Durable goods orders decrease in January
Kimberly-Clark may spin off paper, Canadian pulp ventures
Criminal history forces Smith and Wesson chief's departure
Coca-Cola chief to retire
MIT student wins prize for low-cost eyeglass manufacturing
Nextel to create wireless factory
Barnes Aerospace to open new factory in Singapore
U.S. manufacturing forecast to surpass GDP growth
Channellock wins ISMA American Eagle Award
IWLA, OSHA partner to foster safety in warehouses
PTI issues counterfeit tool warning

Durable goods orders decrease in January
New orders for manufactured durable goods declined 1.8 percent in January to $181 billion, according to the Department of Commerce. This followed a 1.6 percent increase in December.

Durable goods are costly manufactured products expected to last more than three years.

Transportation equipment experienced the largest decrease, 10.4 percent to $49.5 billion. This was the largest percent decline in transportation equipment since September 2002.

Computers and electronic products increased 7.1 percent to $31.7 billion, marking the largest percent increase in communications equipment since January 1997.

New orders for capital goods fell 0.6 percent to $69.3 billion after a 3.9 percent increase during December. Machinery orders fell by 1.9 percent to $23.7 billion, following an increase of 8.5 percent during the previous month.

To read the complete report, click here.

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Kimberly-Clark may spin off paper, Canadian pulp ventures
Kimberly-Clark Corp.'s management will evaluate a potential tax-free spin-off of the company's Neenah Paper and Technical Paper businesses along with its pulp and timber assets in Pictou, Nova Scotia, and Terrace Bay, Ontario.

A spin-off would create a publicly traded pulp and paper company with approximately $650 million in annual sales. The new company would produce a range of premium and specialty paper lines and more than 700,000 metric tons of pulp. It would have leading positions in many of its markets, about 2,100 employees and access to 5.9 million acres of Canadian timberlands.

"We believe that a spin-off will provide greater value for Kimberly-Clark shareholders as it will further enhance our position as a highly focused and innovative health and hygiene company, allowing us to concentrate our management and financial resources on our core businesses and to improve our capital effectiveness," said Thomas J. Falk, chairman and CEO. "Moreover, a spin-off of this unique set of premium paper, technical paper, pulp and timber assets would provide shareholders with a direct stake in a new, high-quality pulp and paper company with its own opportunities for additional value creation."

The businesses being evaluated for spin-off are all part of Kimberly-Clark's business-to-business segment. Although the businesses would have approximately $650 million in annual sales on a stand-alone basis, they represent less than 3 percent of Kimberly-Clark's annual net sales. It is expected that Kimberly-Clark would become one of the new company's largest customers through a pulp supply agreement.

Following a spin-off, Kimberly-Clark would produce about 10 percent of its worldwide virgin fiber requirements, which is consistent with its previously stated plan of reducing its pulp integration.

Sean T. Erwin, the current president of Kimberly-Clark's Pulp and Paper Sector, would become head of the new company. Erwin joined Kimberly-Clark in 1978 and held numerous management positions in the company's pulp and paper businesses, as well as its consumer products and nonwovens operations.

Management is expected to complete its evaluation and present recommendations to the board of directors during the second quarter. If the board ultimately approves a spin-off, a transaction would likely be completed during the second half of 2004, subject to market, regulatory and other conditions.

In 2003, Neenah Paper had net sales of more than $200 million. The operation employs approximately 500 people and has manufacturing facilities in Neenah, Wis., and Whiting, Wis.

With commercial customers in 35 countries worldwide, Technical Paper had net sales in excess of $100 million in 2003. It employs approximately 350 people and has a manufacturing facility in Munising, Mich.

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Criminal history forces Smith and Wesson chief's departure
Smith and Wesson Holding Corp. chairman James Joseph Minder, 74, resigned his position three weeks after the Arizona Republic newspaper reported he spent more than 10 years in prison for multiple armed robberies.

Minder committed his crimes in the 1950s and 1960s, served time, and founded Spectrum Human Services after his release. Spectrum is a non-profit agency that supports disabled and delinquent children in Michigan.

Minder said he felt it was best for the company if he resigned, given the circumstances. He said he never told Smith and Wesson's board of directors about his crimes, saying that he had turned his life around in the 30 years since.

