Division of Agricultural Sciences and Natural Resources / Oklahoma State University
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Manufacturing the Future
By Fred Causley
“Helping existing businesses expand or simply to remain solvent can be as important to the economic life of a community as is developing a new business. I am excited about the positive results achieved to date through the efforts of the Division of Agricultural Sciences and Natural Resources and the College of Engineering, Architecture, and Technology to bring field-based engineering assistance to entrepreneurs who might not be able to afford it on their own.”
James Halligan, President, Oklahoma State University
 From left: Cooperative Extension applications engineers Terry Collins and Sam Harp look over bermudagrass harvesting and planting equipment with manufacturer Richard Reynolds of Okarche. Harp and Collins developed a computerized system to help Reynolds track his production costs. |
Editor’s note: This issue of Agriculture at OSU carries the theme of economic development. The articles, such as this one on aiding rural manufacturers, highlight only some of the programs under way to benefit Oklahomans. The success stories featured in this issue represent a cross section of the numerous research and Cooperative Extension programs in which OSU personnel work with rural entrepreneurs and manufacturers, large and small.
If a manufacturing company in Oklahoma City or Tulsa needs engineering assistance, it is available. Experts can be brought in on short notice to help owners solve a production problem, materials can be located, and equipment suppliers can be identified.
However, some 2600 rural manufacturers in Oklahoma are keenly aware that engineering assistance is not readily available to them. They often may not know where to look for the assistance they need. When they do find it, it is likely to be cost prohibitive.
The story begins as a pilot program set up in 1992 and operating on USDA funding to provide engineering technology assistance to rural manufacturers.
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“The first phase focused on one-on-one technology transfer to small industries,” recalls Billy Barfield, head of the OSU Department of Biosystems and Agricultural Engineering. “The support we offered included electronics, material flow, plant layout, analysis, and design of components. We learned how to help with that program, but the funding was limited.”
In 1996, OSU and the Oklahoma Alliance for Manufacturing Excellence joined forces to provide engineering assistance to rural manufacturers. One of 70 Manufacturing Extension Partnerships (MEP) in the U.S., the Alliance is the manufacturing extension service for Oklahoma. Barfield—who is with OSU’s Division of Agricultural Sciences and Natural Resources (DASNR)—Tim Greene, of the OSU College of Engineering, Architecture, and Technology (CEAT), and Randy Goldsmith, Alliance president, developed and submitted a proposal to the National Institute of Standards and Technology. | Economic development highlights in this article: • 438 jobs created, saved, or retained, mostly in rural areas. • $38 million added to the state’s economy. • More products produced more efficiently in one company. • An overall product increase of 25 percent in another company. • One company with a 95 percent income inflow from outside Oklahoma. |
To the benefit of Oklahoma, NIST accepted the proposal and provided funds which were matched by DASNR and CEAT, and then additional funding came from the Oklahoma Council for the Advancement of Science and Technology. The result was the funding of a state-wide application engineering program that is one-third federal, with two-thirds coming from state and private sources.
 Plant manager David Bean holds one of the largest filters manufactured by Leedar, Inc., while Betty Wright displays one of the smallest. Cooperative Extension Service transfer technology specialist Phil Norton helped Leedar owners Carl and Lori Randall facilitate moving their company into new quarters and developed product flow analyses to streamline production. |
“Agricultural knowledge has been disseminated through Cooperative Extension offices for decades, so it seemed natural to use the same successful model to provide field-based engineering services,” Barfield says. To date, specialists have been placed in the four Cooperative Extension district offices and two at the main campus in Stillwater. Win Adams works in the Northeast District and is located in the Muskogee office. Terry Collins is at Enid for the Northwest District. Jim Friesen covers the southwest district and is located at Cordell, while Phil Norton serves the Southeast District and is located at Ada. Sam Harp is located at Stillwater, and like Adams, Collins, Friesen, and Norton, is a member of the OSU Department of Biosystems and Agricultural Engineering. Harp also is a senior applications engineer. Jim Henderson is a senior applications engineer with CEAT. |
The Alliance has four industry sector specialists, sponsored by the Oklahoma Department of Commerce, who provide expertise in the areas of food processing, medical products, international trade, and aviation/aerospace. In addition, 15 Alliance manufacturing extension agents across the state, funded by Vo-tech and higher education entities, provide assistance to rural manufacturers in technology, marketing, human resources, finances, and business relations.
