The factory, which employs about 700 people in manufacturing as well as another 800 in design, engineering and management, is an anomaly in modern America – a manufacturing site in one of most expensive cities in the country.

But to Gillette’s parent company, Procter & Gamble, Boston is an ideal base not only for making Fusion and Mach 3 razors, but to produce machines that assemble Gillette products around the world: After a century of making razors at the site, the company has a critical mass of experienced workers.

“The guys in my world see the new products three to five years before anyone else,” said Ronald Calder, who runs the machine shop at the South Boston facility, which develops the equipment that produces many thousands of razors per day.

Having his crew of machine makers a short walk from the people who manufacture the razors allows them to develop and fine-tune machines quickly and cheaply.

That plays to what P&G management regards as its strength.

“Oftentimes, the basis for our competitive advantage in a category is the process or manufacturing operation that allows us to make better quality than our competitors at a lower cost,” said Bruce Brown, chief technology officer with the Cincinnati-based company.

America’s debate over manufacturing has escalated in the face of stubbornly high unemployment and the realization that younger workers lack some of the basic skills necessary to hold down a job in an assembly plant or a fabrication shop.

Gillette is facing that issue in part by putting interested factory workers through a technical training program at a nearby state university.

One graduate of that program is Mike DiBella, 31, who started at the factory five years ago with a high school diploma and some vocational school experience. After the additional program, today he manages 14 machines that sharpen steel for blades.

DiBella said he is never bored, enjoys the challenges of the job, and sees opportunities for growth.

AGAINST THE GRAIN

P&G runs against the grain in corporate America in believing that the company’s manufacturing skill is a large part of the reason shoppers are willing to pay about $3.50 for a single Fusion razor cartridge.

The company argues that manufacturing in-house and in Boston helps it to meet exacting standards for its razors, necessary since men would be less willing to pay premium prices if they cut themselves during their morning shaves.

It is not just basic items like clothing and furniture that have migrated to offshore production. More complicated, and higher-tech products such as Apple Inc’s iPads and Nike Inc running shoes are largely made overseas, often in subcontracted factories not owned by the brands whose products they are making.

Cheaper labor costs have been the main drivers of such production in China and elsewhere but with Chinese wage costs rising sharply, the yuan currency gaining against the U.S. dollar, and transport costs increasing, the advantage against the U.S. has narrowed a bit in recent years.

Also the main downside of moving production to an outside contractor in a country like China is the danger of losing some control over quality and over intellectual property.

Still, American manufacturing is now considered to be primarily the domain of makers of bigger-ticket, highly engineered products such as medical imaging devices and excavators, including General Electric Co, United Technologies Corp and Caterpillar Inc.

And it’s not as if P&G hasn’t weighed the options for the Boston site.

When the company bought Gillette in 2005, it considered closing the 45-acre (18 hectare) facility. After deciding to keep it open, it then pulled the company’s white-collar staff out of the city’s iconic Prudential Tower and consolidated Boston operations onto the factory campus.

Keeping both its manufacturing and the design of its machinery in-house makes it harder for rivals to knock off its designs, the company reasons.

Mike Chaney, Gillette’s vice president of product supply, cites the line of Sensor razors, introduced in 1990 and no longer protected by patents, as an example. “Anyone could copy it, but they don’t because they don’t know how to make it efficiently,” said Chaney.

The company has good reason to be protective of its razor business, as it is one of P&G’s most profitable ventures. The company’s grooming division – which includes men’s razors, as well as other products including men’s deodorant but not women’s razors – notched a 20 percent profit margin in the fiscal year ended June 30, well above the company’s five other divisions, which make products ranging from Crest toothpaste to Pampers diapers.

CUT TOO DEEP

While a weak global economy and rising costs in emerging markets have led more companies to think like Proctor & Gamble, manufacturing experts say many executives have long looked at manufacturing operations too narrowly, focusing mainly on cost.

Quick reductions to the cost of making a product, whether by moving production to a lower-cost region or handing it off entirely to another company, can provide a quick boost to profit margins but make it vulnerable to quality problems or theft of technology and designs.

“They call it a cost center. It costs money rather than adds revenue,” said Jung-Hoon Chun, the director of the Massachusetts Institute of Technology’s Laboratory for Manufacturing and Productivity. “Because it’s a cost center, if you become a manager of the unit, if you get rid of that then from day one you get rid of costs.”

