May 13/CBS Detroit
By Matt Roush
SAULT STE. MARIE — Michigan’s oldest city dates back to the 1660s. Its most famous feature, locks that get freighters around treacherous rapids between Lake Superior and the Lake Michigan-Huron system, date back to the 1850s.
But stay tuned. Sault Ste. Marie, the Rapids of St. Mary, might just be famous for something else pretty soon, something at the farthest reaches of technology.
At least, that’s the hope of Kristen Claus, executive director of the Sault Ste. Marie Economic Development Corp., and host of other Soo locals I met with Friday, Day Two of the Great Lakes Innovation and Technology Report 2012 Spring Tech Tour.
We started the day at Claus’ modest office in Michigan’s oldest business incubator — built by Lake Superior State University, the local college, in 1971, and taken over by the city a few years later.
Claus has been on the job since January 2011 after working two years for the city planning department. Her undergraduate degree, from Western Michigan University, was in aviation management, and she originally wanted to be an air traffic controller. But the federal feud over air traffic controllers squashed that idea, so she went back to school at Eastern Michigan in urban and regional planning. Then she moved to Sault Ste. Marie and got the city job.
The Sault EDC has the usual mission — support existing businesses, attract new ones, help with work force skill development, and grow the wealth of the community through job creation. It’s funded by city tax dollars, and that’s not as much of a problem in Sault Ste. Marie as it is elsewhere because its property values haven’t crashed to the extent they have in other places (perhaps because they never rose unsustainably before the crash).
Claus said Sault Ste. Marie has about 14,000 people, with 38,500 total in Chippewa County, of which it’s a part. About 600 jobs in the region are in manufacturing, a number that’s growing.
“We’re not an auto town, we’re not a life sciences town, we’re not driven by any one industry,” she said. “We have auto, we have life sciences, we have tech, we have an aviation company. We’re very diversified and that’s the way I’d like to keep it.”
Claus said many of the Soo’s high-tech and manufacturing companies are founded by people who vacationed here as children, like Precision Edge, in surgical tools, and AMI, an auto tubing firm.
And things are getting better soon. The industrial park around the Soo’s municipal airport has just been designated one of only 15 Michigan tax-free SmartZones, and a 15,000-square-foot, $2.6 million incubator is rising there. It’s called SMART Center, for the Sault Ste. Marie Advanced Resources Technology Center, and it’s informally known as the “business breeder.” The current incubator is about 30,000 square feet.
My first visit shares the original incubator with the Sault EDC. Innovative Composites International is a branch plant of a Toronto-based firm that makes advanced composite materials.
They’re used in everything from automotive tonneau covers to building materials to the Soo Locks. They’re also developing a lightweight composite Fiberglas material that’s highly bullet- and shapnel-resistant for vehicles, general manager Chris Olson said. Some of the material is made from recycled plastics, including shredded former pop bottles.
ICI currently has 33 employees and expects to grow to 50 in the next couple of months, Olson said, and to 70 by the middle of next year.
ICI also uses Lake Superior State’s engineering talent to design its housing produccts, which are made at another plant in South Carolina.
From there, it was a short stroll on an absurdly beautiful spring day to Hoover Precision Products, a location of a company founded in Chelsea in 1913. Leander J. Hoover founded Hoover Steel Ball Co., and the company rocketed to success during World War I, when imports of German ball bearings obviously stopped.
Johnson Controls bought what was by then Hoover Universal in 1984, and spun it back out in 1990, when it was bought by a Japanese firm, Tsubaki Nakashima. The Sault Ste. Marie plant has been around since 1978. Originally 18,000 square feet in size, it’s now 45,000, and is browing to 67,000 in a project scheduled to start later this month. The company has 50 employees now and will be hiring soon, said sales engineer Tom Patton.
Hoover Precision makes balls — in a bunch of sizes, from barely visible to the eye to six inches in diameter — out of a variety of materials — from exotic metal alloys to ceramics to composites to plastics.
The balls are used in everything from medical measurement devices to automotive seating to automotive shifting and steering assemblies to pumps and valves used in mining and oil exploration to ink jet printer cartridges.
The balls are formed by either machine grinding or being squeezed between two plates with abrasive compounds.
Hoover Precision also makes plastic tubing and Petri dishes, which is largely what the expansion is about. Medical applications have to be made in a clean room, and the Hoover clean room is about to grow from 2,000 to 8,000 square feet, and from four to 16 super-clean injection molding machines.
The company ships about 60 million pieces a month. And on the last day of December last year, it shipped no less than 22 million balls.
From Hoover, it was off to the Lockview Restaurant for what I was told was the best whitefish on the planet. Well, being allergic to finny fish, I did content myself with some terrific shrimp, although I’m betting they came from considerably farther south than Whitefish Bay.
