Recently, Ben Lorenz, managing partner at Human Element, sat down with Mike Folster from the Industry 4.0 Accelerator to talk about how Michigan’s manufacturing ecosystem is evolving—and why now is the perfect time for mid-market companies to take the leap into smart tech.
Watch this episode on YouTube.
Full Episode Transcript
Ben Lorenz: Welcome, everybody. I’m here talking with Mike Falster from Industry 4.0. Mike, you want to introduce yourself and let everybody know how we met and maybe why we’re sitting here today?
Mike Folster: Yeah, great, Ben. Thank you and thanks everybody for your attention. My name is Mike Folster. I’m a Michigander and I’ve been involved in advanced manufacturing for my entire career, like many, with a background in automotive supply. And then in the last 15 years, I’ve shifted into the advanced technology domain. And it’s in that role, working with the industry 4.0 accelerators, expert in residence, that I had a chance to meet you Ben and the team at the Michigan Manufacturing Association Operations Conference in Lansing, which is a state funded MEDC sponsored program for which we’re essentially matchmaking the manufacturing space with the emerging technology domain that’s changing manufacturing quickly as I’m sure, you know, things like artificial intelligence are taking hold in the business environment. So that’s just a brief about me and look forward to sharing more about what we’re doing with our program.
Ben Lorenz: Yeah, and so for those of you guys who don’t know, I’m Ben Lorenz: with Human Element. We’re a systems integrator for e-commerce platforms. And we also work with the Michigan Manufacturers Association to help business to business organizations, manufacturers, distributors, get on a technology roadmap that allows them to start selling their products and parts and services through e-commerce portals. And so our paths intertwined a little bit at that conference. And I thought what you were doing was really interesting and wanted to have a few moments to get you on our podcast to talk about some of this stuff to our end users. So we do work with a lot of manufacturing organizations that are sort of right up your alley.
Mike Folster: Right.
Ben Lorenz: Maybe just give me the, you know, what is the industry 4.0 accelerator? Let’s start there.
Mike Folster: Yeah, that’s a great one because it’s a bit nebulous and worth a moment of definition. Our program is a coordinated effort between two of Michigan’s smart zone accelerators. The first one is out of the Lawrence Tech University in Southfield, Michigan. called Centropolis Accelerator. That’s headed by a gentleman named Dan Radomski. And he’s partnered with Jackson Areas, smart zone accelerator called Lean Rocket Labs. And that’s handled by Brandon Markin. So those two guys basically partnered up with MEDC to create this program. And what we’re doing in a nutshell is we’re listening and learning from the Michigan manufacturer leaders, companies like Ford and Whirlpool are perfect examples of our corporate partners.
And we’re trying to understand what the challenges are in their journey to take on these new technologies and accelerate them into scale. What we are able to learn then is where are those tech gaps at? And in parallel, our team is globally tech scouting for the best emerging industry 4.0 products where they’re already making a difference in the area that they’re being developed. So what I would want to emphasize is that we’re not promoting startup organizations to these companies. We’re promoting companies that are in scale mode where they’ve already had success, maybe in Europe, working with a major manufacturer. They’re looking to enter the North American market. We’re helping provide not only connections to the customer space, but also connections into landing in Michigan. So for sure, we’re an economic development organization.
where we’re also in part trying to bring investment into Michigan for these companies. A new lab in the Detroit area is a good example. We’ve been fortunate now, 10 of these startups are set in boots up on the ground. And it’s really simple yet worth clarifying that to meet the demands of our Michigan manufacturers, you have to be close to them. The business changes daily.
The issues are fast moving and if you want to be successful, it’s almost imperative to be a neighbor. And so we coach them up, we give them connections, we give them a place to land and then it’s on them, right? We’re not taking any equity in these relationships. We’re maintaining our position as an honest broker where we can provide them that feedback and then step out of the way and let the market work.
Ben Lorenz: So what types of technologies do you focus on?
Mike Folster: Well, in the industry 4.0 domain, and for those that aren’t familiar with this jargon, essentially what’s happened in the technology space over the last 10 or 15 years, there’s been a lot of technologies that are leveraging what we’ll call a digital twin. So you can start using a digital representation of the product or the process to make decisions against, which is a lot cheaper than making physical products and learning about them.
