The Manufacturing Executive
The Manufacturing Executive

Episode · 2 years ago

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


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 wet. After spending time and a lot of companies, I'd always find myself working in some sort of distressed organization. Something wasn't going well in my job was he will fix it and if that for the long time I thought that was just, you know, my art and charm and good looks that was making that happen. And and what I realize is I actually do have a process. Welcome to the manufacturing executive podcast, where we explore the strategies and experiences that are driving mid size manufacturers forward. Here you'll discover new insights from passionate manufacturing leaders who have compelling stories to share about their successes and struggles, and you'll learn from B tob sales and marketing experts about how to apply actionable business development strategies inside your business. Let's get into the show. Welcome to another episode of the Manufacturing Executive podcast. I'm Joe Sullivan, your host and a cofounder of the Industrial Marketing Agency guerilla seventy six. Today I have a unique guest in the sense that he can be called both a manufacturing executive and an author. Let me take a moment to introduce Rob Tracy, rob is the president and founder of Rob Tracy Consulting. With more than thirty years of leadership experience in the Manufacturing Industry, ROB has become an expert in navigating the sector's distinct challenges. After publishing his first book in two thousand and Nineteen, how to fix a factory, rob now uses his unique perspective to reveal issues, reset dictations and restore working order and manufacturing companies across the nation. Rob understands that every company's situation is different and he doesn't believe in just mechanically applying the latest tools and hoping for good results. He works to realign companies with their core values, touching each level of the business to truly provide a holistic analysis of what's going wrong. People focused in practical rob sees through the clutter of everyday obstacles to find the root of the problem his boots on the ground approach and shows that issues are not only identified but solved for good. Before founding his consultancy, rob held leadership rolls with prominent companies such as Anderson Windows, pent air, Intech, plastics and Clifton Larson Allen. In addition to being highly experienced with Lean and EOS practices. Rob Holds a bachelor of science in industrial and operations engineering from the University of Michigan and is a graduate of the Minnesota Executive Program at the University of Minnesota's Carlson School of management. A Lifelong Learner and observer, ROB shares his latest insights about business strategy and life on his website blog. So on that note, Rob, welcome to the show. Thanks for much jokes. Looking for to our conversation will rob, you and I first connected back in January of this year, or so I think. You stumbled across my company. Girl is somebody six online one way or another and, realizing we had overlapping audiences, we start up a conversation from there. That's right. So you have been a longtime manufacturing guy, as I know. An introduction. I know that your potentially shifting gears in your career, maybe broadening your horizons a little bit, but regardless, I'd love it to hear from you about sort of how you got to where you are today, and they also where you see yourself... to day. I'll try to keep out the bio brief. Like I said, I'm I I'm an engineer, a group in mention Michigan. been around manufactur on my life. My Dad was part of the foundry industry at General Motors. First job out of school was that General Motors and they found it was just way too big and I started moving to some different places, each time going to progressively smaller organizations and settled as the CEO at INTAC plastics, after going to swoop some do some of those other companies that you mentioned and found that I just have a passion for an of that fifty, sixty, seventy million dollar company, hundred, a few hundred people, because you can move fast, can get things done, you can make an imprint and make a dent. For the last five years I've been doing consulting work and will for the last twenty years. Well past my operations as my fastball, I've been more at that senior level for the last twenty years. The last five years as a consultant I've really been focused on helping the sea sweet people get a handle on their business on a wide range kind of general management stuff, not just operations. Awesome and I learned from talking to you months back that you would kind of just published your first book how to fix the factory, which was really interesting and, as you know, we talked more in decided you be a really great guests for the show. I I read the book over the last few weeks and I found it super interesting and you know in particular, I mean there's so many nuggets in their specific to the manufacturing industry, but so many just great business principles that even I can relate to. I'm a marketing guy, so the book's not written for me, though I had takeaways. But tell me, tell me a little bit about you know, who the book was actually was truly written for who your audience was and and at a high level, really what it's all about. You know, I'll start by saying the writing a book is always been on my bucket list. I would have called myself an author, but I guess I am now. It was a it was a challenge, but it was a lot of fun. was good growth experience. The book is targeted at senior leaders and small, the midsize manufacturers, I mean that's the sweet spot. And by senior leaders, CEOS, ceosvp of OPS, CFOS, those kind of people that can really influence the overall direction of the company. A plant manager would get something out of it. I think other people, all the way to a production supervisor would would get some value, but the target was at senior level. What what I was trying to do with the book? First, I've met my goal is to make it practical, Short, like one plane right across the country and you kind of got it. Non jargony. I tried, I don't there's no lean words in there and you know, none of that stuff. I just want to have common, everyday English. But what I found is we want. After spending time and a lot of companies, I'd always find myself working in some sort of distressed organization. Something wasn't going well in my job was he affix it and if that, for the long time I thought that was just my art and charm and good looks that was making that happen. And and what I realized is I actually do have a process I go through, and so writing the book was waited for me to get it out of my head onto a piece of paper. But...

