Category Archives: Business

Swarfcast Ep. 10 – John Griner, Twists and Turns of a Hydromat Shop

By Noah and Lloyd Graff

Scroll down to listen to the podcast with John Griner.

In today’s Podcast we interviewed John Griner, founder of Griner Engineering in Bloomington, Indiana.

John has been cranking out turned parts for the last 40 years, and since the ‘90s his bread and butter has been the legacy Hydromat business.

He’s a renaissance man. He studies philosophy, flies planes and has played the guitar for 50 years. He has had 34 different startup businesses as diverse as centerless bar stock grinding, cold forming, video production, and an exotic animal business called “wild things.” But in the end, the one that always stuck was the multi-spindle/Hydromat business.

John Griner in New Orleans

We talked to John about how his machining business has evolved over the years. He started running single spindle screw machines, graduated to cam multi-spindles, then added Hydromats and finally introduced modern CNC turning equipment into the mix.

John talked with us about how he copes when deals go bad, how he finds good employees and why he prefers not to drug test in his shop.

Question: Is a strict drug testing policy a necessity for a successful machine shop?

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Swarfcast Ep. 8 – Electric Cars and 3-D Printing with Jeff Reinke

By Noah and Lloyd Graff

Scroll down to listen to the podcast with Jeff Reinke.

In today’s podcast we interviewed Jeff Reinke, Editorial Director of Industrial Equipment News (IEN). He gave his take on several of the fastest emerging trends in the machining business, including electric cars and 3-D printing.

Reinke said that right now Elon Musk is suffering the consequences of overpromising and underdelivering on his products. He said that Musk is a unique car company CEO because when certain projects suffer setbacks he stubbornly charges forward instead of shelving them as other car companies would.

This boldness enables Tesla to develop innovative technology that sets the company apart from the established but conservative automotive makers.

Reinke said that when the big car companies start producing all-electric vehicles on a large scale Tesla will have to develop a niche to survive the market. Not having a niche could lead to being acquired by an established car company seeking to obtain Tesla’s technology.

Thirty four non-spring parts made with a laser-sintering machine out of Inconel 625 (weaponsman.com).

The big question is whether the majority of consumers will follow the electric technology or if they will stubbornly hold onto their current gas vehicles.

Reinke also said the advancement in 3-D printing is one of the current trends in machining he is most excited about. He said it is fueling the demand for customization and he is impressed by the cost-effective materials available for the process such as carbon fiber and metal. However, Reinke believes that for the near future large volumes will still be made with conventional metal cutting equipment rather than using additive manufacturing.

Question: Does producing guns with 3-D printers scare you?

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Swarfcast Ep. 6 – The Mind of an Auctioneer with Robert Levy

By Lloyd Graff

Scroll down to listen to the podcast interview with Robert Levy.

In today’s podcast we interviewed Robert Levy, longtime industrial auctioneer and owner of Robert Levy Associates, a firm that consults with companies looking to monetize their industrial assets.

Robert joined his family auction business, Norman Levy Associates, in 1980 but only had the opportunity to work with his father for three years. He and his brother continued to grow the company until finally selling it to DoveBid (now GoIndustry DoveBid) in 2000 for $30 million. He stayed on the board of directors at DoveBid but then parted ways four years later, dissatisfied with the direction of the company, which many unhappy former Norman Levy Associates employees had already quit.

At the end of the interview Robert said, “I’ve been in the business 40 years and I’ve been in three companies, and I would still like to be in the one I was at originally.” It was an interesting comment, but my bet is that Robert doesn’t regret his life’s journey from stand to stand.

Robert Levy of Robert Levy Associates, Inc.

Sometimes you have to burn down the old to grow and thrive, and if nothing else just survive. Sometimes the clear choice is to sell out to a competitor or private equity firm. Or, you hire someone like Robert to help liquidate your assets that are not giving you what you need anymore. Then go build something new and great.

You still get to keep your fond memories of the past.

Question: Does bidding in an auction excite you or make you crazy?