“Projects that require more than eight hours of assistance from an applications engineer require the client to agree to a pre-project needs assessment and a post-project evaluation by the Alliance before the applications engineer can provide service,” Barfield explains.
One result of that requirement is a clear idea of the benefit the program is having on the Oklahoma economy.
Program evaluations—done by an independent survey party—are nothing short of phenomenal. Since 1994, 438 jobs have been created, saved, or retained, with the bulk of them in rural areas where they are badly needed. The value of the services those jobs render is nearly $11 million, but with the multiplier factors in place, the value of the jobs themselves is placed at nearly $22 million, for a total impact of almost $33 million on the state’s economy!
It is noteworthy to look at Oklahoma manufacturing statistics: the state has more than 4,200 firms that employ over 160,000 people. This translates into a $4.5 billion payroll, 21 percent of the state total. Most of these people work in small firms with fewer than 50 employees.
“The states of Georgia and Maryland have model MEP programs that have proven to be major successes. With the proper support, we can achieve similar results,” says Karl Reid, Dean of the College of Engineering, Architecture, and Technology.
The following examples are indicative of the relationships and successes experienced so far by OSU/CEAT personnel working with Alliance manufacturing extension agents to help small rural businesses:
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Precision Components Co.—This company manufactures precision machined aircraft engine components, engine cylinders primarily. Located at the edge of Owasso, they have 90 employees in a 25,000 square foot facility. The company has a sister operation at Grove called Precision Machine and Manufacturing Co. that employs 110 more people in a 36,000 square foot facility.
In the throes of planning for an expansion, Kevin Diehl, Director of Operations and Quality for Precision Components, contacted the Alliance for help. He was referred to Win Adams, Cooperative Extension applications engineer for the northeast district. |  Precision Components, Inc. owner Kevin Diehl, left, goes over plans for a facility expansion with Win Adams, OCES applications engineer for the Northeast District. Diehl said they now produce more in less space due to OSU support. |
“For once, a manufacturer came to us before taking action,” Adams recalls, smiling. “Doing so ensured a cost avoidance situation rather than a cost savings one. They were needing 8,000 to 10,000 more square feet to meet their parameters and to adjust the processing flow, which is the movement of raw material into the plant to finished product out.”
After defining the constraints and goals, Adams conferred with Sam Harp, with the OSU Department of Biosystems and Agricultural Engineering. A graduate assistant was assigned—under Harp’s guidance—to gather data, study the project flows, the macrodepartmental flows and other parameters.
“We worked to try and reduce the handling—the back and forth flow—and to increase overall efficiency of the operation. It is a total system application,” Adams says.
Adams presented the recommendations as to where the expansion should be placed and in which departments. It involved working with a Precision Components quality control team who would ultimately make actual decisions based on Adams’ input.
“We are in the middle of the project now,” Diehl says. “We didn’t act on all the suggestions made, but we took some even further. It was a valuable help to us that we may not have been able to afford on our own. We were actually able to be more efficient and produce more product in less space than originally planned. I foresee having a good, long, relationship with Win and with OSU. Hopefully, this will not be our last expansion.”
Leedar, Inc.—Moving from a facility of 17,000 square feet to one of 35,000 square feet might be thought of as a small manufacturer’s dream. But for owners Carl and Lori Randall, parts of it were promising to be a nightmare.
Leedar, Inc., located north of Shawnee on Highway 18, manufactures air filters for trucks, tractors, ventilation systems, stationary engines, and panel filters for tractors.
“The best thing we had going for us when we started was being naive. If we had known what was ahead, we probably would never have done it. However, we have grown and about three years ago, we had to face the fact that we needed more space, ” Randall says.
