Addressing Supply Chain and Workforce Issues in Manufacturing with Alan Davis

Connect with Alan Davis

Email: alan.davis@i5services.com

LinkedIn: https://www.linkedin.com/in/alandavissolutiondevelopment/

Website: https://i5services.com/

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturers' Network Podcast. I'm excited to introduce you to our guest today, Alan Davis. Alan is the founding member and CEO of I5 Services. He started i5 services to change industries through creative technical solutions to complex business problems. His background is in technology and years of experience, leadership, and the transformation process. For the last eight years, he has been working tirelessly to connect the U.S. manufacturing supply chain.

Alan, welcome to the show.

Alan Davis: Thanks for having me today, Lisa. Great to be with you.

Lisa Ryan: Alan, please share with us some of your background. What led you to focus on manufacturing and then the founding of i5 services?

Alan Davis: Great question. In 2001, I was involved in another industry. We came up with an innovative solution for the airline industry when 9/11 happened, and the airline industry was somewhat devastated at that point and having a hard time recovering. Our solution had a huge impact on the client that we were working for - about 40 million dollars a year. That solution opened our eyes. That technology is still being used today; almost all the world's major airlines use it. But it helped the airline industry at a time when it needed it. That opened my eyes to the fact that there was this great need for some very innovative technical solutions that would solve very complex business problems. These solutions would have a direct impact on the bottom line for our clients. They would also have a dramatic impact positively on the entire industry or ecosystem that they serve.

Fast forward a few years. The downturn of the economy happened. I got a nice severance package from my former employer, and we started i5 Services. Here at i5 services, we focus on manufacturing. A couple of years after we had started the company, an economic development study was done in the state of Utah to determine how to improve the various economic sectors. Part of that study was that in manufacturing, they decided that they needed a virtual industrial park.

It was this ability to connect manufacturers with each other. The idea was that if a prominent manufacturer could buy local first, it would keep more jobs, more dollars in the state, and therefore boost the economy overall in manufacturing. We were selected to build the solution for that, along with Utah Manufacturers Association. We brought together manufacturers from around the state. We probably had 30 or 40 manufacturers participate, and over four months, we held workshops every other Friday for four hours.

We got in the conference room, and we dug deep into why the solution was needed? Why weren't the existing solutions out there solving the problem? What were the benefits of doing this? It was a very informative and enlightening process because we truly understood that our manufacturing ecosystem is not connected well as we went through this. In fact, not well at all to the point where we have a hard time finding manufacturing capabilities. Anyone who had their eyes open during the pandemic will certainly understand challenges and problems in the supply chain. As we were looking at the problem, the manufacturers said this to me - and I thought this was eye-opening - they said, go to any solution that's out there today, any search engine, and try to search and find all the women-owned plastic injection molding companies in the state of Utah and tell me what you see. You cannot get a comprehensive set of results in any solution out there other than the one that we built at that time for the state of Utah.

We put a prototype together while we were going through the workshops. One of the large manufacturers came to us at the end of those workshops and said, look, we have a $70 million contract. We're going to award it outside of the state because our buyers have scoured the state, and they cannot find anyone here that can deliver this. So we said this is perfect. We have the prototype ready, and we searched.

Sure enough, two miles from their facility was the exact company they were looking for. They didn't know they were there, and that was when we decided as a company that number one, we needed to solve this for our country because it was a massive need. But number two, that it had huge value to the industry. If we could solve this, not for the state, but our country, imagine the economic impact that it would have. At that time, we decided this is our journey, this is our path. This is where we're going, and we've been all-in every sense, trying to make sure that we built the right solution for our country. We built the first U.S. manufacturing supply chain connection solution that connects us to the manufacturing capabilities of the United States.

Lisa Ryan: That's what it's all about. You look at what I'm trying to create here with the Manufacturers' Network Podcast – it's connecting manufacturers. Sometimes you get so focused on your business, what you're doing, and your products. Either you don't think about other manufacturers in the area, or unfortunately, you look at them as the competition. I don't want anything to do with them versus building this connection - this group of people – and knowing who you can give the business if, for whatever reason. You're not the right company for it, or you don't have what you need to fulfill that order, and partnering with other manufacturers, it's it seems so easy that it's something that we should have been doing all along.

But putting that focus on keeping it local to have the jobs and everything else, and building those relationships.

Alan Davis: It's amazing if you start looking local first. Then, you can expand your search beyond your local community to your state, and into your country, and then international. That helps - no matter which ecosystem you're in. That helps your ecosystem because starting local first is always going to be the most economical solution. Well, not always, but almost always will be the most economical solution if you can find the right kind of provider.

