Orthoville held a revival meeting on September 11.
The tent was the brand new Orthopaedic Capital Center on the campus of beautiful Grace College in Winona Lake, Indiana.
Grace College Orthopaedic Capital Center, photo:Kelley School of Business
The secular gospel for the 200+ parishioners attending the Indiana University Kelley School of Business Life Sciences Conference was delivered by Indiana native son and Rhodes Scholar, David Johnson, President and CEO of BioCrossroads. The gospel was in the form of a report paid for by the Lilly Endowment.
In addition to David Johnson, the conference brought in national industry experts from Washington, the media, and top leaders of local orthopedic companies.
Dr. Blanchard Addressing Attendees, photo: Kelley School of Business
“Lessons From the Orthopaedic Capital of the World”
The 58-page BioCrossroads report, “Lessons From the Orthopaedics Capital of the World, “ laid out a blueprint for future industry and community growth for Indiana’s orthopedics industry and the need for the folks of Warsaw and Kosciusko County to agree on a common vision for their community’s future.
Warsaw has been the center of the orthopedics world ever since Revra DePuy figured out that the trees in Kosciusko County had the perfect qualities to make splints for wounded soldiers. Founded in 1895, DePuy begat Zimmer in 1926, followed by the engineer Miller who spawned Biomet in 1977. Eventually Danek, now Medtronic, joined them. Today, the area is home to one of the most concentrated clusters of manufacturing anywhere in America.
These giants are supported by dozens of Warsaw-based suppliers and contract manufacturers such as Symmetry Medical. “Collectively, ” says the BioCrossroads report, “these enterprises earn more than $11 billion in annual revenues, representing better than a 50% market share in the United States, and more than a 33% market share in the world.” The report went on to state that since 2001 the area’s orthopedics industry employment base has grown by 39%, adding 2, 800 jobs to reach nearly 6, 000 jobs today.
Playing in the Local Sandbox
So what’s the problem? Why the need for a new plan?
Johnson said while the sector has been tremendously successful, their research makes it clear that “global pressures now confronting the whole economy…have sparked a broadly perceived need for a community and industry engagement strategy focused on education, talent recruitment and retention, workforce and community development to ensure sustainability.”
In other words, the people of Warsaw have to figure out a way to better educate their workers, keep the ones they have and make their community a place were top talent wants to live, work and play. When you compete with the lure of Beale Street in Memphis―the “other” orthopedic cluster―the quality of “community” in the Warsaw area becomes a significant factor. In a community where the leading industry players are used to going to the mat for market share, working together will require the sale of a common vision and a degree of collaboration not seen in the past.
Warsaw Mayor
Ernest WigginsThe current spotlight on physician consultation practices of the “Big 3” in Warsaw by the U.S. Department of Justice “only intensifies the isolation of these companies from one another, ” says the report.
Warsaw Mayor Ernest Wiggins told us during a reception that the community has to do something to attract and keep employees for their orthopedics businesses. He also quickly pointed out that Warsaw is also the home of the largest printing presses in the world; home to the world’s largest manufacturer of projection screens; and home of the famous CoCo Wheats hot breakfast cereal.
Regional Cooperation
The Mayor sees a bigger picture than just his community. Warsaw has been jealously guarding its industrial treasures as other cities have offered alluring incentives for expansion in their communities. “This has to be a regional effort, ” the Mayor told us.
Warsaw is not very similar to small towns dominated by one industry. In this industry town, there are three major competitors perched on various edges of town. They compete for market share, employees and intellectual property. But ultimately, their employees go to the same churches, their kids attend the same schools and work is cautiously brought up at little league baseball games.
The companies are known locally for differing cultures. Biomet has had a reputation for casualness, Zimmer is a bit more dressed up, and DePuy is button-down, being owned by Johnson & Johnson from New Jersey. A visit to this conservative community will not show evidence of remarkable cooperative action that one would expect from such a wealthy town. Big government is not welcomed here, even local big government.
The Mayor’s comfort with regional cooperation was highlighted in the report by noting that neighboring communities such as Ft. Wayne, which has housing and business services, and South Bend, which has university, research and medical centers not available in Warsaw, could serve to “extend Warsaw’s vitality and sustainability.”