But I did lunch with Jeff Hagan, executive director fo the Soo area’s regional planning agency, the Eastern Upper Peninsula Regional Planning and Development Commission, and Jeff Holt, economic development director of the Sault Tribe of Chippewa Indians, which has a 600-acre reservation within the Soo city limits and hundreds of acres scattered around the rest of the eatern U.P.
Holt, a Lake Superior State grad, said the tribe has an annual payroll of $55 million and $10 million a year of local purchases. At 2,000 employees, it’s the largest employer in the region by far.
Hagan also attended Lake Superior State in land use planning and regional development and opted to stay rather than return to the land below the bridge.
We talked about some of the region’s economic development challenges and opportunities, like the tribe’s social opposition to growing trees only to cut them down and turn them into ethanol and the region’s ongoing study of wind power.
From there it was off to Lake Superior State University. Yes, I know, I’m only supposed to visit universities on the Spring Tech Tour. But it’s been half a decade since I’ve been to the Soo, and the university here is involved in not just tech transfer and spinoffs but local basic economic development up to its armpits, so excuse me.
In face, the new dean of the college of engineering at Lake State has a really interesting title. David R. Finley is dean of the new College of Business, Engineering and Economic Development. A chemical engineer by training with a doctorate from Wayne State University, Finley was most recently an administrator at Trine University in Angola, Ind. At Lake State, they’ve now “combined the schools of business and enginering and added economic development to its charter in order to horizontally integrate that process. For me, the position her was a perfect fit in a beautiful place.”
Lake Superior State isn’t just trying to spin out faculty research ideas into companies, it’s actively involved in both the current incubator and the new one, and recent successful effort to be named a SmartZone.
In fact, according to Finley, Lake Superior State will be involved at every stage of company formation. The university’s Product Development Center, managed by Eric R. Becks, can design, prototype and test parts, and make one or two components as prototypes. The SMART Center, or business breeder, will be in charge of getting that to tens, hundreds of thousands of prototype parts. From there, the traditional business incubator and area technology parks will take over to the commercial market stage, Finley and Becks said.
Finley and Becks also showed me around poster presentation of Lake State’s senior engineering projects for the just-concluded school year in everything from power steering controls to solar energy reflectors to robotics. Let’s just say that once again, I felt like the emissary from the Land of the Tiny-Brained Folk, and Lake Superior State, like virtually every other Michigan college I visit, has brilliant students who will some day rule the world, just get used to the idea.
My last visit of the day can be summed up as one man’s remarkable entrepreneurial journey into making products designed to chop off your knees.
Well, it’s not quite that gruesome. But some of the stuff made by Precision Edge, founded in a U.P. garage in 1989 by Saginaw-area native Greg May, is designed to grind your bones — in a good way.
May took up the tool and die trade out of high school at a company called S&E Machine, making auto and aerospace parts. But it also shifted into surgical products for Kalamazoo-based Stryker Corp.
Like a lot of entrepreneurs, May thought he coulddo it better and set up his own company. He then moved to the Sault area, where his family had vacationed during his childhood. Starting in a garage in the tiny town of Barbeau, May said, “I started hiring local kids and training them. Most of them didn’t even know what a micrometer was.”
May said the strong U.P. work ethic made his company a quick success. That, and how he treated his employees: “I had learned all about that as an employee, about how I wanted to be treated. So that part was pretty easy.”
May said the company grew like crazy — so much so that he received, and accepted, an offer from Chicago’s Pritzker family to buy the company in the mid-1990s. May must like the arrangement; he’s still here, hard at work. And now, the company he founded has grown to 190 employees in Sault Ste. Marie, and has established a second factory in Boyne City in northern Lower Michigan that will get about equally big when it’s fully staffed out.
“Today we can’t hire people quick enough and get ‘em trained quick enough to meet the demands of growth,” May said. “Meanwhile, the FDA is tightening the screws on regulation.”
Precision Edge makes drill bits that are used only once — because they drill into your bones when you break them, helping doctors insert pins, screws and wires to help broken bones knit back together. The company also makes saw blades used to saw bones in knee replacement opearations, and burring devices used to create holes in bone, from hips to skulls. (It’s kind of gross to think where this stuff is going to wind up, but hey, thank God for anesthesia, you wake up and you’re better, and what pain remains can be knocked down by derivatives of another thing we need to thank God for, the opium poppy.)
May provided a simply delightful 45-minute tour of his plant. And he freely admits the tour could have lasted for hours. But eventually, I had to get off my own arthritic knees that will some day need replacement.
And so Saturday I’m leaving the U.P. for northern Lower Michigan as the tour continues. And my hat’s off to the passionate people I met in the Soo, doing all they can to make this region a more prosperous place to live. Like most places in the U.P., the Soo is an insanely gorgeous place, with an amazing quality of life for anyone who likes the outdoors, but it also has the added bonus of a college to bring in arts, sports, culture, and intellectual gravitas.
See you soon, Soo, I hope.