Published: November 07, 2009 09:54 pm      

Region developing recovery strategy

Focus remains on training workers, improving efficiency.

LAFAYETTE — The Region 4 Workforce Board is working on a strategy to help the 14-county area better position itself for the economic recovery.

The Region 4 board conducted its annual meeting Thursday, which included a presentation on how the region can be a leader in the national recovery and how Lafayette-based Kirby Risk has been dealing with the downturn.

Graham Toft, with GrowthEconomics, said the goal is to make production the driver in the regional plan. He said part of the strategy is to merge economic development and workforce development efforts.

The region stretches east-west from Wabash to Warren counties and north-south from Fulton to Montgomery counties. It also includes Howard, Tipton, Clinton and Cass counties.

“Only some states and regions will pull out of the recession,” Toft said. “It has happened in the past and will happen again. We want this region to be one of those areas.”

Toft said Indiana is facing the toughest recession since 1981 and the focus should be on the middle market companies that are the backbone of the state’s economy.

“The Federal Reserve did a study in the 1990s on what areas recovered from the 1981 and 1982 recession,” he said. “The Midwest turned around because it started manufacturing products better, faster and cheaper.”

Toft said many areas of the country are relying too heavily on the federal stimulus funding and the recovery has to be focused more on the region, companies and individuals.

He said the regional organization has to help small and mid-size firms to diversify their markets and assist with generating domestic and international leads. Additionally, the region needs to make use of the REACH Centers in Kokomo and Lafayette to provide training to workers and supervisors.

Toft said another challenge is training new workers as businesses retool and realign quickly and use local tax funds matched by employers to increase productivity and sales growth.

“There are a lot of opportunities to expand markets in the Midwest,” he said. “There are a lot of companies that don’t know how to market nationally and globally.”

Toft said another goal is to provide information within 48 hours when potential new businesses begin looking at what is available in the region.

Doug Mansfield, president of manufacturing operations for Kirby Risk, explained the company experienced revenue growth of 226 percent between 1997 and 2001 when a major customer indicated it was now competing against 11 other companies.

“We had to reduce our prices by 42 percent to keep the plants operating,” Mansfield said of the downturn. “The challenge was to produce products at a lower cost.”

Kirby Risk learned the lesson of lean management in 2002, because the only way to lower costs was to increase productivity, he said.

“We have had a 300 percent increase in production since 2002,” Mansfield said. “Continuous improvement was the way we were going to move forward.”

Mansfield said the company invested resources in training and remained disciplined so as not to lower costs through eliminating employee and supervisor training.

He said the company was seeing a steady increase in revenues until the recession hit in 2008, which has resulted in a downturn in production of 80 percent.

“We’ve had four layoffs in 39 years and three of them have come this year,” Mansfield said. “People needed to understand that we’re in survival mode and needed to lower costs.”

He said, despite that downturn, the company remains committed to training and is using a system implemented during World War II to train new workers.

“It worked during World War II when all the men were off fighting and women had to be trained to do the work,” Mansfield said. “It worked then; there is no reason it shouldn’t work now.”

• Ken de la Bastide is the Kokomo Tribune enterprise editor. He can be reached at 765-454-8580 or via e-mail at ken.delabastide@kokomotribune.com