Manufacturing center presents 'tremendous opportunity' for region

2014-03-01T23:00:00Z 2014-05-02T17:16:14Z Manufacturing center presents 'tremendous opportunity' for regionJoseph S. Pete joseph.pete@nwi.com, (219) 933-3316 nwitimes.com

While flanked by a robotic arm, a helicopter engine and other "pretty cool stuff," President Barack Obama joked at a news conference last week that he was announcing they were building Iron Man.

What they are really building – a $140 million lightweight metals lab near Detroit and a $320 million digital manufacturing center a few miles north of Chicago's Loop – is expected to have a major impact on the regional economy, the future of local manufacturers and even what gets made at the steel mills.

The U.S. Department of Defense is contributing $70 million to each first-of-its-kind research center as part of an effort to make U.S. manufacturing more technologically advanced and cost-effective. The Lightweight and Modern Metals Manufacturing Innovation Institute outside Detroit will develop lighter, stronger metals such as the advanced high-strength steels produced at local mills, while the Digital Manufacturing and Design Innovation Institute in Chicago will focus on using computing and data analytics to improve the production process for a wide array of manufacturers.

"It's a tremendous opportunity for Northwest Indiana to tap into the results of the research that will be done at the digital manufacturing lab," said Anthony Sindone, a lecturer at Purdue University North Central. "It's some pretty exciting stuff in terms of workforce development and new technologies that may emerge."

Professors, politicians and economic development officials expect the manufacturing lab on Goose Island in Chicago will bring a number of benefits to Northwest Indiana, including luring more highly educated researchers to the region, creating new job opportunities, keeping more local engineering graduates in the area, spinning off new companies and strengthening the area's reputation as a hub of advanced manufacturing.

Existing manufacturers in any sector could benefit from discoveries, innovations and process improvements the federal government estimates could cut manufacturers' costs by 7 to 12 percent.

The lab is tasked with shortening the time between the development of a prototype and full-scale production, helping companies get products to market faster and cheaper, Obama said at the news conference. Factories would be able to respond to consumer demand faster, retool products as needed and keep inventories low.

Optimized manufacturing processes will make companies more efficient, spur more investment and ultimately create jobs, said Dan Botich, an adjunct professor of economics for Calumet College of St. Joseph and the executive of the Merrillville-based consulting firm Cender & Co.

"From a business perspective, what it's going to do is allow entrepreneurs to enter and exit products more quickly in a competitive market," he said. "It's going to allow businesses to be more efficient. Here in the Midwest, they've called us the Rust Belt and we've been caught in the middle. The steel industry has faced the question of whether to invest in new technology or let the facilities run their course. But this type of investment in the Chicagoland area will mean more research and development, and ultimately more opportunities for labor and production."

Leveraging NWI's assets

The Chicago manufacturing lab, which is backed by 73 companies, governments and colleges, will serve as the hub of a system that will have spokes all over the country, including at universities in Texas, Oregon and Colorado.

Purdue University, Indiana University and University of Notre Dame all will contribute research to the initiative, which aims to give American factories a technological edge over overseas manufacturers that have lower labor costs.

Purdue researchers, for instance, will lead one of the first projects, and use 3-D modeling to help companies in a U.S. Department of Defense supply chain exchange data. They will identify best practices that will be used to create training and workforce education materials. IU will loan out its Big Red II supercomputer to help with initiatives like the Digital Manufacturing Commons, an open-source platform that will let companies share design information with suppliers to get products to market more quickly.

"Northwest Indiana is a worldwide manufacturing leader and this announcement enhances the advanced manufacturing research being conducted at Purdue University, Indiana University and the University of Notre Dame," U.S. Rep Pete Visclosky, D-Ind., said. "This investment emphasizes the need to increase connectivity between the residents of Northwest Indiana and the city of Chicago's $500 billion economy through the expansion of the South Shore Rail Line."

The manufacturing lab and any spin-off companies would provide employment opportunities for science, technology, engineering and mathematics graduates from Indiana University Northwest, Calumet College of St. Joseph and other local colleges, said Dushan Nikolovski, director of Purdue Calumet University's Center for Entrepreneurship Success.

"I was just talking to someone from the state, in reference to an individual moving out to San Francisco, that we have brain drain here in the region," he said. "We foster but don't keep a lot of expertise to develop products for companies. We could use more of that in this area."

Northwest Indiana could lure more highly educated residents, since it is an easy commute to Goose Island and the region boasts less traffic, low home prices and good school districts, said Jainshankar Raman, assistant provost for international affairs and associate professor of economics at Valparaiso University.

Northwest Indiana also could attract any next-generation manufacturers that might come out of and choose to locate near the lab, he said.

"This is a significant opportunity for Northwest Indiana," Raman said. "The question is how we leverage the opportunity and keep it out in the forefront. Big things like this make a splash, but then the opportunity goes away if no one stays on top of it."

The Northwest Indiana Forum, a privately funded regional economic development organization, plans to stay on top of it, and work to capitalize off of the manufacturing lab. The initiative already focuses on one of Northwest Indiana's core sectors: advanced manufacturing, said economic development director Don Koliboski.

"It's serendipitous that this is located in Chicago," he said. "Big steel, big oil – that's our base. But we're also diversifying the economy, and advanced manufacturing is something the region is strong in."

Northwest Indiana could land spin-off companies because of its proximity, lower cost of doing business and available land, Koliboski said. Chicago is built-out and landlocked, and new manufacturers likely would look for greenfield sites in modern business parks.

"This is another opportunity to make hay out of our advantages," said NWI Forum marketing and communications director Karen Lauerman. "It's an opportunity to bring more investments to the right side of Chicago, the Northwest Indiana area."

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