The Manufacturers' Network

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce our guest today, Jim Huebner. Jim is the founder and CEO of Huebner Integrated Marketing, a 33-year-old firm dedicated to helping companies become more relevant to their customers and more profitable. From the world's leading recreational and emergency vehicle manufacturers to specialty baked goods and high-end power equipment makers, the firm has guided dozens of companies to more meaningful positioning, messaging, and relevancy since 1989.He recently published his first book, The Irrelevant Old Brand, about why businesses fail and how to avoid becoming irrelevant. So Jim, welcome to the show.Jim Huebner: Thanks. It's an honor to be here.Lisa Ryan: So, share with us a little bit about your background. I know you have an extensive manufacturing background, but how did you get to do what, doing what you're doing?Jim Huebner: Yeah, that's a good question. I always wanted to have my own business. I discovered in college that marketing was going to be it. I had some marketing positions before I started my agency in 1989. And about six years into it, we worked with many local clients, banks, doctor's offices, and insurance companies.But they're all local, and we had a large manufacturer in our town. So I got an opportunity to do some work for them. One of their divisions was an RV recreation vehicle division. So it was fun doing marketing for a company that, in a vertical market, was selling products all over the country, even around the world, as opposed to just doing some local things.So that was fun for us and more challenging and exciting. And we ended up in the late nineties just focusing on manufacturers in vertical markets selling their products worldwide. And that's all we've done since then. And yeah, that's how we landed in manufacturing.Almost all of our clients are manufacturers of some product, and they all have the exact needs. So that's to understand how they're most relevant in their marketplace and how they can be more appropriate. And we help guide them through that and then help them communicate that to the world.Lisa Ryan: So, what are some of the biggest mistakes manufacturers make regarding their brand?Jim Huebner: I don't want to overuse the word relevance too much, but everything in my book has some kind of connection somewhere.They're not all the same industries and things, but they are from many of our real-life stories. But often, manufacturers will find they got a good foothold in the marketplace with a great product. Over time needs change society changes. There are all sorts of changes.And unless there's this intentional methodology to determine how relevant you remain in that marketplace. They tend to drift a little bit. Sometimes it ends up just being a messaging issue.They're just saying the wrong things about themselves. So instead, they must focus on what is most meaningful and relevant to their customers. That's a more straightforward fix than sometimes when a product becomes completely irrelevant. Think blockbuster, or there are many situations where our society changes so much that a product is no longer relevant.But that's what tends to happen. They sometimes need to catch up on what their message should be or how their product works. There's some innovation with their type of product that they should have included. And they sometimes need to retool and figure out what else they could be doing differently that's more meaningful and relevant to the customers.Lisa Ryan: What would be some signs they may need to address relevancy? How would they know that they have some updating to do?Jim Huebner: Yeah, in the book, we outline our process. There are a lot of different ways to skin that cat. Our process is undoubtedly the way we do it. We recognize there are lots of different ways to do it. We start by doing some research and having a lot of conversations and a lot of surveys and things going out to find out why those customers are doing business with us in the first place.And why don't they do business with us? How critical are you to their success? How important is it that you're selling them what you have for their success? Because a lot of times, if you're just a commodity, that can be a considerable challenge. Suppose you're just a commodity and have yet to find a way to differentiate.I wrote an article once on how to not sell on price. But, of course, it would help if you were not a commodity. A CEO of one of our clients called me in because he wanted to discuss how we're getting commoditized.What do we do about it? And that's where a relevancy report comes into play. In the relevancy report, our goal is to uncover where those opportunities are. Where can we be more meaningful and more important to our clients? And it's sometimes about more than just the product.Sometimes it's just about how the service is delivered, the product, or the relationships. For example, we had a client and the manufacturing space, and they talked about a client like them in the book that sells. They manufacture self-storage units.It's all pre-engineered, still packaged, and delivered for the contractor to put up as a self-storage unit. And one of the things they found over time was, or through our research, that those contractors weren't doing business with them because their steel was better and their delivery was better because of all the traditional things. It was more fade-resistant. It didn't have anything to do with the product. It had a hundred percent to do with the people. It was because they built great relationships with them and hired salespeople who were great relationship builders.Those contractors knew they had their back and that in thick and thin, no matter how tough times were. This particular manufacturer was going to have their back. I remember one time, there was an employee of that company that I went to church with. I saw him at church one morning, and I asked what you would do this weekend.And he goes, Oh, I was sleeping all day yesterday Saturday. So then, Thursday night, we got a request from one of our contractors. He needed a bid out by Friday morning, and the only way I could do that was by pulling an all-nighter. And I got it done at seven in the morning, went home and showered, and returned to work for the rest of the day.That's why they say they do business with you because of your relationships because people are doing that. They're pulling all-nighters to meet the needs of the customer. So that's how they were so incredibly relevant to those contractors because they always had their back.It's only sometimes we have the best quality product. Sometimes it can be just the way you do business. Getting back to your original question, that process you need to ask, do the research and find out, and that sometimes honestly sounds selfish of me, but it's best to use a third party. It's best to have somebody from the outside ask your customers these questions because customers don't want to be uncomfortable or make it awkward in their relationship with you. So they'll tell you what they want to hear instead of a third party. They're like, I don't know anything. They don't know who I am, so I'm just going to let them tell them what I think. But it's finding those things out, finding out what they think you don't do so well, and finding those differing opinions about the brand.Some people might think back to that one manufacturer I just mentioned. Some of the people thought they were doing business with them because they had this special e-coated steel, which is why people were buying the product. And other people recognized. Now it's probably our relationships, but it's just that process of discovering all these differentiating factors and then what we call value indexing those and saying, Okay, here's all the differentiating factors about our company, our brand, our products.Which of these is most valuable? