Regional Economic Development Conference Sherwood Park

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Regional Economic Development Conference
Sherwood Park

• Central Alberta Rural Manufacturers Association
• Lawrence Eason, Vice President Founding Member
  Co-Owner of The Advanced Group, Innisfail
• Neil Liknes Co-Owner of the Advanced Group,
  Innisfail
• Mark Burggren, CARMA Executive Director

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What is Manufacturing?

• Manufacturing Definition
• From Latin manu factura making by hand
• The use of tools and labor to make things for
  use and for sale.
• Vast range of human activity, handicraft to high
  tech.
• Most commonly applied to industrial production,
  raw materials transformed into finished goods,
  often on a very large scale.

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Why is Manufacturing Important?

• Manufacturing is a wealth-producing sector of an
  economy, requiring long term capital investment
  in wealth-producing assets.
• Economic multiplier effect widely documented as
  being between 3.01 and 3.5 1. Why?
• Manufacturing generates a flow of goods and
  services necessary to support manufacturing.
• Creates incremental jobs in an economy.

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Whats Special about Rural?

• Example of a rural manufacturer

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Whats Special cont.

• And its neighbors

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Whats Special cont.

• Special contribution to Albertas high quality
  way of life
• Off-farm income 01 census 44, 06 census -
  48, especially smaller sized farms (upwards of
  60). Performance of rural labour markets is an
  important factor in the economic well-being of
  farm operators.
• Jobs for young people to offset migration to
  urban centres important for farming succession
  planning.
• Creates demand pull for other economic sectors
  in rural communities through regional economic
  activity
• Services, tourism, recreation.
• Tax base.

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How to Engage Help RM

• 1st - Respect the complexity RM owners/managers
  face.
• Marketing todays products, current sales, daily
  operations, output capacity, managing cash flow,
  financing for survival growth, employee
  public safety, environmental stewardship, quality
  assurance, employee retention, employee
  capabilities growth, raw material costs, vendor
  reliability, developing tomorrows products,
  ongoing process innovation, IT integration,
  productivity enhancement, and the list goes on.
• Two other special factors global overcapacity
  connectability.
• Short attention span and sense of urgency by
  necessity.
• Rural owner/managers are likely SMEs, where
  he/she personally wears two or more of these
  functional hats in addition to overall company
  accountability.
• Different concept of flow-time vs. the public
  realm.

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The CARMA Experiment

• Networks may be the silver bullet.
• Precursor project by the Central Alberta Economic
  Partnership REDA in 07-08.
• Integrated with a database of some 380
  manufacturing individuals from 121 of 246 rural
  manufacturers in the CAEP region.
• Business-directed through Board of Directors, all
  rural manufacturing executives.
• Maintain strong ties to support organizations and
  communities through an advisory committee.
• Strongly supported by Alberta Finance
  Enterprise. Sponsored in part by the Rural
  Albertas Development Fund,
  whose funding is provided by the Government
  of Alberta.
• Value delivery mechanism - evening learning and
  networking events, brought close to the point of
  action.

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CARMA 08 09 Projects
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CARMA 09 10 Projects

• Summer series of Brown-Bag Lunch Manufacturing
  Round Tables.
• One every two weeks through the summer.
• Two each in Olds, Stettler, Ponoka Rocky
• Fall/Winter/Spring series of another seven
  evening learning events.
• Five in Red Deer, two in satellite centres.
• Topics will feature a nimble response to the
  changing economic and competitive environment.

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CARMA cont.

• Based on trust mutual respect.
• Find a semi-retired manufacturing executive in
  the pay-back phase of his/her career.
• I understand your world, I care deeply, and I am
  here to serve your interests i.e. valuing
  behavior.
• Open, honest and consistent communication
  (personal first, with electronic follow-ups).
• Its all about creating a Manufacturing
  Community of Practice for mutual learning and
  favorable outcomes.
• CARMA is honored to collaborate and share its
  story and formula with any interested region.
  www.centralalbertamanufacturers.ca

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• Lawrence Easton Neil Liknes

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ADVANCED Group of Companies

• Comprised of
• Advanced Welding Fabrication Ltd.
• Fe Industries Corp.
• Advanced Waterjet Design
• Advanced Trade Placement Ltd.

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Location, Location, Location .

• Manufacturer located in Innisfail
• By definition we are an example of a rural
  business
• Own and occupy three side by side properties in
  the south west industrial park

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• Custom welding fabrication
• Specializing in aluminum stainless
• In house and portable welding

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• Manufacturer and supplier of pressure equipment
  for oil and gas producers
• ABSA certified shop
• Specializing in instrumentation and control
• Includes solar powered equipment

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• Recent expansion and investment in innovative
  equipment
• Latest in abrasive waterjet cutting technology
• Enables precision and repeatability cutting any
  raw material up to 12 with no heat affected zone

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• Support rig and mining sectors through custom cut
  component parts
• Latest investment is a CMM measuring device
• Precise measurement
• CAD/CAM drawing creation from a physical part
• Reverse engineering wear analysis

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• Skilled trade labor placement service primarily
  for the industrial and mining sectors
• Capital equipment installation and industrial
  maintenance
• Also provides human resource flexibility in house

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Corporate Merger

• Fe Industries Corp. and the ADVANCED companies
  merge in fall of 2008
• joining of complimentary products and services
  strengthens an industry recognized reputation as
  one of central Alberta's premier fabrication and
  production facilities.

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Why did we choose rural Alberta?

• Our manufactured products are utilized locally
• Construction and use is regulated locally
• Skilled labor force and familiarity with our
  industry and equipment (knowledge is here)
• Close proximity to end user making customer
  support more efficient
• Lower property costs for business
• Removed from the rat race of the larger cities
• Housing costs more reasonable

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Staffing Opportunities Challenges

• Opportunity to employ local people
• Rural background, mechanically inclined, rooted
  in community and loyal
• Can be a challenge to attract skilled labor to a
  small community
• split attraction factor for potential skilled
  labor
• Competition for limited number of skilled
  individuals is high in busier times
• Use creative means to develop your own workers

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Staffing Opportunities Challenges

• Opportunity for a healthier environment to raise
  family rurally
• Challenge is that health care for specialty
  concerns is in major centers
• Post secondary education is in the larger centers
• Potential need for greater satellite learning
  support for rural communities?

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Finance Opportunities Challenges

• Financial institutions can be predominantly
  agriculturally focused in rural regions
• Potentially dont fully understand the innovation
  and leading edge technology required in our
  business
• Support for capital equipment expenditures is
  very difficult (especially recently)
• In a rural environment, identified business
  opportunities can be exploited with reduced costs

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Opportunities Challenges

• Some costs can be higher for rural businesses
  cant just drive up the block
• Raw materials suppliers are not in the local
  community
• Minimum weight or order quantities for reduced
  shipping costs could mean carrying larger
  inventories conflicts with LEAN philosophy
• Regulators inspectors costs are higher
  (commuting costs)

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Globalization of business

• The new phone book is called the internet
• Competing with global neighbors now and not just
  the business at the other side of town
• Good news and bad news

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Forging Ahead

• Looking for new opportunities and business
  streams to ensure business continuity
• CARMA and events such as today
• LCPP pilot project
• Investment in people, innovation, and technology
• Diversification through new business streams and
  product development (RD)

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Keys to Sustaining Business

• Business is required to grow communities
• Shorter response time from Govnt business
  operates with a sense of urgency
• Financial institution support is critical
• Govnt and Industry working together to create
  stability which breeds confidence
• Support programs and training that give youth a
  reason to stay or return to smaller communities