...what is that process? How do I go about that? Because even though the challenges are different, the path to take it is often very similar. So that was a goal. That was what I was training to accomplish and sure that that insight. So the book is called how to fix a factory. What are some examples of situations in a factory or a manufacturing facility that constitute fixing? Yeah, as you can imagine, it runs a wide gamma, but I'll give you three examples. Just could these have been more common lately? One would be a situation where they're not taking very good care of customers and not shipping on time and lead times are extending and they don't know why. They've tried stuff, they're running over, they're doing all kinds of things. Are Trying and fix it. It's not getting any better and so I'll go in and I'll help kind of start peeling back that onion. And I've seen situations. One one company, the problem was that they weren't tracking their production through put very well and production to drop by about five percent, which doesn't sound like much, but over the course of weeks it starts to add up and the next thing you know they're in a hole and they got to the go out of it another place. The customer service was placed in orders on the factory that were far in excess of the capacity the factory. They didn't have any sales in our rations plan to keep the two link together. That's been happening more even and even as the as the pandemic as head and you think would have all kinds of capacity, they're still struggling with with that issue. So that want one issue. Another one would be just misinterpretational financials. The standard cost systems that have been in place for eons in manufacturing can give very, very misleading information that lead to bad business decisions and just managing profitability and understanding the role of product costing but also understanding capacity and through put and how to really drive financial performance. Standard Cost Accounty doesn't help very well with that. So it's we use something tore. I use something called value add reporting direct PNL's. So helping them get a little different insight into what the PL can look like and how to drive it so that that's happens a lot. Then the third one is is talent. I mean we all know what talents a struggle. Unfortunately, a lot of the clients I work with Hann't really taken a strategic look at their talent and I think it on talent. The fight for talents is going to get the rays up to the onst the same levels of fight for customers and in these deaths, kind of strategic, strategic view. And so many clients are just going to kind of agencies and they've got this revolving door of people and had which creates all kinds of issues. So just helping them kind of get reground it on and raise their talent plan at a p more strategic level something like is a real common issue. Yeah, I hear the the talent problem so often from these we are client base is very similar to yours. He's kind of midsize manufacturing companies and you'd think that you know even with well, you hear so much about automation and and that the negative things that the common the general public thinks about...

...automation and right placing human beings and and taking jobs away. In the reality is a lot of manufacturing organizations can't find people who want to do the job. They don't want to do dirty work. Then want to work third shift, they don't want it, you know, do things that put them at safety risks, of course, and right that talent recruitment part of it and retention as well, is just so, so important but so challenging. Yea You know there's still a lot of factory that don't look like a cleanerom. You see the little bit the ones that look really pretty, and you know on the epoxy floors there's a lot of them that's still is fairly industrial, and this really hard to get people that want to do that work well. Substantial chunk of your book covers a topic that you describe as the core ten systems, and I'm going to read a little passage from from here. You had written all factories had to have a set of course systems that must be operating with reasonable proficiency for the factory as a whole to have good outcomes. When a factory becomes distressed, it's usually due to weakness and one or more of these course systems. Now I know from reading the book we could probably do an hourlong podcast on each of these core ten, but I'm wondering if you could give us kind of a birds I look at what these ten systems are, maybe as a synopsis of each, will understand sort of what's important from your perspectives, and so let's I'll just give a little bit of context. I would call these core ten related operations, that there's others there's financial systems and H R, there's there's other systems that marketing sales. This doesn't cover those. So the these are operationally oriented, so I just buzz through them. The talent system, we talk a little bit about that. That's raising talent up to a strategic level, talent brand and really how are you going to attract, recruit higher, retain great culture of those kind of things. The second one is a core ten as a clean, safe factory. We can use the buzz words of five us. I didn't do that. It is said, idea said as a matter of being respectful to our people. We need to have a factory that's clean, well organized and, say, firm to come to. And if you don't have the discipline to do that, then you probably don't have the discipline to do a lot of the other stuff that needs to be done to run the place. The third one is a management system, and that's really the management structure. That's having the right ratio of from the plant manager to how many superintendence, to how many supervisors, to how many leads, and because one of the biggest issues I see is they'll have a supervisor covering fifty people and then then wonder why they can't follow through on stuff and do continue improvement or aren't running the place well, it's because he's spent an all day administering, because you don't set to another a structure. So that's been the next one. The fourth one is an equal equivalent reliability system, and that's just making sure that the people on the floor have equipment that works and gets the job done and produces a quality product. So maintaining it well, keeping to the up to date. The buzz words would betpm and all those things, but it's just about do we have equipment that's reliable and working, and if it's not, then we can have a problem. Fifth one is the quality system. Quality System is just making sure that we've got the tools and the prophssism place to ensure that we...