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Swarfcast Ep. 5 – Esben Østergaard of Universal Robots

By Noah and Lloyd Graff

Scroll down below the blog to listen to the podcast interview with Esben Østergaard.

Today’s Swarfcast is an interview Noah and I recently conducted with Esben Østergaard, founder and chief technology officer of Universal Robots, a Danish firm that sold out in 2015 to automation conglomerate Teradyne for $285 million.

Esben started the company on a shoestring with his partners in 2005. They struggled to build a viable prototype and then luckily found an investor who believed in their idea of a compact, inexpensive robot that was easily programmed by factory floor workers. The robot was intended to be used as a tool for a person, or “cobot.” It was not intended to be used as stand-alone automation like traditional robots developed for giant automotive plants, doing work around the clock on the same job year after year.

Esben got into robots as a child, developing his first crude robot to solve a problem for his father who was working as an engineer building the water system in Seibu City in the Philippines. At the time, his father’s staff was using dogs and piglets to carry cables through the pipes, but the animals proved unreliable and ornery. Esben developed a battery powered robot made from Legos to pull the cables though, which beat chasing dogs around the project.

In the senior year of his Masters Degree studies, Esben and a team of other students developed a robot soccer team which ultimately won a World Championship in the event. Later he studied and worked in Los Angeles and Japan, but eventually returned to the University of Southern Denmark for graduate work and a teaching position.

His passion was to start a company to bring about his vision of a low cost but exceptional robotic arm that would aid people on the factory floor, rather than replace them.

In 2008, with the company starving for the cash needed to develop the distribution and sales to reach the 25 units per month break even point, they found an investor.

Esben Østergaard of Universal Robots

Esben is delighted by the creative ways people are using his cobots, which most people can learn to program in a free 88-minute online course. Universal Robots are giving massages, being used in hospitals for rehab, and landing airplanes as co-pilots. They have even found their way into movies as villains. “You don’t even have to dress them up,” Esben says.

We asked him if he felt that robots would ultimately replace many people in the work force. He said that many companies who have bought Universal Robots actually end up hiring more people because their businesses grow.

Esben said that he sees the definition of “work” constantly evolving. He said that if a person from a hundred years ago saw a modern office she would not be able to identify a single person working. History has shown that people are driven to work, but they must keep adapting and constantly reeducating themselves as technology advances.

Question: Are you afraid a robot will take your job?

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Swarfcast Ep. 4 – Our Family Treasure Hunting Business

By Noah Graff

Listen to the podcast with the player below.

In today’s podcast Lloyd Graff and his son Noah delve into their family used machine tool biz… er treasure hunting business. They discuss how Noah came to work at Today’s Machining World and Graff-Pinkert, what it’s like working together and basic alchemy.

Question: Would you like being in business with a family member?

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Swarfcast Ep. 3 – Part 2 of Miles Free Interview

By Noah Graff

Miles Free, Director of Research and Technology at the Precision Machined Products Association, opines on electric cars, economic patriotism and how American machine shops have evolved to thrive in today’s economy.

Question: Are tariffs aimed at China economic patriotism or a tool for the enemy?

Listen to Swarfcast in the player below.

Honda Assembly Plant in Liberty OH   (Dayton Daily News)

 

 

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Machinery Marriage

I often ask clients of our machine tool business where they make the most money in their businesses. They usually have an answer immediately, and it isn’t in the place where they are investing fresh money.

I’m frequently talking to folks who run multi-spindle automatic screw machines, usually cam-operated, in tandem with a host of other equipment. Many people regard these machines as antiques from the antediluvian epoch of manufacturing. These are machines that some folks say won World War II. For the uninitiated, that was the war in which we fought the Germans and Japanese, while the Russians were our allies. The world does have the ability to change.

The ironic answer I often get is that the multi-spindles make the most money, and the return on investment is off the charts because they were written off eons ago.

