GRAND RAPIDS ? Rick Van Dis, Irwin Seating?s Director of Supply Chain Management, was one of the 225 people who attended the 10th Annual Midwest Supply Chain Management Conference on March 14 at Grand Valley State University?s Eberhard Center. He said he?s participated every year.

?The conference gives me a great cross section of what my peers are doing,? Van Dis said. ?I get something out of every class. We?re all dealing with the same issues.?

The conference was divided into four tracks. Those included Operations & Logistics, Growth & Innovation, Global Perspective and Leadership & Development. There were also two keynotes. In the morning, Rick Mattoon, Senior Economist and Economic Advisor, Federal Reserve Bank of Chicago. Mattoon predicted what the U.S. and Midwest economic performance will be and what impact that will have on supply chains. In the afternoon, R. David Nelson, CEO and Senior Advisor, Dave Nelson Group, formerly Vice President of Supply Management for Honda, Deere, Delphi and Toyota, said management ?Do Not Have To Be Complicated.?

Economist Mattoon said the headwinds for the economy will come from the Eurozone in recession, China?s economy slowing down, volatile oil prices and the uncertainty posed by the U.S. fiscal budget cuts and the likelihood they will depress Gross Domestic Product by 0.6 percent this year.

But, he said, some headwinds may have turned into tailwinds. Those include tightening housing stocks, upturning housing construction, and the near doubling of new household formation since the recession.

He also said retail trade is coming back. Sales have been up for much of the year, although Christmas was soft. Auto sales continue to grow and 2012 hit 14.5 million units. The February reading had the auto sales rate at 15.5 million.

What?s more, the University of Michigan Consumer Confidence Index shows consumer confidence is almost back to pre-recession levels. After January consumer confidence numbers took a hit, probably due to fiscal and tax issues, February numbers came in at about expectation, Mattoon said.

Both the manufacturing and agriculture sectors have been going great guns, he noted. The National Purchasing Managers Index was 54.2 (above 50 means expansion) in February, again above expectations. Farm incomes are at record highs as well as farmland values.

What tightening housing stocks and increasing farmland values may help unleash a lot of liquidity on the side lines as more optimistic corporate execs start spending cash again.

The overall economic outlook also is buoyed by the employment picture, which may be getting better, Mattoon said. Job numbers in November and December were revised up significantly, while natural gas has turned to a positive as well, he said.

Mattoon predicted at or slightly above potential growth for 2013 and even stronger growth in 2014. The Federal Open Market Committee in December projection for GDP growth is a revised 2.3 percent to 3 percent for 2013 and 3 percent to 3.5 percent for 2014. The likely long term average is 2.3 percent to 2.5 percent, he said.

On the flip side, Inflation appears contained, too, Mattoon said. The Consumer Price Index should decline or experienced minimal growth, although gas and food prices might cause a blip. The Fed forecast has the core Private Consumption Index at 1.6 percent to 1.9 percent for 2013 and 1.6 percent to 2 percent for 2014. Over the longer run the average is 2 percent.

The Fed also forecast unemployment at 7.4 percent to 7.7 percent in 2013, dropping to 6.8 percent to 7.3 percent in 2014. The long run unemployment projection is 5.2 percent to 6 percent.

Strong national and regional Purchasing Managers Index numbers suggest that this manufacturing surge has legs. He said new orders also looked pretty good suggesting that supply chains should benefit. The strongest beneficiaries will be anything related to natural gas, heavy equipment, autos, and agriculture. The problem areas are anything targeted by federal budget cuts, particularly defense work. And if this forecast is right, economic growth should continue well into 2014.

Despite all these positive economic indicators, the Fed predicts there will be an underperforming recovery for the rest of 2013. Since some of the fundamentals are getting stronger, such as housing, the Fed also predicts 2014?s recovery will be stronger, with a real chance at above potential economic growth.

Breaking the numbers down to the Midwest, Mattoon said Iowa and Indiana have done better and are back to pre-recession levels, while Illinois, Wisconsin and Michigan have lagged. Fiscal issues at the national, state and local level will continue to impact the economy negatively.

Meanwhile, in the morning keynote, supply chain management guru Nelson said Toyota and Honda have the best lean practices, such as reducing waste, reducing costs and producing the best product for the best cost.

Other factors for lean management success are not about squeezing suppliers? margins, nor about getting prices down. Success is all about getting costs out of processes and getting costs out of parts, he said. When suppliers do, the results are a strong competitive supply base.

For a company to become a lean leader, he said, it must improve processes, improve trust, and elevate financial performance. Effective suppliers, Nelson said, share technology, share risks, share the benefits and share the accountability.

This year?s Supply Management Conference was sponsored by the Supply Chain Management Council hosted and facilitated by the Right Place and the Michigan Manufacturing Technology Center ? West.

?The success of the event is a combination of the people involved, the speakers and our host GVSU Eberhard Center,? said William Small, the West Regional Director for MMTC.

The day-long spring conference will be followed this fall by two half-day programs: In October, the commodity outlook, where experts talk about the outlook for commodity trends and pricing in the coming year; and in November for the Supply Chain Best Practices Sunrise Series. Small said this event?s focus has not yet been determined because they try to make it a hot current topic.

?We?ll know what to call it later this year,? he said, noting that council members come from a variety of business sectors, including auto, furniture, and food.

?Two of our biggest members are Amway and Steelcase,? Small said.

Mike Brennan is Editor & Publisher of MITechNews.Com