...are passing good quality on to our customers and internally, that we've got good product going from one operation to the to the next and that it's not eroady in our capacity, in our through putting all those things. But that happened when you don't have good control of your quality. The sixth one is supply and the so the supply system is managing who do you choose to buy from? What quantities? How do you flow it in? How to make sure you got good quality? And if you don't have a good quality, a good supply base that's healthy and taking care of you, then you're going to struggle inside your operation. The next one is in the inventory system. Inventory is just, you know, the lean we always want to talk about one piece flow. I've never seen it. Every factors got the inventory and so the inventory system and making sure that it's under control. You know where it's at, you can find it, it's being rotated properly so that when it does time time come to put it to product of use on the the line or and it works all, you can go get it in and and and it's not you're not losing stuff. Eight, one of the sales and operations planning talked a little bit about that problem earlier. Sales and operations plannings of creating that linkage between the sales group in the operations and he probably the financials as well, and making sure you got that ongoing. You know, two or three, one forward look to create alignment and we don't have customer service putting out more on the factory than they can produce. At the same time, operations has to understand what they need to do to take care of the customer and where they should be adding capacity taking capacity off of table. The next one is a data and measurement that's just so if having the right measures up and down the up and down the chain, from at the cell level, what's important to them? What do they need to measure, all the way up to the to the senior leadership team, and which should they be be watching? What I see at times is they're missing a key measure and performances slipped in on that, but because they're not watching it, it's just you get this erosion at that ends up having a big impact over time. Those example I gave about. They weren't watching their through, but five percent, you know, run away and they ended up suffering. And the last one is the operating system. The operating system is that hard one to describe because it's the kind of the overall framework for how do you run the business? What is your meeting pulse? Yeah, whether that's your weekly staff meeting or your quality system meetings, how to set your priorities every ninety days, and that's really where I'm focusing a lot of lately on on my things. Yeah, that's Great, good, good synopsis of each and I love having a framework like this because I'm sure is our listeners are hearing you talk about these. There's probably a lot of heads nodding. These are all issues that any manufacturing leader deals with, but to be able to have a structure to follow and say kind of put them in buckets and have a process for addressing each I see the value in that because it's the same in my business in the way, you know, we approach you know, implementing a marketing sales program for example. Right what what I see is we know, going you look at him, to a company that's struggling or facility that struggling. They may be fine on nine of them and it's just with one of those ten...

...that's undermining everything. So you get I think you said it earlier, you have to be reasonably proficient in all of them, because any anyone, can turn into a week spot. Yeah, and it provides a great system to, I imagine, for you know, kind of auditing somebody up front and saying where strong, where you week, or can we move the needle the most and poor our energy, because you can't attack everything at once, right resources get thinned out. So absolutely, yeah. Well, you know, number ten on that list I want to talk a little bit more about and have you really unpack that, and that's the operating system, because I know that one of your big initiatives right now personally, is developing a formalized operating system that a company can kind of hold in their hands and take in deploy inside their business. So tell us a little bit about what you're doing on that front, what you're reslid thing as as an operating system goes, and what also inspired you to develop that system? Absolutely, you know, I wish I'd used a different term than operating system because it sounds like Ms Das back in the s. You know, the operating system is that that framework for how you run the business. And so if you're listeners are familiar with Eos, the entrepreneur operating system, that's an operating system vernharnish has got scaling up. That's an operating system I'm creating my own. I got very familiar with the US both as an implementer, where I went to all the training, but also work in a company that had was using it for three years. So I've got that boots on the ground view and there are a lot of things I like about it and the thing I'm creating, which I'm calling the business forward framework, it has elements of that, but we're going to come at it a little differently because I don't think eous is a good fit for all companies. You got to have a certain personality profile that for to be an ideal client for them. So I've got six buckets, so I'm going to put mine in. You got to have a right strategy, got a right culture, right people, a ninety they focus. Is Critical that every ninety days your resetting priorities and determining what you're going to focus on, a work on having the right data and metrics. And then I've something I call habits, and they can be the meeting habits, but even though one of my favorites is just to have of just say it, so we set the tone that says when we're when we're together and we're talking about it, that's just you and I one on one or in a meeting. If it's in your head, we're going to say it. We're not going to walk out with things being unsaid and then go talk behind people's backs and we say things to each other, not about each other. That's what I have it. So what I want to do to fill a different niche with this framework is come at the implementation different instead of having just one size fits all that you know. This is how you go about implementing it is help come in, figure out where they're at, where that we're at, the good starting point is, and then create a custom roadmap form and then be with them to implement. And I'm only going to work in industry that I've got experience and I'm not going to be an agnostic generalist. Yeah, makes sense that. You know, the implementation of a framework like this is just so key and I know you know I'm familiar with EOS and which is, for those of you listening or maybe aren't familiar, Geno Wickman was the author of traction,...