But the secret sauce is the knowledge of where they fit in the picture. Banging out a half million dumb parts on old Acmes or New Britains is a losing game. Increasingly, sharp manufacturers in Shanghai or Bangalore will make you bang your brains out. Subsidized steel in China and dirt priced brass in India make the simple threaded widget yesterday’s game. But, combining the raw machining strength of 6- or 8-spindle multis with the

finesse of twin-turret, twin-spindle CNC turning centers can turn 20 cent blanks into $2 medical or aircraft pieces. Running single bars through an Okuma or Nakamura will make you a bit player in a crowded cast, but combining those machines with the muscular multis that still can pull their not-so-insignificant weight, makes a potent combination that Shanghai and Bangalore can’t beat.

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President Trump’s tariffs are an annoyance which could grow into a blister if they do not bring any fundamental shifts from the Chinese. American manufacturers, particularly steel users, are today’s sacrificial lambs as the Administration vaguely pushes for China to stop stealing intellectual property. The naïveté of somehow expecting Beijing to allow one of its biggest employers, the inefficient State-run steel industry, to suddenly erode because of the tingling jab of American tariffs is quite surprising. I fret that the strong U.S. economy has made an overconfident Trump start a fight without a clear endgame.

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My son Noah is getting married next month and already receiving some gifts. It brought to mind a few memorable gifts my wife Risa and I received for our wedding that have lasted over the decades we have been together.

We still use our copper bottomed Revere Ware skillets and sauce pans almost every day. Amazingly, 48 years later, they are better than when we got them from Shirley Silverstein as a gift, because they have been seasoned. We seldom shine the copper bottoms, however.

We still have aluminum baking pans, perfect for brownies and cakes, which have remained as wonderful as they were when we received them more than four decades ago. Then there is the cookie recipe book that Risa refers to often and the old Better Homes and Gardens recipe book that never seems to age.

The ideal present does not have to last for 40 or 50 years. Luggage can be used hard for 5 or 10 years and happily discarded, and a sweater that you wear often has a finite life. My wife and I have our own good china, but she usually uses her mother’s china for Sabbath meals and special occasions.

We have several weddings coming up besides Noah’s. The Amazon gift certificate is an appealing surrogate for the special wedding gift that will be remembered fondly 50 years from today. Gifts also go out of vogue. Silver serving bowls seem like such an anachronism today. Who has the space for them to sit idly on shelves?

With wedding season at its peak, I am curious to know who has gifts that have withstood the test of time. Who has a great idea for a gift that will keep on giving or impart a memory which will last forever?

Question: Is running multi-spindles a losing game?

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Swarfcast Ep. 2 – Talking Tariffs with Miles Free

By Noah Graff

Listen to Swarfcast in the player below.

In Episode #2 of Swarfcast, Today’s Machining World’s podcast, Noah interviewed Miles Free of the PMPA (Precision Machined Products Association). Free is one of the world’s foremost authorities on the steel trade. They discussed how the recently implemented tariffs on raw materials into the United States affect the U.S. precision machining industry.

In the interview Free equated harsh raw material tariffs to economic sanctions on imports that the United States would inflict on an enemy like Russia or Iran.

If you want to learn about Trump’s new tariffs listen to this interview!

This interview was conducted in April, so at times Free will refer to tariffs as a potential threat rather than a current one.

Question: How are tariffs affecting your business?

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Manufacturing in Thailand – the “Detroit of the East”

Emily Halgrimson, Today’s Machining World’s Managing Editor, was invited to join 11 other journalists from the U.S. and Canada (six in the automotive sector and six in the food industry sector) by the government of Thailand’s Board of Investment (BOI) on a four-day media tour to promote Thailand’s industry around Bangkok and the Southeastern seaboard.

Saturday, January 14th 10 a.m. – Left Chicago’s O’Hare International for Thailand on American Airlines. It’s not comforting to fly a bankrupt airline’s 757 over the Pacific. The distance is a drawback to North Americans doing business in Southeast Asia – 15 hours to Shanghai and another six to Thailand is a haul. I was pleased to find PBS’s excellent series, Downton Abbey, on the inflight entertainment, but slept most of the way thanks to Benadryl.

