In Old Milwaukee: Tomorrow's Factory Today

By John S. DeMott

The oak floor glistens through four coats of polyurethane, reflecting red, blue and yellow blinking lights. The machinery, tenderly adjusted and lubricated and looking like mobile sculpture, whirs and swivels competently behind transparent plastic enclosures. The employees are gung ho, and the most enthusiastic of all is their boss, John Rothwell, 41. "This is my life's dream," he says. "I love it." The atmosphere where they work is electric, suffused with a feeling that what is taking place here, in its boldness and sophistication, is happening nowhere else on earth.

And that could just be true. Because behind the doors on the eighth floor of Allen-Bradley's good gray corporate headquarters near downtown Milwaukee is an operation that may signal a renaissance in U.S. manufacturing. Department 260, as it is known, is the company's innovative and expensive ($15 million) attempt to make its popular lines of sturdy industrial-control devices better and cheaper than those of competing companies in the U.S., Western Europe and Japan.

In stark contrast to Allen-Bradley assembly operations elsewhere in the same building, where some 1,650 workers still put products together largely by hand, Department 260 is run by 14 people. Six of those are white-coated attendants who man the floor's 26 machine stations, clearing equipment jams and feeding the machines' voracious appetites for raw materials. Department 260 is what engineers call a CIM plant, for computer-integrated manufacturing. Computers, from programmable controllers on the floor to a large IBM 3090 Sierra mainframe across the hall, tell the machines how to fashion 600 different varieties of relays and contactors, essentially boxy switches that turn electric motors on and off. Only 14 months old, Department 260's assembly line is not yet running at full speed. But when it does, working at a rate of 600 devices an hour, it will be able to make 4,800 in a single eight-hour shift. If required, it could turn out this volume for orders received the same day.

And yet unlike the overwhelming machines of Charlie Chaplin's Modern Times, Department 260's equipment is mostly nonthreatening, with sometimes vexing personalities. "Mamma mia, ti prego comincia a lavorare! (Please, start working!)" implores Mechanic Bruno Lockner to one balky contraption. "This machine understands Italian," he jokes. Some machines have names. Clarabelle is a complex wonder that churns out 1,000 crossbar assemblies an hour. It was designed by Allen-Bradley engineers, and is tended by 18-year veteran Employee Cheryl Braddock. Says Braddock: "I talk to her every morning. I pat her on the side. I say, 'It's going to be a good day.' "

For the machines, the day begins just before dawn, when much of Milwaukee's human population is still asleep. All night, orders have been flowing to the IBM from Allen-Bradley distributors in London, Singapore, Hong Kong, Caracas, - Melbourne and 400 locations in the U.S. From the IBM, they travel silently across hidden cables to Department 260's own network of 29 smaller computers.

At 6:30 a.m., the ceiling lights turn themselves on. At 7:30, on cue from electronic signals speeding through an overhead conduit, the factory goes through its morning calisthenics. The machines begin moving and stretching, flexing conveyor belts, cams, steel-armed grippers, hissing pneumatic tubes, spot welders, laser beams, grinding stones, power drills and screwdrivers. Warning lights, strung like Japanese lanterns across the ceiling, start blinking. Soon the assembly line is running, producing the day's orders.

On the largest scale, the 45,000-sq.-ft. facility is Allen-Bradley's bid to stop chasing cheap labor in distant locales. Since 1977 the company has moved manufacturing to Texas, North Carolina and Mexico, resulting in the loss of 1,300 Milwaukee jobs. Now, with Department 260, Allen-Bradley is putting a factory where its skilled work force is.

To Company Chairman C.R. ("Bud") Whitney, automation is possibly the only way to prevent the U.S. from becoming entirely a paper-shuffling service economy. The soft-spoken Whitney believes that the most important wealth of nations comes from manufacturing. "You get it out of mother earth," he says. "You mine it, farm it or fish it. Then you take that basic raw material and add value to it. That's what we call manufacturing. If we don't create wealth, we are going to become a third-class country."

Other Milwaukee manufacturers have cut back in recent years, lowering the city's blue-collar employment from a peak of 223,600 in late 1979 to about 171,300 now. Schlitz, "the beer that made Milwaukee famous," is no longer brewed there. Allis-Chalmers no longer makes tractors in its suburban Milwaukee plant, where employment has plunged from 4,900 in 1979 to just 750 today. After losses in the early '80s, Harley-Davidson has staged something of a comeback in its battle against big Japanese motorcycles, helped by some automation, Japanese-style management techniques and tariff protection.