...which I've read three times and we've borrowed elements of it for our business. We've never sort of fully embraced the full system, although we're thinking about it at my company, guerrilla, right now. But you know, he describes the sort of implementation side of things as traction. And as you put this framework in place, how you know at the end of it. Now you've got actually hit the ground running and you have to have people, have to be bought in and you have to follow through on doing it. So I don't know if you want to speak to that, Cuz I know you're obviously in Eos. You've been there and been an implementar and know that system really well. So maybe speak speak a little bit to that idea of gaining traction or, in your case, the Implementation Element. The let me think about the best way to talk about that. There's there's a lot of things in Eos we're around how to get that traction. Some of my favorite things is, well, I talked about the ninety day pulse. That's that is there's a ninety eight paulse on, an annual pauls sudden. That strategy, so you know you're off for stroke in the same direction, is critical. But then breaking things down into ninety days where you say, what are the top priorities and we'll do these facilitated sessions where will come up with all the possible ideas that we could do in the next ninety days, list them out and it might have a hundred on the list and will narrow down to five and say and then we scope them. I'm a big Fan of right in one page project charters that talk about what's in scope, what's out of scope, what are the milestones and and then you integrate those into the weekly meeting where every week you're checking in saying are we on target? We off target? So you don't lose sight of and they don't go sit on a show. So those are just some of the tools and techniques about how to had drive performance forward. Yeah, I think there's even research out there. I remember reading in traction that, you know, the human mind is like built in a way that it can handle about ninety day milestones and not much more than that. So when you have these big, these massive goals that you're trying to accomplish for the year or beyond, you kind of shut down and line up getting nothing done. Unless you can break it down into smaller chunks. Right, that could be maybe a ten and in ninety day segments. Absolutely, even if some if it's a huge project, I do in an earp implementation that might take two years, you can still say what are we going to do in the next ninety days? And then you might be the next night days are going to do software selection and the next night is around to get our data's cleaned up in the next day is ring. But you can at least when you when you have something that's a year or two out, it can seem like you've got an awful long time to implement and if things go on the back burner, you don't really work on them. Ninety days is that time frame. Ers Long enough you can get something done, but short enough that you've got some emergency like you gotta get moving, because times I'm burning. Yep. And then I think those weekly touch points become so important because it creates accountability. Right, if you you wait a month, if you'll need sort of touch base with with your team as you are implementing these ninety day, you know, milestones. Well then everybody wait still, day twenty nine, says I me and I got to get all this stuff done and you hack your way through it. And Yeah, versus weekly,... create consistency and accountability for each other. Right. Yeah, yeah, I mean we want to avoid that college student syndrome where you keep pushing it off and then cram at the end. It do doesn't work very well and makes sense. Well, rob anything else you wanted to touch on in terms of your operating system, I think this was you know, I'm curious where is it available out there for people to look at you as it's still sort of in the works. I'm kind of curious if people want to look at your operating system or how they think. I would say I'm about ninety percent done. Yeah, I don't have it out and published any where. It's not up on my website yet. So probably the best thing to do is is reach out to me through Linkedin. Be Happy of talk at talk anybody through it, kind of talking and I can hope compare and c trash with with the US. I'm still an US fan. Yeah, I it took help show where they where they would be different so they can make direct break in decision. But yeah, that's going to reach out for to Linkedin or go to my website in my contact information that is on there. It's just simply the Rob Tracy dottnet so pretty pretty simple to find. Beautiful. Well, rob thanks a ton for doing this today. This is a super valuable conversation. I learned a ton. I'm sure our listeners are saying the same and really, really like what you're doing, so appreciate you joining. Okay, appreciate that. I love manufacturing. I'm that guy. Can Glad I had a little chance to get to talk to you and your audience. Great well, thanks, Robin. To the rest of you, we hope to see you next time. On the manufacturing executive you've been listening to the manufacturing executive podcast to ensure that you never missed an episode. Subscribe to the show in your favorite podcast player. If you'd like to learn more about industrial marketing and sales strategy, you'll find an ever expanding collection of articles, videos, guides and tools specifically for BTB manufacturers at Gorilla Seventy sixcom learn thank you so much for listening. Until next time.

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