UEDA MEP Presentation Nov 2008. Final

Manufacturing Extension Partnership: Demonstrating Innovative Strategies in Performance Metrics Carroll Thomas, Partnership Catalyst Kenneth P. Voytek, Chief Economist

Presentation Purpose & Objectives
About The Manufacturing Extension Partnership (MEP)
underlying rationale for the program
How MEP Evaluates Partnership Opportunities
Examine how MEP assesses and evaluates client, center, and program performance

“ It’s déjà vu all over again!”
~ Yogi Berra

Mission Statement
“ To strengthen the global competitiveness of US-based manufacturing by providing information, decision support, and implementation of innovative approaches focused on leveraging technologies, techniques, and business best practices.”
The National Institute of Standard and Technology (NIST) is an agency of the U.S. Commerce Department

What/Where is MEP 59 “Centers” 1600 Field Staff 440 Service Locations

The MEP Program in Short….
The centers, serving all 50 States and Puerto Rico, are linked together through the Department of Commerce's National Institute of Standards and Technology .
59 assistance centers with 442 field locations
System wide, Non-Federal staff is ~1,600
Contracting with over 3,000 third party service providers
Partnership Model – Federal/State/Industry
MEP System budget ~ $300M
1/3 Federal, ~1/3 State and >1/3 Industry (fees for services)
Emphasis on performance – program and center – measured based upon impact of center services on client firms.

What MEP Does
Focus on meeting manufacturer’s short term needs, but in context of overall company strategy
Working directly with over 27,000 manufacturing companies a year*
UNDERLYING IT ALL – Establish and expand partnerships with other like-minded, mission oriented organizations at Federal, state and local level
*Based on FY2007 MEP Center reported performance data.

Client Impacts Resulting from MEP Services
New Sales $3.11 Billion
Retained Sales $3.65 Billion
Capital Investment $1.65 Billion
Cost Savings $1.115 Billion
Jobs Created and Retained 52,585
FY 2006 economic impact results are based on a survey of 4,959 MEP-served establishments out of 5,384 attempted.

= Partnership
The Green Suppliers Network , an innovative collaboration between government and industry,
Focus : Address the dual challenge of reducing the environmental impact of small and mid-sized manufacturing suppliers while simultaneously increasing those companies’ efficiency, productivity and profitability.
Approach : Lean & Clean on-site reviews
Value Add : Expands lean definition of waste to include environmental considerations
Deliverable : Measurable business and environmental impacts

What to Look for in Potential Partners Center Impact / Revenue / Reach
Alignment of missions
Overlap in customer base or target markets
Brand prominence, credibility and fit
Complementary products & services
Visibility with stakeholders
Financial resources for clients or the center
Opportunities to share or leverage resources
Stakeholder Influence, Visibility Complementary Products & Services Referrals (Access to Clients) & Joint Marketing Basic Partnership Model Financial Resources (for Centers, Clients) Other Benefits Buried Treasure/Other Benefits Types of Partnership Benefits Partnership Benefits What to Look for in a Potential Partner (to obtain these benefits)

How to Evaluate “ROI” of Potential Partnerships Partnership Benefits Identified in this Study Referrals/Cross-Marketing Complementary Products/Services Stakeholder Visibility Financial Other Benefits

Evaluation and Performance Measurement
Performance Measurement: The ongoing monitoring and reporting of program progress and accomplishments using pre-selected performance measures.
Program evaluation: systematic study using measurement and analysis to answer specific questions about how well a program is working to achieve its outcomes and why.

The Changing Face of Manufacturing: Getting Smaller; Need to Get Smarter
Facts about small manufacturers:
Represent 99 percent of all manufacturing establishments
Employ 10.2 million people -- 70 percent of all manufacturing employment, and
Account for about 57 percent of the total value-added by all U.S. manufacturers
The Challenges for Small Manufacturers:
In 2002, productivity per employee in large establishments was 69 percent higher than productivity in small establishments. In 1967, productivity per employee was “only” 26 percent higher.
Over the last 10 years, productivity among large firms grew 7 percentage points faster than small firms.
Market Failures in several dimensions: firm, inter-firm, consulting/services, public failure.

Evaluations should assess the extent to which the NIST MEP strategy is achieving its goals
The principal goal is to help manufacturers increase the competitiveness and productivity of U.S. manufacturing and NIST MEP has a two-pronged strategy:
Help manufacturers in the United States improve performance – i.e., make products the right way
Help manufacturers in the United States grow their business – i.e., make the right products for the right customers profitably

Performance should be assessed on multiple dimensions
Coverage . The extent to which companies in the target population have received services.
Outputs : The volume of services undertaken by affiliated centers as reflected in key outputs.
Operating efficiency . The extent to which processes are efficient, yielding the highest level of output for a given level of input, or alternatively, using the fewest resources to achieve a given level of output.
Financial sustainability . The extent to which affiliated centers have sufficient resources to cover their operating costs and needed investments.
Effectiveness . The extent to which the objectives have been achieved in terms of improved performance of the target population and associated economic outcomes.
Leadership, strategy and operations . The organizational performance of affiliated centers.

