Former manufacturer says ‘right people’ key to success

The state's second ever Arkansas Manufacturing Day started bright and early Friday morning (Oct. 4) with a presentation by Jon Harrison at the Fort Smith Regional Chamber of Commerce's First Friday Breakfast.

Harrison, the former general manager of Caterpillar's North Little Rock manufacturing facility and the executive director of non-profit Vine & Village, spoke about how he was able to be successful in his 25-year career with Caterpillar and how current manufacturing leaders could apply what he learned during his career as on-shoring brings more manufacturing jobs back to the United States in the years to come.

At the beginning of the nearly 45 minute presentation, Harrison highlighted his experience at Caterpillar, which included stops in Melbourne, Australia, and Tokyo before coming to North Little Rock. Having an economic background versus a management background, he said, had nothing to do with whether or not he was successful in the various markets where he worked over the course of his career.

"They (Caterpillar) wanted a special culture, they wanted people that were passionate. So that's why I was selected – not because I was a manufacturing background. I brought really smart manufacturing people with me. But that's how I got to Arkansas."

For manufacturers looking to either grow their current workforce or re-enter the American manufacturing sector, the biggest advice Harrison said he could give was to not only hire the people with skills, but also people that held values that aligned with the mission of the company.

"What I realized all those years at Caterpillar was that was the key to everything we do – hiring the right people, hiring people with values … having your people be informed."

He said passion for any company will not be present in employees without those employees being informed as to what is taking place in the company.

As for why manufacturing jobs started to leave not only Arkansas but the United States as a whole, Harrison said, it was because companies focused solely on the bottom line. That often meant trying to reduce salaries through the use of foreign workers with the assumption that quality could or would continue to be at or near what it was when goods were manufactured in the United States.

He also said companies, like Caterpillar, opened some foreign manufacturing facilities not necessarily to save on labor costs, but on shipping by producing on the continent of consumption, something he said made companies more efficient and could lead to more companies choosing to re-locate their manufacturing operations back to the United States due to high fuel prices making foreign manufacturing not near as lucrative as it once was.

On-shoring, he said, had resulted in nearly 50,000 manufacturing jobs coming back to the United States from China, showing growth of 10% in the manufacturing sector since 2010. Part of the increase, besides saving on fuel costs, is because of rising labor costs in markets like China and India and better quality of goods produced by American workers.

Fort Smith, Harrison said, is poised to take advantage of on-shoring and expand an already large manufacturing footprint in the region where more than 18% of the population is employed either directly or indirectly due to manufacturing, resulting in $3 billion in revenues and $53 million in capital improvements in recent years.

For businesses in the Fort Smith region or those looking to make the area home, he said it is important to focus on "what you can control" instead of focusing on outside factors.

"Control your work environment, your hiring process, who you hire," he said, adding that searching for the right people versus just hiring anyone who applied made a world of difference in getting buy in from employees.

He also stressed that "training is critical," explaining that employees at the Caterpillar facilities he managed on three different continents received intensive training, culminating in a 12 week training program at the company's North Little Rock facility.

In order for companies to excel and achieve "world class status," he said it was important to not only focus on hiring the right people and providing adequate training, but also sticking to the company's vision, strategies and values.

He pointed to the example of former Razorback Head Football Coach Bobby Petrino as an example of someone who achieved the University of Arkansas' objectives, but he did not necessarily do it in a way that aligned with the school and athletic program's stated strategies, values and vision.

In closing, Harrison said Fort Smith was in position to capitalize on the on-shoring being pushed by Wal-Mart and other companies, the region just had to embrace the resources readily available, such as a good transportation system that includes Interstate 40 and the Arkansas River.

"That's the ultimate key to economic development," he said. "You've got a great location. There's no downside to Fort Smith."