Innovation and R&D
That Warsaw is a manufacturing hub is well-known, but it is also a growing center of innovation and R&D.
The BioCrossroads report mentions that Zimmer has 800 researchers working in Warsaw, and there are currently more than 30 sponsored research partnerships with institutions such as Purdue and Notre Dame down the road. The citizens of Warsaw have also generated patents at six times the national average. Intellectual property matters in this community, and cooperative efforts to foster that local resource received a lot of attention from attendees at the September 11 conference.
For example, orthopedics isn’t just about hips, knees, hammers, nails, screws, and plates anymore. The future of orthopedics lies in biological and regenerative treatments. As Zimmer’s chief scientist, Cheryl Blanchard, Ph.D., told us recently, “We’re in the ‘meeting unmet clinical needs’ business.”
But threats to Warsaw’s preeminence are evident. The report cited some local challenges:
- “Significant” shortfalls in the education of orthopedic workers,
- Difficulties in attracting and retaining senior talent,
- Absence of locally accessible industry support services,
- Transportation and infrastructure challenges, and
- An increasing need by smaller orthopedic players for access to innovative research, new technologies and capital.
Collaborative Seedlings
The report said the community has “developed opportunistically” rather then strategically and this may not serve it well as it addresses its future challenges. There was praise for the collaborative planning and investments totaling more than $6 million for shared facilities used for education and technical development purposes at both Grace College and Ivy Tech Community College.
The 56, 000-square-foot Orthopaedic Capital Center on Grace College is a center for community events and conventions. It was built in partnership with Biomet, DePuy Orthopaedics, Paragon Medical, Symmetry Medical, and Zimmer.
But the big opportunities were identified in the area of developing intellectual capacity.
The report identified an opportunity to “establish a center of research, testing and education, building on, but also extending beyond, sponsored research partnerships and educational investments the companies in the cluster have already made. Such a center could potentially be college- and university-led, and provide a platform for engineering, business, and regulatory and other technical support services responsive to widely acknowledged orthopedics sector needs.”
This was all music to the ears of Zimmer’s Blanchard, one of the key organizers of the project. Blanchard said she has been working on this effort since joining Zimmer. With the presidents of the orthopedics divisions of DePuy and Biomet, David Floyd (a local Grace College graduate) and Jon Serbousek, respectively, joining Dr. Blanchard at the conclusion of the conference to support this effort, the revival meeting may well spur Orthoville into a makeover and we’ll have to begin referring to Warsaw not as Orthoville, but as the business “League of OrthoWorx.”
OrthoWorx
Now that the revival meeting is over and the blueprint has been delivered, what happens next?
We’ll give the final word to the folks from BioCrossroads.
“There is definitely an energy that emerged as a result of the release of the BioCrossroads Orthopedics report and the IU Kelley Conference last week. The research we did seems to have sparked a broadly perceived need for a community and industry engagement strategy focused on education, talent recruitment and retention, workforce and community development to ensure sustainability. And, we’ve heard from several community and industry leaders who are interested in taking a role in the development of the initiative and getting involved, ” said Lori LeRoy, BioCrossroads’ public relations and marketing manager.
LeRoy continued, “We’re now in the process of developing a Warsaw-based, regionally focused organizational initiative that can better define and prioritize the challenges and opportunities, and then seek funding to bring the best and most responsive ideas to life.
David Johnson and Industry Leaders, photo: Kelley School of Business
“During David Johnson’s panel that included Cheryl Blanchard, Jon Serbousek, David Floyd, Toby Buck, Brian Emerick (Micropulse CEO), Ron Manahan (Grace College President) and David Finlay (Lake City Bank), we heard positive signs that everyone wanted to be engaged moving forward. Specifically, there seems to be a lot of interest in working on educational opportunities, both K-12 and higher ed, as well as developing some of the other recommendations. They all have a common goal of driving the community and industry forward so that the sector continues to thrive.
The BioCrossroads report concludes that it is important to establish a “credible, highly consultative, participatory, and strongly supported branded community initiative—soon. An organization such as OrthoWorx…is in the best position to translate opportunities into action.”
Creating a new vision of a future and rebranding a community that has been one of the most successful little towns in America will not be easy. But as Mayor Wiggins told us, “We have to do it.”