Though Allen-Bradley was sold to Rockwell International for $1.67 billion in 1985, that is no reason, feels Whitney, to do what some other companies have done and halt manufacturing in Milwaukee. In Department 260, Allen-Bradley makes two lines of its unsung, unglamorous electrical-control devices. They click through their critical duties unseen by the typical consumer, yet they help run the motors that raise elevators in skyscrapers, drive the machine tools that power Detroit's auto-assembly plants, twist the huge drills that coax coal from West Virginia and oil from East Texas, and start rides rolling -- and passengers squealing -- at Disney World.

Founded in 1903, the company started with an idea for a rheostat dreamed up by Lynde Bradley. Building on that idea, the company was well positioned as American heavy industry, led by autos, began its lusty journey through the 20th century. Owned solely by the founders and their descendants until the sale to Rockwell, Allen-Bradley had 1985 sales of about $1.15 billion, making it far larger in its particular field than such competitors as Square D, Gould and Westinghouse.

By the late 1970s, though, Whitney and President J. Tracy O'Rourke realized that the marketplace was changing, and Allen-Bradley would have to evolve to survive. The company was too dependent on the machine-tool industry and its biggest customer, Detroit's automakers. Both were reeling under the attack of lower-cost foreign competitors. Although Allen-Bradley's domestic sales had not been severely hurt, the day when they would be seemed just around the corner.

What to do? A planning team assembled by Whitney came up with the answer: Allen-Bradley, since its founding a parochial company doing almost all its business in North America, would aggressively expand in Europe, but with a major new twist. Instead of making industrial controls almost exclusively to American standards, the company began designing them to the specifications of the International Electrotechnical Commission, the European arbiter. And instead of buying a foreign company to make the controls, which several competitors had done, it would make them in Milwaukee, in a new facility.

Thus was born the idea for Department 260. Says Whitney: "The light bulb came on." But an unprecedented degree of automation would be required to pull it off. Reason: a representative contactor that sold for $20 in the U.S. sold for just $8 in the highly competitive markets of West Germany and Australia. To make a profit at the lower price, Allen-Bradley had to get costs down. By using automated equipment, the company could produce contactors for 60% less than it could by relying on a manual assembly line. "Labor costs," says Whitney "obviously had to be a nonissue."

One big advantage was that since Allen-Bradley would be making entirely new + products, it could design them in tandem with the new assembly process. Moreover, by labeling each product at the outset with a computer bar code, Allen-Bradley could program its assembly line to vary the specifications; as a result, contactors and electrical relays can be tailored without slowing down the line.

Most of the normal ways of looking at such an investment were ignored because adhering to them would discourage even starting the project. Department 260 was high in risk and cost, but if it worked it would yield far more than its price tag. O'Rourke, in persuading the company's directors to pump money into the project, was blunt: "I figured if we could produce $30 million to $50 million a year in sales, and it cost just $15 million to build, that was a good deal."

An air of excitement swept through the company. Even organized labor went along with the idea. Since the planned products had never been made before by Allen-Bradley, workers would not be displaced by the new operation. Mindful of past job cuts, the union's leaders were at least happy to see the operation take root in Milwaukee. Says Ted Krukowski, president of Local 1111 of the United Electrical, Radio and Machine Workers: "There's concern, but there's also a feeling of accomplishment that our folks played a role."

Still, Department 260's near total automation amounts to more than the old and familiar threat to the shrinking blue-collar work force. Says Krukowski: "Before, you always needed people out there to build the special items. It's the sophistication of the automation here that has to have people worried."

More change will certainly come as U.S. manufacturers try to compete with foreign producers. "This is an issue the whole country is going to have to deal with," says Whitney. Yet not even Allen-Bradley plans to automate existing product lines; the cost of redesigning traditional manufacturing processes would be too great. The totally automated, problem-free factory that can turn out complex consumer products like cars and dishwashers remains a science-fiction fantasy. What does exist, for now, is Allen-Bradley's Department 260, a step toward the future, with temperamental machines named Clarabelle that need patting.

With reporting by J. Madeleine Nash/Milwaukee