Now, if you can't find the right kind of provider, you have to expand that search, and sometimes that does take you internationally. But there are definite advantages to everyone. If you start with that local search, first one, especially when you look at things like the contribution to the local community, of standing out there, of letting people in your community, in your area know what you're about, know what your mission is, how you're contributing, because then also in a market where it's so difficult to find the correct skilled labor force that you need, that makes your plant somewhere where people want to work. They want to be a part of that because they see what you're doing locally.

That was right after the Supply-Chain workforce was the next area the manufacturing asked us to start working on, so we have a workforce module. The solution is the Connex marketplace. You can find at Connexmarketplace.com. But that was the next piece that they came forward with and said, look, it's great if we solve the supply chain problem, but that introduces the next problem right behind it: do we have the workforce to sustain that business?

That’s been an ongoing problem for several years. It seems to be exacerbated in the current climate, so there's a lot that we need to do in that area as well, and R&D or innovation is right there with it. We are working on all three of those problems and trying to help solve the challenges associated with them in manufacturing.

Lisa Ryan: We think about the workplace. I mean, back in the day, you went into manufacturing because you could make great money with great benefits, and all this, and now you're not only competing with other manufacturers, but you're competing with Amazon. You're competing with these other tech companies that have money to play with. We're getting away from having that conversation. Looking at the things that differentiate a career in manufacturing and knowing that we need to have that conversation to attract people into the labor force that we're so desperately looking for.

I know that there is no easy button to have potential workers show up at your door. But what are some of the things that you have found that are working to attract the workforce that we need?

Alan Davis: That's a big question because many things contribute to it. One of the first things is manufacturing struggles to compete for the workforce, particularly in the U.S., mainly because of some perception problems we have a perception that manufacturing is this old, dirty industry that no one wants to work in, and it's hard work and low pay.

And it couldn't that perception could not be further from the truth. Today's manufacturing is very much high-tech and has tremendous jobs. In fact, on average, they pay about a quarter percent more than any other industry. It is a fantastic industry to be involved in. But getting past that perception problem is part of what we're trying to help within the application and better connecting industry and education institutions. There's a better exchange of knowledge, understanding, and information between them.

If kids are attending grade school through university, they don't always have an understanding of what some of those pathways are. They don’t know the opportunities of these high-paying jobs, and incredible careers that are available in manufacturing. When they begin learning about the workplace, and learning about jobs, and starting to think about what those jobs might be for their future, and then obtaining the right skills to be able to enter into those jobs. We haven't solved the problem because it has to come through that process for the next generation of the workforce to understand what the opportunities are, and to take advantage of them.

There's the issue of helping the existing workforce transition to manufacturing jobs and be able to find a pathway that takes them from their current place of employment or direction of career to be able to make an amendment, a change, or a pivot to come back over into manufacturing and take advantage of some of those amazing jobs. So those are a couple of the things. There are also some challenges associated with training the existing workforce.

There's a concern occasionally about automation, robotics, and things like that taking over all the jobs. That's not the case. When you implement automation and robotics, the reality has been that it almost always creates more jobs and increases production. An interesting statistic that I think helps here is that with one-tenth of the labor force, we produce almost the same output as China in manufacturing. So China has about 20 percent of the world's goods. We produce about 18 percent. They do it with about two hundred million whereas opposed to our 20 million, so it is a stark contrast.

But what it means is we've been very innovative in our ability to manufacture goods in the United States. That level of innovation has to continue. Part of being in manufacturing is the opportunity to innovate and find ways to take those leaps and bounds forward in producing new goods, producing all goods in new ways, and so many things. It is such an exciting place to be, and right now, with so much focus on the problems that we have with our supply chain, and being able to fix those problems, and making sure that we're resilient in our supply chain in the future, all of that tends to hopefully help people understand that this is a long term, wonderful industry, and it's not going anywhere. The jobs there are going to grow and get better. I think if we can begin to combat some of those perceptions or misperceptions, then I believe we have a much better shot at addressing some of the workforces challenges that exist today.

Lisa Ryan: Right, and even thinking about automation for years, it was expensive and scary, and, oh, this is going to take away everybody's job where instead, as you said, it's creating jobs. But now what it's doing is getting rid of that drab, that manual labor, that repetitive motion, basically the grunt work. So why not have automation take care of that so that you can leave the innovation, and you need people to program those robots? When I was in the welding industry, it was all dark, dirty, and dangerous.

And now, as you said, it's opening up those channels to introduce kids coming through schools to see what it's like to see that it's bright, and high tech, and a fantastic place to work where you have that immediate gratification of something that you helped to build, you helped to create. So lots and lots tied up in there. You are using things like Manufacturing Day to open up to the local schools, to come in to see what you're doing. You're not going to get all of those kids. But if you get one or you get a couple, that puts you ahead of everybody else.