Sunday 10:30 p.m. – Arrived at the airport in Bangkok, and while waiting for the other journalists to arrive, ate some of my favorite Thai food of the trip – deep-fried pork with a red coconut curry sauce and Tom Yum soup. Made a vow to eat only Thai food for the duration  –  was not a problem. Transferred to our five-star hotel, Novotel, and were welcomed with plates of Thai deserts, wine and palm-to-palm bows by all.

Some of the journalists after a tour of Western Digital’s hard drive production facility

Monday 8 a.m. – Totally jet-lagged. We visited Western Digital’s (WD) plant in a recently flooded industrial estate near Bangkok and were met by John Coyne, President and CEO. Forty-five percent of the world’s hard drives are produced in Thailand, and WD, worth $10 billion, is the largest company. Their plant was under 1.9 meters of water only weeks before our visit. Divers come in for the most valuable equipment and moved it to a kind distributor’s facility 100 km away so they could decontaminate and repair it while the floodwaters lingered. WD employs 38,000 Thais, most who make under $10/day. I’m not sure what I was expecting, but the modern clean plant was a total surprise. It contrasted heavily with outside the industrial parks, where the country’s poverty is more obvious. Western Digital’s projections for 2011 were $176 million; because of the flood they reached $119 million. No word yet on the cost of the cleanup.

The journalists preparing to enter the Board of Investment’s (BOI) Fair

Monday 11 a.m. – Headed across town to the Thailand Board of Investment’s (BOI) Fair. This was interesting. When Westerners hear the word “fair” we think animals and Ferris wheels. In Thailand, a fair is a showcase of the country’s industry direct to the consumer. The fair happens only once every 10 years and was a huge deal. The King of Thailand – whose authority and respect are reminiscent of Kim Jong-ll – is a “green nut,” and the green theme is seen country-wide. The “Royal Pavilion” showcased a “green themed” 3-D film, complete with a tree growing up from the middle of the room, and the finale – a real rain shower (watch your camera). Huge exhibits in the outdoor park included Toyota, the most popular carmaker in Thailand; Chevy, which had its own 3-D show about the evolution of the American-born automobile; and CP, a huge frozen food conglomerate born in Thailand who’s big in Costco. The show also had a beer garden (hint-hint IMTS organizers) and a joyous sort of “look what we have in Thailand” feel to it. The people of Thailand are proud of what they’ve done in attracting these international companies over the last 20-30 years, but seem cognizant of environmental mistakes the U.S. and China have made during their development, and are making an effort to not repeat them.

Tony Blair speaking at the CEO Forum Bangkok

Tuesday 8:30 a.m. – Attended the BOI CEO Forum. Guest speaker: Tony Blair. A very inspiring and encouraging speech. Interestingly, he noted strongly that America would not be where it is without its open immigration policies. Mr. Blair encouraged Thailand to create this immigration-friendly atmosphere now, and noted that Thailand has “enormous potential” – its people, geography, and relative stability. He emphasized that Thailand’s job was to let the world know that it’s “open for business.”

 

 

Tuesday 3:30 p.m. – Left Bangkok for Pattaya, a tourist city next to the Eastern Seaboard Industrial Estate (ESIE) and checked into our spa hotel on the beach – filled with Russian vacationers. Two Thais told me that the Russians are disliked, they are stereotyped as being cheap.

Dinner on the beach in Pattaya

Development in the industrial estate was shocking, in a good way. The government invested millions in infrastructure to attract international companies interested in supplying the Eastern Hemisphere. Roads, electricity and water supply are new, modern and reliable. Ate a fresh seafood dinner at a beach restaurant while the sun disappeared over the ocean and the beer and conversation flowed. Beautiful.