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Coca-Cola chief to retire
Coca-Cola Co. chairman and CEO Douglas N. Daft will retire at the end of 2004, citing "personal wishes" he shared with the company's board of directors.

"In 1999, when the company's board asked me to assume the position of chairman and CEO, this company faced a number of significant structural and strategic challenges," said Daft. "Over the past four years, we have accomplished a great deal and repositioned this company for accelerated growth. Today, our brands are stronger and our global production and marketing system has been restored to health."

Daft said he will work with the board and the company's management development committee to support the transition. Coca-Cola said it will ask a search firm to help find a new candidate for the position; the company will look internally and externally for a new chairman and CEO.

To read more about Coca-Cola, its MRO spend and its procurement strategy, check out the MRO Today February/March 2004 cover story.

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MIT student wins prize for low-cost eyeglass manufacturing
Massachusetts Institute of Technology (MIT) doctoral candidate Saul Griffith, whose inventions include a “desktop printer” for low-cost eyeglass lenses, received the $30,000 Lemelson-MIT Student Prize for inventiveness during a ceremony Feb. 19.

Merton Flemings, director of the Lemelson-MIT Program, which sponsors the annual award, cited Griffith’s innovative device for manufacturing low-cost eyeglass lenses and his work creating comic strips that inspired children to learn about science and engineering as important reasons he was chosen this year.

“Saul tackles some very challenging real-world problems, yet at the same time there is a wonderful sense of playfulness and simplicity to his work,” Flemings said. “His low-cost vision-testing and lens-manufacturing inventions could dramatically improve life for billions of people in developing countries who cannot access, nor afford, prescription glasses.”

Griffith’s advances in low-cost lenses sprung from his interests in rapid prototyping technologies and efficient manufacturing. Using a process dubbed programmable molding, he created a portable device similar to a desktop printer that can produce any prescription lens from a single-mold surface in five to 10 minutes.

The device casts the lenses by applying pressure and constraints to a programmable membrane, which becomes the mold surface when under pressure. The current device uses car window tinting film for the membrane and a reservoir of baby oil for applying the correct pressure. A large range of lens types, covering the majority of prescriptions, can be cast from two such mold surfaces.

Traditional lens manufacturing systems require expensive molds for each lens type. In remote rural areas, it is cost-prohibitive to maintain a library of thousands of lenses for relatively small populations of people. The traditional process not only comes with enormous inventory and handling costs, but also can result in excessive waste. Griffith’s patent-pending device essentially eliminates these problems.

But efficient lens manufacturing is only half the issue. Proper diagnosis of vision problems is the other half. Current automatic diagnostic technologies are expensive, fragile and error-prone. Because they rely on a patient looking at electronically generated images a few inches away from his or her face, they can lead to incorrect diagnoses. Plus, highly skilled people are required to operate these machines.

To resolve this problem, Griffith created a prototype device to test the human eye. Patients wear the device, which looks like an oversized pair of goggles, and look at the world around them. An electronic sensor superimposed on the goggles monitors the lens in the wearer’s eye and adjusts the device’s lens to cancel the refractive errors, thus determining the correct prescription.

In 2001, Griffith and colleague Neil Houghton won the Harvard Business School Social Enterprise Business Plan Contest for the concept. They have since started a company called Low Cost Eyeglasses to manufacture and market the product.

“It’s sometimes easier for engineers and scientists to work on the next generation of computer chips or the next PDA, but there are some beautiful problems that a lot of people don’t go after because it’s hard to get support and funding and it’s incredibly hard to be successful,” Griffith said. “It would be nice if my work inspired others to address some of these problems and make them more acceptable.”

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Nextel to create wireless factory
Digital wireless communications service provider Nextel Communications will create a "Wireless Factory by Nextel" at a customer facility to demonstrate how wireless voice and data products and services can increase manufacturers' productivity and lower costs across every area of their business.

When completed, it will showcase Nextel's Wireless Business Solutions (WBS) throughout the customer's entire manufacturing process, including sales force automation; inventory management; maintenance, repair and operations (MRO); factory floor operations; shipping and logistics; and field service.

