The Manufacturers' Network

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. Our guest today is Nick Foy. Nick is the founder, CEO, and Chief Evangelist of Silverdale Technology, which provides access to world-class processes, systems, and change management methods, regardless of the size or budget. Democratizing ERP, he has over 30 years of experience in business and technology consulting and leadership positions, focusing on logistics and supply chain. Nick, welcome to the show.Nick Foy: Thanks, Lisa. It's great to be here.Lisa Ryan: Share a little about your background and what led you to do what you're doing with Silverdale.Nick Foy: Yeah, like you said in the introduction, I usually say it's been 30 years, but I probably should increase that a little now. I've been saying that for a couple of years now. It's time I revised that number. But my background I started on the manufacturing line. That was my first job in the manufacturing line, producing video recorders.And I'm guessing some of your listeners aren't going to know what the hell I'm talking about. Whatever the hell is a video recorder, and why would you make one? That was my first job. I probably got sacked from there after three months for being a disruptive influence on the production line, and I'm pleased to say after 30-plus years in the industry, I'm still doing the same thing.Lisa Ryan: Is that disrupting things?Nick Foy: Absolutely. Asking questions, pointing things out, and making changes is what I do. As I said, I started on a video recorder production line. I then moved into what every good Scotsman does - I ended up working at a whiskey company and worked a lot in production and logistics in that in that business for six years, and then went down into third-party logistics and which was a great experience., and then, found myself in consulting. I worked for some great clients, such as Kellogg's, doing manufacturing and lean manufacturing with them all over Europe. I eventually ended up at Amazon and spent five years at Amazon doing some great projects there.Three and a half years ago, I founded my own company here at Silverdale, which is about bringing together the 30-plus years of experience that I have and helping companies that I've seen over the years, just like those, get into ERPs and systems and helping companies with process design and implementation.Lisa Ryan: Can you explain what ERP is and why it's crucial for businesses?Nick Foy: ERP is such a horrible phrase. Anyone who's not in the ERP industry doesn't call it that. It's a ridiculous phrase that we use internally. And when we say ERP, it stands for enterprise resource Planning.Now, that doesn't mean anything, either. We all know what those three words mean individually, just not in that order. What we're talking about is we're talking about a set of tools within a system that helps you to manage workflow to help give you a single view of the customer, a single view of your business, where all your data is connected, regardless of whether it's customer or product, bills, and material, whatever those things might be.Having it all in one place so you can make better, faster, smarter decisions. That's what an ERP is. And it's designed to replace a whole myriad of different systems out there that many companies are using if you get it right.Lisa Ryan: Regarding manufacturing, which is the show's focus? What should leaders in a manufacturing company look for to implement an ERP system?Nick Foy: If I were a manufacturer, some of our clients are very much into light manufacturing but also very heavy manufacturing. I recommend that you don't look at it in isolation from a manufacturing perspective, what's happening left and right, up and down in the manufacturing space.What we mean by that is how did the manufacturing order get created. What did that happen in the first place? Is it? A sales order. How did that sales order get created? Did it come from CRM? You've had to look left of that process. Then you have to look right at that process. Once it's manufactured, what do I do with it? Do I put it into inventory? Am I managing that through lots of serial numbers? How do I ship that to customers, get it off the shelf, et cetera? And then we've had to look up and down. What we mean by up and down is then looking at things like how do we control things like versioning. How do we control the bill's material?How do we control things like PLM - product lifecycle management? How is all that controlled? And then there's the detail of the manufacturing process itself: how are work orders controlled on the floor? How do I get instructions to operators? How do I make things clearly and easily understood on the shop floor? How do I control quality maintenance, all that great stuff that goes along? Again, because we're talking about all those things, it's about more than just that core manufacturing part of the system. There are lots of inputs, there are lots about bots, and there's a lot of stuff up and down at that as well.As far as manufacturing's concerned, there are a lot of great standalone manufacturing systems out there. We know that. But you've got to ask yourself, does it do everything to the left and right and up and down of this process as well? If it doesn't, then you'll have a hard time in manufacturing.Lisa Ryan: There are probably some challenges you've observed in the manufacturing and industries you've dealt with. What are some common challenges, and how can an ERP system address them?Nick Foy: One of the, one of the biggest challenges we see from our clients and especially over the last few years with covid and supply chain issues, is, do I have everything on the floor ready for me to start my production process?That's one of our most common issues when starting this production run. Do I have all the raw materials I need where I need them? And again, that comes down to your inventory control, how you receive products, how you store products, and how do you pick for production. For example, I can start the job by ensuring everything is in place. And getting that visibility here are the jobs I can start and those I can't. Your system needs to give you that kind of insight into material readiness or component availability.There's nothing worse than starting a production when realizing a quarter of the way through you're missing a vital component and then having to scramble. You either have tons of work in progress now taking off the line, or you have to substitute something else that may not be as ideal as it could be.There's nothing worse than that. Certainly, the availability of components and ensuring that inventory shows that the start of manufacturing is one of the biggest challenges our clients have faced. I believe it is, especially over the last few years.Lisa Ryan: What are the most common mistakes manufacturers make in implementation?Nick Foy: One of the most common mistakes we see is going too complicated, too quickly. We see clients with multi-level bills and materials: sub-components, sub-assemblies, et cetera. We had a client who we've helped get out with some of that over the last couple of months. We had an eight-level bill of material. And the reality is that it needs to be simpler for them to manage. All those sub-assemblies are part of a sub-assembly, part of another sub-assembly. And the poor operator on the shop floor is just; they're clicking buttons on the ERP. It's taking longer than it did to create the product. That's when you know you're in trouble. When the operators spend more time pressing buttons than they make the thing, you've gone to the too complex and too low level and your bills of material.Lisa Ryan: How would they fix that if it was such a complicated process that they already have? How would they backtrack and get out of that?Nick Foy: It comes down to which ERP system you use or the manufacturing system you use. Our system of choice is DU and with DU manufacturing. Rather than just a blunt bill of material or sub-assembly process, you also have a lot of other tools that are available to you, such as we can create different work centers to help manage that complexity. We can also create operational steps within manufacturing that can replace some of the sub-assembly processes.So sometimes, it's about something other than dumbing things down. When I say about getting complex too soon, it's not about dumbing it down to say, let's have a single level and deal with everything offline. What it comes down to is you've got to use a myriad of tools available to you in your ERP to make the complex a lot more straightforward.And rather than just seeing Bill's material as that, a blunt tool to fix that. There are a lot of other things in your ERP that are available to you to help fix those situations. This is where using a partner like what we do here at Silverdale becomes vital for these companies. Trying to do this on your own is problematic because guess what? You don't know what you don't know, or you don't see how other people solve This same issue, having a partner that you can call and say, Hey, Here's a problem I'm having. What do you think? And we can talk you through it.We've got another client in a similar industry, hardware, with a similar challenge. Let us talk you through how we solved it for them and then set up a demo and a walkthrough and help the team to understand that it is an important part of what we do as a company and how would a company know if they weren't using an ERP system, how would they even figure out that, Hey, maybe this is something that I should look at or do things a different way that I'm doing.Lisa Ryan: What would be some telltale signs?Nick Foy: One of the very big telltale signs is a lack of visibility. If you have a sales team selling the product, they don't know the customer order status, especially when you've got custom-made products. I'm sitting in the car now. I've just finished another client who does one hundred percent of what they do is custom. Every single job, every single project is completely custom. Their problem was that the customer would call in and say, Hey, I'm just checking on the status of my order.The problem is that they would have to call the customer then back. I don't know its status; I need to know the material availability. I don't know what's going on in manufacturing. I don't know the scheduled date. I don't know the ship date. And they'd have to call that customer back.Now what they can do, Is immediately see, okay, yeah, great, I've got your order here. They call in, and we know who it is because of their telephone number. We can bring up their project and bring up the manufacturing order. We can see the status of the material and the scheduled date they're ready to do. Certainly, you are experiencing some of those types of issues. If you can't see the visibility of when things are happening or be able to answer those questions in a single contact or a single phone call with a client, then it's probably time to start doing that. If you've got a lot of work in progress. If you've got a lot of inventory and capital tied up in your whip, it's time to pick up the phone. As I like to say to people, implementing an ERP is never too early, but it's always too late. The best time to do your re-ERP implementation apart from today was yesterday. And it's never too early to start that journey.Lisa Ryan: A lot of the show focuses on the workforce and creating that type of workplace culture, and we know that nobody likes change. When implementing a system, how do you approach change management for organizations now, especially if there may be some employee resistance?Nick Foy: I don't know what you're talking about. That's what never happens. You never run into that. Of course, everybody buys into it right away. Everyone sees the panacea; everyone sees the oasis that we're selling. It's never an issue. Yeah, I've, of course, it's always an issue. The biggest way that we do that is spending time on site with the, not just with the client and not just in the boardroom. We spend very little time of our time in boardrooms. We spend a lot of our time on the shop floor understanding how things work today, but also explaining and showing and demonstrating what it will look like tomorrow.And I know, I don't know what you're like, Lisa, but I know what I'm like If someone came into my workplace and started moving things around on my desk, put the mouse on the other side, put the webcam, underneath the monitor instead of on top. I'm going to be pretty pissed at that, and I want people to explain to me what the hell a benefit of that is.I want the opportunity to have input. There's a famous saying, I can't remember who said it now, but I use that a lot, which is if you're going to change me, involve me. Okay. We're very big on being on the shop floor, showing people what's happening, and getting them to be part of that process as early as possible. This change is not something you can do to someone. Otherwise, it's a very negative experience. I am spending a lot of time on site, helping our clients with their change management process, creating that awareness, creating the desire from people on the shop floors. They say, oh, that's way better than these pieces of paper, or It's way better than me going to this whiteboard every five minutes to update the quantities, or whatever it might be.It is creating that sense of awareness and desire. Give them good training outside the conference room, because guess what? Nothing's done in a conference room. But doing a training on the shop floor, creating a training environment inviting four shop floor operators to come and press buttons. Not being afraid of pressing the buttons. It's got to be a big hurdle for people when they see buttons that say, okay, cancel. Delete. Oh my God, am I going to delete the whole system? Getting people used to pressing buttons in a safe environment and helping them understand, you're part of a bigger picture here.A lot is going left and right in what you're doing. And being on the shop floor during the go-live and the training and the support is incredibly important to be part of that team. We're very good at what we do. We spend much time engaging with the operators on the shop floor.You'll regularly see us there in our blue shirts, on the shop floor, answering questions, helping operators, and getting to know them individually. In a lot of cases, everyone is in change management. Everyone does this at an individual pace. And you have to engage with individuals when you do this sort of thing. This is not something you can do in-mas. There are lots of tools and tricks that we have up our sleeve to make that happen. But, it's it is quite a journey, but again, it's a very individualized journeyLisa Ryan: Do you have an example of a client that you worked with, like a before and after where the employees were fighting it, or they were just a mess, and y because of that process that you just shared, what the benefits were what the turnaround turned out to be to benefit that customer.Nick Foy: Yeah. Yeah. I've got a goa couple. We have a client down in Georgia. They are manufacturing. They're a print company. They're manufacturing a lot of letters, postcards, and various other things on demand for some big nationwide entities. We spent a lot of time on their shop floor. Before the ERP, they had another system on the shop floor, but it wasn't available to the operators. They weren't using it for real-time updates on production. They had a wad of paper that would follow the order all the way through, through the shop floor, to make sure everything was accurate.Now what we did is again, we spent a lot of time on that shop floor with the operator understanding, what they do today, how they do it today, and then showing them, for example, on an iPad, we put technology on the floor. We put some iPads on the floor that are not what they're now using to run their manufacturing operations.What was interesting was showing them how easy it was to use. And I'll tell you, this is a big revelation for me. This first time on the shop floor with that client was about a year and a half ago when we first did that, and that was a. a big epiphany for me because it was fresh out of Covid.We hadn't been on-site with clients for quite some time. And it was interesting that when we were on the shop floor, we gave them an iPad with a keyboard attached, thinking, okay, they're going to use that and do this. The first thing they did was touch the screen, and that was a big revelation for me that things have moved. People have shifted now to they're expecting to touch screens. They're not expecting keyboards and mouses on the shop floor anymore. The old ERP systems manufacturing shop floor systems were complicated and looked cumbersome.You asked the question earlier about how you know when it's time to look at an ERP or look for a new system. If you've got keyboards and a mouse on your shop floor, you should replace them. There's no place for a keyboard and a mouse on the shop floor. And if you find yourself having to do that, you've got the wrong system. Things have moved on over the last five years. And if that's what your operators have to use, then it will not be intuitive, especially for this new generation of workers who are very used to touchscreens, et cetera.This is a significant learning for me; it is that, wow, this world has moved on. That client spent a lot of time on the shop floor, getting them used to the workspace, also giving them some choice around, okay, where should we put this touchscreen? Should it be on the left? Should it be on the right? Should it be underneath? Should it be on top of here? And giving them some choice around their workspace as to, oh, that's the most convenient. Put it up here. Oh, great, fantastic. Let's put it here. It gives them this sense of involvement and part of that process.We're not just going to stick it there, and it's that weird angle they can't reach or use easily. Certainly, doing small things like that makes a big difference when implementing this type.Lisa Ryan: Yeah, and with Covid, the last couple of years, we've just, we've had no choice but to adapt to technology. Technology itself has changed to become much more user-friendly.Nick Foy: Yeah. The shop owners think they have an older workforce, and these guys will never buy into this. They're not going to do it. It's no. They are. And, as you said, it's an expectation.Lisa Ryan: I do the same thing. I immediately want to touch the computer, and it's like when people tell me, oh, you have to use the mouse. I'm like, what?Nick Foy: Oh, absolutely. Yeah. We call it the official price screen. If it doesn't look like Fisher-Price. If it doesn't look like something you get on a kid's toy, then people aren't going to like it because they want big buttons. They don't want it to be difficult to right-click on something to make it go to the

