Innovation: Old hand shows it’s not just for young turks
The latest fixation in the economic development game is the relentless pursuit of innovative employers and the higher-paying “knowledge-based” jobs they create.
Just last week, the S.C. Commerce Department announced it had created an Office of Innovation “to support and further grow an innovative, technology-based and entrepreneurial business environment.”
The knee-jerk image that brings to mind is of a fresh startup ready to disrupt some old-fangled industry on its way to heady growth and, possibly, a lucrative initial public offering.
Occasionally, it plays out that way. For proof, look no further than Daniel Island-based software-maker Benefitfocus and its recent $70.6 million IPO.
But nimble young turks haven’t cornered the entire market on innovation in the Charleston region. Not by a long shot.
Large seasoned multinationals, like relative newcomer Boeing Co., have brought planeloads of tech-savvy jobs to the Lowcountry.
Last week, another deep-pocketed, old-school industrial business, one with a 75-year track record in Charleston, set out to demonstrate — again — that it’s no slouch itself on the innovation front.
MeadWestvaco Corp. sold its local paper and saw mills five years ago to KapStone, but it’s still a big player in the region. And getting bigger.
The packaging giant’s North Charleston-based MWV Specialty Chemicals announced Thursday that it’s investing $9.3 million to create an “innovation center” at its Virginia campus. It’ll be staffed by about 25 of those coveted knowledge-based workers, mostly newly hired scientists and engineers.
They’ll join the North Charleston-based division’s 1,200 workers worldwide, including 450 locally.
The investment builds off a previous expansion from 1998, when what was then Westvaco Corp. opened a $20 million chemical research and development center just below Interstate 526.
This latest addition will focus on improving products that come out of the nearby labs, where chemists turn wood waste into renewable additives used in the emissions, oil, asphalt and adhesives industries. Once they leave the innovation center, the new or improved products can be made right next door in an adjoining manufacturing plant.
“During a time when many companies are taking a step back, we’re planning to be able to grow in South Carolina,” said Ed Rose, president of MWV Specialty Chemicals, which traces its roots back to 1953.
The division is a top performer within Richmond, Va.-based MeadWestvaco. The North Charleston unit’s second-quarter sales climbed about 6 percent to $260 million from a year ago. While earnings were flat for the April-June period, at around $61 million, the profit margin from chemicals was a stout 23 percent.
Rose said the thinking behind the innovation center is to “accelerate” the growth of the division, which now ships as much as 40 percent of its additives overseas, to places like China. “You don’t hear many people here saying they’re exporting to China,” Rose said.
He said the company isn’t sinking more money into North Charleston to make minor refinements. It’s gunning for meaningful advances, even breakthroughs. Innovation without adding value ... isn’t innovation that anyone cares about,” Rose said.
He cited a previous home-grown example, a product called Evotherm that allows road crews to pour asphalt at half the typical temperature. Besides saving energy, it cuts toxic emissions in half and is safer to handle. It also lets workers pave farther from the plants where asphalt gets heated, and it can be used longer into the cold seasons. Rose said sales of Evotherm have been “tremendous.”
“It’s that kind of stuff that realigns the slope of growth for us,” he said.
MeadWestvaco is still best-known for the big, belching paper mill it ran on the Cooper River from 1937 until 2008. North Charleston Mayor Keith Summey last week alluded to the distinctive stench from the smokestacks, saying it smelled “just like money.”
The company is still sniffing out growth and profits, by innovating.
Contact John McDermott at 937-5572.