Attendance, operating costs requires look at future of onsite lab facilities. (Cast Metals Institute: 2002-'03 Status Report).

In 1957, future-thinking industry leaders understood that metalcasting's relevance depends on an educated workforce and created the Cast Metals Institute (CMI). CMI continues to provide a unique resource in which industry personnel can learn and take that education to the shop floor. Since its inception in 1957, more than 78,000 students have attended CMI lecture, in-plant, AFS chapter cosponsored and lab courses of study.

While visitors marvel at CMI's onsite facilities, what is not as visible is the human and financial resources required to build and sustain this teaching facility. Just as there are challenges in operating any small private school, CMI's focused curriculum and low numbers of attending students create a daunting business model, which boils down to a simple case of fixed costs vs. the number of students.

The cost of the CMI operations is supported solely by course tuition; AFS dues and other revenues do not contribute to CMI's programs. There are three facilities owed and operated by CMI: the Frank S. Ryan Laboratory, H.H. Harris Laboratory and the Pangborn Wing of the AFS Headquarters facility. The Ryan and Harris labs provide a foundry, sand lab, metallography lab, pattern shop, mechanical testing lab, auditorium and classrooms, all of which are used to provide hands-on training by the Institute. The operations and maintenance costs of these facilities are high and much of the expense (such as property tax) is fixed, thus unaffected by cost-cutting strategies implemented during periods of low attendance.

Among the many factors contributing to the reduction in attendance over the years are the general economy, a consolidating industry, automation trends and offshore production. The chart at right illustrates the attendance pattern over the past 10 years. The current recession, coupled with the effects of September 11, greatly impacted course attendance and the ability to support operations. Attendance for the current fiscal period is 47% lower than last year, and 61% lower than 1998 levels.

At its May 2002 meeting in Kansas City, Missouri, the CMI Board of Directors discussed the need to restructure operations to strengthen its financial position yet ensure continued support of the industry's educational needs. Specifically, the role of the laboratories and their benefit-to-cost were examined. Based on the current number of students and companies currently using courses, the business model for the CMI labs must be questioned.

A subcommittee designated by the CMI Board is evaluating options that will continue to accomplish the Institute's mission of serving the industry's educational needs but without the high cost of operations. An option already in use is videoconferencing, which allows instructors in Des Plaines to offer classes to various sites while also reducing travel time and cost for students. While such new options exist, clearly the hands-on training provided by the labs is a resource that is difficult to replace. That being said, if the industry is not utilizing this resource, CMI's ability to continue laboratory classes in Des Flames can not be guaranteed.

A recent article by ASM International's Michael Kenney showed the return on investment that training can provide. Studies indicated "an increase of $680 in the firms' training expenditures per employee generates, on average, a 6 percentage point improvement in total shareholder return in the following year."

In the final analysis, the question that must be answered is: "How will we, as an industry, promote the learning process and remain relevant in an ever-changing world?"

Industry comments may be directed to Dwight Barnhard ([e-mail]), AFS, 505 State Street, Des Plaines, IL 60016, fax: [phone].

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