And then also there’s been a great reduction in the demands for coding. So tools now come much easier to be used by frontline workers because they’re almost like apps. And now, you know, with our smartphone life, everybody knows what to do with those. It’s really the digitization and the simplification of technology that brings more mass use. Only within the last few years has artificial intelligence – also we like to say machine learning – had an even more dramatic influence and it’s only accelerating the conversation. So with that grounded understanding, we break down the market into roughly nine segments of this space, think of them as nodes of commonality. And in that nine groupings, we focus on about half of them. So machine vision and quality inspection, metrology, those are longstanding and fast improving tech stacks where, again, the notion of allowing automation to make decisions around metrics and quality. It makes for a faster and more reliable use case. Autonomous robotic automation, we’re seeing not only the easy use of robotics and expansion, but also the ground game. They’re moving around like small cars delivering products. There’s a lot of waste in manufacturing, a lot of non-value added activity.
People are hard to find to want to do the work in manufacturing to begin with, give them a good job that matters. You know, pushing a cart around all day, that’s not something to build a career around. So that’s what we’re seeing, some of those technologies. The internet of things, IOT, it’s a broadband, but connected worker platforms, connected machines. Think of connecting data through sensors to be able to provide decision-making faster, more reliable because you’re closer to the information. Those are kind of the buckets. And again, we drill down into those and a big part of our job is to bring sense to it so that when we talk to the manufacturers, they’re not getting the spaghetti diagram of options. They’re getting concise, clear input on this is what this does and this is what it does to make your business different and better. So hopefully that helps give some context there.
Ben Lorenz: Yeah, so when we’re engaging with manufacturing organizations, we generally get to talk to a certain level within the organization, the people who have interest in a technology transformation or something like that. When you’re engaging with a company like this, or if I’m at a company and I’m trying to find somebody like you to do consulting for me, who are you looking to talk to at those organizations, like who jumps out and raises their hand or who should be contacting you.
Mike Folster: No, that’s a great question. The role that you’re contacting is probably similar to the ones we have. The digital transformation leaders, it seems to be a new title out there. They’re the ones that have their hand over the whole playground of the activity base. Usually these folks come out of a controls engineering background, I think.
I think if you get down to it, most of this technology is integrated into the machine process control. And those that understand that are likely the ones to bubble up in organizations because they can see the technical demands and risks and appreciate them and navigate that. When we go into facilities, mean, at the end of the day, plant managers, they run the show.
So, you know, if we can’t get on the floor talking to a plant manager, getting their feedback on what they’ve tried, I mean, these guys have tried it all. So, you know, you really want to know where they have had some success, where maybe they’ve had some heartburn so that you can learn from that and, you know, and help coach them appropriately and not push an agenda. And I think that’s a big, you know, all of our team members have 25, 30 years of experience, whether in deep tech or in deep management responsibilities. We’re very empathetic to the demands of the business leaders. And that’s why we think we do a good job is because we’re light on that and we’re heavy on experience and ideas that might help them out.
Ben Lorenz: Yeah, I find that when we’re consulting with organizations, a lot of our competitors will come in and try to sell a solution where it sounds like your approach and our approach is very similar in the sense that like I want to talk to the people who are boots on the ground that are doing this every day that see competitive advantages in the ways that they are already doing things.
And how can technology improve on that competitive advantage in a way that’s not a distraction to their workers that makes sense and they’ve got some return on investment in the process? And I think that’s a smart way to look at how to engage with these customers.
Mike Folster: That’s what they need. There’s too many solutions and not enough trust. Ultimately, I think that’s our simple logo for my career, you only need trust in a good solution and the trust is earned and hard to find. I think from the accelerator, because we’re all doing this as honest brokers and with frankly the intention of helping Michigan be a better manufacturing state to make sure that our kids and our grandkids have opportunities to grow their careers. This is a great way for our team to give back some of our experience and yet stay relevant in the market in regards to what technologies are moving the needle.
Ben Lorenz: So if one of these technology leaders or the target market wants to get involved, what does the process look like? How do they raise their hand, get a hold of you? What does that initial assessment look like? Just walk me through that process.