Connect with Vince:Website: https://3dspc.com/LinkedIn: https://www.linkedin.com/in/prodotrak/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce our guest today, Vince Sassano. Vince is the CEO of Strategic Performance Company, SPC. A leading provider of software and consulting services that enable manufacturers to increase throughput, grow profitability, and permanently improve workplace culture. One of my very favorite things to talk about. Vince, welcome to the show.Vince Sassano: Thank you for having me on.Lisa Ryan: Share with us about your background and what led you to do what you do with SPC.Vince Sassano: I am a degreed computer engineer and have been involved in manufacturing and consulting for over 30 years. Much of my experience with manufacturers came with installing and maintaining ERP systems. I owned a business with my partners on that. I subsequently sold that business and focused specifically on the plant floor because there was a tremendous need and an area where technology could help.This would've been back in the nineties when I did this. When I made that shift, I could utilize my technological talents in a lot better fashion, in conjunction with my consulting talents, and that's how it all started.Lisa Ryan: When it comes to workplace culture in manufacturing. Quality is a big thing, and we have to make sure that we're delivering on time supply chain, but workplace culture is the thing that makes it all happen. What do you think are some things manufacturers should do to improve their organizational culture?Vince Sassano: One of the first things they should do is review their organizational structure and see if they're just simply talking about the same issues over and over and not changing or are in a place where they can foster good communication from the frontline up to the front office.Lisa Ryan: How would they get started? If or how would they know that there's a problem?Vince Sassano: The simple answer there is data. You must have some information about what's happening; numbers are the best place to do it. I come from a culture long ago where the best way was what we used to call M B W A, which is management by walking around. The plant manager and the supervisors would walk out on the floor and look and see if they had a good or bad day based on stacks and piles and where they thought they ought to be. Then, at the end of the day, they would use just a gut feeling. Yeah, we had a good day. Yeah, we had a bad day. How do you know? How do you know unless you're performing some form of empirical measurement of what's happening?Lisa Ryan: Data, of course, is essential, but by walking around and seeing not only the piles but and looking at your employee's faces? Are they hiding from you when you're walking through the plant? Are they smiling and greeting you? So when it comes to workplace culture, that's still, even though we don't officially talk about it as much as we used to with the M B W A, it's still a critical component of assessing a company's workplace culture.Vince Sassano: I agree 100%. First and foremost, the people on the frontline want to matter, and they want to know that they matter. And if you have a culture that fosters that, then you have a better opportunity of not having that be a hindrance when it comes to performance. And you can see that when you are out on the floor, you can see it.I was told once by a management consultant when I read one of his books, and he said the best sign of a well-run plant is everybody walking around calmly. Because everybody's doing what they are supposed to be doing, and nobody's running around with their hair on fire. The best indication of a poorly run plant is everybody's running around like a chicken with their head cut off. They go from crisis to crisis. You can see your employee's faces. You can see if they're struggling. You can see if they're in crisis mode, and that will give you an indication of the fact that there's an issue there.But then you'll need to bring the data in to determine why this is happening and what we can do about it. Do we need more labor on the line? Do we need to change some machinery out? Is there a piece of machinery that's a real struggle? For example, from experience on the back end of the line, if there's a problem with the case taper or the case packer, which is usually the end of the line in many of the companies I work with, that's a struggle.That's just because that's the last thing they need working before they can palletize it and ship it off. And they are starting at the back end of the line and moving forward, looking at the employees and their actions. So that will be a significant indication of what's going on.Lisa Ryan: Also, make sure that you have current data. Because, as I like to say in my programs, we are staying in the good old days of 2019. After the pandemic, our priorities have changed, and that level of connection has changed. Everything has changed, and there's an expectation for things that in manufacturing we would've never thought about before - flexibility, shortened workdays, having shifts like the mom shift from 10 to two, and just making sure that you realize that data needs to be accurate and constantly talking to your employees to find out where they are and what resources they need. And I like that analogy of starting at the back of the line and working backward. Yeah.Vince Sassano: I can share with you that when it comes to cross-training, it was never more critical than during the Covid days. Having multifaceted people, you can move them around from line to line and from different parts of the line. And we have one of our customers who has a compensation program where one of the components is, "Are you useful and trained on multiple machines? Do you want to learn how to run this machine and run that machine?" That's the way the employees can then help control their destiny when it comes to that. If you think about it, manufacturing was the only industry with Covid that you can't mail in. How can you make your products remotely?Lisa Ryan: Exactly. You can't, no. And when it comes to cross-training, too, you think that you may have your employees in one part of the plant or an employee in one part of the plant, and when you cross-train that person in another plant, it lights them up. We discover that, hey, we have the right person on board, but maybe they're in the wrong seat on the bus, and it allows us to cater to that employee to find out what they're best at, what they like doing because we have a much better chance of keeping them that way.Vince Sassano: Yeah. And one of the big things we have as a corporate ethos and will never drop if I'm sitting in this chair is that people matter. People matter, and unless you have a fully automated line where stem to stern, it's a hundred percent robotics, your quality, and your efficiency, and everything is all computer generated. If you don't have that, then people will always matter. And quite frankly, that's the type of people we excel with and work best with because that's where the culture matters most. Because there is no culture with a machine, culture is people. And it's how people work together and interact.Lisa Ryan:  What are you seeing regarding some of the triggers from manufacturers when they need to consider a change or continuous improvement for their workplace culture?Vince Sassano: They're obviously feeling some pain, and they've had some event happen – a financial hiccup, loss of a key customer, some turnover, something has happened. That has given them a little bit of a kick in the pants. I can tell you a story about a prospect we were working with. They made all of the leather seats for John Deere. They had the exclusive, but it wasn't an exclusive contract. It was we've been working with these people for 35 years, and it turns out they had a problem with the machine and they had a problem with the operator. So through a series of events, they missed some shipments, which greatly affected John Deere.They said, listen, I hate to do this to you, but we cannot have you as our only supplier anymore. So we're going to have to take you out for bid. And boy, was that a wake-up call for them because they had been doing good for decades. And then, all of a sudden, they had a problem. They didn't have any backup provisions and ended up losing a significant portion of the business because, from John Deere's perspective, they could not afford that liability.Many people, especially in the manufacturing industry, don't necessarily think about what they will do if something goes wrong. But, especially when something has always gone right, that's not the case; contingencies are increasing, especially with the Covid situation. Contingencies are becoming increasingly important, so it's usually some event that happens.Lisa Ryan: We pay attention to things when it's either going well or something terrible has happened. But when things are just going along swimmingly and the day-to-day, we take that for granted instead of continuing to have those conversations and recognizing and acknowledging people for doing their job, doing it well, and keeping things running smoothly. When we get away from that, where it sounds like with that particular company, maybe they got a little lax or a little complacent because they'd had the business for so long that they assumed. They would have it forever, which only happens if you pay attention.Vince Sassano: They would've had it forever without a problem. Nothing would've changed. One of our customers does something that I like when it comes to this. This concept of weaving culture and technology and data and people, they always set on an annual and a quarterly basis, two things. One, they set a goal. For their productivity, they set a stretch goal, okay? And they say, okay, here's what we want you to hit. But if you hit that, here's what we want you to hit. And it helps combat complacency. And that's what you're talking about. You get stuck in the same old, same hole, and everything's running fine, and there's no incentive for what if we tweak the machine up a little bit?What if we get it going faster? What if we kick it up one bag a minute? Is everything going to blow up, or will we see any problems that come up? And having that stretch goal has encouraged me—the culture to continue to expand on an incremental basis. You're not trying to double your productivity in one day, but you are trying to say, okay, we've hit our goal for the quarter, the first four weeks in a row. What do we do now? Let's look at the stretch call. And I must commend the VP of management and the president of that company for coming up with that concept of being able to do that. Because then it gets you to know what your organization's limits are.Lisa Ryan: And then, how are they getting the buy-in from the people on the line? Because obviously, you want to meet your goals, and then there are the stretch goals, but there's got to be some reward for the employees or getting their input or doing something so that they still feel valued. So they are willing to put in that extra effort that we hear so much about the quiet quitters that don't. So what is this management team doing to get their employees excited about these stretch goals and meeting the regular goals?Vince Sassano: There are three different components to it. It's not every department. Most departments have a stretch goal, but for some, the first thing you do is educate. They educate the people on the front line about what management is trying to accomplish and how they're trying to accomplish it concerning meeting a particular goal. And then the second thing that they do is they give them access to information and data about how well they're doing. And what could they do to improve; what are the primary issues that are presenting or hindering them from being more productive?There's a communication that goes on there, so the employees feel part of the process because they're part of it. Then the third thing is they've implemented a pay-for-performance model in some areas of their company where the employee can see a direct benefit to wanting to reach the stretch goal. So, for example, reaching 85% efficiency on their line puts them at a level two employee with this particular pay scale. If they get to 90%, that might bump them up to level three. Okay? Now, productivity is not the only component. There's quality, safety, and cross-training; there are so many other components that they've added to that paper for the performance model.But still, the employee understands. What the important the importance of efficiency is and productivity to themselves? They get it. After all, they've bought into the system because they understand that education is the first step.Lisa Ryan: When they reach the goals, is a celebration a part of it? And how do they do that?Vince Sassano: Yes, the celebration happens on a shift by shift in a day by day and week-by-week basis. Because what they do is they take their information and they post it on the board. There you go. It's right there where all the employees walk into the locker room, and they can see all the productivity, efficiencies, downtimes, issues, and charts going up and down and sideways and all that kind of stuff.They make it very visible to the employees. In the meetings that they have, the daily production meetings, the weekly production meetings, and the monthly trend meetings, they talk about. The stuff that they post and what's going on. And it's in those meetings where the employees, and the dissemination of that information, feel part of the team; even if they're not in the meeting, they know their boss is in it. And then the boss says, hey, I just met with the shift supervisor or the plant manager, and he's happy about what we've been able to do on these lines with these products and let's keep it up. Good job. And by the way, here are some of the struggles that we've had, but here's what we're going to do about it. So it's a lot of open communication. But this communication can only happen because they're speaking a common language. And they must speak a common language.Lisa Ryan: That level of transparency you shared is so important because some companies think I want to keep my employees manageable. Or if things aren't going well, I don't want to scare them or whatever it is. But if they know that you are laying everything out and being transparent, good times, bad times, everything in between. Because if you go through a good time, things start getting bad. Your employees are much more likely to say what if we try this? What if we try this? Because it's like they know their jobs better than their managers know their jobs. When managers are transparent, it trickles down that employees are much more willing to share.Vince Sassano: Absolutely. When you've got people on the frontline daily, they know what's happening better than anybody else because they're there for their entire shift doing whatever task. And it's imperative that they feel that they matter and that information trickles down in that transparency. I agree a hundred percent is significant. I don't think information dissemination is not done because they're worried about overwhelming the employees. They can take on a lot more than people think they can. And you shouldn't limit somebody's capability based on the position that they're in. You should limit their capability based on what they're capable of.It's that stick factor that's more of an issue because the managers are afraid to share the information because they think the employees are going to feel they're going to get beat up with that information. So they don't share it. Or the employees are afraid that if they say what's going on, it will be a stick and that they will get beat up by it. That is a hurdle, but it can be overcome. Overcome, and you overcome that hurdle through education, but not just educating on the what? Educating on the why. Why are we doing this? What is it that we're trying to accomplish here? It's that type of transparency. That is a tremendous booster culture.Lisa Ryan: That's one way to ensure you are keeping your more tenured employees relevant. Because they understand the history, they understand the why, and it's up to them to share that passion with the newer people coming in that don't have that same level of history and background so that they can more fully understand the why. They have that same level of passion and passion that your more tenured employees have.Vince Sassano: I agree. And when the tenured employees are at their position, walking around, or in the lunchroom, they carry themselves differently because they know that they have achieved and earned a certain amount of status. They garner respect from management because they're instrumental, and they garner respect from their peers and the people that work on the line with them because these people know that this guy's been around in a while and he knows what he's doing. Exactly. That's where cross-training and information dissemination are essential.I'll tell you a short story. One of our customers had a problem with a can labeler, and they noticed through their information that it consistently ran better on the first shift than on the second. The first shift was 85, 90%. The second shift was down in the seventies. And I pointed that out on some of the reports, and I was like, why is that? I went to the guy on the line. And he was like, oh yeah, I developed this little technique that the machine sticks, and if I have a little bit of a ruler and when it sticks, I just poke it keeps things running smooth. The second shift guy needed to learn of that. I went to the manager, and I told him that, and the manager said that's an easy fix.I'll have the first shift guy stay late and the second shift guy comes early, and he can show him what he's doing. And that happened the next day. And when he showed what he was doing, the second chief guy said, " Oh my gosh, thank you so much. I have this problem all the time. I didn't know what to do. So it's those little nuggets of information that unless you have that culture that encourages that type of cross-communication or you have a reporting system that can point that stuff out where you can ask why that's when things can pay dividends.Lisa Ryan: Absolutely. I know you have a background in technology, so what are you seeing as far as using technology with change management to improve the organization's culture?Vince Sassano: What I'm seeing is that the more you can interweave technology with people, Not the opposite, which would be people with technology, the more

Connect with Peter MannLinkedIn: https://www.linkedin.com/in/peter-mann/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce our guest today, Peter Mann. Peter Mann is the CEO & Founder of Virginia-based Oransi, a leading air purification company known for its efficient, intuitive, and reliable products for consumers, schools, organizations, and businesses. He is the Chair of the Association of Home Appliance Manufacturers' Air Cleaner Council. Peter is late diagnosed autistic and now advocates for autism awareness in the workplace. Peter, welcome to the show.Peter Mann: Yeah, thanks, Lisa. I am excited to be here.Lisa Ryan: share a little about your background and what led you to do what you're doing with Oransi.Peter Mann: Sure. Yeah. I grew up in Syracuse, New York, and attended college in Rochester nearby. I didn't know what I wanted to do. So I took a Navy ROTC scholarship which effectively paid for my college. Then I was in the Navy for four years, which was interesting and unexpected since the first Gulf War started. We got sent over to the Middle East and didn't anticipate that.After four years, I got out; I got a job at a company called Tech Data in Clearwater, Florida. They're a large computer distributor. I was there for seven years. It was exciting because this was in the nineties, was the computer industry started to take off. We went from Fortune 500 to Fortune 100, and I moved up from an individual contributor to director of Marketing Operations.In 2000, Dell recruited me. I moved to Austin, Texas, and did some development work for dell.com, and then I moved to a marketing role where I was a marketing leader with the Dell printer launch, managed pricing strategy, and a few other things. That's when the.com bubble burst.I was at Dell for about three years, which pushed me to start something on my own. So I co-founded an e-commerce business with another guy in Austin. I sold my part in 2009 and used those proceeds to create Oransi, focusing on indoor air quality and, specifically, air purifiers. My interest in that was because my son suffered from asthma as a child. It was rough, especially in my younger years in elementary and middle school. So I've always been interested in trying to help him and others like him who suffered from respiratory issues.Lisa Ryan: It seems you do one thing, and suddenly, you join the military, and you're in the Gulf War. You go into the dot com industry, and the bubble bursts. You're on all these trends; air purification hits and a pandemic.Peter Mann: Yeah. Who knew? The pandemic was incredible because there was more demand in supply. What's been interesting is that many brands entered the market. It was more of a niche market before Covid; now, the market's gone back to more or less pre covid levels. But now there are two or three times as many brands as before. So it's going to be interesting. I would add that, during Covid, we merged with an electric motor company in Virginia that has a proprietary motor technology, which will allow us to restore manufacturing; that's where our focus is now.What's exciting about that is we can latch onto the next trend, electrification and moving away from fossil fuels now that we have this electric motor base. We're starting with air purifiers since that's what we know, but we could make anything with an electric motor in our facility. For me, that's pretty exciting since the air purifier market, as much as it is, it's painful to say, it's become more of a commodity since there are too many brands in the space for the market size currently.Lisa Ryan: You mentioned before the show that you were actively bringing this reshoring back from China to the United States because you can do that almost as cheaply as it was before with China. Talk a little about why that is happening and what restoring a business is like.Peter Mann: Yeah, I have to keep relearning this lesson because it always takes longer and costs more than you, you would think. From a cost standpoint, though, on the product, what we've realized is if you're buying components or raw materials, the cost is similar here versus in China; the difference is in labor. So we've been focused on how to take labor out of the manufacturing assembly of the products. Because if you can take the labor out and make it much more efficient, you can close the gap from a cost standpoint and may make it lower cost than you can from China.The other thing that's happening is these tariffs have been coming on, coming off. They're 25%, which is more significant than ocean freight. We got crazy expensive during Covid. So it's back to where it was pre covid. But that's another variable risk regarding sourcing from China in the longer term. We've talked to several companies, and there's interest in wanting to restore and not rely on manufacturing anything in China.Lisa Ryan: It sounds too that you're focusing on going from fossil fu fuels to more electricity and with that clean energy mission. Talk a little bit about that. Why is that important to you?Peter Mann: It's the right thing to do. It's the moment in time. I remember the nineties, and the computer industry was like that's all the momentum was. If you look at the government and where they're putting the funds in terms of chips, batteries, investments, several other efforts, and import tariffs. The focus is on how we make stuff here and how we make it here competitively. And you can fight it. But that's where all the momentum and the market's future are. Clean energy will be similar to what the computer industry was like in the nineties and early two-thousands.Lisa Ryan: I'd like to spend some time talking about your journey with autism. First, finding out, you said that you were late-stage diagnosed; what were some of the signs, first of all? Then I'd like to lead the conversation regarding potentially hiring workers with autism. We look at the fact that in the labor market, we need more people, particularly in manufacturing. We have a lot of people that can do a great job, but maybe due to fear or myths, or not knowing or not being educated as far as this group of people who may make great employees if you can share from diagnosis to what you've discovered and what you're sharing now.Peter Mann: This was something that figured out during Covid. My wife was watching a C B S morning