That attitude has contributed to a slow decline in U.S. manufacturing employment. The sector currently employs about 12 million people in the United States, down from a peak of near 20 million around 1980.

While many companies have reduced headcount due to productivity initiatives, cutting manufacturing too deeply can take its toll.

The world’s largest cereal maker, Kellogg Co, for instance, in November cut its profit forecast for the year, saying that it had cut too many jobs at its factories and would need to boost spending to fix problems related to food safety. U.S. regulators in June found listeria at one of the company’s plants in Georgia that produces Keebler and Famous Amos cookies, and in 2010 Kellogg had to recall millions of boxes of cereal due to an unusual smell.

“We did cut too many people in our facilities in the U.S. network,” acknowledged Chief Executive John Bryant in a conference call with investors.

On a similar note, an executive from Schlumberger, the world’s largest oilfield services company, has concluded that trying to manufacture equipment far from its main centers in the United States and France was not the right move.

“Some of our manufacturing has been seen as something that’s easily commoditized and exported to the low end,” said David Rowatt, Schlumberger’s research director for mechanical and materials science, at a recent MIT conference. “We have had in place an approach of being able to design in one place and produce anywhere in the world and what we have seen internally is that is a model that has not worked for us.”

Schlumberger officials did not respond to request for comment on the specific problems it faced.

DIM VIEW WIDENS SKILLS GAP

Even if executives warm more to the idea of American manufacturing, a combination of factors – the perception that U.S. factories cannot compete with lower-cost rivals in emerging markets and the notion that manufacturing plants are simply cost centers – has soured the American public’s view of the sector. As a result, manufacturing executives say, they have a hard time finding young people with the skills needed to work in today’s highly automated plants.

“Manufacturing has a negative perception and it’s a negative perception because of many years of saying, ‘It’s OK to be a service economy and manufacturing is all about brawn and not about brains,’” said Keith Nosbusch, CEO of Rockwell Automation Inc, a Milwaukee-based manufacturer of factory automation equipment, in an interview last month. “Obviously it’s something we worry about a lot.”

Jason Miller, assistant to President Barack Obama on manufacturing policy, recently addressed an MIT summit about the U.S. government’s new plan to work with major manufacturers and top universities to educate young people on advanced manufacturing.

“It’s not about some desire to return to a romantic notion of the past, of what manufacturing was,” Miller said. “It is about a fundamental recognition that without a robust and vibrant manufacturing sector, it’s going to be difficult for us to sustain a robust and innovative economy.”

Proponents of manufacturing often point to the so-called multiplier effect of the jobs the sector employs. Each new manufacturing job created in the United States on average creates three more nonmanufacturing jobs – ranging from supplier jobs to restaurants and shops where factory workers spend their pay, according to a Boston Consulting Group study.

Many U.S. manufacturing executives complain that U.S. high schools are not providing students with the technical and scientific training they need to work in modern factories.

“We’re having a challenge increasingly finding capable people coming out of our secondary schools, with high school educations that have the capability to work in some of our operations,” Caterpillar group president Stuart Levenick said at the Reuters Global Manufacturing and Transportation Summit this week. “You think about manufacturing and a lot of people in this country think of it as an old, dirty, unsafe environment. And this is becoming a very high tech, world-class, highly paid job.”

That view was echoed by Rolf Meyer, CEO of Harting USA, a privately held maker of electronic connectors. “Kids don’t have any kind of relationship to manufacturing anymore, so why should they become an engineer?”

Meyer recalled hiring an engineer who was handy with computer-aided design but hopeless at building things. Meyer once had to take a screwdriver out of the worker’s hands.

“I was afraid he’d kill himself,” he said. “The screwdriver had a very sharp tip. He had never used it.”

(Reporting by Scott Malone in Boston, additional reporting by Nick Zieminski in New York. Editing by Martin Howell in New York.)

The First Million

Until I was thirty years old, I wasn’t much of a fisherman. I’d take a rod and reel along on a camping trip, but I never expected to catch much of anything. In my mind, fishing was a relaxing past time you enjoyed with friends and beer. Then my buddy Brian asked me to go fishing. I took him to a lake I knew that was hidden in the woods; and he taught me how to fish for bass. He showed me how to cast my lure along the edge of the lake; how to give the line a couple of tugs to “jig” the lure and attract the fish; then to reel it back in quickly.