Mike Folster: So our program has three levels of engagement. And if you’re a Michigan manufacturer or or we’ll say a value chain provider or system integrator, high tech distribution, the silver and gold programs are free of charge. So we’re just glad to have as many Michigan manufacturers engage with as possible because
We have what we’ll call three levels of services. The first level, our basic, is thought leadership and content. So whether it’s me working with you today to provide some messaging and some ideas, or we recently put out our second now tech paper, a white paper. This is now on machine vision. Our first one we put out in December was on autonomous material handling.
We’re at a base level, we’re providing grounded information for Michigan manufacturers to be able to learn and understand the space. Think of it as tech for dummies, keeping it real basic and able for multiple levels in organization to bring good value out of it. At the gold level, what we’re doing there is floor walks.
We’re getting more engaged at a personal level. We’re trying to understand that business’s gaps and provide them ideas on where to go next, again, with no vestiture in the process. are other entities in Michigan that do more of this, call it boots on the groundwork. MMTC is our national MEP organization.
They’re the folks that will get in there and spec out equipment and do more cell development if you think about it. Automation Alley is another equal partner in the effort of promoting these ideas. They’re, think, more positioned around thought leadership. They’re a much larger organization than us. They’re also spearheading a lot more of that focus in cybersecurity and in the 3D printing domain.
Because they’re so good at that, we just kind of leave it to them and we focus on our areas. But to give you some framework on how we all come to market, the platinum level is a paid for service. So a good example is working with Ford or some of the larger tier OEMs. Their problem is frankly, they’re so large, they don’t have a process to internalize new technology that’s very efficient.
And what we’ve been doing there is helping them quite a bit. We’ll call it curating the technology experience. And a good example of that was at the Automate Show, which back in May in Detroit, largest automation show in North America, we were able to organize a full day of tours through the floor, 150 Ford manufacturing personnel ranging from management to supervision to frontline deliverables. And those folks were able to come away with, they had a worksheet, they had to fill out information. So at the end they could get a consolidated viewpoint. And then for the two days that followed, we organized pitch events. We had 18 companies that were organized into six technology buckets. So three companies each presenting for 20 minutes are given an opportunity to show their wares to the same 150 folks across North American operations. You could imagine that’s a very unique opportunity for those startups. That’s the scope of our work.
And again, just to reiterate for Michigan manufacturers, the first two levels of those programs are at no cost. You just simply go to our website and there’s an intake form that you apply for. And it is a very light demand. Sign an MOU so that we can exchange the logos and we get after trying to help you out.
Ben Lorenz: Yeah. Now I know that there are a couple other little hidden things that are possible through your program. One of the things is a robotics grant. You want to talk a little bit about that?
Mike Folster: The Industry 4.0 Adoption Grant, it’s an MEDC program. So that’s a statewide initiative. And it’s been very successful to the point that actually it’s been, the financing has been exhausted. We’re waiting for more money to hit the bank right now. It’s been highly leveraged, which is fantastic. It’s a pretty straightforward situation. You would be contacting your local SmartZone interface.
If you’re in Jackson, you’d contact Lean Rocket Labs, for example, and through them, the application process is, to me, it seems fair, given that’s a government grant request. It’s not absurd, but it’s not, you know, something you’re going to scratch out in five minutes. But basically, the way it works is you can get approved for up to a $25,000 matching grant.
And it covers a number of different technology opportunities. What we’ve seen is hard goods seem to get approved without much contest. So if you wanted to do a robotic application, maybe pick a part up out of the machine, place it into a box, have a camera that you present it to check for the label being there in the right spot, just making this up, you know, that cell might cost $50,000, $16,000 in equipment. Not necessarily the programming time, so be mindful, but the equipment costs, now you can with approval of that grant, you could cut that cost down to 30,000 or whatever it is. So it’s intended to get you into the game on an early application. It’s only for small businesses, which in our state is 500 employees or less.
If you’re in that range and it sounds interesting, then, if you don’t know who to reach out to, you can always send me or our team an email and we can get you directed to the right folks. That’s not a problem.
Ben Lorenz: Got it. So stepping back a little bit and thinking about the Michigan manufacturers in general, why do the mid-market manufacturers have the most to gain from looking at Industry 4.0 stuff?