show, and they did a profile on a woman that maybe worked for NASA, and she was describing her traits. It was a profile of her as an autistic person being successful in the workplace. When she told me her traits, it was exactly how I was. My wife watched it. She's, oh my gosh, you need to watch this. If I had gone back a couple of weeks before that, we would have had a conversation where she was upset about something that poured out her heart to me. I wasn't feeling great, and I had no response.It went from her being upset to What was wrong with you? You don't have human emotions. I have no words, as I had, my brain was empty, and you know, when she saw the C B S Morning show, you're like, oh, that explains a lot, okay. Yeah. I watched it, and I'm like, holy cow. That's right, I went online and took an online screening tool. What's pretty interesting is that one of the leading authorities in doing these kinds of assessments or research into autism is the disguise, Simon Baron Cohen. He's a cousin to Sasha Baron Cohen. He's a Cambridge professor anyways; he has these 50 questions, and in the assessment, you get a score from zero to 50. Most people score a 16, in the 18 kinds of range; autistic folks tend to score above 30. I took it, and I scored 43 out of 50. Then I took several others, and they were all consistent. I'm like, holy cow, I want to. Get an official diagnosis. I didn't want to be like, feel like a poser, like I was then. I didn't know I was autistic, and I didn't even know a lot about autism.I started calling the local autistic clinics or centers in this area. They're all geared towards children; then there's one. I live right by Virginia Tech, and there's one that is part of the campus, and they could do it, but they wouldn't be able to see me for a year and a half. I eventually found someone that did it via telehealth, and she's in Oregon. She did it because her husband was autistic, and she wanted to provide the service to other autistic folks, particularly underdiagnosed women. I worked with her for some months and officially got the diagnosis. Since then, I've been reading a lot and educating myself on what autism is. Even if it's not what most people think, it's a different way of thinking, perceiving, and communicating.Some co-occurring conditions may or may not be present, such as speech, cognition, A D H D, and a whole slew of other things. So there's essential autism, and then there are co-occurring conditions, which most people think of a lot of co-occurring conditions when they think of autism. That's not the core of what autism is. But you may have those conditions as well.Lisa Ryan: For somebody unfamiliar with it, what would be a good definition or examples or something they may need to know a little bit more about, be comfortable with what it is. Because we all have our ideas of what we think it is, but according to you, it's probably a lot different than what we believe.Peter Mann: A lot of it is having awareness for what's going on with the autistic person. It's that our brains are wired differently. I don't view it as it's been stigmatized as a defective person. It's more like a left-handed versus right-handed person. Your brain works differently. It's not that it's a bad thing. It's different than the way 98% of the people are wired. You're in the; you're in the 2% group. That routine is essential. But you have a routine because it helps you manage anxiety. People need to stick to routines to be simple. It's a way of being your best self.Another one that is widely prevalent with not understood is sensory sensitivity. We can discover disabling if you think of the senses, which most people find annoying. It's a level of intensity. If I go into a loud restaurant, I can hear all and none of the conversations. They're all like, if you think of Charlie Brown's teacher went to the wah wah wah. It's like they turned the volume up what allowed restaurants like me, and it becomes exhausting over a while of trying to hear conversations.It's like when you plug all the appliances in and blow the circuit breaker, and nothing's working, then why isn't Peter joining in the conversation? And you have no idea how hard this is in this situation. The environment drives a lot of it. When I talk to other people, they're like, nobody likes that. We speak louder it's because I don't have that natural ability. There are certain filters that people have that you could filter out, like other tables that are talking and listening to the person at your table.I don't have all those filters. I'm hearing our table's conversation two tables over, and they're all; it's like having people talking over each other is what it's like. It's exhausting. Do you tend not to put yourself in those situations to cope? That's another difference.The other thing I have, which is helpful in the workplace, is hyper-focus; they call it a state of flow. I can, get focused on something, block out everything around me, and have all these positive chemicals going. That's served me well in the workplace because I can sit for hours on something. I know sitting for that long is not healthy, but I can get completely lost in something and shift to a higher gear that I intuitively know most people don't have.Lisa Ryan: When you're in a loud restaurant, all the words are there, and you hear everything. But when you're in flow, you hear nothing because you're focused. Is that something that you can turn on and turn off? How do you get to flow at work and not in a restaurant?Peter Mann: Because at work, it's something, it's a singular thing that I'm interested in. I can focus on it and then, naturally, block everything out. The problem is if somebody comes and knocks on my door and says something, it's jarring. To come out of that state is a sleep state, but it's like you're being startled.When that happens and you can't, like in a restaurant, I can't get in a state of flow. Because I walk in, and it's woah. I can see the volume going up, and it's overwhelming. I've talked to people, and they're like, can't you get used to it? Or can't you and I'm like, to me, it's like touching a hot stove. It doesn't matter how often you feel it; it will burn. It's like there's no way around that. There's nothing anyone can do to help me in that situation other than not get into that situation. Don't touch the hot stove. My hand's not ever going to get used to it.Lisa Ryan: From a manufacturing standpoint, because on one side, some manufacturing plants are loud, and things are going on, you could get in that routine. Where are good jobs? If you're thinking of a manufacturer, in your experience in manufacturing, where would be some good places for manufacturers to consider hiring people with your skillset?Peter Mann: I guess what I would add is, I'm one person, and I described my experience, but it's like when they say autism, there's a massive spectrum of abilities. Some people have ADHD that I find are super creative in design—coming up with new things. Others have hyperfocus, but they can get distracted a little bit. Like me, I don't have a d c at all. I'm like all in on focus. So for me, it's like a process. If you look at Silicon Valley, they have a high percentage of autistic folks because computer programming is, you dialed in on the computer coding, and you get lost in that.You can have someone on the assembly line that's doing specific tasks. You can get focused. I can do things other people find boring if I'm interested. That's the key. It is an engineering, but if you look at the arts, creative people like David Byrne from Talking Heads are pretty open about being autistic.And it's different from the engineering computer traditional guy like I'm a math person. I'm like an autistic person. But other folks have different talents. It spans almost any job accounting. There isn't a limit to what folks can do. The challenge is most autistic people can't get through the interview process because if you come in, you don't make eye contact. It's like, this person's not trustworthy, or you get asked a question you have yet to think of. So we tend to be more bottom-up thinkers versus most people being top-down thinkers.When you ask a question, if it's something we haven't thought of before, we're going through all these options and details, then it's there can be like, I do this myself with some people, like an awkward pause because I'm thinking through like, how do I best answer that? And the other people, are you there?I get inward and have a lot going on internally, but my face shows nothing, and in an interview, it does. It could translate better. You're like, this guy's or girl is weird. I can't see them being part of our team, and it's unfortunate because these are some of the most like, hardworking, loyal people desperate to work. It's like the Ph.D. that's working at minimum wage. The unemployment numbers are crazy high, up to 80%. I don't know what the actual number is, but most autistic folks are average to above-average intelligence. The other thing is, I'm Gen X and grew up in the seventies and eighties.When I was in elementary school, one in 2,500 was diagnosed as being autistic. Now it's more than 2% more than as high as one in 36. It's not like autistic people didn't exist before; we weren't diagnosed. Unless you have very high support needs, anyone that is a later millennial will be late diagnosed autistic. Almost none of us were diagnosed. You think of how many hundreds of millions have gone through the public school system, trying to get jobs or being diagnosed with other things and not understanding that you're autistic. I don't think there's anything wrong with anyone that's autistic or different. It's, it's when you have most people one way, and it's this is the right way to be, and then you have a small group of people who are a different way. It's, oh no, you're. Yeah, you guys are wrong.Lisa Ryan: When it comes to workplace culture because again, there are many interesting points because we want people to get along, and we have this, this friendship, this relationship building, which is difficult for people who are on the spectrum because of what you said about not knowing how to get to those emotions or asking the question, having to spend more time processing questions that you've ever that you haven't heard before.One of my side hustles is teaching HR law on virtual programs about the ADA; in the interview process, it's not like you can have that conversation; do you have a disability? Because, of course, that would go against ADA. How could a manufacturer craft an interview? Is it sending out the questions before time? Is it give some ideas because, as you said, if I have somebody come in and I'm interviewing, and I don't know about autism, and you're not making eye contact, and you're staring off into space when I'm asking questions, I'm going to do that.Hey, this guy's going to be a bad fit. But if I have an awareness of that. He may, he or me, she may be an excellent employee and can do exactly what I want them to do. So we have to not only have an awareness from my standpoint but to share this with the rest of the people so that we can make those I don't even want to use the word accommodations, but that level of understanding that because this person is different doesn't mean that he's any less than anybody else on there.Peter Mann: Yeah, I would say, you know this, I don't know who said this, but I agree with it, is that autistic folks are more like the canary and the coal mine, and changes that you make to the benefit of the autistic person helps everyone if you're doing an interview what I've seen, which when I've talked with autistic people, they're blown away by, this is It's about setting expectations and having an understanding for what to expect.If there's an interview, give someone a document saying this is where you go. This is what time, this is who you're meeting, this is who they are, this is what you wear. These are the questions we're going to ask you. This is how your day will go for two hours. So someone can mentally prepare for that and see the questions relevant to the job they can think through, like, how do I best answer this? Because the person doing the interview wants to do the best job, but it's, The interview process is primarily set up for social extroverts, which is traditional, right?There's this invisible hierarchy. Autistic folks tend to be at the bottom of the social order. This levels the playing field. If you go to a meeting or something and you're like, this is the agenda or a meeting, and this is what to expect.For me, elementary school was a nightmare. Then when I got to sixth grade, I had a schedule. I knew where...

Connect with Renan DevillieresWebsite: https://www.oss.ventures/LinkedIn: https://www.linkedin.com/in/renan-devillieres/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. Our guest today is Renan Devillieres. Renan is the visionary Founder and CEO of OSS Ventures, who is dedicated to shaping the future of the manufacturing sector through startups and innovative solutions. With substantial operations, SaaS, and venture capital background, Renan is an inspiring leader committed to driving sustainability and fostering adaptability in the ever-evolving industrial landscape. Renan, welcome to the show.Renan Devillieres: Thank you for having me.Lisa Ryan: Please share your background and what led you to do what you're doing with OSS Ventures.Renan Devillieres: Sure. I'm 36, and I started my career as an operations guy. I was working in factories. I was a factory director and supply chain director. Then, I became the assistant director of Richmond Co., a luxury company. And I got to see the incredible world that produces physical things, and I loved it. And then, as I was always a geek, I started coding something in my bedroom and ended up creating a good tech company, leaving my job and ending up in San Francisco, setting my startup to Google, and having a lot of traction there.I discovered the world of tech. And when I sold my company and my shares in the company, I told myself the World of Tech is just incredible. I love operations. Let's bring those two worlds together. And as I had a bit of money, I chose the investor slash venture builder path.What we do at O US Ventures has been three years and a half. We either create or invest in startups technological startups that are exclusively helping the physical world, operations, retail, and those kinds of things. So we've been doing that for three years and a half. We are based in Paris, but we are all around the world. We created 15 companies. We live in a little over 1000 factories worldwide, and 350 people are working for all those awesome tech solutions for the manufacturing world.Lisa Ryan: You started by saying that you were 36 years old, and I know that in manufacturing, changing the conversation to attract younger people to it. What originally made you consider manufacturing an option and something you became passionate about?Renan Devillieres: It's a funny story. I come from a background where people need to learn what even a company is. And I was good at math. So I did the math, then opened Google, and I put a company most well-known for being good at doing business, and the number one result was McKinsey Company. So I applied to McKinsey Company, not knowing what it was, and I was recruited there. I'm very grateful because they taught me a lot about business. On my first day, they told us to choose orientations, and I ended up selecting operations because it sounded cool, and I wanted to do things with the physical world.I did not know what a factory was. I was just a fresh graduate knowing nothing, and I learned my job there. So the first time I went to a factory, I saw that incredibly complex web of people working and incredible speed-changing matter, and I said, okay, this is the dream. This is where I want to work for a lot of time because when you're a geek like me, and you like systems, and you're interested in those kinds of things, It's paradise to me.The two most interesting things you can think of, and work on are either a tech company or a factory because those two systems are incredibly complex, beautiful, and interesting.Lisa Ryan: It's nice to see with such an emphasis on tech, and I know we're going to be talking about AI and all of the new things that are coming into manufacturing, but just to be able to marry those two worlds. Because, again, it's changing that conversation to find people passionate about the physical world and the intricacies that go on with that. In your life, how do you see the future of manufacturing evolving? Particularly when looking at integrating new technologies and increasing automation in factories.Renan Devillieres: It's very interesting to see. I think manufacturing is just the result of two basic passes. First, what do people want, and what does society want? And the second is which technologies are available. And to those two questions, I answer very simply. People want a different social model. People do not want their products to be made by slaves in Bangladesh or China anymore. That has changed, and people would like to leave. Unbelievable planet. People want local things that are more respectful of the environment. Energy prices are high, everything. That's the forces.What is new in technology is that the steam engine and the electrical power automated everything manually and moving beats around. Now, we will automate everything repetitive and intellectual with computers and AI. And what I think is going to happen is that our production model, our factories will be different. They're going to be more local, more green, and more respect for the workers and more automation. So that's a big part of what operations are going to be. And there will be all new infrastructures, giga factories such as massive infrastructure models with billions and billions of capital.It's going to be taking all over manufacturing. And let me take two examples. When I was in California, I went to visit Tesla Freeman. In Tesla Freeman, you have nerds younger than me running around wearing t-shirts and programming machines with their Macintosh laptops. That is the future.Another glimpse of the future of manufacturing operations is a company that stopped sourcing in China. What they do is, as a customer, you pay every month, and you get clothes for your baby. And when your baby has grown, you give back the clothes, and they give you clothes of the right size. What they do is they repair all kinds of clothes, and it is very automated. It is very different. And they don't use materials anymore. They just repaired it. And it's very different as a system, but it's very green and profitable.Lisa Ryan: Wow, I never even heard of that. And we're going to talk a lot about startups and helping them scale, but if you have a legacy manufacturing plant doing things and all of this, you're speaking a foreign language to them; what do you mean? Mail ordering clothes, repairing them, and walking around in t-shirts and programming machines. So is there hope for legacy manufacturers, or is it best to start with a clean slate and have a startup?Renan Devillieres: Yes, there is hope, and I like to take an example, a very simple one: 30, 40 years ago, a little Japanese car company named Toyota invented a new way of organizing factories. They invented Lin, which was ridiculously different from everything everyone did then. Radically different, but it was 20 to 30 points better. And everybody started doing Lin. When you look at a high-level picture of what happens, it took 20 years. 