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August 21, 2014
By Charles Ellison


There’s been quite a bit of talk about how cities and their surrounding metropolitan areas are transforming themselves into not only centers of commerce, but centers of technological research, development and innovation.  

We see this with urban expanses once written off now attempting to reshape themselves through smart economic and social reset. While the going is tough in Detroit, the long-time crown jewel of the global automotive industry is beginning to see itself as more than just the headquarters of car factories. The need to diversify amid the rough and tumble of municipal bankruptcy is suddenly forcing the city to uncover other potential. As a result, Detroit is becoming a slow but steady magnet for entrepreneurs, innovators and start-up aficionados looking for a cheap location to crash that’s willing to make the necessary changes that will eventually remake the city.

Observers can see that scenario playing out in a number of urban corridors that would be last on the usual list of pioneers in the innovation economy. But as that leading edge of what we could call the post-recession “Reset Economy” unfolds, policymakers want centers of higher education more directly and openly involved in the game.

Two legislators in Washington are looking to put money on that market by having the federal government encourage and invest in universities as incubators of manufacturing. Dubbed the Manufacturing Universities Act of 2014, or “MUA” (also known as S. 2719), a bipartisan crew of legislators seeks to upgrade  the U.S. industrial sector by establishing a network of universities churning out grads with advanced expertise in fields like engineering and the information technology specialties that complement them.

“It’s critical that our schools and universities equip students for success in manufacturing and contribute to the research and development that drives advanced manufacturing,” said Senator Chris Coons (D-DE), the original sponsor of the bill who teamed up with Senator Lindsey Graham (R-SC) to maneuver the bill into a full vote by the Senate once it passes committee review. “Although our economy has created more than half a million manufacturing jobs over the last three years, hundreds of thousands remain unfilled because we don’t have enough trained workers. We need our engineers to fill the growing demand for manufacturing workers and accelerate manufacturing’s growth. This bipartisan bill would help us meet that challenge.”

Clearly, Coons is searching for a way to differentiate Delaware from the large Philadelphia market next door that tends to dwarf the state. Hence, constituents like the University of Delaware will end up on the designated list of schools identified by the U.S. Commerce Department as a MUA network school should the bill pass into law. Ditto for Graham, who’s looking to boost his state’s fortunes as a New South gateway for commerce, industry and innovation as its once booming textile sector has all but disappeared. 

It’s no secret that American manufacturing competitiveness is slipping: It generats $2 trillion in gross domestic product every year, but it’s lost considerable global share and intensity to China, Germany and Japan. The MUA seeks to reverse that by stimulating a sector that continues to worry national policymakers. The Commerce Department’s National Institute of Standards and Technology would conceivably identify up to 25 locations as “manufacturing universities.” Once designated, each school would be able to dip into a $20-million-over-four-year federal grant honeypot to build new programs, partnerships and training initiatives. Other agencies, such as the departments of Defense and Energy and the National Science Foundation would be able to take advantage of the resulting talent.

This latest development, however, will shed needed light on the critical integration of what’s referred to as “operational technology” and the more well-known information technology. OT is the nuts and bolts or essential guts of IT—and, in many ways, this legislation illuminates the argument that OT is in itself manufacturing or the industrial core or infrastructure that makes IT possible. Yet, media and government ignores the OT in favor of a focus on a much “sexier” or brand-appealing IT. Forrester’s Dan Bieler argues that OT, or what he views as the enterprise network, “becomes the nervous system of the digital business. It facilitates deeper customer engagement by connecting manufacturers, sellers, and buyers of products in new ways, and it helps drive more operational efficiencies as it supports closer collaboration and connects previously disjointed assets. Yet, for most business leaders, the network infrastructure isn't much more than a utility, such as electricity or plumbing, while most CIOs don't know how to monetize it.”

A recent Hype Cycle report for OT by Gartner’s Kristian Steenstrup underscores this point, offering further support on the need to merge both OT and IT. “The convergence and integration of operational technologies with IT is making significant impact on equipment-dependent businesses and government, but many critical technologies are at least two to 10 years from mainstream adoption,” writes Steenstrup.  

What policy initiatives like the MUA do is put an important and often overlooked spotlight on that convergence. Neither can do without the other. This presents a significant opportunity for both subject matter experts and practitioners who have already recognized how essential this integration is, particularly through the maintenance, repair and upgrade of legacy systems—as well as the byproducts of convergence that have their own flavor security, and business intelligence/analytics. Vendors who specialize in this mix stand to profit, especially as infrastructure evolves into an ever-expansive Internet of Things.

Charles Ellison is a senior analyst relations strategist for TEKsystems. He keeps close tabs on changes and public policy shaping the innovation space. He is also a former congressional staffer, senior aide to state and local elected officials and an expert advocacy strategist. You can reach him with questions and comments @twoARguys via Twitter.

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