Mike Folster: That’s a great question. My feeling is pretty straightforward. Our manufacturing domain in Michigan is led by the strongest companies in the world. And the amount of risk that they mitigate in the process of approving technology is worthy to be shared by all. It’s a hell of a journey to get Ford Motor Company to start using your products in a regular way. If they’ve done that diligence, then to me that’s easy to leverage. You don’t have to take on the amount of work that they did. So when it comes into this tech stack, what it means is that there’s a lot of work already that’s been done over the last 10 or 15 years to get it to the point now where really the person that could take the most advantage is the one that didn’t put much skin in the game. so the market’s being vetted out, you’re seeing who the winners are, you’re seeing what relative cost looks like now because it’s no longer the shiny penny. It’s a competitive, commoditized market for hardware. And at the same time, what’s hard on any mid-market company is having the intelligence in the organization to build out these strategies. And I think that’s where our organization can be really helpful. We’re honest brokers. Did I mention that?
We want you to succeed because then Michigan succeeds. It’s a really simple model for us. So why not ask for some input? We will provide you maybe not what you want to hear, but what you might need to hear relative to the information that’s out there. Because again, we’re not biasing it as a sales pitch to get you to take it. We’re telling you what you need to know.
Ben Lorenz: I think that’s a very similar sort of story for the types of technologies that we’re implementing, which are primarily software only. We’re seeing that a lot of the heavy lifting has been done by some very large organizations in our space. And that technology is now coming down to sort of squarely in the mid market so that the technology is accessible.
The other thing that’s been done too is the sort of speed and rate of adoption. You know, time has been compressed because like you said, and I agree with you that a lot of mistakes have been made for them prior to getting to a decision point to implement this type of technology. And so the speed to market can be increased because of the learnings of some of these larger organizations that have put a lot of skin in the game, as you said.
Ben Lorenz: And so I think there’s a lot of similarities to how software and then how some of these harder technologies get implemented in manufacturing.
Mike Folster: You raise a great point to build on. In Michigan, we have the strongest network of systems integrators in the world. All this automation is worthless if you don’t have somebody that could put it all together and make it work. And these folks have a lot of power in the process. If they’re not comfortable with the maturity of the technology, they’re not going to sign up to the warranty risks and all that comes with it.
I think what’s been interesting is how in parallel a number of really important things have happened over the last 10, 15 years to allow for scale to be ready to take advantage. And a piece of that is folks like yourself on the delivery side that are glad to do it. You’ve oiled your machine. You know what it takes. And frankly, you know that the mid-market doesn’t have inside resources suitable to do it themselves. And so if they want to stay up to speed, they’re going to need to pick their partners and move or be left behind because there is no white knight that’s going to work in a mid-sized market when if they’re good enough, they’re going to get picked up by a big company and drive a big bus.
Ben Lorenz: Yes. Well, it’s been a really interesting conversation today. I want to close with a couple takeaways and action steps that people might be able to take to engage with you. So recap maybe really quickly some of our benefits, how somebody can reach out to you, maybe your website URL, and what they can do to get engaged.
Mike Folster: I would say that first and foremost, i40accelerator.com is our website where you can see a ton of information about who are the strategic partners. Again, from the tech client space, we’re connecting them into the finance world with VC and angel fund investors. We’ve got a network globally of partners that promote their regional tech stars. So it’s a very well oiled machine on our side. And all of that will come through the website. That’s also where you can simply apply. I’m sure you’ll share my contact information. If you just want to make it easy, send me an email and say, “Mike, I want to learn more.”
To reiterate, for Michigan manufacturers and the manufacturing ecosystem, whether you want to just get the thought leadership content or have us engage with a floor walk and a specific, you know, a strategic conversation. All of that’s free of charge.
If you’re a larger organization, you’re frustrated by the lack of results from sending teams to trade shows and not having coordinated strategy, our curation efforts are really making a difference for those types of partners. And then last and least, if not least, we have programs in Michigan to get you off the mark. The IFO matching grant being one of them, again, just our support and our experience might give you the confidence to take that next step on a project.
Ben Lorenz: Great. Mike, I appreciate your time today. And after spending so much time at all of these Michigan manufacturer events, I was really pleased to have met you and walked through some of the things that are available to the wonderful manufacturers that are in the state of Michigan. And I hope that the ones that haven’t connected with you reach out and get to experience your skill.
Mike Folster: Thanks, Ben.
Ben Lorenz: We’ll talk to you next time.