25% of all the factories died because they were not competitive and could not transform themselves. But 75% made it on the other end. And with varying degrees of success, you can only go to a factory with a continuous improvement arm.And they do things, and they do daily meetings. It's going to be the same with tech. Tesla F is the new Toyota. That's the new blueprint, but there are 20 years in the future, and there is to, there is going to be a catch-up movement. It's going to take time. Some companies will die, but some will make it, and it will take time, not because of the tech but because of the people in the future.Lisa Ryan: Such a good point of just realizing that everything is changing and looking at asking questions that you may have never had to ask yourself before. Because business is changing, and as you said, there's going to be a certain percentage of those businesses that, if they don't change, will die.If they want to keep up that, then to explore when you're talking about your approach to identifying and supporting innovative manufacturing startups, you have the small company. So how do you help them scale?Renan Devillieres: We have a very particular method of doing that. First, you need to address a widely available pain point to scale. So I have a 20% team each week. My team visits three and four factories all over Europe, and they ask people like, what are your pain points? What needs to be sold? How much money do you have to solve it? Is it in your top three? And we only work on what we call a burning platform.Like burning hair issues, nice-to-haves are not candidates. That's the first part of the answer. The second part of the answer is that we don't invest in startups or create startups where implementation time is more than two weeks per factory. This rules out 90% of the startups that we are seeing.Of course, you can create a company with six-month or 12 months implementation cycles. Yes, can you scale That? It seems too hard for me. And we only invest in startups that are doing that. So the third thing that we do to help them scale is very simple. We created a platform, and that platform shares technical components to be able to connect to the top 15 ERPs in factories instantly.And that platform shares the contacts of all the innovation-friendly European factories and us. And when you enter the USS community as a startup, you get access to roughly 250 companies—accounting for 1000 factories already deployed on the SS network. And by combining those three factors, our startups achieve consistent 300-person growth year, the average in Repository.Lisa Ryan: I think the lesson that anybody listening to this show can take from you is going around and asking employees about their pain points and acting. On the most critical, those burning issues because there are many times that we think we know what the employees are doing, where they know their job better than we know their job.And when employees see that you're listening to them, there's a much better chance that they will be engaged and committed and help in the process. So true. You mentioned this several times regarding the importance of caring for the planet. What are some of the key strategies that companies can implement to become more environmentally responsible?Renan Devillieres:  I can tell you what I've seen starting to get a lot of traction. It's an ongoing issue. Everybody's speaking about it. We'll see. It's a continuous development, but we've seen first improving processes and improving your footprints on the planet. A consistent thing we have seen is that leaders in being positive for the planet are leaders in performance. There is no anti-correlation. That's the first. The second thing that we have seen is that focusing on the value that you can bring to your customer and then trying to perform that value in a very lean way in terms of the effort and the materials, and the footprint that you have on the planet can lead to incredible results.Let me take an example. One of our customers is Michelin, the tire maker; I love it. I love them. I love all my clients, Michelin. They have a factory producing 40% fewer tires and making 40% more money. And they do that by putting a chip in the tire and selling kilometers or miles for you, us people, to their clients.And they say, I, this is a price per mile. You only pay for the miles that you do. By doing that, they can start improving the lifetime of the tire. They're incentivized. To do less and fewer tires, and they'll get more and more money by producing fewer and fewer tires. And their engineers started working not on improving processes to do more tires per hour, but more kilometers per euro, which is different because you're not optimizing for the same thing.It can help you optimize for the right thing, which is the value, not the object. And what we see a lot of shifts from optimizing for the objects you're producing, which is sub-efficient. You stop doing that, and you optimize the value you create for your clients. And you can reduce the items, increase the value, and take more money.Lisa Ryan: Yeah, that gets into that quality versus quantity conversation. And it's also; you're making fewer tires, you're going to have less waste because you're getting more kilometers/miles for each product sold. So what an interesting way of looking at the things we know are the right thing to do, but when you put dollars behind it, it makes a little bit easier conversation.Renan Devillieres: Of course. Let me take another example. We are working with some of the suppliers of Apple. Apple created the machine. The machine's name is Julia, and what is the machine doing? You can take any iPhone and put it in the machine, and the machine can take any iPhone apart, change components, and put them in little boxes. You can reuse those components for the next generation of iPhones. Their goal for the next generation of iPhones is to have at least 50% of all the value reused in the following phones. When you do that, you reuse the stress on the planets per iPhone and increase the dollars per iPhone.Lisa Ryan: Wow. And people feel better about buying iPhones because they know they are getting products made of 50% recycled material and have less of a negative impact on the planet.Renan Devillieres: Precisely. And for the listeners, if you want to put on YouTube, you put on YouTube Apple Machine, iPhones, and you'll get a video of the machine. It's incredible.Lisa Ryan: We spoke about a little bit, but what do you think about artificial intelligence and machine learning regarding the future of manufacturing? And if you still need to get there, how can companies prepare for these advancements in both?Renan Devillieres: artificial intelligence is both over-hyped and under-hyped. We are overhyping what it will do in the short term and under hyping what it'll do five to 10 years from now. Five to 10 years from now, I'm a former artificial intelligence researcher, and 30 to 40% of all intellectual jobs we're doing will be automated.By AI, if it's intellectual and it's repetitive, it can be automated that will happen. And for example, in manufacturing, and designing new parts, there is already a lot of generative AI and putting a new program in a robot. It's very repetitive. And there is already there is a Stanford startup that is coming from you. Just type a sentence, take the red thing, do a quarter rotation, and put it in the box, and the robot does it.This is going to happen for sure. And it'll take time. And you ask the question, as a manufacturer, what can I do for it? In the artificial intelligence age, your edge is your data and ability to implement fast. With the new technologies on those two fronts, manufacturers are historically bad. 70% of all the data in ERPs and systems are not usable for artificial intelligence because of the data structure, bad data, and because they need more data. As a manufacturer, having good data hygiene and having some nodes and data scientists is an excellent first step. And then the second, when you look, Tesla or SpaceX, or B Y D be your dream is the number one car, an electric car manufacturer in the world. It's a Chinese company. They have data scientists who change the production process every three or six months. Having agility helps you as a manufacturer use the new technologies because if you change your process every six years, then at best, you'll be three years outdated. When technology paces of change go from five to 10 years to one to two years, your frequency of changing your processes has to go down. You have to be more agile, and this is something that manufacturers have historically been bad ads. Let me take basics as an example.SpaceX is launching a new rocket every three to four months. And each rocket is a new version. Building upon the learnings of the last rocket today, no space company could have the path. The best space company's path was one to two years between each launch; they're bringing that down to freaking four months. The versioning of the cars is once every six months. And increasing the pace of change to embed those learnings and those new technologies is essential to surviving that next normal.Lisa Ryan: That is undoubtedly one of the significant challenges that are facing manufacturing today. What would you say would be other significant challenges that manufacturers are dealing with, and how do you think startups can help address these issues?Renan Devillieres: Number one, talent for sure, like number one. If you look at another vertical, another market, retail. Retail. When Amazon came, they were bad at the internet. They were bad at marketplaces. They were terrible at all—that new stuff. And there was a first wave where they said, ah, it's not going to happen. Denial manufacturers a lot of manufacturers are in denial right now. Still, in retail, after that, Amazon became dominant, and when Amazon became dominant, they morphed, and they had to hire talents from startups from the tech world.From those new companies to increase the pace of change, change the culture, and modify the systems. And in manufacturing today, for example, decathlon, an excellent sportswear brand, they are new. C e o comes from Google. Wow, it's a freaking manufacturing textile company. Steel is from that new layer of talent, bringing a new set of crypto technology processes; the pace will change the manufacturing world. But the challenge is getting them on board, retaining them, and giving them the keys to change the crypto. But that's going to happen out of all of this.Lisa Ryan: As we end our time together, what would be your best tip to a manufacturer listening today? And let's say that they are not necessarily a startup but want to make some of these changes. What would you advise?Renan Devillieres: A very simple thing. Get your hands dirty in one big issue that you have at your factory, and be open and say, okay, what if I could solve this with tech and start small, have big ambitions and scale fast for that problem, and then do one another, and then do another, and then do another and exponential change comes from rapid scaling of good local solutions, gone global.Lisa Ryan: And how do you work with your clients? How would somebody listening today know they should schedule a conversation with you? How can you help?Renan Devillieres: Two things that we do. The first thing is if any manufacturer in the world has an issue or something they want to talk about, they can book a call with someone from my team, and they will say either, look, we have our database, 100 manufacturers like you. They all had the same issue, and here is how they dealt with it.That's the first type, the second type of answer; we have more than thousands of...

Connect with Tom Pierce:Email: Tom@i2s.usWebsite: https://i2s.us/LinkedIn: https://www.linkedin.com/in/tom-pierce-6799b356/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce today's guest, Tom Pierce. Tom is the President of Integrated Information Systems with decades of experience; Tom brings a unique perspective to solving complex problems in integrated business planning, cost and schedule analysis, and cross-functional collaboration.His ability to combine human intelligence with innovative software solutions makes him an invaluable resource for those in the manufacturing sector seeking to improve efficiency, streamline operations, and drive sustainable growth. So Tom, welcome to the show.Tom Pierce: Thank you so much, Lisa. It's a pleasure to be with you.Lisa Ryan: Share a little about your background and what led you to do what you're doing now with integrated information systems.Tom Pierce: Certainly. I'll cover the mountain peaks. I took my one and only one computer course in seventh grade. That would've been about 1972. After that, I never took another course. I was self-taught and was fascinated with how computers and technology can help solve problems. It was a side interest for a very long time. Then, I went to college on an Army ROTC scholarship. On my first day of reporting for duty, they plucked me out, seeing my math major, knowing that I loved computers.I was on an analysis team and did simulation modeling for the Army missile maintenance, ammunition, and logistics. After I left the Army, I started working for a defense contractor, developing logistics models for the Army. From there, they put me in with a defense manufacturing facility in Louisville, where I help install an MRP system.That was over 30 years ago, and I'm still helping maintain that MRP system through all its variations and improvements. Seven years in, I quit working for the defense contractor and went out on my own Because I didn't like how my employer treated my people or clients. So I hung my shingle, and we've been in business and will have our 30th anniversary this summer. We have loved supporting everything about the manufacturing and finance piece within the defense industry and a significant client, a major defense contractor. I've been blessed to fall in with many subject matter experts that have guided my career. I was a programmer/analyst. I live on the slash. I am naturally an analyst who knows how to program, so I got bilingual that way. It is a huge opportunity to be embedded with the people who use the software I've written and some of the software I analyze and critique.Lisa Ryan: Right off the bat, you brought up an interesting point. You left one employer because of how they treated you and your people. You don't have to go into immense detail, but what were some of the biggest mistakes they made that caused you to leave? And then how are you turning that around for your employees to create a workplace culture that keeps them?Tom Pierce: Thank you for asking that. That's one of the most important things about what it means to be in business for me. Anecdotally, during one of the most critical demonstrations we had been developing for two years, we fried a computer getting ready to do a demonstration for a room full of 300 Army generals.One of my newest employees came to work for me from Toys-R-US. He was brilliant but could have made a better impression. He volunteered his brand new 486. Another one of my employees drove it down for five hours so we could use it, and we could use it, but we fried his monitor.The employer refused to reimburse him for the monitor we fried. Later on, I was denied a request to give my employees raises. I was denied permission to throw them a Christmas party; a stellar recommendation would produce a 2% raise that the bonuses were in the range of, maybe enough to buy a new suit. The words and deeds didn't match. The final straw was when it was time to renew the contract with our Navy customer. They raised their rates tremendously because they knew the Navy had become dependent on us in that area, creating a tremendous amount of stress, budget, personnel, all that kind of stress that I didn't need to deal with.So I undercut them by 40% and won that contract away from them. As a result, I retained many critical people, and employee retention, family, and team building have been a massive part of our success.Lisa Ryan: It sounds like they were, picking up pennies and leaping over dollars because a little bit bigger raises the price of replacing that monitor or the monitor. It's not like they even had to give 20% raises. But how much money did they lose to make employees feel valued because they didn't do these little things well? And in a market where it's so important to find people and then treat them well enough so that they stay. People need to realize that it's not all about the money. Money plays a part in it, and sometimes you've got to spend a little money to save a lot.Tom Pierce: One of the most authentic expressions of appreciation; put your money where your mouth is. But there are undoubtedly many ways; they need to be consistent. The money, words, and behavior must match your value to the people doing the work.Lisa Ryan: You and I were talking a before the show. Not only do you have military experience, but you talked about, but you have a pastoral ministry, then you have the application software. How have these experiences shaped your approach to solving complex problems that the manufacturing industry is dealing with?Tom Pierce: I used to think I suffered from a dissociative identity disorder or something like that. I have a hat rack with many different hats, but in recent years, they've emerged more. I've started to see how even the seminary education, I'm only half joking when I tell people that what I learned in seminary is more applicable to business than it ever was to church ministry. The problems are not dissimilar. The difficulties of trying to get people to work together well, whether they're volunteer or paid, whether they're clients or employees - the human dynamics. I understand you have a bit of background or emotional intelligence yourself.There's a full range of human experience, whether you are talking about a military commander leading men into battle, men and women into battle, or a manufacturing facility, trying to go cross-functional skill sets and make sure everybody's collaborating or building a small business and keeping the team together, the human dynamics of understanding the value that each person brings to the table and how to pair them up. There's even a little bit of musical background. I was also a choir director, so getting the tenors, the basses, the sopranos, the altos, the drummers, and the guitars to all come in at the right time, and it's not unison, right?It's the harmony that you're seeking. That's been a huge part of my experience. And lo and behold, it turns out computers have the same problem. Getting computers to communicate well with each other and to feed helpful information, manufacturing is an incredibly complex endeavor. Even the most straightforward small firms get all the functions, even speaking the same language. Here's a small anecdote. While I was pastoring at one time, I was pastoring three different churches simultaneously, three different denominations. The old saying of trying to get everybody singing out of the same hymnal was a real logistical challenge for me. It's not the dark red one; it's the right one, red today.The human and computers, that true integration of shared information, shared intelligence and shared understanding applies to humans and computers equally well.Lisa Ryan: It gives you the background because I often don't want to make a broad statement in IT and to work with computers, but it's not a position that screams human connection. Bring that combination of realizing that using your pastoral background to connect with people. See them as human beings and acknowledge their excellent work, making them want to work harder for you.Tom Pierce: Absolutely. There's a surprising amount of overlap between counseling and consulting. You're advising people, seeking truth, and sharing wisdom in every way possible. It's a very similar field.Lisa Ryan: Absolutely. In your experience, what are some of the most common challenges faced by operations and supply chain managers in the manufacturing sector?Tom Pierce: I hate to oversimplify it, but to start with, I'll use the simple word gap. There are enormous gaps that are naturally forming, like an entropy thing. People are incentivized to make their bosses happy. If you're in a stove pipe organization, your supply chain people will be focused on what the vice president of the supply chain wants. Your operations people are going to be, and if there are good relationships or good collaboration at the highest levels, you end up with an entirely cohesive organizational structure. Sometimes they lean too heavily on software to solve other problems. We can get everybody to use the same software system. That'll solve all our problems. It doesn't be because they don't understand each other's language.They don't develop trust, and the digital insertion in communication between humans makes trust more difficult to establish. It's harder to develop a trusting relationship with somebody you know only through email, Twitter, Facebook, or whatever than it is to sit in a room, talk, and collaborate. Some of the most valuable conversations in a business happen in the parking lots and in the hallways when people are reading body language, expressing full life implications of decisions, and collaborating holistically with each other. So you've got massive gaps between finance and production.There's even a war between what you used in the introduction, the integrated business planning. Wait a minute, is that the same thing as sales and operations planning, or one led by finance? One led by production. Oh, do we need both? And supply and operations often fight with each other. Why don't we have the parts we need? Because you needed to order them sooner. You didn't give the specs. Quality lives on its island many times, so trying to get functional people incentivized to collaborate. People don't typically get bonuses. The results show good relationships with the other functions at the team level.Lisa Ryan: If a person listening to this realizes that their communication strategies aren't that good and they need to integrate more collaboration between departments or people, what would be an excellent way to get the conversation started?Tom Pierce: One of the simplest things that my son, who's worked for me for 15 years, Alex, added an innovation that I undervalued first and came to appreciate later. He started putting collaboration notes in every report. So if somebody from the supply chain gets a report, they can comment on it and save it. And that same note gets replicated to anybody looking for information about that appeal in line.And he has expanded the use of collaboration notes, which has, in turn, sparked more phone calls and more text messages. We'll be in conference room settings and workshops, not reporting the status of an issue. But seeing what somebody has written in the notes, picking up the phone, writing an email, or setting up a side meeting immediately solves the problem before it has to be reported on getting that rhythm.Most organizations are not set up to solve problems; they're set up to report them. And if you can get the momentum moving in the other direction where the purpose of the meeting is to solve problems, then you don't have to worry about the plan of action and milestones and whether the due date was met; solve it so that genuine working relationship.Lisa Ryan: Are these collaboration notes a part of the software? Like when you were talking, I was thinking like people using Google Docs where everybody can go in and do the same, see the same notes when people are editing it.Tom Pierce: That's the same basic idea, but Alex incorporated that, and pretty much every report and Excel is very commonly used, even for the people that hate Excel. He figured out the technology and the techniques to embed the collaboration notes in the Excel report. So you may be reading a report, but you can go in and type in save the note. The following person who opens the report sees the note saved in a shared database, but all the reports are integrated. You know the name of the company. We integrate the information systems so that the information is shared, and