Wednesday 9 a.m. – Visited American Axle & Manufacturing’s  (AAM) Rayong Manufacturing Facility in the Eastern Seaboard Industrial Estate. AAM opened its Thailand operation in 2008. 2010 sales were $2.3 billion. They produce mostly axle systems, but also drivelines, drivetrain and chassis, and other metal-formed products for automotive. The plant is 124,000 square feet and is located in one of Thailand’s many “free zones,” (tax-free). They currently exclusively supply GM’s Thailand operation, but plan on doubling the size of their plant, as they will be supplying Volvo soon. The Auto Alliance Thailand (AAT) manufacturing facility, a joint venture with Mazda, which wouldn’t welcome us for a tour, produces the Ford Fiesta and lightweight trucks for that particular half of the world. I was told that Thailand can’t compete with China’s steel prices, so asked what Thailand’s advantage is over China and India. I was told that it’s Thailand’s supplier base. When GM orders a part, AAM must deliver within 70 minutes.

Journalists after a tour at the Thai Summit Group

Wednesday 11 a.m. – I was very interested to tour our first Thai-owned company, the Thai Summit Group, which started in 1977 and makes auto parts for major auto companies. The stamping and injection molding facility makes mainly front and rear bumpers for Mazda and Ford. The plant was impressive and had six 3,000-ton presses and can produce 800,000 bumpers and 6,000 chassis per year. Annual sales are about $10 million. There was a large difference in the atmosphere of the plants from the Western owned companies and this completely Thai run company. They have a basketball court just outside of the main office and President, Mr. Shigeo Sakaki, commented that the workforce there is young and has lots of energy, so they need to have activities for them. It was much more relaxed than Western Digital and American Axle. Young people roamed the grounds like on a college campus. It was nice. They’re obviously making money, but it felt like it would be a nice place to work.

A night out in Pattaya

Wednesday 2:30 p.m. – Visited Celestica Thailand, Celestica’s largest location in terms of revenue. They employ 5,630 people and are five minutes from the large port on the Eastern Seaboard and one hour from the airport. They mainly make networking equipment, high-end storage and servers and teleconference equipment (Web cams, phones, digital photo albums, etc.). They see their future in optical device assemblies for the Internet. The Senior Vice President, Mr. Duangtaweesub, was impressive. Thai born, he had studied 30 years ago in Washington State. He started the company, which was bought by Celestica a few years later. He has been running Celestica’s Asia operation ever since.

Thursday 9 a.m. – We were scheduled to visit Magna Automotive and Asia Precision Co. Ltd. in the Amata Industrial Estate, but Magna canceled because they couldn’t get permission from the U.S. office to let us in. Asia Precision was fascinating. It employs about 800 workers (mostly women, Mr. Karoonkornsakul, the CEO noted, because they’re patient, are very good with detail, and there’s little heavy lifting needed) and has over 400 CNC machines, almost all Japanese. They make parts for automotive and camera and their 2011 sales were $30 million, with $40 million expected in 2012. Most of their business comes from the East, but they are a key supplier for Emerson in the U.S., who has asked them to consider building a plant in Mexico, which they are researching now. They are also considering expanding into Indonesia, which the CEO commented would be “the next Thailand,” with production projections of 2 million autos in 2012.

Asia Precision hires mostly women because they are “patient, detail oriented, and the parts are light”

When the automotive crisis hit in 2008/9 they began making rollers for printers. In response to their foreign clients’ needs, they are trying to expand into medical and aerospace, and are facing many of the same hurdles American companies face: the need for skilled employees and regulatory know-how.

Thailand’s Buddhist culture was obvious at Asia Precision. They have weekly company-wide meetings followed by meditation and a singing of their national anthem, and are heavily involved in giving back to their community through projects. They also had the first recycling center we saw, the proceeds of which are donated to the poor. Most of the employees, who are typically age 20-25, are recruited from villages in the north, and once a year they return home for the holidays. They are also very into exercise and health, recently holding a company marathon to raise money for flood victims. The atmosphere of the company was relaxing and the CEO mentioned they have very little employee conflict. It was refreshing to see a company that makes money but has quality of life at the forefront.