"Wireless technology can streamline processes, increase efficiency and reduce costs by providing real-time access to customers, employees, vendors, systems and data," said Leslie Baker, vice president of Nextel's manufacturing industry segment. "Although many manufacturers have adopted wireless technology in a piecemeal fashion, few have integrated it throughout their entire operation. Our aim with the Wireless Factory by Nextel is to create a working example of the full potential of wireless technology."

Nextel's WBS combine wireless data applications, services and tools needed to deliver real-time information to mobile decision makers who support and manage mission-critical business systems. Nextel's WBS provides in-building wireless network coverage and a seamless transition to Nextel's national all-digital voice and data network.

"Visitors to the Wireless Factory by Nextel will see first-hand how integrated wireless communications can transform the entire manufacturing process," said Baker. "They will walk away with a clear understanding of what Nextel can do to help them more effectively manage the vast systems and organizations that are vital to their success. That is our goal."

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Barnes Aerospace to open new factory in Singapore
Barnes Aerospace, a business unit of Barnes Group Inc., will open a new manufacturing facility in Singapore. The facility will house state-of-the-art manufacturing equipment to produce precision aerospace components for use in a wide range of aircraft engine applications.

The facility will be located in the Loyang Industrial Park and is scheduled to open in March. Barnes Aerospace's Windsor Airmotive Asia facility is also located in the Loyang Industrial Park.

"Barnes Aerospace continues to globalize its manufacturing operations to better meet the demand of our worldwide customer base," said Barnes Aerospace president Greg Milzcik. "Given the need for highly critical components, where continuous supply is essential, we think that having manufacturing operations located in major aerospace center such as Singapore is vital."

He added: "Having two facilities, one for repair and overhaul operations and another for OEM manufacturing, in the same location enables us to leverage infrastructures and resources."

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U.S. manufacturing forecast to surpass GDP growth
U.S. manufacturing is expected to increase by more than 6 percent in 2004, surpassing the anticipated 4 percent increase in Gross Domestic Product. Calling it a “vigorous economic recovery,” National Association of Manufacturers president Jerry Jasinowski also predicted that many of the manufacturing jobs lost during the recent recession will return.

Jasinowski presented the good economic news at a press conference held during National Manufacturing Week in Chicago Feb. 23. NAM’s “Outlook for Manufacturing and the U.S. Economy” said the projected 4 percent GDP increase follows a 4.3 percent gain in 2003.

“As for manufacturing, after edging up 2.7 percent in 2003, we expect production to increase by over 6 percent in 2004. That’s the fastest pace since 1999,” Jasinowski said.

The survey indicated other positive signs for U.S. manufacturers. Companies planning to hire new workers outnumbered those expecting layoffs by a ratio of 5-to-1, with many of the jobs likely to be higher paying skilled production and professional positions rather than lower paying service and support jobs.

NAM predicts that most manufacturing industries will add jobs in 2004, with the overall increase totaling a modest 250,000 jobs for the year.

“In the past, half of the manufacturing jobs lost during a recession came back. I expect that trend will continue as this recovery proceeds,” Jasinowski said.

Manufacturers also report an increase in exports. About 70 percent of respondents to NAM’s annual survey said they exported to an average of 6.5 countries, and half of them expect their sales abroad to increase this year.

At the same time, members expressed frustration with China. More than half agreed that because of various subsidies provided by the Chinese government, manufacturers there often produce product for less than what American manufacturers must pay for raw materials alone.

Jasinowski said he supports efforts by the administration to convince China to change its monetary policy, which pegs the value of its currency to the U.S. dollar, and to comply with international trade agreements. But he argued against a protectionist trade policy.

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The award was given in recognition of the company's Falcon Program of employee recognition and involvement.

The American Eagle Awards, now in their 29th year, are an annual set of awards presented by the ISMA to American manufacturers whose programs best support and promote the ideals of the American free enterprise system.

Submission categories include overall excellence, individual achievement and four individual category awards: community/corporate educational commitment; employee enrichment and involvement; environmental improvement and conservation; and local community involvement.

Channellock's Falcon Program was initiated in 2003 as a means of recognizing the contributions of associates and their families on-the-job, in their communities and at home. It is a five-pronged program that provides recognition, services and discounts to associates.