I accepted his instructions affably, but with little faith, then popped open a bottle of beer and started to get into the rhythm of relaxation. Cast, tug, reel. Swig. Cast, tug, reel. Swig. Cast, tug, reel… Whoa! Something hit my line. Hard. Really hard! I’d never felt anything like that before. My line started spinning out of the reel with a high-pitched whining sound. I cranked it back in as fast I as could, but the drag was set too low and the fish was pulling it back out faster than I could turn the handle.

Suddenly, a hundred feet in front on me, a bright green monster burst out of the lake. It was a large-mouth bass that came full length out of the water. Shimmering in the sunlight, he shook his head back and forth in an attempt to break free from my hook, then splashed back beneath the surface. I couldn’t believe it – it was just like I’d seen on television – and it was happening to me.

Afraid that I’d lose the fish, I yelled at the top of my lungs, “Brian, Help!” He was nearly halfway around the lake, but he dropped his own rod and charged toward me; yelling instructions all the way. I tightened the drag and reeled the fish in a little, then let him pull the line back out to tire him. It felt like an hour, but was probably less than ten minutes, before I finally got him in. He was 18 inches long and weighed eight pounds. The bass wasn’t the only one to get hooked that day; I was too – I couldn’t wait to go fishing again!

For the first time in my life, I had experienced fishing success. Success in anything is very motivating. It builds confidence and encourages you to keep pursuing that particular endeavor.

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Robert Evans Wilson, Jr. is a motivational speaker and humorist. He works with companies that want to be more competitive and with people who want to think like innovators. For more information on Robert’s programs please visit www.jumpstartyourmeeting.com

With the morning mist still on the Hudson River, and the sun just kissing the cliff tops of the New Jersey Palisade, Aaron Burr, Vice President of the United States shot and killed former Secretary of the Treasury, Alexander Hamilton. Political opponents for years, the duelists faced each other after Burr sent these words to Hamilton: “Political opposition can never absolve gentlemen from the necessity of a rigid adherence to the laws of honor.”

Once upon a time people were motivated by honor. Acquiring it, maintaining it, defending it. Bitter duels were fought in its name. I don’t hear much talk about honor anymore.

Could it be the concept of honor is too difficult to understand? Is it truly ineffable – impossible to define – to the point that no one really knows what it means? As a virtue, it has certainly taken a beating when some cultures identify the murder of family members as an “honor killing,” and when criminals such as the Mafia call themselves “men of honor.”

I looked it up in the Webster Dictionary and found the words “reputation” and “integrity.” But, honor seems to be more than that. It is similar to the definition of character which is: “what you do when no one is watching.” Again, it must be more than that. So, I researched what some historical figures said about it. Most of them described honor by what it is not.

Thomas Jefferson said, “Nobody can acquire honor by doing what is wrong.” OK, we’ll assume he means you must do what is right or good. The problem may be that by today’s standards those are up for debate.

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Robert Evans Wilson, Jr. is an author, humorist, and coach. He works with people who want to achieve more without sacrificing life balance. Contact Robert at www.jumpstartyourmeeting.com

By Shobhana Chandra

May 6 (Bloomberg) — The productivity of U.S. workers probably rose in the first quarter at the slowest pace in a year as employers took on staff to meet growing demand, economists said before a report today.

Employment may keep growing as companies such as Timken Co., which slashed payrolls and relied on becoming more efficient to lower expenses and protect profits during the recession, now look to expand as sales improve. The drop in labor costs is also helping limit inflation, giving Federal Reserve policy makers room to keep interest rates near zero.

“Productivity is still pretty good, but we’re likely to see it moderate,” said Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “Labor costs are going to remain very modest. The Fed will be on hold for quite some time.”

The Labor Department’s productivity figures are due at 8:30 a.m. in Washington. Economists’ estimates ranged from gains of 1.5 percent to 3.9 percent.

Labor expenses adjusted for the gains in efficiency fell at a 0.7 percent rate after dropping at a 5.9 percent pace the prior quarter, according to the survey median. For all of 2009, labor costs plunged 1.7 percent, the most since records began six decades ago.

