The Manufacturing Executive
The Manufacturing Executive

Episode · 1 year ago

How to Fix a Factory: Influencing the Direction of Your Company w/ Rob Tracy

ABOUT THIS EPISODE

Something's not going well, and it's your job to fix it. Where do you start? 

You can't rely on your charm and good looks to make a change happen. Instead, you have to work through proven processes that alleviate distress at companies. 

On this episode of The Manufacturing Executive Show, Rob Tracy, consultant and author of How to Fix a Factory, talked about specific processes that can solve problems at distressed organizations.

 

Here's what we discussed with Rob:

  • Why Rob wrote How to Fix a Factory and who he wrote it for
  • How value-add reporting can give distinct insight into P&L
  • The 10 core systems that must be operating with reasonable proficiency for the factory as a whole to have good outcomes
  • Rob's new idea called The Business Forward Framework

Additional Resource Mentioned in the Episode:

Traction: Get a Grip on Your Business by Gino Wickman

To ensure that you never miss an episode of The Manufacturing Show, subscribe on Apple Podcasts, or Spotify, or here.

But what I found is you now, afterspending time in a lot of companies, I' always find myself working in some sortof distressed organization. Something wasn't going well in my job was heaffect it and if that for the longst time, I thought that was just you know.My Art and charm and good looks that was making that happen and and what Irealize is I actually do have a process welcome to the manufacturing executivepodcast, where we explore the strategies and experiences that aredriving midsize manufacturers forward here. You'll discover new insights frompassionate manufacturing leaders who have compelling stories to share abouttheir successes and struggles and you'll learn from btob sales andmarketing experts about how to apply actionable business developmentstrategies inside your business. Let's get into the show. Welcome I to another episode of theManufacturing Executive Podcast, I'm Joe Sullivan your host and a cofounderof the Industrial Marketing Agency Garilla. Seventy six today I have aunique guest in the sense that he can be called both a manufacturingexecutive and an author. Let me take a moment to introduce rob. Tracy rob isthe president and founder of Rob Tracy consulting with more than thirty yearsof leadership. Experience in the Manufacturing Industry Rob as become anexpert in navigating the sector's distinct challenges. After publishinghis first book in two thousand and Nineteen, how to fix a factory rob nowuses his unique perspective to reveal issues reset expectations and restoreworking order and manufacturing companies across the Nation Robunderstands that every company's situation is different and he doesn'tbelieve in just mechanically applying the latest tools and hoping for goodresults. He works to religne companies with their core values, touching eachlevel of the business to truly provide a holistic analysis of. What's goingwrong, people focused in practical rob sees through the clutter of everydayobstacles to find the root of the problem. His boots on the groundapproach ensures that issues are not only identified but solved for goodbefore founding his consultancy rob held leadership roles with prominentcompanies such as Anderson Windows, Pentaire, INTECH plastics and CliftonLarson Allen. In addition to being highly experienced with Lean and EOSpractices, rob holds a Bachelor of science in industrial and operations.Engineering from the University of Michigan and is a graduate of theMinnesota Executive Program at the University of Minnesota's CarlsonSchool of Management, a Lifelong Learner and observer rob shares hislatest insights about business strategy and life on his website. Blug. So, onthat note, Rob Welcome to the show thanks for much joke. Looking forwardto our conversation, Wel rob you and I first connected back in January of thisyear, so I think you stumble across my company grill it semny six online oneway or another and realizing we ad overlapping audiences. We strat up aconversation from there. That's right! So you have been a longtimemanufacturing. Guy Is Anan Introduction. I know that you're potentially shiftinggears in your career O, maybe broadening your horizons a little bit,but regardless I' love to hear from you about sort of how you got to where youare today and Lso, where you see...

