Concentric Circle Around The Globe By Rod Kackley

Concentric Circle

Around The Globe

By Rod Kackley

“The Medical Mile (in Grand Rapids, Michigan) needs to be a concentric circle around the globe,” said one of the people I talked to in the research phase of writing Last Chance Mile: The Reinvention of an American Community.

Jerry Callahan, Van Andel Institute’s director of business development, was making the point in his rapid-fire style that the institution’s on the Mile could not limit their vision to their campus, the city of Grand Rapids or the state of Michigan.

It is a global community in which we live. And it is much of the rest of the world where manufacturers find their greatest growth markets.

Keep that in mind when you learn that Whirlpool Corporation has entered into agreements to become a majority shareholder (51 percent) in Hefei Rongshida Sanyo Electric Co. Ltd. [600983: Shanghai], a leading home appliances manufacturer based in Hefei, China.

Through this transaction, a Whirlpool Corporation subsidiary will acquire all shares currently owned by Sanyo Electric Co. Ltd. and Sanyo Electric Co. (China) Ltd., and purchase new Hefei Sanyo shares via a private placement.

The transaction is subject to customary conditions, certain termination rights, Chinese regulatory approval, and Hefei Sanyo shareholders' approval.  After the transaction is approved, Whirlpool will acquire a majority stake in Hefei Sanyo for approximately RMB 3.4 billion/USD 552 million cash, based on the exchange rate as of August 9, 2013. The transaction is expected to close by the end of 2014.  Whirlpool expects that this transaction will be accretive in the first full year of integration.

"Whirlpool has a strong presence in China's higher tier segments, this acquisition allows the company to build on, complement, and grow its position in the emerging Chinese market and to leverage our global enterprise for greater efficiencies," said Jeff Fettig, the chief executive officer and chairman of Whirlpool Corporation.  

At the same time, we are seeing a phenomenon that has come to be known as “reshoring.” 

That will be the subject of our next post on this blog.

Last Chance Mile: The Reinvention of an American Community tells the story of how the people of Grand Rapids created a cluster of prosperity, Medical Mile, while the rest of Michigan was collapsing around them.

Last Chance Mile: The Reinvention of an American Community is available wherever books are sold online including Amazon, Barnes & Noble and iTunes, as well as on the shelves of Barnes & Noble-Woodland Mall, Schuler Books & Music-28th Street and West Coast Coffee on Monroe Center in downtown Grand Rapids.

Restore The Roar: Manufacturing Renaissance is a five-part ebook essay series that examines the collapse and rise of Michigan manufacturing. It begins with The Great Collapse and is available wherever ebooks are sold online, including Amazon and iTunes.

GM, HP Partner To Expand Automaker's IT

General Motors and HP Team Up on IT Transformation

Multi-year agreement includes project services, software

GM Tech Center-Warren, MI

DETROIT and PALO ALTO, Calif., Oct. 18, 2012 /PRNewswire/ -- General Motors and Hewlett-Packard Co. announced today new multi-year project services and software contracts that will accelerate GM's ongoing IT transformation efforts and deliver seamless, global services and products throughout the automaker's operations. 

These agreements provide GM a cost-neutral solution in which 3,000 HP employees already working on GM's business will transition to the auto company's employment rolls.

"These agreements with HP will enable us to accelerate the progress of our IT transformation by delivering increased innovation and speed of delivery to our GM business partners, and reduce the cost of ongoing IT operations," said GM Chief Information Officer Randy Mott. "Transforming our internal IT operations will give us the resources, tools and flexibility we need to provide better services and products to our global GM customers." 

As previously announced, GM is moving from a highly out-sourced to a largely in-sourced business model, changing the mix so more employees are focused on innovation rather than operations. As part of this, GM has announced new IT innovation centers in Austin, Texas, and Warren, Mich., with the locations of two more centers yet to be announced. 

"GM is an automotive icon and HP values the strategic partnership we have had for more than two decades," said Mike Nefkens, HP acting Global Enterprise Services leader. "We look forward to helping GM deliver even greater products and services to market."

GM also has purchased HP's industry leading IT Performance Suite, Enterprise Security Suite, Vertica and Autonomy Software, all of which will further accelerate the transformation of applications development, support, and high-performance operations computing capabilities.

"GM needed a solution to provide confidence, insight and agility to perform better," said George Kadifa, executive vice president, HP Software.  "They didn't need to look any further than HP's Performance Suite and are the first customer to purchase the full suite of software to enable their business."

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Author’s note: This is the latest chapter in the renaissance of General Motors. The most important part of this announcement is that GM is hiring internally, rather than outsourcing. This should be great news for everyone in Detroit, Michigan, the Great Lakes region, in fact the entire U.S.

Insourcing and reshoring are two trends that  I’ll have more on in the days ahead, as I head into the final production stage of my next book, Manufacturing Renaissance.

I would also like to invite you to check out Last Chance Mile: The Reinvention of an American Community. Medical device manufacturing plays a large role in the first book to focus on Grand Rapids, Michigan and its Medical Mile. 

Last Chance Mile is available at Schuler Books & Music in downtown Grand Rapids and on 28^th Street in Kentwood, at the Abbott Press online bookstore and at www.rodkackley.com

New Growth Industry: Medical Device Manufacturing

The growth of medical device manufacturing could have a tremendous impact on West Michigan. I was treated to a first-hand look at the potential offered by that industry during a meeting August 3, 2012 with Keystone Solutions Group Principal Jim Medsker, Keystone Director of Sales and Business Development Robert Nesky and Tiger Lab’s Alison Keutgen.

