Richard McCreary didn’t play Battleship as a kid. But he grew up to be the captain of the bridge.

“I played Risk. Does that count?” McCreary says with a chuckle.
 
The French game of strategic conquest for world domination? Yeah, that counts — and it fits. A confident comfort level for the calculated move is just part of the day at Marinette Marine Corporation where McCreary commands as CEO and president.

Since January 2009, McCreary has had the helm of this growing multi-million-dollar Wisconsin shipbuilding company where more than 1,500 military and commercial vessels for government and commercial customers have been designed and built in its nearly 70 years.

“We are about a $300 million company today. Within a couple of years, we will be pushing $500 million,” McCreary says. “We have about 1,000 employees. We will be growing to 2,000 by the middle of 2013.”

That expansion is thanks to a new U.S. Navy contract with Marinette Marine — through a partnership with Lockheed Martin Corp. — to build 10 Littoral Combat Ships (LCS) in the coming several years with more growth expected over the next two decades.

Better yet, this whopper of economic good news isn’t confined to Marinette Marine’s buildings along the Menominee River in Marinette.

The Jobs Ship has Come in
Citing an economic impact study done with Lockheed Martin, McCreary estimates the federal LCS contract will create and sustain about 5,000 jobs for vendors, suppliers and service companies in northeast Wisconsin. There also is the potential for about 2,500 jobs for the Upper Peninsula of Michigan, where 
40 percent of Marinette Marine workers live.

Good news for an area hit hard by unemployment. The preliminary January 2011 unemployment rate for Marinette County was 10.8 percent — tied for 12th highest among the 72 counties, the state Department of Workforce Development announced in March. All counties had higher rates than December, but lower than January 2010.

The Navy LCS contract also has the potential for nearly $500 million in regional economic impact with millions of dollars in new tax revenues.

Make no mistake about it: This company, bought two years ago by an Italian ship-building powerhouse, and its big-thinking CEO, lured to Marinette Marine from a southern competitor, have plans to build big in this still-recovering state, national and international economy.

There are contracts to fulfill — including the $123 million, 254-foot Alaska Region Research Vessel for the U.S. Academic Research Fleet. And, there are federal contracts to pursue — such as teaming with The Boeing Company to capture the Navy’s Ship-to-Shore Connector contract.

There are incessant checks for worker safety and to improve operational efficiencies using state-of-the-art manufacturing equipment and Lean manufacturing principals. Marinette Marine says its record of finishing projects ahead of deadlines and keeping costs in check are among the reasons why it has a strong and long relationship with the Navy.

And there are the hundreds of specialized and skilled workers to hire and to train thanks to a partnership with the University of Wisconsin-Marinette and support from the recently created North Coast Marine Manufacturing Alliance, a regional group of marine manufacturers and three higher educational institutions also including the Northeast Wisconsin Technical College in Green Bay and the Lakeshore Technical College in Cleveland, Wisconsin.

Not bad for a company that got its start in 1942 building wooden barges because of an Illinois kid with a thing for boats.

Changing all the Hands on Deck
In 2000, the then-privately held Marinette Marine, worth about $100 million, was purchased for $48 million by The Manitowoc Company for its marine group. Their group included Bay Shipbuilding of Sturgeon Bay, ACE Marine of Green Bay, and small repair specialist Cleveland Ship Repair in Cleveland, Ohio.

On January 1, 2009, The Manitowoc Company sold its four-member marine group for $120 million to Fincanteri Marine Group, an Italian company and subsidiary of the Fincantieri-Cantieri Navali Italinai SpA — one of Europe’s largest, most diversified shipbuilders with more than 7,000 ships in its 200-year history.

Things changed when Marinette Marine went global.

For starters, McCreary, who had been recruited to Marinette Marine in 2005 from competitor, VT Halter Marine in Pascagoula, Mississippi, was promoted to the top post.

McCreary — who earned his bachelor’s degree in naval architecture from the University of Michigan and his master’s of business administration degree from the University of Chicago — ushered in cutting-edge technologies and Lean-based production processes.

“If you do not have essential components on hand, you are idling — at great costs — a large number of people,” he explains. “The carrying costs of materials pales in comparison to the potential cost of idle labor.”

Lastly, Fincantieri-Cantieri is investing $100 million to modernize its U.S. shipyards. The first phase funded cranes and pipe-bending machines. The ongoing second phase will nearly double production area at Marinette Marine’s two construction bays — meaning two complete hulls and parts for two other ships may be indoors simultaneously.

This Way to Workers
As McCreary penned in his column published on the UW-Marinette Web site, having a highly skilled workforce helped the company — in partnership with Lockheed Martin — win the Navy combat ship contract. “Contracts such as this one are not only historic, but they are the first step toward growing a strong, regional marine manufacturing presence in Wisconsin.”