...yourself, Hoadto yeaill try to keep upthe Bibo brief. Like I said, I'm Biim an engineer grew up in mench Michiganbeen around manufactur on my life. My Dad was part of the foundry industry ofGeneral Motors. First drop out of school was that General Motors and itfound it, was just way too big and I I started moving to some different places,each time going to progressively smaller organizations and settled it asthe CEO IDENTEC plastics. After going to Susome, there ware some ofthos other companies that you mentioned and foundthat I just have a passion for you now that fifty sixty seventy million dollarcompany hundred a few hundred people, because you can move fast, you can getthings done, you can make an imprint and and make it dent. For the last fiveyears, I've been doing consulting work and wo for the last twenty years. Twell fasmy operations is my fastball. I've been more at that senior level forthe last twenty years. The last five years as a consultant hi've really beenfocused on helping the the CSWEET people get a handle on their businesson a wide range kind of general management. Stuff, not just operationsawesome, and I I learned from talking to you months back that you would kindof just published your first book how to fix actory, which was was reallyinteresting, and is you K O? We talked more and decidedg to be a really greatguest for this show. I read the book over the last few weeksand I found it super interesting and you know in particular I mean there'sso many nuggets in their specific to the manufacturing industry, but so manyjust great business principles that even I can relate to I'm a marketingguy, so the books not written. For me, though I had takeaways, but tell metell me a little bit about you know who the book was actually wastruly written for who your audience was, and at a high level really what it'sall about. You know, I'l start by saying the righting a book has alwaysbeen on my bucket list. I wouldn't have called myself in author, but I guess Iam now it was. It was a challengeer, but it was a lot of fun. It was goodgrowth experience. The book is targeted, a senior leaders and small to midsizemanufactures I mean that's e, the sweet spot and by senior leaders CEO Cos, bpofops CFOs those kind ofpeople that can really influence the overall direction of the company. Aplant manager would get something out of it. I think other people o know allthe way to a production supervisor would would get some value, but thetargo was that senior level what I was trying to do with the book first time.The my goal is to make it practical short, like H, t one plane right acrossthe country and you kind of got it nonjargony. I tried, I don't, there'sno lean words in there. Like T, you know, none of that stuff I just non tohave common ever day English, but what I found is you know, after spendingtime in a lot of companies, I'd always find myself working in some sort ofdistressed organization. Something wasn't going well in my job was hiaffexit and if that, for the longest time, I thought that was just my artand charm and good looks that was making that happen and and what Irealize is I actually do have a process I go through, and so right in the bookwas waited for me to get it out of my head onto a piece of paper. But what isthat process? How do I go about that?...

Because, even though the challenges aredifferent, the path that take s is often very similar, so that was gool.That was what I wastryineg to accomplish insure that that insiht. Sothe book is called how to fix a factory. What are some examples of situations ina factory or a manufacturing facility that constitute fixing yeah? Well, you can imagine it runs a wideGamit, but I'll give you three examples. Just ta, because th these have beenmore common lately one would be a situation where they're not takingreally good care customers and that shipping on time and lead times areextending and they don't know why. They've tried stuff, they're runningover they're, doing all kinds of things that try and fixit nd, it's not gettingany better and so I'll go in and I'll hope, kind of start. Peeling back thatonion and I've seen situations one one company. The problem was that theyweren't tracking their production throughput very well and production todrop by about five percent, which doesn't sound like much but over thecourse of weeks. It starts to add up, and the next thing you know they're ina hole and they got to di out of it another place. The customer service wasplaceing orders on the factory that were far in excess of the capacity ofthe factory. They didn't have any sales and operations plan to keep the twolinkd together. That's been happening more, even I even as the as the pandemic as Headen. You thinkwe'LD have all kinds of capacity they're still struggling with thatissue, so that want one issue another one would be just misinterpretationoffinancials. The standard cost systems that have been in place for eons in manufacturing can give very,very misleading information that lead Tho, bad business decisions and justmanaging profitability and understanding th, the role of provatecosting, but also understande capacity and through put, and how to reallydrive financial performance standard cost. Acoundy doesn't help very wellwith that. So it's we something thor. I use something called value ad reporting,direct PNLS, so helping them get little different insigde into what the pianocan look like ind how to drive it so that that happens. A Lot then the thirdone is talent. I mean we all know it. Camp Talents O struggle. Unfortunately,a lot of the clients I work with have really taking a strategic look at theirtalent and I think it on talent. The fight for talents is going to give therbras up to the almost the same levls o fight for customers and an es that kindof strategic strategic view, and so many clients are just going to kin ofagencies and they've got this revolving door of people and at which crates all kinds of issues, sojust helping them kind of get regrounded on it and raisetheir talent plan UF, pomore strategic level, something th t is a real commonissue. Yeah. I hear the the talent problem so often from the becaus. We,our client Bass is very similar to yours. These kind of midsizemanufacturing companies and you think that you know even with will you hearso much about automation and the negative things that that the commongeneral public thinks about automation...