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By Annalyn Censky, staff reporter

NEW YORK (CNNMoney.com) — The manufacturing sector grew for the ninth consecutive month in April, and at its fastest rate since June 2004, according to a report released Monday.

The Tempe, Ariz.-based Institute for Supply Management (ISM) manufacturing index rose to 60.4 in April, from a March reading of 59.6. Any score above 50 indicates growth in the manufacturing sector.

April’s number is slightly better than expected, driven by increases in productivity, new orders and manufacturing jobs. Economists surveyed by Briefing.com were expecting a reading of 60.

“Overall, the recovery in manufacturing continues quite strong, and the signs are positive for continued growth,” Norbert Ore, chairman of the ISM’s survey committee, said in a release.

Of the 18 industries surveyed in the report, 17 reported growth. Apparel, non-metallic minerals and wood products were among the industries showing the strongest growth.

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By JACK EWING

FRANKFURT — The past weekend was definitely not a good time to be a Kenyan flower grower, an Israeli avocado farmer, a package tour operator or anyone else trying to run a business that depends on air transport to or from Europe.

Consider TUI, the largest travel operator in Germany. With all the country’s airports closed because of the danger posed by a cloud of volcanic ash from Iceland, the company, based in Hanover, had to take extraordinary — and costly — steps to bring customers back from Mediterranean vacations.

Late Saturday, TUI flew 540 of its customers from the Spanish island of Mallorca to Barcelona. After staying overnight in hotels paid for by TUI, the vacationers boarded a dozen buses for a 20-hour trip to Frankfurt. From there they continued home by train.

Economists have begun considering when, and to what extent, the extra costs sustained by companies like TUI — not to mention the airlines — will start to damage Europe’s already shaky economy.

Most say the effects will not be catastrophic if the skies clear soon.

There were signs of hope Sunday as airports in Frankfurt, Berlin and some other European cities reopened on a restricted basis, at least temporarily.

But a longer spell of airport closures — or intermittent disruptions in the coming weeks and months as the volcano continues to erupt and winds carry the ash to Europe — could start to take a toll.

“Given that the recovery of the euro-area economy is anyway so weak, it might have an impact,” Daniel Gros, director of the Center for European Policy Studies in Brussels, wrote in an e-mail message.

While most economists are not predicting that the volcano will push Europe back into recession, there is a risk of unexpected consequences that could amplify the economic damage.

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Seventeen years ago, I became the president of my community association. It was a lively organization with scores of activist members who were busy gentrifying an inner city neighborhood. One of my responsibilities was to deliver a monthly speech and conduct a formal meeting with a loud and raucous crowd.

Over the course of my two year stint, I always spoke from behind the lectern with my hands firmly attached to the sides in a white knuckle grip as I read from my notes. When my term ended, I felt that I might have been a more effective leader if I had some real speaking skills, and if I wasn’t so afraid of being in front of an audience.

So, I joined a Toastmaster’s club and began my training as a public speaker. A year later, I had completed ten speeches and the basic program, but I was still firmly attached to both the lectern and my notes. My mentors encouraged me to work without notes and to move away from the lectern. “At least stand to one side of it!” they cajoled. But I was not about to leave my comfort zone. I was plenty uncomfortable just giving a speech. Besides no one could see my legs shaking behind the lectern.

Then the club held a speech contest. A humorous speaking contest. Now, I can tell jokes, so I was game! Four of us entered the competition, and I managed to win the third place ribbon without venturing an inch beyond the safety of the lectern. I can’t recall who placed second, but I’ll never forget the winner. Les Satterfield talked about an airplane flight and he soared about the room with his arms spread wide and the audience roared in laughter at his comic yarn. Later on, as I watched him receive his shiny gold statuette for First Place, I knew I had to have one. I was motivated… but not quite enough.

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Robert Evans Wilson, Jr. is a motivational speaker and humorist. He works with companies that want to be more competitive and with people who want to think like innovators. For more information on Robert’s programs please visit www.jumpstartyourmeeting.com

I was leaving my last class for the day when I saw my friend, Ken Frankel, working out in the hallway with one of those pistol-grip label makers. I stopped and asked what he was doing.

“The Dean asked me to put the room numbers up in Braille so the blind students can find their classrooms.”