“The problem was to come up with a layout for maximum efficiency of the new space. The move itself was problematic, because down-time moving meant no production to be shipped, and customers don’t like that. Knowing where to set up in the new facility translated into minimizing down time.”
Shelly Dick, cylinder hone operator for Precision Components, Inc. of Owasso,
puts final touches on airplane engine cylinders. OSU application engineers
helped the company streamline production during a business expansion phase.
Randall heard through Richard Huff, an Alliance Manufacturing Extension agent, that expertise was available. Huff referred Randall to Phil Norton, Cooperative Extension technology transfer specialist for the southeast district.
“They could have done this themselves,” Norton says. “However, we were looking at it with outside eyes. We studied their operation and did an analysis. We also created a product flow computer model and developed several options for Carl’s layout.”
Randall assigned his plant manager, David Bean, to work with Norton, Harp, and Terry Collins, who was then a graduate student, but now a Cooperative Extension applications engineer for the northwest district.
“We picked one of the plans and went with it to the letter,” Randall recalls. “We striped the floor to know exactly where specific pieces of equipment went. We started moving on Friday afternoon and the first filter at the new facility was finished at 8 a.m. Monday. The key was knowing where everything went; that the plumbing and electric was there.”
Through attrition, Randall has been able to actually downsize his crew. Instead of 36 persons, he now employs 29—but, he says, that’s not as bad as it may sound to some.
“The bottom line is profit. This move has given us an overall product increase of 25 percent—with less people. This enables us to pay better, offer better benefits, and keep good people. We’re not there yet, but we will be,” Randall says.
“This program enables small companies like ours to get the best help available when we couldn’t afford it otherwise, or even know where to look or whom to trust. They had our interests at heart because they work for OSU and for the state of Oklahoma,” he adds.
Bermuda King, Inc.—One of the few companies in the world that manufactures bermudagrass sprig harvesters and planters, Bermuda King is a 40-year-old business located a few miles outside of Okarche. Current owner Richard Reynolds purchased the business from Willard and Ruth Duffy in 1993.
Eighty-five percent of the company’s sales are in the southeastern U.S. and California. Reynolds says sales are increasing in states such as Kansas, Nebraska, Colorado, and Indiana as more cold-tolerant bermudagrass varieties come on line. In addition, Bermuda King exports machinery to Mexico, Italy, Saudi Arabia, and Egypt.
“Less than five percent of our income is from Oklahoma—everything else is an inflow. I see that as a direct boost to the state’s economy,” Reynolds says.
The problem Reynolds needed Alliance/OSU help with was one of tracking costs of production. He knew what a particular piece of steel for a component cost, but by the time labor, welding rods, painting costs, overhead, and other factors were considered, the true costs became hard to pinpoint. Multiply that by hundreds of parts in a machine, and it added up to a Bermuda King-sized headache.
“We had tried and tried to work up cost sheets, with little luck. Then Jim Friesen Cooperative Extension applications engineer for the southwest district] introduced me to Sam Harp. Sam helped us with our paint booth and filtering system, even with the type of paint we use,” Reynolds says.
“The main thing we did was to develop a computerized system to track the cost of production,” Harp recalls. “One of the factors is just the time the company has to hold their inventory.”
Harp explains that because bermudagrass sprigging is seasonal, equipment sales begin in January and nearly stop by June. Yet Reynolds wanted to keep his good employees working year around. The result is that he sometimes has $1.3 million to $1.5 million in inventory, because they continue to build about 2.5 machines per week year around.
In addition to the regular machines, Reynolds recently completed the prototype for a large golf course sprigger that can put hundreds of sprigs per acre into the ground in a hurry. Another development is a mini-planter being built for rental companies to rent to homeowners who want to sprig small areas such as yards.
“Sam and Jim were the first people to come out here who actually followed up with what they said they were going to do. I don’t know how much it helped exactly, but I do know that it is a factor in our still being in business,” Reynolds says.
Agriculture at OSU Spring / Summer 1998
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