...and right, placing human beings and andtaking jobs away in the reality, is a lot of manufacturing organizationscan't find people who want to do the job they don't want to do dary work.They don't want to work third shift. They don't want tit, you know, dothings that put them at safety risks, of course, and like that talent,recruitment, part of it and retention as well, is just so so important, butso challenging yeah. You know, there's still a lot of factories that don'tlook like a clean room. You see the little bit ifh the ones that lookreally pretty, and you know he epoxade floors, there's a lot of one that stillis fairly industrial and this really hard to get people that want to do thatwork. A substantial chunk of your book covers a topic that you describe as thecorten systems and I'm going to read a little passage from from here you hadwritten all factories had o have a set of course, systems that must beoperating with reasonable proficiency for the factory as a whole to have goodoutcomes when a factory becomes distressed, it's usually due toweakness and one or more of these corse systems. Now I know from reading thebook we could probably do an hour long podcast on each of these coure town,but I'm wondering if you could give us kind of a birds iy look at at whatthese ten systems are, maybe, as a synopsis of each O, Wi understand sortof what's important. From your perspective, an Inti Leti'll just givea little bit of context. I would call these core ten related operations, there's other tees financial systems inat theres. There's other systems that marketing sales. This doesn't coverthose so of the user operation h oriented so I jos bus throug them thetalant system. We talked a little bit about that. That's raising talent up toa strategic level, talent, brand and brilly. How are you going to attractrecruit? Highe retain great culture, those kind of things the second one isa corten is a clean, safe factory. We can use the buzz words of five US Ididn't do that is so I car say as a matter of being respectful to ourpeople. We need to have a factory, that's clean, well, organized and savefor him to come to, and if you don't have the discipline to do that, thenyou probably don't have t a discipline to do a lot of the other stuff thatneeds to be done to run the place. The third one is a management system, andthat's really the management structure. That's having the right ratio of fromthe plan manager to how many Superintendente, to how manysupervisors, to how many leads and because one of the biggest issues I seeis you know, they'll, have a supervisor cover in fifty people and then theywonder why they can't follow through on stuff and do continues, improvement oraren't running the placewolds, because he spendit all day an administeringbecause he don't set, doesn't have the right structure. So that's been thenext one. The fourth one is an Equa equipment, reliability system and therssystem Te, making sure that the people on the floor have equipment that worksand gets the job done and produces a quality product, so maintaining it well,keeping to the UP. To date, the Buzzword told be TPM and all thosethings, but it's just about, do we have equipment, that's reliable and working,and it's not, then we can have a problem. Fifth, one is the qualitysystem. Quality System is just making sure that we've got the tools and thepropheses in place to ensure that we...