Keystone, based in Kalamazoo, and Zeeland-based Tiger Lab have a long history of working together in strategic partnerships. The latest effort has resulted in the creation of an oxygen flow diverter, an idea that came to Keystone from the mind of a Zeeland Hospital nurse.

What a team! This is such a great story for a variety of reasons. We have different companies in West Michigan partnering in a very strategic way to innovate, create and market together. The idea came to them from someone outside both companies, and there is one more element to this partnership, the involvement of Spectrum Health.

More on this story will be posted in the days ahead as we explore an industry that has both a strong history and incredible potential for West Michigan, medical device manufacturing.

The Keystone-Tiger Lab story will be explored in greater detail in Manufacturing Renaissance, which will be published in early September.

The medical device industry is no stranger to West Michigan, as is detailed in Last Chance Mile: The Reinvention of an American Community.  We have one of the largest medical device makers in the world in Kalamazoo, Stryker Corp.

But could this community grow? Might this be the next cluster of prosperity in West Michigan? It oculd happen. In fact it is happening.

Here's an excerpt from a visit I made to the West Michigan Science and Technology Initiative on Medical Mile and a conversation I had there with the head of the West Michigan Medical Device Consortium, Don Beery about growth the medical device community:

  It will not be easy. “It will take time. It will take effort. It will take money,” Beery said as he pointed out his office window overlooking Medical Mile. “But we have demonstrated before that we are willing to do that and we know how to do that.”

  He sees the public-private sector partnership model that rebuilt Grand Rapids 20 years ago –I have said it before and I will say it again, this is not the city I moved into in 1990—as being critical to moving the region into the Top Five for medical device manufacturing. “It is night and day in Grand Rapids,” Beery said, “because some folks cared about it and invested their time, energy and money in it. I’m not so sure we can’t pull it off.”

  Venture capital and angel investment money will be important and he said there is never enough of that to go around, although Beery added that he sees the situation improving.

  He also sees great potential for the Grand Rapids community if the area can become a Top Five medical device maker because it is manufacturing. Nothing feeds the family like manufacturing. Factories are capital intensive, land intensive –that means tax revenue—and jobs that are high-skilled, high-wage positions.

  Beery said medical device jobs have an incredible multiplier impact. They create more than 3.5 jobs for every medical device manufacturing position. The initial job pumps money into the economy, big time, with the average annual salary 22-percent higher than the typical job in Michigan.

  However, as much as Medical Mile is about organic growth, creating, developing and monetizing home-cooking, Beery doesn’t think that will be enough. He believes we are going to have to go out and convince one of the big players to move to our town, planting their flag here. “That is the kind of velocity we are going to need to go there (to the Top Five) in a reasonable amount of time.”

The complete interview with Don Beery, along with more on what is happening on Medical Mile and how that cluster of prosperity has transformed Grand Rapids is available in Last Chance Mile: The Reinvention of an American Community available now through www.rodkackley.com

Let Me Introduce You To Medical Mile

I am in what is called the "galley modification" stage of the production of Last Chance Mile: The Reinvention of an American Community. The story of Grand Rapids' Medical Mile and the reinvention of this American community takes place on Michigan Street NE.

So, in this excerpt from Last Chance Mile, please allow me to take you to the home of Medical Mile:

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Grand Rapids’ Medical Mile is a cluster of prosperity. It stretches from the Grand Valley State University Cook-DeVos Center for Health Sciences that includes an entrepreneurial incubator on the east to Meijer Heart Center, Lemmen-Holton Cancer Pavilion, Spectrum-Butterworth Hospital, Van Andel Research Institute and Michigan State University College of Human Medicine on the west.

It is the epicenter of this 21st century revolution in the way this community is thought of, and more importantly in the way this community thinks of itself. Yet, it is only part of Grand Rapids’ story of transformation.

None of this existed 15 years ago. It all began with a $1 billion endowment from Jay Van Andel, a man who was destined to suffer from Parkinson’s, one of the diseases being investigated at the research institute that bears his name.

Michigan Street NE doesn’t sleep anymore. The people and the traffic of Medical Mile keep it awake from College to Division avenues. A full mile that slumbers but never snores.  It is the insomniac of Grand Rapids.

Ambulances scream up and down Michigan Street’s spine at all hours, while Aero Med helicopters fly over its head, bringing patients, doctors and organs for transplant to Spectrum-Butterworth Hospital.

The flow of people running across Michigan Street’s shoulders never stops. Doctors, nurses, technicians; white, black, brown, red and yellow people all in scrubs, some flowered, some plain, some blue, arriving for work, leaving for home every eight, ten or 12 hours. They never stop crossing from the new multi-story parking garages that were built on the northern shoulders of the Mile to the huge, blue Helen DeVos Children’s Hospital building that was added on to the colossus of Grand Rapids health care, Spectrum-Butterworth hospital.

Parents are inside DeVos Children’s and Spectrum-Butterworth hospitals at all hours of the day and night praying that their children’s hearts will continue beating just as this heart of the Medical Mile keeps ticking away, a silent metronome that keeps Michigan Street NE from closing its eyes.

Doctors and nurses race across the spine of the Mile before the lights change. Some of them run into Meijer Heart Center. This is where old hearts are exchanged for new, where lives begin again, where families grieve, where families celebrate. It is the building of second chances. It is yet another reason that Michigan Street NE can’t sleep anymore. The Mile won’t let it even doze.

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Last Chance Mile: The Reinvention of an American Community