it's not meant to replace human face-to-face voice sharing. It's intended to facilitate it. I see here that you made this note. Can you tell me more?Lisa Ryan: What are some other best practices for successfully implementing ERP systems in manufacturing businesses to help them to streamline their operations and improve efficiency?Tom Pierce: Similar answer but a completely different angle on it. I've been a part of multiple ERP implementations, one at the beginning of my career and several SAP implementations. The classic approach is, by nature, fragmented. Let's get all the supply chain people over here. Let's get all the production control people over here, all the finance people over here. And to try to speed up the process, they think what they're doing is dividing and conquering. But in any organization, some essential lynchpin kinds of people function as translators between those functional areas, and those people can't be in both meetings. So you need to add your schedules to allow the people focused on a particular functional area to talk to each other. Have somebody from procurement in there. When talking to quality people, have somebody from protection in there. When you're talking to the finance people because they, the fragmentation of large organizations is one of the biggest rings. It is a sink of efficiency, motivation, and morale. It's a communication breakdown from the GetGo to the implementation process itself. They tend to fragment people. So try to get everybody involved at the same time. It might slow your schedule, but it pays off in the long term.There are no surprises when everybody brings out their little separate hymnals. They're talking to each other, and they're pro potentially building relationships, which leads to friendships, which leads to them not leaving the organization willingly. One of the astounding, I can't quote the exact number, but there's an astounding number of people that leave the company; I remember I was like 30%. In a typical ERP implementation, 30% of the people will leave. Wow. Because the implementation process itself is so exhausting and straining on relationships, time and budget pressure, and everything else. And the people who leave first are the people that find the next job easiest, which tend to be your best people.Lisa Ryan: Especially in the last three years, we've seen that people are making different choices with the pandemic. If they are miserable at their job, they're like, you know what it is? Life is way too short to stay somewhere I'm miserable. So that's how we start losing, keep losing our people.Tom Pierce: Exactly. And the work-from-home phenomenon opened that door. I can sit here at my desk, and I've got a client in Mississippi that I'll be supporting for the next three weeks. I don't have to go; I used to drive to Mississippi once every month for ten years. I don't have to drive anymore. I can do everything from here that I could do Then, which opens the door for employees. It's more of an employee's market now.Lisa Ryan. That leads us to the role of technology evolving in the manufacturing industry. How do you see that working in automation, data analysis, and integration with legacy systems?Tom Pierce: Absolutely. I love the way you asked that because when I first started my business and chose the name, the problem was this new thing that appeared called a pc. Everybody wanted to use their PC, Windows, and Word Perfect document to create work instructions, but their PC couldn't talk to the MRP system's mainframe. One of the first innovations we built was the communication between the PC and the mainframe. The legacy system, integrating with the new technology, was the reason I called my company what I did 30 years ago. I thought it was temporary until Windows took over; I was wrong. Getting the computers to talk to each other has an equal emphasis on the people working together.They go hand in hand. I've been fascinated with this latest surge of interest in AI, the chat GBT and everything. I see instructions advising people how to talk to your AI here. Here's a set of prompts you can use, and it reminds me of what it's like I've got six grandchildren, and so they're all four and under. You learn how to talk to your grandchild, and your grandchild learns how to communicate with you in two different ways. Dynamic, and it's funny. My four-year-old Christopher did not speak at a very young age, but he managed to express himself and communicate with body language and to point, and the first word he used commonly when we were out for a walk was way, yeah, I want to go that way, and he would point.We teach each other how to communicate. We've got the same problem with people when Google was new. People had to learn how to talk to Google. How do I ask my questions to get the answers I want? That will continue to happen, but it will explode if you don't know how to talk to, communicate with, and convey what you want to this automated device. I joke with people that I'll believe AI is here for good when Alexa knows I'm mad at her. And she doesn't; she annoys me sometimes and doesn't pick up on the signal that I'm annoyed. But what I'm worried about is what happens when Alexa gets mad at me. That's a different problem, but emotional intelligence will find its way into our relationship with technology. You probably need to be older to remember, but it wasn't long after the PC boom that people threw their computers out the window in sheer frustration. It was the blue screens of death from the old days. They keep changing what happens when the computer freezes. But all of us get frustrated in working with technology. Technology is great when it works. We're going to have to interact with it more and more.We're going to have to develop the soft skills of interacting. And if you are okay with me elaborating, one more stretch on that. I used to think of it as a humorous point; I'm not treating it more seriously. I'm a huge fan of automation. I hate asking people to do tedious work that the computer can do. So you'd come up with this whole flow chart of how this process feeds that process while you're asleep, and then people started saying, wait a...

Connect with Jonathan:LinkedIn: https://www.linkedin.com/in/jonathanpporter/Website: https://www.porterlogic.com/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce our guest today, Jonathan Porter. Jonathan Porter, a renowned supply chain professional, is the founder and CEO of PorterLogic, the supply chain stack for ambitious brands. As a Georgia Tech alumnus, Jonathan's warehouse management and industrial engineering expertise allow him to help businesses navigate supply chain and inventory complexities and achieve their full potential. Jonathan, welcome to the show. Jonathan Porter: Thanks so much. I'm excited to be here. Lisa Ryan: Share a little about your background and what led you to do what you're doing with Porter Logic. Jonathan Porter: Sure. I started my career at Manhattan Associates, which is probably the top w m s provider in warehouse software. I spent five or six years implementing warehouse management systems, so I got immersed in detail with supply chain and warehousing. But I just found it fascinating. Honestly, warehouses are some of the coolest things.So many processes must come together for that box you ordered online to show up at your door. And so many people need to understand how much goes into modern e-commerce. So yeah, I saw a lot of opportunities for efficiency improvements and ways to improve things.I started the company coming up on about three years ago. But I came from a super entrepreneurial background and knew I would always do something. Of course, I had side businesses in high school and all that. But yeah, the timing was right, and the market opportunity was there, and we are excited to be doing what you're, what we're doing.Lisa Ryan: It is fascinating. From a consumer standpoint, I drive by some of these huge Amazon warehouses in my area and wonder. How do they find the coffee I order can be there within a couple of hours if I order within the next 31 minutes? Jonathan Porter: Yeah. It sometimes floors me what folks like Amazon and others are doing. Yeah, you can order in the morning and get it delivered a couple of hours later, which we used to think two-day delivery was remarkable. But no, now they're, like I said, Amazon and others, but many people are pushing the bar even higher.Lisa Ryan: It was interesting, too, of the subject, but I was in the car with an Uber driver the other day. And Amazon has an Uber-type app for their drivers for delivery. We are seeing so many changes that even a couple of years ago, we would've never in a million years thought about using people in their cars instead of our beautiful company trucks to deliver products and get them there that quickly.Jonathan Porter: Yeah, no, it's fantastic to see, but simultaneously, it's incredible that the technology is powering much of this, right? You could only do this with a lot of the underlying technology that's powering somebody to log onto an app and receive a task to do a delivery. And it just routes them directly to where to pick it up and where to put it out.And that all has to seamlessly integrate with the warehouse management system and your order management. And it's just this orchestration of a lot of data moving back and forth that then is powering this consumer experience that, most people I've just mentioned, like most people, don't realize what's going on.You order something, you click to buy, and you're mad. Now if it shows up two days later, you expect one day. But yeah. And. The number of people has ended up touching that box. It must go from a warehouse to a truck, train, or ship to another warehouse.It is a; it's amazing what's going on in the background, and in a lot of ways, we now see the pandemic has shown us just how critical the supply chain is. Everybody realized very concretely we couldn't get toilet paper; we couldn't get proteins in the grocery store. And it's now.Very much in the limelight or very much in the foreground. The supply chain is critical, and the technology is critical. Lisa Ryan: Oh. How do you see the role of digital transformation in advanced technologies like IoT and AI impacting the supply chain? Jonathan Porter: Sure. I'll be the first to say that I was a naysayer on AI until ChatGPT, as much as I hate to say that I'm a technology person. I've coded most of our products, and even I was saying, oh, AI's way overhyped. So, yes, there's maybe something there, but I. We've seen it happen with several technologies in the past where people say they're going to change the world. Blockchain's a great example. And then, there are some interesting use cases around blockchain. Don't, no doubt. But it has yet to have this profound impact outside of crypto and that industry. But AI and things that are happening with generative AI are transforming the way that we do business.A lot of, even our marketing materials, right? We're using chat g p T to at least write a draft. There's still usually a human layer that interacts, but it's just. It's enabling things to happen much quicker and much faster. And then, especially, you layer that into the supply chain. There are just so many untold efficiencies that are coming out of automating things that people previously did.IOT's also interesting when you get into the supply chain on the transportation and warehousing sides. Things like temperature sensors have been around for a long time. Companies are now starting to make those enabled to communicate with other systems. That's interesting.But also things like pallet tracking, so in specifically in a warehouse, having digitally enabled pallets that know where they're moving, instead of people having to go and scan a pallet off, tell the system it's in a particular rack location, or instead of a conveyor having to constantly scan goods as they go around.You can now have connected pallets and connected chips that go onto pallets so that you know where those are at all times. A plethora of use cases have started emerging because of things like 5G that's enabling connectivity in places we didn't have before.So it's several factors that are coming together. AI is one of the most exciting. Flashy ones come to the front, but it's taking multiple technologies all coming up simultaneously to work in concert. That's then empowering some of these new digital transformation initiatives.Lisa Ryan: And just the speed of technology. I remember when Google started coming out, and we're like, oh my God. Ask a question, and we can find the answer. And then when one of my friends got G Ps for his car, the time and the car was talking to us, and now that, just within the last couple months with chat G P T. One of my friends was like let's ask it to write this, whatever it is. And yeah, we have the human to it, but you're no longer; you no longer have to look at a blank piece of paper. So yeah, you can have something that gives you that head start. And so the user-friendliness of technology is what's helping people to get over their fears and try things that, even a couple of years ago, we would've never, ever thought that we could do as much as we're doing. Jonathan Porter: Yeah, it's outstanding you say that. I was reading an article recently from somebody at OpenAI. It might have been Sam Altman. They're like c e o, but somebody was talking about how they had the actual model and underlying technology for a long time, but then they had to put a lot of forethought into the user interface.What would it look like for a person to interact with this technology? And that's part of why chatGPT has explicitly catapulted. There are a number of these AI projects going on. Several generative ai or companies are doing AI art and all kind of stuff, but that person and where the person interacts with the software and the technology is critical. And it's also part of why so many people fear AI taking over the world. And I don't think it will take over in many ways people expect because there will always need to be some human input.That point at which humans interact may change. As a result, we may have to learn how to work with technology differently or in a different capacity. But at the same time, it will take a while for an AI to fully replace that human decision-making or input.Lisa Ryan: What are some of the strategies that you see that manufacturers can implement to ensure seamless end-to-end visibility throughout their supply chain? Jonathan Porter: Great question. Visibility is interesting, especially over the last few years, because visibility first meant knowing what was in your warehouse. That was step one, right? Or knowing what was in your supply chain. We saw, though, over the last couple of years what happens when there are disruptions farther upstream. And now, the conversation is about tier two and three supplier visibility. Not only just seeing what you have, but what your suppliers have, what have they, and what their demand even look like, right?Will they be able to fulfill your demand given everything else they have going on? You see some interesting things happening with predictive. Say you have a supplier in an area of the world where an earthquake just hit, and some systems can monitor things like news outputs and start giving you predictive alerts around.If a supplier is going offline soon, you should redirect some of your demand. And it's, it all comes back to visibility, though. And what we mean there is just pulling data into one place. It's as simple as that. So you need something that's going to pull that together.You'll hear words like control tower specific; it's talking specifically. A control tower is often a system that will sit on top of your and other systems to pull data together. You can build control towers with tools like Power BI or Tableau; that's just a system to pull data together and do some aggregation.So then you can see whether it's in a dashboard or something visual. Okay, here's all my inventory; here's inventory that's in other places. Here's inventory that's on the water, right? You may be pulling in container data or something to see what's on a vessel, what's at a port.Being able to paint that whole picture is an important piece of it. You can see everything you have on order, what you have in transit, and what's shipped, but you must get to your customers. So a piece that's flourished is pulling all that data together in one place, whether a control tower or another reporting tool.There's a part about data. Of course, we need data to figure out all this stuff, but on the other hand, it's almost overwhelming as far as what data is the right data to have and how you determine that. So what are some examples of how Porter Logic has helped manufacturers optimize their operations and data collection for inventory management?Yeah, that's a major piece of what we do. We are a warehouse and inventory management system and a native integration layer to pull data from other systems. Specifically, we have a customer that is a retailer. And they have 12 different fulfillment partners.So they're not doing any of their warehousing or fulfillment. They're relying on third parties three, pls. And they needed a way to pull all this data across company lines into one place. So that's where talking about tier-two supplier visibility or The challenge; it's the cross-company lines.How do you do that exchange of data? And you had technologies like EDI, which unfortunately are still around. They're antiquated at this point. But it is being able to pull all that data from various sources. So doing things like APIs, we read APIs from a couple of different systems, but also being able to pick up emails like, I know that's crazy and simple.It could pull an automated email or receive an email with an attachment we could process. That's something that our technology can do. And that allows us to pull in data from all kinds of sources. For that particular customer I was referencing, all of their three, please send inventory data into Porter Logic.And then, they can log their inventory system again into Porter Logic and see all their inventory in one place. The other major component of our platform is a low-code UI builder or a user interface, a screen builder so that you can then build grids, charts, dashboards, and interactive screens to tell the system some data. It can be making decisions on that.For this particular customer, we built them a network-wide and then a buy warehouse view. And then, they have views into their kits and their finished goods. And so once you get the data in, you can slice it in many different ways. You can interact with it. We do things like, push Slack reports to their marketing team so that their marketing team gets visibility into inventory, but they can have partial access to the system.They need primary inventory data to run promotions and things like that. So we send preemptive alerts around low inventory, and we do threshold checks to make sure if they are running low on particular items, that maybe they have that in a different warehouse, and they didn't know that.And so we're correlating a lot of that in the background. Then we're presenting this concept of managed by exception. Your users don't have to look at everything. It's what we're calling out; here are the five things you must focus on today. And that allows companies to repurpose a lot of the time previously spent, combining over data spent all in Excel sheets and just trying to wrangle all this together.Now you can do value-added work. So here are my five problem areas, where I should focus, and where I should be putting my time. And yeah, it allows for all kinds of efficiency gains and just improvements in operations. Lisa Ryan: When it comes to this, if you have a manufacturer that's been around for a long time and may need to have all the bells and whistles and technology that they need, how would they even know where to get started?Jonathan Porter: Yeah, that's a great question. And much of the advice we give to companies we're talking about is to start small and hacky. Start in a spreadsheet. Start with something simple, quick, and dirty because you need to validate or try something new to see if that will even work.For example, say you're a manufacturer and do you have a legacy ERP or some legacy system you know may not. Exactly optimal. But yeah, you're at that point of how you even get started, right? It's this behemoth of a project. Our advice often is to find a painful tiny sliver.It could be the processing of your return or your food waste if you're like a food manufacturer or something. But pick one very painful but contained section to dive into and then try things in ways that might not scale. That's one of the things that you learn as a startup.But more prominent companies and more established companies can take advantage of is do some things that aren't going to scale Initially. Experiment and try some things and do it in Excel, do it in Slack, do it in just basic systems. And from there, if you find something that works okay, it's time to automate it and find a system.But initially, many companies spin their wheels by saying, okay, we know returns are a problem, so we need to find a returns management system. And they spend months pouring through every RMS out there and trialing and proof of concept. Then, when their problem may be something completely different, that's manifesting itself in return.But they'd done a lot of experimenting and trying. In that case, they might have identified that the problem was they needed a system that they needed a customer experience system to manage the customer side of it, less the warehousing side of it. In any case, just an example of where you can click in on one area, do a lot of trialing and experimenting to find out what the actual root cause is, and end up saving probably a lot of time than just trying to layer on and integrate some other system that you don't know if that's solving your actual problem. Lisa Ryan: Wow. How would you recommend that manufacturers approach demand forecasting and capacity planning so that they could manage some of those fluctuations in production?Jonathan Porter: Sure. Yeah. Demand planning is an exciting topic because, historically, the vast majority of demand planning and forecasting was based on sales and previous sales data, right? So we would look at the last couple of years, and we would run an average or a median, and you would add some growth multiple, but that was heavily predicated on what your sales were over the last couple of years.That doesn't work right now because of Covid, and the pandemic demand has been everywhere. And supply chain disruptions have caused demand patterns that don't accurately reflect consumer demand. So your sales data may be low, but that might be because you were out of inventory for six months.And you can only rely on a few historical models to do accurate demand forecasting. So the gist is you have to figure out a way to. Accurately figure out what that true consumer demand is. And so one of the tips that I give people is to look at competitors. For example, say you're trying to launch a new blue T-shirt and want to figure out how much or how much you should order now, given that you're calling six months later.That's another piece you constantly have to factor in lead time. You always have a factor in manufacturing time. So from that point, look at a competitor also selling a similar blue shirt and extrapolate how much they are selling. How much and what is their demand for it to give you some of the true consumer demand right now?There's another try. Things you can try throwing up a fake product on your website like that also sounds crazy, but if you want to sell a new blue shirt, Go ahead and put it on your website and see what kind of demand you get in. You can always cut it off after a hundred orders.But see what time it takes you to get a hundred orders of this new product, and that can help you gain what the genuine demand is right now because that is what you should be planning on. So I advise companies that if you're still trying to use historic sales, some industries could have been more effective that would still work. But, still, most industries have been through some upheaval throughout the last couple of years, which makes your sales data less accurate right now.So yeah, get creative, but look for that true consumer demand number, and that's what you should be planning and forecasting around. Lisa Ryan: But it's something that just when you were talking about that, it just reminds me of in my industry speaking in the training of how many times we develop this fantastic training program and finds people don't necessarily see it as fantastic we do. And so just coming up with an I,

