Board, insurance companies and the lawyers who fight for and against them is fascinating. Naturally, Tesla and Mobileye are bobbing and weaving, knowing that lawsuits await.

Tesla Model S that resulted in the death of driver Joshua Brown in May 2016. Courtesy of theverge.com

The Geicos and State Farms have huge money potentially at stake if cars become substantially safer. Car insurance generates $200 billion in premium revenue. If accidents were cut in half by autonomous cars, you can imagine a lot of folks could make the decision to gamble on going naked on fender bender policies. It could ruin the current business model for Jake at State Farm.

Huge money is going into driverless car research. In Palo Alto and Ann Arbor such cars are constantly rolling around local streets. They are so common they don’t even get a second look in Palo Alto. Google and Apple both see the car as a vital piece of their business in the next 10 years.

After the Joshua Brown accident, the doubters have come out to crow about the virtues of humans at the wheel, but 35,000 traffic fatalities a year tells a different story.

I have always been a technology doubter. To this day, I prefer maps to a GPS system. However, I really hope and believe I will eventually buy an autonomous car to replace my 2003 Toyota Avalon. I am holding off buying a new car because the only reason I can see to buy one is to get the driverless features. The primitive parallel parking apps that are being advertised now hold no allure. I actually like to parallel park, though living in the burbs gives me scant opportunity. I do think the lane warning feature has value.

Let the engineers and lawyers do their work. Autonomous cars are coming, and personally, I can’t wait to be driven by one.

Question 1: Do you like to drive?

Question 2: Do you like convertibles?

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Buying a Job Shop

By Lloyd Graff

Dave Dolan runs one of the biggest screw machine operations in North America, KKSP Precision Products of Glendale Heights, IL. The company started in the 1960s with a couple of Davenports and a founder possessing great skill and ambition. I sold him some of his first machines.

He sold out long ago when the name was still K&K Screw, but the company is true to its roots, even with 460 machines in the U.S. and Mexico. It is still pounding out parts on Davenports and Acmes, about $55 million worth a year now, cutting 28 million pounds of brass and steel with 16 sales people sniffing the bushes for work.

Last week KKSP announced another acquisition, Dune Manufacturing of Melrose Park, Illinois, a tiny buy for one of the biggest screw machine houses in the world, 15 Davenports and a handful of skilled people. You would think it barely moves the needle at KKSP so I called Dolan, who comes from a financial background, to find out the rationale for the acquisition.

Dolan said he is continually looking for deals to grow the company. Like a baseball general manager combing the free-agent market for undervalued talent, he is constantly trying to strengthen and expand the company.

KKSP started with three Davenports in 1969.

He calls the Dune Manufacturing buy a “tuck in” purchase. KKSP is buying machines that are easily integrated into its Glendale Heights facility. It gets the opportunity to hire some talented machinists who know how to run the screw machine work that Dune is transferring. KKSP also retains the former owner of Dune, Denis Colht, to tend his customers and use his special knowledge of the marketplace to search for more.

Colht is a machining veteran who gets to cash out his equity in the business for more than asset value.

Dolan sees it as a “win win” though KKSP is known in the business as a tough bargainer.

I have learned in business that how you frame your proposal is crucial in making a deal.

Dune was selling a book of ongoing profitable business, the opportunity to hire knowledgeable set up and operating talent and a capable owner who will transfer his knowledge to KKSP, all located within 10 miles of Glendale Heights. Dolan gets the business but very little of the overhead.

Dolan has a long list of possible buyout candidates. He is looking for a company doing $10 to $25 million in sales that will give him more geographical reach and expand his customer base. From his experience the $5 million sales company often has an owner wearing many hats with no depth in its staffing. In a bigger company you buy the ISO and TS qualifications, good IT infrastructure and experienced people in the critical staff positions. The bigger company benefits from KKSP’s sales capability, but they can also grow independently.

Dolan says KKSP hopes to make one such acquisition each year, though often nothing fully comes together. So they keep looking, analyzing each possibility and waiting for the gem that is a good fit and fairly priced to come along.

Meanwhile, KKSP keeps cajoling pieces out of 2000 spindles of vintage Davenports and National Acmes.

Question: Would you start a machining business today?

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One Chance

By Lloyd Graff

The issue that seems to be giving America heartburn in 2016 and driving the election rhetoric is the gulf between the well-off and the falling-off. Underlying that is the feeling that it is getting harder and harder to move from “barely getting by” to “feeling successful.”