...are passing good quality onto ourcustomers and internally, that we've got good product going from oneoperation to the to the next ind that snity Rodin our capacity and ourthroughput and all those things when that happen, when you don't have goodcontrol of quality, the six went is supply and the so thesupply system is managing. Who Do you choose to buy from what quantities? Howdo you flow it in? How do you make sure you got good quality and if you don'thave a good quality, a good supply base, that's healthy and taking care of youthen you're going to struggle inside your operation. The next one is in theinventory system. telimentory is just you know the len. We we always want totalk about. One piece flow: I've never seen it. Every factor's got inventory,and so the IVEN TRAC system is making sure that it's under control, you knowwhere it's at you can find it it's being rotated properly, so that when itdoes timetime come to put at a productive use on the on the line or,and it works off, you can go, get it in and and it's now you're not losing stuffetone. The sales and operations planning talked a little bit about thatproblem. Earlier sales nooperations planins of creating that linkagebetween the sales group and the operations, and he probably thefinancials as well and making sure you'e got that ongoing. You know two orthree month forward, look to create alignment and we don't have customerservice putting up more on the factory than they can produce. At the same time,operations have to understand what they need to do to take care of the customerand wheheythey should be adding capacity. An taking capacity offfooktable the next one is a data and measurement.That's just ol having the right measures up and down the up and downthe chain from the at the sell level what's important to them. What do theyneed to measure all the way up to the to the senior leadership team, whichshould they be be watching? What I see at times is they're missing a keymeasure and performancehas slipped in on that, but because they're notwatching it, it's just you get this erosion and that ends up having a bigimpact over time. Those h example I gave out they weren't watching theirthrough put and five percent. You Know Wen away and they ended up sufferingand the last one is the offering system the operating system. Is that hard oneto describe because it's the kind of the overall framework for how do yourun the business? Well, what is your meeting pulse yea, whether that's yourweekly staff meeting or your quality system meeting, is how do you stet yourpriorities every ninety days and that's really where I've been focusing a lotof lately on on my thing: Yeah, that's Great Good, good synopsis of each, andI love having a framework like this, because I'm sure is our listeners arehearing. You talk about these Te's, probably a lot of heads nodding. Theseare all issues that any manufacturing leader deals with, but to be able tohave a structure to follow and say you no kind of put him in buckets and havea process for addressing each. I see the value in that because it's the samein my business and the way you know we approach Y K O implementing a marketingsales program, for example right t. What I see is we know Goingon you lookat Hemto a company, that's struggling or facility. This struggling. They maybe fine on nine of them and it's just N.

...it's one of those ten, that'sundermining everything, so you get. I think you said it early. You have to bereasonably proficient in all of them because any anyone can turn into whatweeks pot yeah and it provides a great system to. I imagine, for you, know,kind of auditing somebody up front and saying Wer, where you strong, where youweek, where can we move the needle the most and poor, our energy, because youcan attack everything at once? Right, your resources get thinned out soabsolutely yeah. Well, you KN number ten on that list. I want to talk alittle bit more about and have you really unpacked it and that'sthe operating system, because I know that one of your big initiaves rightnow personally is developing a formalized operating system that acompany can kind of hold in their hands and take and deploy inside theirbusiness. So tell us a little bit about what you're doing on that front. Whatyou're developing as far as an operating system goes and what alsoinspired you to develop that system. Absolutely you! I wish Ihad used adifferent term than iperating system, because it sounds like Ms dos back inthe s yeah. The operating system is that framework for how you run thebusiness, and so if you're listeners are familiar with els the entrepenaloperating system, that's an operating system. Vern Arniss has got scaling up.That's an operating system, I'm creating my own. I got very familiarwith the US, both as an implementer, where I went to all the training, but Ialso worked in a company that had was using it for three years, so I've gotthat a boots on the ground Youm, and there are a lot of things I like aboutit and t the thing I'm creating, which I'm calling the business forwardframework has elements of that, but we're going to come at it a littledifferently because I don't think e us is a good fit for all companies. Yougot to have a certain personality profile, forr to be an ideal client forthem. So I got six buckets, so I'm going to put mine in Gotto. have heright strategy got to have right culture right people? A ninety. Eightfocus is critical, that every ninety days, your resettin priorities, a d anddetermining what what you're going to focus on a work on having the right,Datin, metrics and then I've something I call habits and they can be themeeding habits. But even though one of my favorites is just to have us justsay it so we said he, the tonethat says Wen our when we're together and we'retalking, Wbith er, that's just we you and I one on one or in a meeting. Ifit's in your head, we're going to say it we're not going to walk out withthings being unsaid and then go talk behind people's backs, and we saythings to each other, not about each other. That's what's a habit. So what Iwant to do to fill a different Nich with this framework is come at theimplementation different instead of having just one size fits all that youknow. This is how you go about implementing. It is help coming figureout where they're at where the, where the good starting point, is and thencreate a custom roadmap form and then be with them to implement, and I'm onlygoing to work in industry that I've got experience in I'm not going to be anignostic generalist. Yeah makes sense. T A you know the implementation of aframework like this is just so key, and I know no I'm familiar with EOS andwhich is for those of you listening who maybe aren't familiar. Geno Wickman wasthe author oftraction, which I've read...