Alan Davis: One of the things we've been working on is this opportunity within the solution for teachers, academic advisors, and others booking plant tours and downloading materials, videos, about the manufacturing processes from the industry to connect better. We're a part of a group in defense manufacturing community partnerships in the United States where we're holding these workshops to try to understand better what some of those needs are in the workforce, and R&D, and in additive manufacturing, and advanced manufacturing, and all these areas so that we're able to step in, and better help solve those problems.

Lisa Ryan: Where are those resources available? Because I think that if a teacher or a guidance counselor or people are working in the schools that knew that that was available, that maybe that would open some channels that they didn't know. What would be some good resources for people listening to check out and find some of those videos and resources?

Alan Davis: We are in the process of compiling that. It'll be coming out and available to the academic organizations sometime in the fall. But in the meantime, to reach out to any of their manufacturing organizations in their state. So who is a great resource, by the way, the MEP system that we have in the United States is beneficial to manufacturing and certainly acts as a liaison to help in some of those communications between academia, and industry, manufacturing associations, the Chambers of Commerce.

There are so many wonderful organizations that are there to help support manufacturing in the state. Right now, they're the ones who do their very best to try to make some of those resources available and to make those connections, and so the solution that we're putting forward is to help support that communication and all that interchange back, and forth.

Lisa Ryan: I talk to my clients about partnering with your local tech schools, and getting involved in those because then you're basically getting students right off the line that are coming into your plants. You’re building those relationships. When students see that you're involved with that trade or technical school, you're a known entity, and they feel comfortable working for you. So, and when it comes to additional resources, if somebody is not familiar with what an MEP is, can you tell us a little bit more about that?

Alan Davis: Yeah, absolutely, and I will make one more comment on what you said because working with those tech colleges, one of the things that we learned early from them was they want to help more students get trained and be ready to come into the workforce. But they were limited or constrained by the access that they had to equipment into materials that they needed to train the students better. So that was one of the problems or challenges brought forward to us some years ago.

We put an exchange center together for the exchange of surplus material where our large manufacturers were so gracious and stepped forward, and said, look, we have the equipment, we have materials, and we're happy to donate that or provide it at a very low cost to schools so that they can have better access to those things to help with the workforce problems. So that exchange has been amazing, and so those organizations come back to us frequently and say, this has been one of the best values we've ever gotten out of the application is this ability to exchange.

So in our country, MEP goes back about 30 years. The National Institute of Standards and Technology (NIS) was asked to create the MEP program, which is a manufacturing extension partnership, and what that is, is an organization. There is one MEP who is a partner to NIST in every single state. They have federal funding to help manufacturers, particularly with challenges and issues that they face, such as being certified or finding some training that they might need to help the manufacturers with their operations better. Their mission has continued to expand grow, and I know they are very much involved in helping with issues like cybersecurity and making sure that your plant is safe and secure. There are loads of resources that are available through the MEP network and your state.

Lisa Ryan: OK, so they can do a Google search on their state and MEP, and that should be able to come up easily findable. Absolutely, and then finally, let's get to the issues with the supply chain. Some of the things that you're seeing are the issues and what is working right now. What are some of the good things that manufacturers are doing in an area that the supply chain is struggling with, and they can turn it around?

Alan Davis: I think almost everyone now sees the problems, and the struggles, and supply chain, and everything from ships being stuck, and not being able to goods into the port, to not being able to get goods manufactured, and shipped soon enough, to not having enough ships, and all kinds of things. That is impacting various aspects of the supply chain but in a very positive way. When these challenges arise, it opens a door and an opportunity for innovation and positive change.

I tend to gravitate toward what I see is happening to address the issues. In addition to trying to work through the problems to get the supply chain flowing again, there's also a lot of innovation. There is a lot of focus and effort around trying to change the supply chain, maybe a little bit, see if you can't find a closer supplier to your facility or provide something to you in the United States that maybe you were getting overseas.

Now, that's not always possible. It's not always feasible, and it's not always the best course of action. But we're seeing it often right now, and then we're seeing companies starting to innovate. So I'll show you quickly. I am holding a pen here. This is the first promotional pen produced in the United States in many, many years. This is a 3D printed pen and one of the first pens made in the United States, which is because there have been these problems in the supply chain. So manufacturers are stepping forward, and I know I'm using a straightforward example of a pen. But, still, I use that to illustrate that this is happening all over the United States. When manufacturers see the problem, they're stepping up, and