A training room at the Thai-German Institute

Thursday 3 p.m. – Visited the Thai-German Institute, a government training program for industry. This was interesting – I kept wondering why the U.S. isn’t doing something similar, it seemed so obvious. This organization started in 1992 with German funds with the goal of providing high-tech workers to industry. It is now run by Thailand’s Minister of Industry and trains 2000-3000 young people per year, mostly in mold and die technology, but also in automation and machining. It provides workers to the industrial estates in the south, who pay a fee for each worker they hire. Recruiters from training programs like these go to the north in search of competent, bright, high school graduates whom they lure to the south with the promise of decent salaries, subsidized lodgings, and per diems for the duration of training. Then they find them jobs. It appears to be a very win-win system that’s working for Thailand.

Question: Would you consider moving your business or finding suppliers overseas to save money?

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Industry Scuttlebutt

I was in Northeast Indiana last week for a press junket promoting the manufacturing sector of the region. The first company we visited was the General Motors plant in Roanoke, IN, a 716 acre facility with 35,000 employees where they build light and heavy pickup trucks–476 trucks in an eight hour period we were told. Our guide Mike Glinski, manager of Fort Wayne Assembly, a GM employee of 26 years, really impressed me with his presentation. He was one of the best speakers on the trip and we were all pleasantly surprised how relaxed he was about letting us shoot photos and video as we toured the line. He said the facility even gives tours to the public with an appointment.

I couldn’t believe how immaculate the facility was. The operation was well organized and highly automated. One topic that was discussed as we toured the different companies on the trip was Indiana’s strong political movement toward a “Right to Work Policy,” which would allow employees to work at any business without having to be in a union. A GM plant with employees not in the UAW just sounds unfathomable. But stranger things have happened right? After all, they took out the lard and then the trans fats from Oreos and they’re still delicious (and kosher!). In any case, Glinski’s intelligence and openness, along with the positive vibes I got touring the factory gives me optimism that GM is finally taking the steps to compete in today’s lean economy.

Best to check out the video below to get a better sense of the place.

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Wearing both my reporter and machinery dealer hats on the tour in Indiana I asked some of my presenters about what types of equipment they were buying lately. At one shop specializing in medical implants, the president  told me he was shying away from buying Mori Seiki lathes because after the U.S. partnership with DMG he had lost trust in the organization and customer support of the company. Most agree that DMG’s equipment is some of the best available worldwide, but they’ve always been notorious for weak customer support in the U.S. Merging with Mori Seiki was supposed to raise the company’s game in that respect, not pull down Mori Seiki’s.

But the next day we went to C & A Tool, a diversified, successful job shop (many times referenced in Today’s Machining World). The people at C & A told me the company had recently purchased several DMG machine tools, which they love. Their rationale for buying the DMG machines–C & A engineers had gained confidence in DMG after it had combined forces with Mori Seiki. So the merger of the two machine tool companies is working sometimes.

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Kim Jong-il’s son Kim Jong-un is about to replace his deceased despot father. One of the few things people know about Kim Jong-un is that he’s a huge NBA fan, a Chicago Bulls and Michael Jordan fan in particular. Supposedly the Jongs had a huge full court in the backyard of their palace, and when Kim Jong-un was allegedly studying in Switzerland many people remarked that basketball was one of his main uses of spare time. If Obama and Kim Jong-un ever end up meeting, the two leaders at least have one common passion on which to relate to each other. Maybe they can just settle their differences over a game of one on one.

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Happy to say that the Today’s Machining World blogs are getting plenty of traffic and comments lately. We often are surprised by the reactions of our readers and we get to learn a lot from their perspectives. For instance, when Lloyd wrote the blog about Newt Gingrich, we received a high number of comments by people saying they couldn’t support him because of his gun control politics. When we published the blog, Newt’s politics on gun control hadn’t even crossed our minds as an issue people would comment on, let alone that it would be a deal breaker for votes. The opinions were so strong it reminded me of an abortion rights debate.

Question: Was the Iraq War worth it?

Videos of General Motors plant in Roanoke, IN

 

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