The winner has his or her name added to a plaque displayed alongside an exceptional, hand-made Daum glass falcon figurine in the Plant 1 reception area. Additionally, the Falcon Award recipient will be rewarded what promises to be a very memorable prize, individually personalized each year with the winner's input to determine the most personal, meaningful award for each honoree. 

Examples could be a week's vacation for a family of four, one semester of college tuition to be paid by Channellock, an all-expense paid trip to Hilton Head Island with accommodations at a beach-front house, a new set of furniture, or virtually limitless other options. As an American Eagle Award winner, Channellock will be presented with a crystal award and a $500 American Eagle Scholarship Award.

The American Eagle awards will be presented May 24 during the ISMA/I.D.A. Annual Spring Conference in Orlando, Fla.

"With the advent of the Falcon Program, the DeArment family and the Channellock board of directors have demonstrated a very real commitment to celebrating and encouraging all Channellock associates," said Randy Ferguson, director of communications. "More important than the material recognition associated with the ISMA American Eagle Award is the fact that the Falcon Program is now a nationally recognized model for companies interested in assuming a more proactive role in recognizing and assisting their employees, both on-the-job and in their busy personal lives."

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IWLA, OSHA partner to foster safety in warehouses
The Association for Logistics Outsourcing (IWLA) and the Occupational Safety and Health Administration (OSHA) signed an agreement that will establish a collaborative relationship between the two organizations to foster safer and more healthful warehouse workspaces.

"As the leading national trade association representing third-party warehouse and logistics providers, IWLA has always made safety a priority," said Hoiland. "In fact, a good part of our education budget each year is dedicated to helping members identify and reduce risk in their workplaces. That’s why it is a natural fit for us to enter into this alliance with OSHA, which is dedicated to protecting the American worker on the job. By pooling our resources, we can make great strides toward improving worker safety in the 3PL industry."

Under the two-year agreement, IWLA and OSHA will work together to:
• educate warehouse employees about how to operate more safely through education programs and voluntary inspections protocols;
• reach out to workers and employers through various media to encourage participation in voluntary cooperative programs and various speaking engagements; and,
• facilitate a national dialogue about the importance of workplace safety and health through convening forums and roundtable discussions.

A team made up of representatives of both organizations will meet to develop a plan of action, determine working procedures and identify roles and responsibilities in carrying out the above. They also will meet at least quarterly to track and share information on activities and results in achieving the goals of the alliance.

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PTI issues counterfeit tool warning
The Power Tool Institute (PTI) issued a warning to power tool users not to be conned into buying cheap, counterfeit power tools.

The members of PTI became aware of certain sales activities in which persons claiming to be sales representatives of major power tool manufacturers. The fake salespeople say they have just finished working at a trade show and want to go home without their tool samples.

These people typically sell power tools from the trunk of their rental car for what seems to be bargain basement prices for tools such as rotary hammers, grinders, cordless tools and combination kits. The unsuspecting buyer often finds out these tools are counterfeit only after they open the boxes and begin to use them. Soon the tools fail and they attempt to have them serviced at manufacturer service centers.

Members of the PTI have also become aware of counterfeit tools sold over the Internet on some auction sites. When found, these sites are reported and often shut down.

Major manufacturers targeted include Bosch, Hilti, DeWalt, Makita and Milwaukee. These tools may be dangerous as well as poor in quality. The tools are not tested and approved by a respectable lab, such as Underwriters Laboratories or Canadian Standards Association, though the tool may bear a UL or CSA sticker. These counterfeit tools are sometimes sold with stickers from large retail outlets on the cases as well. The PTI members are concerned that use of these tools may lead to injuries or damage due to their poor quality and unsafe construction.

PTI reminds the public that if the price for a branded power tool seems too good to be true, it probably is. You should only purchase power tools from reputable retailers and distributors. Members of PTI are involved with state and federal law authorities in criminal investigations. Several arrests have been made in this counterfeit activity.

The public’s help is needed in stopping the problem. If someone suspicious approaches you or someone you know and makes these types of offers, refuse the sale and report the action to local authorities and to manufacturers of the counterfeit tool. Contact numbers for the PTI member companies can be found in the member profile section of the PTI Web site at www.powertoolinstitute.com. 

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