Connect with Arno Ham:Linkedin: https://www.linkedin.com/in/arnoham/Website: https://www.sana-commerce.com/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. Our guest today is Arno Ham. Arno is the Chief Product Officer of Sana Commerce. Sana helps manufacturers, distributors, and wholesalers succeed by fostering lasting relationships with customers who depend on them and making their SAP or Microsoft Dynamics ERP and eCommerce work as one. He studied computer science and has been a driven eCommerce manager for years for big (retail) accounts such as Heineken, AkzoNobel, and Michelin. In his free time, Arno enjoys maintaining the webshop for the band and music society he plays in. So Arno, welcome to the show.Arno Ham: thank you. Thank you, Lisa, for having me. I'm excited.Lisa Ryan: So, share a little about your background and what led you to do what you're doing.Arno Ham: Everything is with technology. I am a nerd. I started computer science. I started working here at a company that was an agency digital agency. We built many web store websites back then, mainly for these big weak retailers. But at some point, we came across businesses with other needs. B2B companies - and it was already more than 10, 15 years ago.By helping them, we realized how we could help B2B companies, manufacturing companies, or wholesalers to do business online. , you need to do something differently. We can talk more about it later today. But the funny thing is that was the moment when Sana was born because we said, Hey, guess what? You talked in the intro about the long-lasting relationships that our customers want with their customers. In B2B, that's important. If you do, if you're shopping online as a consumer, you may buy something that you wear at the lowest price or where you can get the quickest shipment.But in B2B, if you need to have supplies every day or multiple times a day. It needs to be good, and you have trustworthy partners, et cetera. And to make that happen, to transform that, to put that from, let's say, all those business processes before, let's say, non-digital with or by phone or by fax or by email to make the digital.A lot of complexity is involved, and Sana was born. We were making that complexity easy by making ERP and e-commerce work as one because in that ERP, these systems that these companies are driving on, I would say where all your customers are, your order details, your transactions, your inventory, all that logic around it that makes you unique.You need to open that up to the world to ensure you can automate things. We are key players here in what we also call a digital transformation. We have around 1500 customers worldwide running SAP or Microsoft Dynamics as their ERP. We are helping them create a B2B eCommerce environment with which they can serve their customers.With B2B, it's just the beginning. Not all companies are doing digital commerce yet. They're starting with it. We are right on that wave. That was the shortest version I could give you, Lisa, but we could take it from here.Lisa Ryan: And when you talk about, back in the day, you had more of that personal connection, talking to people on the phone and maybe seeing them in person. Now we're bringing in that whole element of technology and digitalization. How do you continue to work with your customers and keep that personal presence when everything is so technology-based, so you're not just another button on a keyboard?Arno Ham: I love that question. There is a lot of complexity involved in making that relationship, let's say, more or less the same. But to give you a couple of examples or share a couple of customer stories, The important thing is that if you are a B2B buyer, as we call it, somebody needs to purchase something to do their job.So let's say you are a gardener or a contractor and need to work at some house; you require equipment, building materials, etc. You could call or go to a store and get your supplies. And you get that personal touch that you say, Hey, you had this pricing. We have agreements about that. You are a customer that is here every week. So, we have these agreements. But if you go online, you want to have that same experience. You want to give discounts, for example, or trade agreements. And you need to bring that online.And that is that example of the complexity we are solving, but it's so important. It sounds so stupid or simple that you must solve these things, but making that happen in your world is complex. And that's what we are solving. So that's one.It's about real-time pricing, inventory, product information, and selection. So all these things you need to have transparency and with whatever channel your B2B buyer is, reaching you as a company, as a manufacturing company, if it is over the phone or via the web store or another, or in the store itself, you want to have that same price, the same inventory levels, and the same product description.Because otherwise, you get an issue. You gain if the price is different online than in the store, then you harm the relationship, and you say, Hey, what's going on here? If I want to place an online order, the price is different. It's not what we agreed upon, harming the relationship.So that's why we are all targeting that or not a relationship. It should be as convenient as if somebody's talking about it. But you need to translate that whole relationship into a digital world. And we are solving many of these complex things and making them simple.And that's just one aspect of it. But we can also talk about, let's say, all the problems that manufacturing companies are struggling with. Still, I think this is where we see companies succeed in adopting their digital platform in this area, making sure that you supply total custom convenience as we say it. The features are that you can place these complex orders every moment of the day, 24/7 per day, seven days a week and that you have reliability without any compromise, which means it's real-time. The inventory is accurate. So, if you, that's not that you, if you're ordering something and then the salesperson or support person is calling you and saying, no, sorry, you just placed the order. But we have yet to get it in stock. That's, that is a pain, of course. So we are solving that and that you can. If you are also placing an order that the company is directly processing, it's a whole process to bring it online. So we are helping our customers with that. And it's a complex thing. But if you have done that, there are a lot of benefits for you as a manufacturing organization.Lisa Ryan: Timing is such a crucial aspect of it because we expect that immediate gratification when we want to find something and get it online. And often, the person who receives the order is the first to respond to the request for a quote. Yes. The first one they reach is that they can do it quickly, as you said. To see what's in stock to get the correct pricing and place the order versus waiting for a couple of days or even a couple of hours for the sales rep to call him back and then go through the quote process, and it's lengthy all that stuff. Digitization has sped that up and it's an expectation now.Arno Ham: Correct. Especially on the newer generations. They are used to living on their phones, to do everything from there. So if you are not opening that channel for them, you will have a missed opportunity, or you will, in the end, you will miss business, and the competition will take it for sure.Lisa Ryan: We talk about some of the good things that are going on, and then, of course, in manufacturing, there are all kinds of issues. In inventory management and supply chain, we saw a lot of disruption issues because of the pandemic. And then the war in Ukraine. What's your take on this, and what's the role of digital and e-commerce in inventory management?Arno Ham: Yeah, so for inventory management, all the things you just mentioned, it has been a couple of hectic years. And we are still in these in this period where we have a lot of manufacturing companies in our customer base. And when talking to them, they all struggle with the same kind of issues that they say. So we do not know at some point in time if we had something in stock or when we will get it back in, or that we get our inventory levels where we want to have it, or if the price of a product was differentiating all the time because the production cost the raw materials, the pricing for that was changing a lot because of the situation we had in the world.And what is so essential if you have these kinds of changes or need to adapt your business has. So, for example, if something is unavailable in stock because you cannot produce it, or is there something else? There is just a high month; they must ensure how to deal with it.Are you going to prioritize it for a specific customer group? Are you saying, hey, these customers need it more than others, or are you showing the real-time values and informing your customers to give that transparency, saying, Hey, sorry, it is not available, but it will be there in a month or so? So all that information exchange and transparency contribute to keeping these relationships in good shape.Because if you need to do that over the phone, you will be burning in on calls, and so on. But on the other end, if you do not have accurate numbers, you also will, once again, people will start ordering, and they will get issues because you cannot deliver. After all, you have problems with the production lines or something like that. So we have a lot of companies that have struggled with that and with the help of commerce. By giving transparency and intelligence in the platform, you can say, okay, this is not available anymore. Still, we have an alternative product that can help solve your problem.These are all things that we are helping. That's helping a lot of manufacturing through these challenging times. By doing so, they can reduce costs on one hand. They can keep the relationships, on the other hand. Some of them even become much better out of this situation because they took the opportunity to do it correctly.Lisa Ryan: That brings up a good point regarding the relationships because if there is a limited number of items. You have to prioritize which customers get those items, it's probably going to be the customers you like the most and you have the best relationships with versus those that come in and out.So it's a good reminder that people are on both sides of the equation. Keeping those relationships strong gives us a better chance of getting the needed products.Arno Ham: Correct. And that's what we have. We are solving that problem with technology, but it's mainly about the people in their sense, and technology supports that. But its effects on these companies, both the B2B buyer side and the manufacturing companies we support, are amazing. Another pain or another interesting sample, Lisa, is, for example, the complexity manufacturers face in going online.You already mentioned the lengthy quotation processes. That is something we also see; there's a lot of back and forth, generally over the phone or via email. But you can solve it in a digital way or in a platform that you can with the product selection process that you guide the customer what they need with information or with small wizards or product selection mechanisms.We also sometimes call that configured price quote. So that is all something we are doing, and it is, especially with manufacturing in the B2B space; sometimes, it can be highly complex. For example, ordering a new television or a piece of clothing is super easy in terms of complexity. But if you're purchasing a new truck or machine worth a couple hundred thousand dollars, you can imagine that it needs to be more easily transferred to a digital space to come to that selection process. So we have all kinds of partners we work together with to make that magic happen that you can say, okay, nicely configure a machine, or what spare parts do you need, et cetera, to bring that selection process or that lengthy quota process digital and that the B2B buyer can do that in their own time and their convenience and much faster than when to wait to on interaction from sales support. But still, the sales supporter, the people, was an important factor because they can step in when it's necessary when they can add that added value.Lisa Ryan: And you're looking at people that may hesitate to go digital because of the complexity of the product that they have, that a hundred thousand dollars truck or piece of equipment or machine. So, when it comes to the efficiency of it, how do you balance that?What would you suggest when somebody's. At that precipice that they don't know, is this something that I should keep doing the old way, or do I pay a small price for higher, a lot higher efficiency down the line? Where does that decision come into for them to decide?Arno Ham: Yeah. That is one of the most complex struggles or the questions they are asking us a lot or that they are struggling with themselves. Most of the time, we can have investments in B2B e-commerce can be severe to solve the complexity, and so on.So, will you get a return on investment at the end of the light? Looking at the 1500 customers that we have, many of them succeed and can reduce so many costs by chasing a better opportunity by automating or digitizing things.Let me give you an example. We had a European company that was a supplier of cleaning equipment, chemicals, and so on in the B2B space - for hotels, restaurants, etc. You need to keep these things clean, and before, they didn't have any digital channels, so they had salespeople on the road every week, every month, just taking in these orders.On the one hand, that was quite time-consuming because these people were driving around all those hotels checking, okay, how much do we need from this? How much do we need from that? And it needed to be automated or digitized. But, on the other hand, when Corona hit Europe, they could not physically visit these locations anymore, so they needed to do it differently. So what they did was they started with Sana, they digitized everything, and salespeople were not driving in cars anymore to all those hotels every weekday to get the orders.No, they were just online to say, Hey, place these repeatable orders or these orders on a day-to-day basis in the digital platform via the mobile app. And when I'm coming by, I will talk about more strategic topics of explaining new product times, really spending the time of you enhancing that relationship. And guess what? These salespeople now also have more time because they were not. So they could have this meaningful conversation by taking all these repetitive tasks they were not spending time on. They could also explore new markets or businesses because they have more time, and that's how you can expand your business.Lisa Ryan: I've heard that a lot because the pandemic taught us that a salesperson can call on smaller customers. Some accounts could be seen by salespeople who wouldn't jump on a plane and go to some tiny machine shop or something because it wasn't worth their time. But now being able to digitize that, being able to do it online, Not only does that give you access to customers that you may not have ever paid any attention to before, but as you said, now there's more of a strategic opportunity to work with the customers and personalize the attention and build stronger relationships by digitizing.Arno Ham: There is always a way, Lisa. This is about saving costs or chasing an opportunity by getting the boring stuff out of the way so the salesforce can do more valuable work there. But another attractive area is where we see a lot of success with struggling manufacturing companies, saying, Hey, how do we start, or the investment is considerable.There is always a way to start in a specific area. For example, if the machines are still lengthy, complex, and very hard to digitize, you can start with the after-sales or spare parts. That can also be a big part of your business, and you can have the opportunity there to digitize it.We have many manufacturing companies that are just focusing on, in the first years or in the first phases on that area, so that they say, Hey, this whole machine selling that is still, let's say, more or less a human process. All the after-sales and the spare parts that are fully digitized and the same values about the relationship are still there because the nature of our solution is that sense or the importance there is that all that information on what machines you have as a customer. You want to know that information to order the correct spare parts. You're not looking around for hours to ensure you have the right tools because you want to fix your machines quickly.That is what we solve with our solution. This integration we have with systems like SAP or Microsoft Dynamics is because all the logic is most of the time, and the data is already there. We are just bringing that to the surveys and helping the B2B buyers have this convenient place where you can, with a couple of clicks, say, Hey, these are my machines. I know this machine is broken. I need a new wheel. I have to correct one order and have it delivered as soon as possible to fix it.Lisa Ryan: So, when discussing manufacturers wanting to start the process and sell their spare parts online, where would you suggest they start? What are some of the things that they need to look at? Do you have any examples of a situation that began with spare parts that led to that same company's ability to do much more digitization by starting small and getting those results?Arno Ham: Exactly. So have for most of the manufacturing start indeed with spare parts. Another customer is Diversity, a prominent supplier of cleaning equipment, chemicals for hospitals, tools, et cetera, et cetera. It's a huge company; they do a couple of billion a year. Also, in the US and where there, we started with all these consumables, not only spare parts but also the chemicals to use in the machines because they're selling these cleaning machines and so on.That is step one. And later on, it went from region to region. They started first with one a couple of countries in Europe. And they have gone to another store, into another store. And now we are also talking about, hey, now we have all these consumable products for many different regions. What if you also digitize the machines' sales process, for example? We have C P Q tooling that you can do that's a selection process also for more complicated stuff like a machine, and you have all those questions and selections you need to do. And that is the next step to take another example I have, which is interesting for you to share. We had a company called Pinger, a global player in the world that is doing. It's a supplier of lifting equipment. Every truck needs a lift most of the time or a crane. Nine out of ten times, it's from Pinger. It's an Austrian company, but it's a world player there.And we are also starting here with spare parts. So as such a...