...three times and we've borrowed elementsof it for our business. We've never sort of fully embraced the full system,although wer were thinking about it at my company grilla right now, but youknow he describes the sort of implementation side of things astraction and, as you put this framework in place, how you know at the end of itnow, you've got actually hit the ground running and you have to people have tobe bought in and you have to follow through on doing it. So I don't know Iyou want to speak to that because I know you're, obviously, in eols, you'vebeen there and been in implementer and know that system really well. So maybespeak speak a little bit to that idea, O of gaining traction or in your casethe the Implementation Element Teem. Let me think about the best way to talkabout that. There's. There's a lot of things in els were aound how to getthat traction. Some of my favorite things is Yei talked about the ninetyday pulse. That's that is N. there's a ninety day, Pulson inh annual pollsSodin that strategy. So you know your offtor Strok in the same direction iscritical, but then breaking things down into ninety days. We y say what are thetop priorities and we'll do facilitated sessions where well come up with allthe possible ideas that we could do in the next. Ninety days list them out andit might have a hundred on the list and we'll narrow it down to five and say,and then we scope them. I'm a big Fan of wrighting one page project cargersthat talked about. What's in scope, what's ooutofscope what are themilestones and and then you integrate those into theweekly meeting where every week you're checking in saying are we on target ore?We off target, so you don't lose eitherone, they don't go sit on a shell,so those are just some of the tools in techniques about how do you driveperformance forward yeah? I think, there's even research out there. Iremember reading an traction that you know the human mind is like built in away that it can handle about ninety day milestones and not much more than that.So when you have these big in these massive goals that you're trying toaccomplish for the year or beyond, you kind of shut down and and Lind upgetting nothing done unless you can break it down into smaller chunks right.That could be maybe a ten in ninety day segments absolutely ye. Even if, ifit's a huge projuct, I doin an Europe implementation that might take twoyears, you can still say what are we going to do in the next ninety days andt we might he en the next min days were going o o Stoftfar selection in thenext ninet is we'regoing to get our Datas ceaned up in the next NintydaysWer, but you an the least when, when you have something that's a year or twoout, it can seem like you've got an awful long time to implement and thethings go on the backburner. You don't really work on them. Ninety days isthat time, fraers long enough, you can get something done, but short enoughthat you've got somemergency like you got Ti, get moving because times e oBurning Yep, and then I think those weekly touchpoints become so importantbecause it creates accountability right t. If you you wait a month, if you onlysort of touch base with with your team, as you are implementing these ninetyday, you know mile stones. Well, then everybody waits till day. Twenty ninesays o man. I got to get all this stuff done and you hack your way through itand yeah versus weekly. You create...

...consistency, N and accountability foreach other right, yeah yeah. We want to avoid that college student inderomewhere you keep pushing off and then cram at the end. It just doesn't workvery well. It makes sense, well rob anything else you wanted T to touch onin terms of your operating system. I think this was I'm curious. Where is itavailable out there for people to look at yet? Is it's still sort of in thework so'me kind of curious? If people want to look at your operating systemor Othethin, I would say I'm about ninety percent done yeah. I don't haveit out published anywhere. It's not up on my website yet so the probably thebest thing to do is is reach out to me through Linken ye have yot to cock. Ittalk anybody through it kind of talking and I can hope comparint to trast withwith the US, I'm still in the US fan. Yeah like it took help show where they,where they would be different. So they can make thert Briak into decision, butyeah bestthing to reach out for to Linkdan or go to my website my contectinformation that is on there is just simply the rob. Tracy got N at sopretty pretty simple. To find beautiful. Well, rob thanks a ton for doing thistoday. This is a supervaluable conversation. I learned Aton, I'm sureour listeners are saying the same and really really like what you'r doing soappreciate your join in yeah appreciate that I love Manufacturind, I'm like Ican Gad, I hav a little chance to get to talk to you and your audient great.Well, thanks robing to the rest of you. We hope to see you next time on themanufacturing executive. You've been listening to themanufacturing executive podcast to ensure that you never missed an episodesubscribe to the show in your favorite podcast player. If you'd like to learnmore about industrial marketing and sale strategy, you'll find an everexpanding collection of articles, videos guides and jols specifically forM to B manufacturer at Grillla. Seventy SIXCOM FLAH war. Thank you so much folistening until next time.

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