As I watched Ken work, I thought of some of the blind students I knew there at Georgia State University. Suddenly the devil got into me and I asked, “Does that thing do the alphabet as well?”
“Yes.” Ken replied.

“Excellent! Let’s take it over to the men’s restroom in the Student Center and put up some graffiti in Braille!”

So we did. The next day we made a point of running into our blind friends, and asking them if they had been keeping up with the graffiti that people were putting up in the stalls.

The typical answer was, “Come on man, why are you asking me that when you know I can’t see it?”

So we replied, “Next time you’re in there, feel above the toilet paper dispenser.”

They did, and within 48 hours every blind student on campus had heard about it. Then they were after us to put up some more! They told us, “This stuff is great!”

Feeling obligated to get some new material, we hit the bars for inspiration. One night we found the mother lode: the men’s room at Moe’s & Joe’s, a 50 year old pub where they never painted over the witticisms scrawled on the walls.

Several mugs of beer and several trips to the restroom later, we filled several sheets of paper with funny bathroom graffiti to take back with us. As we looked at our collection, we came to two conclusions: first that we’d had way too much beer, and second that we should keep collecting graffiti until we had enough for a book.

Little did we know how long that would take! After a few days of active searching we had little to show for our efforts. Somewhat frustrated, we made a decision to just collect new material whenever we happened upon it.

A decade passed, but it was an idea I couldn’t forget. It still made me laugh every time I thought of it. I kept the idea alive, and we kept collecting. Finally, 15 years later, our collection was big enough and we found a publisher who agreed with us that it was a very funny idea.

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Robert Evans Wilson, Jr. is a motivational speaker and humorist. He works with companies that want to be more competitive and with people who want to think like innovators. For more information on Robert’s programs please visit www.jumpstartyourmeeting.com

By ALAN TONELSON and KEVIN L. KEARNS
Washington

FOR a quarter-century, American economic policy has assumed that the keys to durable national prosperity are deregulation, free trade and a swift transition to a post-industrial, services-dominated future.

Such policies, advocates say, drive innovation, which leads to enormous labor productivity and wage gains — more than enough, supposedly, to make up for the labor disruptions that accompany free trade and de-industrialization.

In reality, though, wage gains for the average worker have lagged behind productivity since the early 1980s, a situation that free-traders usually attribute to workers failing to retrain themselves after seeing their jobs outsourced.

But what if wages lag because productivity itself is being grossly overstated, especially in the nation’s manufacturing sector? Then, suddenly, a cornerstone of American economic policy would begin to crumble.

Productivity measures how many worker hours are needed for a given unit of output during a given time period; when hours fall relative to output, labor productivity increases. In 2009, the data show, Americans needed 40 percent fewer hours to produce the same unit of output as in 1980.

But there’s a problem: labor productivity figures, which are calculated by the Labor Department, count only worker hours in America, even though American-owned factories and labs have been steadily transplanted overseas, and foreign workers have contributed significantly to the final products counted in productivity measures.

The result is an apparent drop in the number of worker hours required to produce goods — and thus increased productivity. But actually, the total number of worker hours does not necessarily change.

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On a summer weekend in 1977, my friend Tony and I made plans to go waterskiing. When he picked me up there were two people in the car that I did not know. He introduced his new girlfriend Sue, and her brother Bubba.

Bubba was the quintessential redneck. Within minutes of getting on the boat, he stuffed a wad of chewing tobacco the size of a baseball in his cheek, then chugged several beers. In less than an hour we were dealing with an irritable drunk. He belched loudly, spit constantly, complained incessantly, and couldn’t string two words together without inserting a profanity. In short, Bubba made our visit to the lake completely unpleasant. Eventually he passed out in the back of the boat and we enjoyed the rest of the day.

My opinion of Bubba’s character, talent and intelligence could not have been lower. I looked upon him as a total loser. A dimwit who would never amount to anything.

At the end of the day, Tony drove Sue and Bubba home first. When we arrived at their home, Bubba was awake and somewhat sober. Sue asked Tony to come inside and see the new dress she’d bought. Then she turned to Bubba and said, “Why don’t you show Robert your chickens?”

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Robert Evans Wilson, Jr. is a motivational speaker and humorist. He works with companies that want to be more competitive and with people who want to think like innovators. For more information on Robert’s programs please visit www.jumpstartyourmeeting.com.