Lisa Ryan: Hey, it's Lisa Ryan, and welcome to the Manufacturer's Network podcast. I'm excited to introduce our guest today, John Abplanalp. John is the president and founder of Tight Lines Advisors consultancy, which focuses on optimizing manufacturing performance. So John, welcome to the show,John Abplanalp: Lisa. Thank you very much. I'm delighted to be here.Lisa Ryan: Please share a little about your background and what led you to focus on manufacturing with tight lines.John Abplanalp: I will try to give you the quickest version possible. I was involved with a family business, a precision valve corporation. My father invented the aerosol valve. I'm looking at the patent copy in front of me right now.He received the patent on March 17th, 1949. He is Swiss, but St. Patrick's Day was a celebration for my father that afternoon. He started their business. We ended up with 22 locations worldwide, serving most of the major customers, the SE Johnsons, the Unilevers, the record, Ben Keer, the who's who of, who's in the consumer packaging goods.A lot of the products they had were in aerosol form. He passed away 20 years ago at the end of August 2003. If I drop some numbers, we made about 250 million in sales. We get some family dynamics - a sister and brother-in-law that didn't necessarily buy into what we were doing, where we were going, confidence about myself, et cetera. It's not a complaint about it. Everybody has a right to, so we made the deal of evaluation and allocation assets, et cetera, and got that behind us in 2006 and continued. In 2008 we went from 250 to the end of our fiscal year 2008. We got to 343 million, and I'm proud of myself and the team for what we were able to do. That was the fiscal year of May 31st, 2008. You may remember a little turbulence in 2008, 2009. We went from 343 million in sales leverage from 343 to 290 million. It nearly killed us. From that, we brought the guys in to do the restructuring. We brought partners in the private equity world, and through you, watch it. I understand it. It's receivables. It's payables. It's inventories. It's what are we going to cut? What are we going to cut? What are we going to cut? As we went through it, we were two or three years into this process and had an opportunity to visit our South Carolina plant.Customer service was an issue, so we raised inventories, and cash was the issue. So we're driving inventories down again. The organization was just getting pulled back and forth again. I fully realized I was tapped into the ship at the time that created the change. But I had the opportunity to go down to our plant in South Carolina. It was a great group of people and still is. What we decided to do was focus on productivity. We started looking at the obstacles of productivity, material losses, health, and safety issues, downtime, and quality issues. We did it in various part series. We did it in a parade and went after the biggest issues first.We found that we made some mold changes without putting capital or throwing real capital investment into it. We did some, while leadership at the time was talking about we didn't have enough capacity. We had to spend $440,000 for a mold in a machine that was $20,000. We were getting the changes in a mold that we made. A mold that was 30 or 40 years old, and my father was getting about 50% output out of it.It took us eight hours to set up. Within 30 seconds, the mold was running at a hundred percent capacity. It was a phenomenal turnaround. We said that if we continued the path we were going, and what we could do, get all these changes, and the next ones on our list would reduce the cost of goods by 10 to 12% in one year alone with a lot more work to do.That would allow us to get more output in fewer hours. So you'd reduce your amount of labor hours. The other part was that productivity was greater, your lead time was reduced, and your on-time delivery was more consistent.Also, we were going after qualitative problems, and as a manufacturer, if something happens internally, it will eventually get. But we were able to reduce the number of qualitative issues that we had internally, and therefore the external failure rate dropped. So, our competitive position was enhanced along with greater profitability. At the time, if we were going back in and looking to sell, which I understand was part of the deal when we brought in our rescuers in the private equity world.But now we had a real chance to show to whoever was coming on. So here's your path out. Here's how you can drive profitability. If the gross margin improves, gross margin improvement, especially when you get a competitive position, is the greatest thing you can do to drive value in a company that drops right to the EBITA.You show it's consistent, the multiple improvements, the valuation takes off exponentially. So we continued down that path. The company eventually ended. Being sold, whether the ideas were adopted or not. I honestly don't know. Part of the reason we couldn't share those in the selling process.It was reflective, look, reflective on current management, but that's someone else's issue. But we sat there and said, Hey, this is viable. This is a hundred percent viable, and it's a real passion because the coolest part of the whole thing was not necessarily the dollar. But we had them when you watch people on the floor that were finally a part of this. We had the machine maintenance guys.We had the machine, the operators. We had the assembly mechanics. We had the assembly operators all have a partner say in it. Because they're the ones working around the problems and the issues daily. We gave them our support. You had guys high-fiving each other on the floor.When you started seeing the turnaround, there was one woman that was in charge of an assembly machine, and this one machine, we had to run Three shifts, seven days a week, and import goods from one of our sister companies to meet our demand in the two months. So by the time we were done, it was down to running two shifts a day, four days a week, and she wouldn't let anyone else near her machine.And it started when we first started doing that work. She came in with a bag of rejects, put it on the table before me, and said, we need a new machine. I said trust us. Let's go down this process for two months; I'll be completely behind you if we do. By the time she was done, there was no way you were getting rid of her machine.And to watch that turnaround, and to see the involvement, and the enthusiasm of the people, and don't get me wrong, everybody wants to make a. But, to watch what these people achieved with the appropriate guidance, I still need to come up with the solutions. They weren't my ideas.These were solutions running around our floors and machines for 30 years. So was, it is fantastic to do it, and that's the genesis of tight lines. The best way I could tell you is driving this profitability and value for a company with an organization that's upside down to the traditional triangle.My job is to support everybody else down there so they can be most effective as they can, and the last thing, and I swear I'll shut up and let you ask a question with it, but the last part of that is part of, the, one of the tenants of what the tight lines advisor says. So as we go through this process, we get that gain in the competitive position, the revenue line, and, most specifically, the cost of goods, which drives valuation.You take that gain in the cost of goods every year that the organization has been supportive of. Then, put it on the new valuation, a company, and give that value back to the employees appropriate on the appropriate percentages in either real or synthetic equity. Because yes, they will be working fewer hours, but you give them back because you can only achieve this with their input.So that's that, that's where the dynamic is. So now you've got partners with you that are all focused on the same aspect of what you're doing, getting the obstacles of productivity out of the way.Lisa Ryan: So that's such an important lesson right off the bat when owners and leaders of companies consider their hourly employees Because they know their job better than you know their job.And when they feel that they are a part of the greater mission, that they're able to make a difference, they are willing to give you so much more, and as you said, you also realize that there's an expectation of a return. So if employees are helping you to be more profitable, of course, they share in the profits, but when things don't turn, you know when things aren't going well.At least the employees know. So there's that level of transparency and accountability. You built in that feeling of ownership with your people, who were the lowest in the organization and the most important.John Abplanalp: How well did that come home to us during the pandemic? In the manufacturing op, it was guys. They came there every day when everyone else could afford to work from home in manufacturing. We saw it with the police officers, the supermarket guys, and the rest. They were the ones, they were the, right there facing the operations.This was this idea, and these concepts were formed before that. But okay. Someone said okay, I wouldn't have a hundred percent of the value. Yep. You won't get anywhere near the value, increase, or continual increase if you don't have their ideas. As you said, they're closest to what's going on.They're the ones that are dealing with the decisions the guys in the corner make on equipment. They have. Our brilliant ideas, and I'm not disparaging the guys in the corner office, don't get me wrong about that. But there are so many different things that are going on plants, and it's, a lot of it is legacy stuff that, that they were given either poor design, et cetera, that we made them run.Lisa Ryan: And it, when it looks like it, you had your first downturn, of course, in 2008, and now we're facing some different challenges when it comes to the economic headwinds that currently exist. So what are you seeing regarding some of the biggest roadblocks to productivity and growth that manufacturers face today? And how would you recommend they overcome them?John Abplanalp: My biggest issue is the pervasiveness of the success of the private equity world. That is not so much, and I don't want to paint them all with that same brush. You're familiar. You see how private equity works. They come back in cost, ripped out, et cetera.Decisions are made in a corner office, the same thing we're discussing on the floor. So you've got companies like Nusteel or Danaher even, productivity-based, et cetera., and they perform well. But my, my, my biggest headwind is not even so much it's an operation.It's the operating philosophy. There's a line. If I can say it this way, go back to you. You probably needed to be older to remember a gentleman named William E. Simon. Bill Simon was a treasury secretary under Gerald Ford and the energy secretary under Richard Nixon. But as treasury Secretary, ironically, he also made his fortune as the LBO of a company called Gibson Greeting Cards, which was the progenitor of the whole private equity world.But his view, and his quote, which I think is phenomenal, and I wish I had under, I had known it while I was still operating before, before tight lines in his as a country, he was speaking of the United States, the productivity, and the growth of productivity should be the first to economic considerations at all times.It is through those two things innovation, jobs, and wealth. If you can bear with me as I describe it this way, I'm using my two fingers. But if you can get more and more consistent output for fewer units of input. That's your gross margin line. So in between those two, that spread gets better.That's what drops to the bottom line. That's where the company's value has been created over the last 20 years. But unfortunately, it's one of the things I only have my subscription to the Wall Street Journal for this quarterly productivity report.Covid Aside, you can see over the last 17 or 18 years that while productivity is improving, the rate of productivity improvement is in decline. And to me, that is because what has happened was everybody started chasing As they got more competitive, they started losing productivity. China opened up, and Mexico opened up.Everybody was chasing cheap labor and not going after the productivity side of it. I'll say this. It could sound sarcastic or sincere, but when the previous glorious leader was down in Washington, the one that was just recently in New York yesterday. He put the tariffs in to support manufacturing in the United States.I'm not a big tariff guy. I am a, yes. I understand it would help the US manufacturers think it's artificial at some point. Cause you know it, it puts the barrier on the incident, which allows people not in the productivity to razor priThek the biggest hit in the face was when we had the supply chain issues, and we started realizing our dependence on.There's no cost to import from Mexico, China, or these other locations. There's the manufacturing there. There's a freight. Some logistics have to be baked into it. But I think in the US manufacturers, as they come back in, and onshore if they're coming from a lower labor rate area to a higher labor rate area, where we are right now, a lot of guys are resistant to doing that because it's going to reflect poorly on their financials.The only way out is through productivity. If I might add, the other aspect is that I guess the most significant headwind is changing our thinking even more than economic aspects Going on. The other thing that was going on, that was after World War II, had three advantages. One was we had a growing population.We had a population that was getting older, so you know, what we were buying was, increasing. We had more people coming in, but we also dramatically improved our productivity rates. So we are getting older, but it's almost running at a decline right now. Population wise. We're certainly not adding to the population.The only way we're out of we can get out of this thing now is productivity. One last part is to think of the huge amount of debt that the US has right now because of what was necessary in most cases in CO through Covid, and all the rest of us through Covid, and all the rest, not the covid. So the only way we get out of this is to become a net exporter.Nobody will buy from us just because we're the United States. We have to compete on price service. You know, the innovation side of the only way we can do that. Remember, we started before you went after productivity, lead times reduced on-time deliveries, and more competitive external quality. Is there a reduction or improvement in your gross margin line?Therefore, you can reduce your pricing. We have to. The only way we can do that is to be competitive in what we're doing. We can only do that through productivity, innovation, and the innovation that'll give us.Lisa Ryan: When you look at some of these things, you're talking about tariffs, and China, and supply chain, and the national debt, and some of those, sometimes it just feels so overwhelming as we think as an individual manufacturer or organization that's not something that we have any control.So when you're looking at the things that you know manufacturers themselves can control, that over time will benefit that big picture. But what does it take for an organization to do in its culture to generate that productivity at all levels of the organization?John Abplanalp: First, you have to go in e even before collecting the data. As we discussed before, the people in New York have to go in with an intrinsic belief in the human spirit. You have to figure out there are some dirtbags out in this world. We all know, but you have to believe that most people coming in to try to provide an income for themselves and their family is there for the right reasons.And they want to be part of something even bigger than themselves, that they feel good about it. So if you've got that, then we use the system called the DMA system. I'm not, the guy Nick Demus now passed away in South Carolina, but it was a great way to keep track of it.I recommend it for anyone to keep track of all the negatives. I like looking at the negatives because the positives to me, what your output was only the positive output result in any daily production or what was there was only because of the absence of the negatives if I can. So the more you can measure these negatives, and go after it, and organize your people, and in such a way to go after the biggest issues first.And it was non-financial. It was the number of pieces lost, in that series, the number of pounds, lost amount, it all translated to. By the way, we're patenting this tight line system the way it all rolls back into it. You can come back and take how it affects the financials, but that's what I would do.Believe in your people. Start organizing a data collection so you can go back in and start looking at what the negatives are, again, health, and safety issues, material losses, downtime, and qualitative issues, and then start organizing your key or best employees that you think could help out to begin with, and start working on the buy-in.Lisa Ryan: It comes down to company culture and what you do to connect those employees with the mission. One of the techniques you stress as crucial for creating sustainable value is your inside-out approach. So talk about that. How does it work, and what are some of the benefits that result from it?John Abplanalp: We've talked a lot about that and what we're doing. It's the guys on the floor. It's getting the data from the inner side of it, being able to put it we have yet to use. Terms like lean or six, whatever the appropriate methodologies are, you want to go back in and organize the people so they can do it.But you know what we're doing is collecting the internal and external data that is there, bringing that back into the organization, letting them have it, and having it reflect both internally, financially, and externally on the., and your competitive position. One of the things you mentioned sustainable growth.Sustainability is different. We hear a lot about the pros and cons of ESG - environmental, social, and governance. But you've listened to what we're talking about now. Are you in an environment where we can get more and more consistent output for fewer units of input material?That works for the ESG. The social aspect is now we're bringing our employees in. Not only by the way, not only are we compensating them on this side of it, but the other thing that we're doing is

Bryan DeBois, Director of Industrial AI at RoviSys, discusses AI's impact on manufacturing, challenges, and opportunities. He highlights the integration of data pipelines and historical data into AI processes, emphasizing cybersecurity in manufacturing. The podcast also shares a success story of a digital transformation project in the manufacturing sector and the importance of expert guidance and stakeholder involvement in AI implementation.