Effectiveness should focus on the impact of centers on the change in value-added and sales within manufacturing firms.
The crucial issue in assessing impacts is comparing the observed situation with the counterfactual

The Center Balancing Act The Program Balancing Act Revenue Market Penetration Client Impact Market Penetration Financial Stability Market Penetration Economic Impact

MEP Measures Success & Performance At Different Levels Client Impacts and Performance Improvements Center Performance & Impacts System Performance & Impacts

Manufacturing Extension Partnership (MEP) Program: Impact Path
Inputs
Funding
Federal Funding
State/local funding
Client fees
Staff
Trained MEP Center staff
National MEP program staff provide program oversight, training, technical business assistance
Activities
MEP Centers provide:
Information
Decision Support
Implementation assistance
Center’s services help manufacturing clients adopt new and more advanced manufacturing technologies, techniques, and business practices
Firm-level Business Impacts
Cost savings
Capital investment
Jobs created
Sales (new and retained)
Profit Margin
Improvements in:
Manufacturing systems
Human resources system
IT systems
Marketing and sales systems
Management systems
Outcomes
Productivity growth of small manufacturing firms
Increased global competitiveness of US-based manufacturers
Improved supply chain efficiency
Improved job opportunities for US workers
Higher rates of business survival
Output Tracking MEP tracks the number of clients each year over 20,000) and the total number of activities performed by MEP Centers (over 30,000/year) Measuring Client Impacts Through an annual client survey, MEP tracks the impacts of Center assistance on several major firm-level indicators (sales, cost savings, jobs). As a set, these indicators suggest the presence of business changes that are positively associated with productivity growth Program Evaluation Need more access or creative ways to conduct such studies Center Review Annual operating plan, External reviews, Center impacts metrics, and quarterly reporting Measuring Along the Way Measuring Along the Way

MEP Performance Continues to Increase While Federal Funding Remains Relatively Flat Project-based survey Client-based survey Center Metrics in Place *FY 2007 data represented only ¾ of impacts

CLIENTS TOUCHED AND SURVEYED OVER TIME Note: Data on clients served did not become a GPRA target until FY 2001. In addition, FY 2000 and FY 2007 data on clients surveyed represent partial years. Surveys are done with a lag. Client Interaction Metric in effect

MEP’s Data Reporting & Center Performance System
Operating Plan : Annual plan (linked to the center’s strategic plan) that outlines the anticipated activities and results for the coming year.
Quarterly Data Reporting : Center reports progress and client project data quarterly.
Annual Review : Each year prior to annual renewal of federal funding, the performance of the center is reviewed comprehensively by NIST-MEP or an external panel.
External Panel Review : Every two years the center is reviewed by an external panel that assesses the center performance and alignment with their operational and strategic plans.
Third Party Client Survey : NIST sponsors a national survey conducted by an independent third party that quarterly collects data from center clients on the business impacts of the services provided by their local center. NIST-MEP uses this performance data as a core component in reviewing center performance. The results also provide the centers with a tool to measure their effectiveness and benchmark their performance against other centers.

Center Performance Metrics Percent quantified impacts (10 points) Clients Served per Million Federal dollar (15 points) Investment Leverage Ratio (25 points) Bottom-line client impact ratio (25 points) Impacted clients per Million Federal $ (25 points) Center Performance Metrics

LOW IMPACT, LOW PENETRATION HIGH IMPACT, LOW PENETRATION HIGH IMPACT, HIGH PENETRATION LOW IMPACT, HIGH PENETRATION The Variation in Center Performance, Q2 2008

Median Center Performance Over Time

Components of MEP’s Performance & Evaluation System: The Portfolio
Firm Level Studies:
Impact Data from Third Party Client Impact Survey : new sales, cost-savings, investments attributed to MEP services [GPRA metrics] used in part to develop center performance metrics.
Longitudinal Studies : focuses on comparing the competitive performance of MEP clients relative to similar firms that did not receive MEP services.
Case Studies : focus on successful MEP projects to gain insight into variables at both the firm and industry-level that impact technology adoption and business transformation.
Impact Studies: regional economic impact analysis of MEP centers

Attributes of Current System
Mix of performance measurement and evaluation approaches
Triangulation of results through different methods and approaches
Focus on intermediate outcomes and ultimate program goals
Multi-level & Multi-dimensional (firm, center, and system)

MEP Measurement System is a Competitive Advantage
Communicate to federal, state, local stakeholders
Replicable, believable data
Voice of Customer results
Measurement process investment better than any economic development program
Operational Improvement
Benchmarking against other centers
Measurable impact focus drives service delivery choices

Thanks! Contact the MEP
Just call our toll-free number 1-800-MEP 4 MFG (1-800-637-4634), and your call will be automatically routed to the MEP center that serves your region.
www.mep.nist.gov
Program Questions: mailto:mfg@nist.gov
NIST MEP 100 Bureau Drive, Stop 4800 Gaithersburg, MD 20899-3460 (301) 975-5020

UEDA MEP Presentation Nov 2008. Final

by Ed Morrison on Nov 09, 2008

Accessibility

Categories

Upload Details

Usage Rights

2 Embeds 3

Statistics

UEDA MEP Presentation Nov 2008. Final — Presentation Transcript

http://www.slideshare.net	2
http://ueda2008.net	1