I listened to a remarkable podcast this week by Malcolm Gladwell called “Carlos Doesn’t Remember.” It was so good I listened to it twice. Gladwell recounts the struggle of “Carlos” (not his real name), an exceptionally gifted student from a broken home who is trying to reach his potential. He was spotted in 4th grade in a rough Hispanic neighborhood in Los Angeles by Eric Eisner, a wealthy Entertainment Industry lawyer turned philanthropist, who helps disadvantaged but brilliant kids reach their best life outcome. Eisner says that he has to find kids by the 4th grade; otherwise they will be sucked into gang culture or fall so far behind their affluent counterparts that they will be too discouraged to do the work to catch up.

The Carlos story is complicated by numerous crises in Carlos’ personal life: a missing father, an emotionally fragile mother who abandons Carlos and his sister and ends up in prison in Texas, and a foster child system that separates Carlos and his younger sister. Despite all of this turmoil, Carlos, who is now a teenager, continues to excel academically, even at the elite private high school 45 minutes away that Eisner has helped him get into.

The thrust of Gladwell’s podcast is that middle class and wealthier children get several chances to screw up in life, but kids like Carlos, if they are extremely lucky and smart, get one chance. If they screw up just once they miss their opportunity to rise above their bleak circumstances.

Listen to the podcast on youtube here: https://youtu.be/2Uc-u79D31w

*****

I was reminded of Carlos while talking to Scott Wallace of southern Indiana’s Vincennes University, which has perhaps the most sophisticated training program in the country for aspiring CNC machinists.

Vincennes University “CNC Machinist Now” Grad

The Vincennes approach is a 60-credit hour Associates Degree with 5 instructors and 15 modern pieces of Hurco CNC lathes and machining centers.

In the two-year curriculum students are challenged with classwork and intensive instruction on the production equipment. Mr. Wallace indicated that most of the graduates go directly to the shop floor at employers in the Indiana, Kentucky and Illinois areas near Vincennes. Enrollment is full at 75 students for the first year. They have about 60 in the second year of the degree program.

They also have an advanced one-year program with 14 students in programming, which enables students to earn a second Associates Degree.

The Vincennes program costs $177 per degree hour, so a full-time paying student is on the hook for $10,000 tuition without assistance. Room and board adds to the tab.

I wonder if the smart, mechanically inclined young man or woman in Gary or Fort Wayne even thinks about their possibilities for a career that a Vincennes curriculum might provide. And even if somebody informs them about Vincennes, are their lives too complicated and filled with personal crises to take a chance on a two year commitment, $10,000 in tuition, and life away from what they are familiar with?

When Bernie Sanders and now Hillary Clinton float the idea of free college for all it sounds appealing, but Malcolm Gladwell’s piece dramatically portrayed how life gets in the way, even for the most gifted of students.

Vincennes is a nice option for kids who have some prior initiation to machining and math. Unfortunately, so many young people living in the inner cities have very little of both and are born into desperate circumstances which hold them down. If it is extremely difficult for an exceptionally gifted student like Carlos who has the help of a wealthy angel looking out for him, what chance do people have who don’t have such advantages?

Question: Does everyone have a chance to achieve prosperity in the United States?

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The Dune

By Lloyd Graff

The path was steep and winding, inaccessible by car. It led to the beach on the Pacific Ocean at Monterey Bay, near where my granddaughter went to summer camp. She wanted to show off the scenery to us.

I chose to stay at the car while the others in our group trudged down the rapidly descending path to the sea. I wanted to douse my memories of 8 years ago, when I was wondering if I’d make it up the sand dune at Lake Michigan where the family was vacationing right before the heart attack that almost ended my life.

For the last 8 years I’ve almost entirely avoided sand dunes and steep ascents from the water. The images they provoke in me are just too unsettling. Why look for anxiety when there’s enough in everyday existence to fill my cup to overflowing?

I thought I had buried the sand dune memory, turned it into a postcard photo after eight years, but I hadn’t. I don’t know if I can kill the scary images of the past. Maybe the best I can do is identify them and say to myself, “I know you, you annoy me, but you don’t spook me anymore.”

Sleeping Bear Dunes, Michigan

Eight years ago, as I struggled to climb the 150-foot sand dune at Union Pier, Michigan, the sweat poured from my forehead and armpits. It was as much from the fear and denial as the exertion. Was I going to make it to the street? Were they going to have to call an ambulance? And if I did make it up the dune, was I going to fake it like I had been all week on the trip, or let everybody know how scared I was?

I faked it.

Everybody else went out for lunch at the nearby burger joint, but I stayed in the car, trying to will away the pain in my left upper chest and dry the sweat on my brow.

I had forgotten that awful half hour waiting for the family to finish lunch, wallowing in fear in the Toyota, until just writing this. Maybe memories never really are buried.

Question: Have fear and denial almost killed you?

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