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. I'm excited to introduce our guest today, Vinny Maurici. Vinny heads up the data engineering practice at ObjectEdge, a digital consultancy based in the Bay Area of California. He brings over 15 years of experience launching data programs for Enterprise and Fortune 500 B2B manufacturers and distributors. Vinny, welcome to the show.Vinny Maurici: Thanks for having me.Lisa Ryan: Share your background and what led you to do what you do at ObjectEdge.Vinny Maurici: As you just mentioned, I've been in the data world for about 15 years, and for me specifically, my brain has always worked in a way where I've seen data as more than just a means to an end. I like to build tangibility around how data can affect businesses. It's fallen into more of the consulting world, and it's been an excellent opportunity to work with our customers over the years to say, Hey, let's take this thing called fluffy data. You go to conferences all the time, and they say data are the new oil, and you need to turn data into an asset for an organization, and nobody knows what that means.It's such a big, wide-open topic, and for my team, we pride ourselves in saying, Hey, let's turn the intangible into a tangible. Let's create steps, order of operation, and actual outcomes and benefits for why data is essential to an organization. And it's been such a great time trying to build all these models for our customers.Lisa Ryan: With data just expanding at the rate it is. Before the show, we were talking about how AI is transforming everything, and data can be used for good and can also be used for evil, and it goes the whole spectrum in ways that we would've never thought about before.So specifically, though, when it comes to manufacturers, what are some of the data challenges that manufacturers are facing today?Vinny Maurici: There are some very unique challenges that manufacturers are seeing. If I take a step back, for example, and I look at even the distribution side of things like B2B distribution, they're all pushing to be more digital. MSC Industrial, for example, is a major MRO distributor that just came out last year in fiscal 2022 saying, Hey, We now do 2.28 billion in digital revenue alone, and they're growing at 17% year over year. So that's at a distribution level. So, what does that mean for manufacturers? It means that all their customers, whether a distributor or a retailer, are pushing to increase the channel presence. This means that the amount of data that these manufacturers, many of them are mom-and-pop, is more significant. They now need to support all these digital transformations that their distribution network their customer network is going through.It can be difficult because I have to manage more than I used to. And so I, as a manufacturer with a lot of unstructured data or data that I'm just used to, have supply chain information. So I want to send my products efficiently, not necessarily for people to use a digital network to make a purchasing decision.So how do I do that without hiring an army of employees or utilizing my current employees without burning them out? Because there's so much more now than there was. That's a difficult thing to solve as it creates a foundation of a problem even though they know that there is revenue and their success on the other side of the equation because all of their customers and digital partners are distribution partners and are doing great in that.Lisa Ryan: Can you give some examples of what you're talking about when talking about digital data and monetizing it? I'm wrapping my head around what that looks like, especially in a mom-and-pop shop or somebody that didn't necessarily have the technology, but they have all of this data. Yeah, just putting it in simple terms, what does that mean?Vinny Maurici: Yeah, that's a great question. So the way that it has been working for decades is that I, as a manufacturer, I'm going to go and I'm going to make something, some widget, and that thing will go through a lot of engineering and requirements and drawings that I'm going to have to build that thing. And then I'm going to go and sell it. And I usually sell it to distributors or wholesalers or whoever will take my product. In the old days, I would need an E R P, and the E R P would manage a couple of important facts about my product. For example, how much does it weigh? How many go into a box, how many boxes go onto a pallet, and what's the weight of everything so I can send it across?It's only a couple of pieces of information, and then your distributor goes out and sells it to their customers. And if it's B2B, they're picking up the phone, talking with their sales rep, and then placing an order. Now everything has changed. If I go back to an example of a distributor, these are complex parts.They're trying to make it so that their customers are no longer picking up the phone. They want to make it so that a buyer, an inventory manager, is going onto their site and finding the exact products they want, which leads to, Hey, I've got forty attributes across a job or drill bit, which might be a very simplistic product or an indexable cutting tool or welding equipment that I would typically have not needed to provide as a manufacturer, that type of information to my customers.So now they must go back to their engineering documents. They have to go back to see how they're utilizing that information and figuring out how to structure it. That's not a simple task, especially when much of this lives in PDFs or unstructured databases. So that is a significant hurdle for these organizations pulling out their hair, saying, I want to support my distributors. Still, I need the wherewithal. I need to have the data organized. I don't have it in a place that's easy to. We call it syndicate, syndicate downstream to my network of customers.Lisa Ryan: When looking at some of these, what are some of the other unique challenges you will encounter when you have this direct-to-consumer manufacturer?Vinny Maurici: Direct-to-consumer is a fascinating topic because, for a while, direct-to-consumer was this significant initiative or forefront for a lot of organizations because when we look at the advancements of cookies and adaptability of searching and a customer going out and asking for what they want, you could then grab that search result or grab those cookies and quickly serve them ads. I, as a manufacturer, don't need to rely on Amazon, or I don't need to rely on distributors.I can go and serve products directly to consumers and then not have to pay that in between the margin hit of getting it to a wholesaler and distributor. The problem is, last year, what did Apple do? Apple created this opt-in era where they said, " Hey, on default, we're going to turn off cookies, and you have to opt-in as a customer to serve those types of ads.All of a sudden, and there are many case studies about this, direct-to-consumer manufacturers started nose-diving in terms of their revenue because they couldn't find their customers very well. The whole point of this process was it was a very cheap way of customer acquisition. So now they have to differentiate themselves through good product data better.They can't rely on something like cookies through the customer data they now own. But, hey, somebody just searched for TVs. So I will serve them as a TV manufacturer, some options because that whole model has been cut off. And now, I need to build out those data profiles by myself because I now need to trust that consumers will do research.I need to bring my organic searches up through Google or Bing. And I have to create the best possible experience model so that people trust my site and make that purchasing decision. It has completely turned the way that folks are purchasing things on its head because they served up particular advertisements may be a thing of the past unless there's something new that some advertising agencies are trying to figure out.Lisa Ryan: That's so interesting because, for so many years, you get used to accepting cookies and everything. Yeah. And as a consumer, I would look at one ad on Macy's, and then for the next three months. I would just be getting this. And I never realized how that happened. It went to the extreme, and now it's being pulled back to protect the consumer from targeted advertising. So it's better for the consumer because we're not slapped upside down with 40,000 ads daily. But as you said, it makes it harder Yeah. For the manufacturers, because they don't own, you always want to own your list.Vinny Maurici: Exactly. People who didn't own those cookies and didn't have access to that information anymore. And it has made a struggle for an organization that built up an employee base, revenue model, and supply driven off a specific customer acquisition dollar.That customer acquisition dollar has been taken out of the equation, and they have to build a new equation now to figure it out. It's caused a lot of stress and anxiety with employees, with enterprises where we discuss things like the interest rates going up. These companies no longer have infinite cash, as they have free money from the banks.So this anxiety has this direct to the consumer group. I call it an industry, even though it's filled with sub-industries trying to figure out their way. All because, in essence, Apple started the trend of Google's now talking about doing something similar, and you say it's for the sake of privacy. There are arguments on both sides of the equation. Now you almost have to funnel to significant distributors like Amazon, Wayfair, or Walmart, who have substantial inroads into being able to advertise cause they have the money to do that. These smaller organizations need more money to do it.Lisa Ryan: This is new information for me. That was just the way that I saw it. Yeah. As far as all the trouble that Facebook got into for the privatization of data. That's the thing. Something good, we'll always find a way to use it for evil.Vinny Maurici: Exactly. Unfortunately, that's always the case. I know.Lisa Ryan: And it will be. Or else we'd never go to the movies because that's all the movies are about. So, when looking at good data and sound data practices, how would you define these when discussing an engineering lead for manufacturers?Vinny Maurici: That's an excellent question because this is, in essence, the first aspect of recognizing and realizing there's a problem. When we talk about good data practices, the first thing I preach is, do you, as a manufacturer, have a center of excellence focused on data? I might have multiple business groups. For example, I might have various regions cause I'm a global company. And a lot of the time, what you find is everything is siloed. Oh, Europe works differently than the United States. That works differently than the Asia-Pacific region, which works differently than the Latin America region. in one regard, that might be fine.Regulatory requirements will be different in various areas, but in the grand scheme of things, on how I manage data, I talked before about manufacturers. They have a lot of engineering documentation and tend to be in prints and in unstructured things, not in a way that's easily digestible or analytical to create business intelligence around.The first step is to say, Hey, how do I have good data practices? I've built a center of excellence that goes above everything. It goes above the business unit. It goes above regionality and it. I want to ensure data is supported consistently and accurately as an organization.I look at it like a library sciences methodology, right? If you look at the Dewey Decimal system, I know nobody uses the Dewey Decimal system anymore because we have computers in the library, but that is the fundamental of one of the very first taxonomies created or attributes created around how to find a book.The same thing should be your mindset: how do I discover and find a product or widget I am building within my organization? How do I define my customers, and how do I determine my customers in a very efficient, concise, and consistent way? Globally. So that creates a way to build data stewardship that is first in your mind before you do anything else.Remember, data should not be viewed as a means to an end. Oh, I have a new customer. I have to fill out pieces of information. I have to ship a product, fill out this information, and ship it. That's just a means to an end. I want to say, This customer is essential. They consistently buy X, Y, Z. Therefore, I can now upsell these other parts because they're related to these, and all of a sudden, I have all of this information at my fingertips to build a revenue pipeline and build out my customers in a much better and more meaningful way.And we want to create win-win situations. It's not. Like, how can I make more money? It's how I can make my customers do a great thing for their end consumers and increase the data sets or SKUs that they will be selling to their customers.Lisa Ryan: So how would for a large organization that's been focused on data for decades? Yeah, it's easier because they have a whole department. But if a smaller manufacturer, a mom-and-pop shop, who doesn't necessarily have the manpower and the knowledge to think about all the different things you just brought up. How do they even get started?Vinny Maurici: Interestingly, you asked that because for a smaller or mid-sized organization, I always have this feeling that is building out good data practices, and I'll get to the way to get started in a second. They're more important than large enterprises. Large enterprise has enough money to live through the pain. They might be sending spreadsheets everywhere, massaging data, and trying to figure out business intelligence in every way to serve their customers better.But they can do that because they're so large. So as a smaller, mid-size organization, the focus needs to be on, let's take a deep breath. We know this is essential to how we must go forward and serve our customers. And as I said before, we also can't just burn out our employees, and I don't have the money to hire many folks.So how do I get our house in order? And so that's my first suggestion to any customer I'm working with asking me what the first step is. Let's get your house in order. Let's worry about analytics and trends and all these other areas. Second, let's first decide, hey, how do you build and structure your data today?Because, more often than not, we'll hear an answer. Joe Schmo has this spreadsheet that they maintain, and there's this other spreadsheet, and we send emails back and forth, and the first step is just recognizing and writing down how data flows through your organization in a current state.And then all of a sudden, eyes get wide because people don't realize how deep they are into it until you map out your data flow through an organization and then, You say, Hey, there's a lot of low-hanging fruit here. So, for example, if I were to build out an enterprise categorization structure or if I were to integrate attributes that are being held into a spreadsheet into a better purpose-built database or workflow engine, I'm going to save my team tons of time.And then it's a win-win because the company will have all this better data to make more money. And then the employees who are in product management or who are in digital merchandising or who are in engineering or regulatory, they now have a much easier way of managing all this data as opposed to pulling out their head because they've probably been struggling with it just as long as anybody else.Those are probably those who have been asking for change for a while. And now you get the enterprise to recognize how important this is.Lisa Ryan: So you had mentioned employee burnout. On this show, we talk a lot about company culture. So how do you get your employees to buy into this and realize that all the little data points and all of the quote-unquote paperwork that they're doing that they're being forced to do now to collect this data at the beginning is going to pay off for them? What are the words to use or the things to put in place, or so we have a little bit of pain here to have much less pain in the future if we do this correctly?Vinny Maurici: That's so important because change management is a part of anything we do for our customers. You can't just go in and say, Hey, you're doing this poorly, and I'm just going to plop down a new process, technology, and things that will change everybody's working life.Because people are still people at the end of the day, right? They might be going through a cruddy process, but they might do it for 15 or 20 years. You don't know that. And so, any change they might view as a negative. And the critical aspect here is to ensure the business user is a part of the process from start to finish.Suppose we will change technology or process to enable data to be an asset within an organization. In that case, the people managing that data must be at the forefront. So we cannot just say, Hey, C-Suite is mandating this exercise or C-suite is man mandating this initiative without having the folks who are going to be a part of that initiative or who are going to be the end consumers of managing and making sure that data is in there clean and consistent and accurate.They need to be a part of this process from day one. They need to be giving their input into, in terms of what they do day to day and have knowledge into this is what we're going to do, and this is why we're going to do it, and this is why it's going to make your lives so much better. It's not going to be painless because change is always going to change.You can go from a green screen to some UI-based system that will bring people to tighten up and say. I don't want this type of change. But if you flow with them through the process and allow them to be a part of any of these data initiatives. It becomes a lot easier, and it starts connecting and clicking, and then people start buying in.And that's the key. It doesn't matter how much money you spend on technology; it doesn't matter how good a consulting firm is. We're the best consulting firm there is out there for data. If you don't get adoption by the people who will be doing it, it's all destined for failure.People are important, and those working on data are essential to any data initiative and program.Lisa Ryan: Just from the standpoint of showing your employees how valuable they are to the organization, and as you have your tenured employees that are, that have that whole history of the company and why you did everything, and then they start to feel that maybe they're going to be replaced by technology or by automation and just capturing what we're losing in the data that they naturally have in their mind to put into that process so that they feel they're valued and they also feel that they're contributing to a greater mission in the organization than maybe they felt before. Having that as part of the conversation