Growing that strong marine manufacturing presence means McCreary also must sustain a skilled and specialized workforce in the region. How will he do it? He’s got four strategies in play.

The first is to tap the region’s unemployed and under-employed workers whose jobs were lost in the great recession. “We think initially that we will be able to grow with those who already have welding or electrical skills,” he says.

To help find shipbuilding designers skilled in cutting-edge technologies, the company teamed with UW-Marinette, other shipbuilders and the University of South Alabama to craft a series of industry-standard courses. The two universities are the only two in North America to offer these courses. And UW-Marinette is the only campus nationally to offer the introductory design online — attracting students from Korea, India and Norway.

Sharon Huntley, UW-Marinette director of continuing education, says much of the local interest in the shipbuilding course series comes from laid-off workers “looking to take the skills and knowledge they have 
and parlay that into a new career in ship-building.”

The introductory course is open to the public. Marinette Marine offers two course scholarships for anyone in the community who meets the basic course requirements. The five customized training courses are only for company employees but that could change.

The second McCreary strategy to finding workers is the longevity of the LSC contract itself, and the expected 10 to 20 years of work ahead. The company recently negotiated a contract with its roughly 650 members of Boilermakers Union Local 696.

A third McCreary strategy is a new helper class of entry-level workers. Those who are 18 or older can come out of high school, become an entry-level Marinette Marine worker and progress through the wage levels. “This is brand new. We have never had that category and it will allow us to provide entry-level jobs for people in the area that normally would have to leave the area [to find employment],” he says.

The fourth strategy is using contract labor.

“We are a major employer. If we are not the largest, we are certainly going to be the largest,” McCreary says. “And we try to participate in the community.”

The company each year does one “high-value” improvement project for the three major home communities of Marinette Marine workers — Marinette, Peshtigo and Menominee, Michigan. One year it was new bleachers for a ballpark and another year it was a new pit cleaning station at a boat launch.

With all the talk of federal dollars, big ships and cutting-edge technology, McCreary insists the best part of his job is the company’s workforce.

“More than anything it is the people,” McCreary says of the “very talented” dedicated workforce where suggestions for company improvements can be found. “Everyone has good ideas. The challenge is finding the time to hear them all.”

That’s the kind of challenge made for a veteran Risk player.




You build boats where?
Wisconsin’s ship- and boat-building industry supports 5,830 jobs, generates more than 
$1 billion in economic impact and more than $308 million in wages and salaries, according to the December 2010 Department of Transportation’s “Economic Impact of Wisconsin’s Commercial Ports.”

Impressive for an industry not readily associated with the state known for beer, cheese, Packers and cows. Yet, shipbuilding has been part of Wisconsin since the mid-1830s when the first shipyards were founded in Milwaukee and Manitowoc, both Lake Michigan port cities.

The Great Lakes are friendly to shipbuilding for their freshwater construction sites, freedom from hurricane threats and waterway access to the Atlantic Ocean and Gulf of Mexico.

It takes work to land federal work
Landing a federal contract requires commitments.
So says retired U.S. Navy Vice Admiral Terrance Etnyre now vice president of government programs at Marinette Marine Corporation, a Wisconsin mid-tier shipyard which has built more than 1,500 vessels for the U.S. Navy, U.S. Coast Guard, other government agencies and commercial customers in its nearly 70-year history.
“The federal contract process does not open and close very quickly,” Etnyre says. “The federal government has specific requirements and processes for all acquisition programs that generally drive a longer timeline — on the order of two years from initial announcement to award.”
In 2009, Wisconsin ranked 16th nationally for federal contracts which totaled $9.2 billion in federal sales. Federal contracts can be lucrative, but prepare for upfront investments. “This is not necessarily an infrastructure investment, but committing the people and overhead needed to submit a credible proposal,” Etnyre says.
The federal contract process generally starts with the request for information. Companies submit “suggestions/recommendations to the government customer for how industry can help meet the requirements of the program,” Etnyre says of the three- to four-month process.
Next is the draft request for proposal, which seeks more industry comments. That’s another three to six months.
The request for proposal follows. Think of it as last call. Competitors submit everything — costs, management structure and construction processes.
Finally, Etnyre says, you wait with no guarantee you’ll get the federal work and recoup your investments.
Still want to try? Here are tips and Web sites:

• Scrutinize your company’s reputation. Ask Dun and Bradstreet: www.dnb.com
• Attend contractor seminars to see your competition and learn what’s needed. More than 300 businesses and 600 people attended Marinette Marine’s event.
• Learn contract requirements. Try the U.S. Small Business Administration: www.sba.gov.
• The Wisconsin Department of Workforce Development posts much about federal contracts: www.dwd.state.wi.us
• Try the federal government’s super friendly Web site, www.usa.gov. Click on the link for businesses and nonprofits. It’s loaded.

By Joanne Haas

Joanne M. Haas is a freelance reporter, writer and editor living in Madison, Wis. 

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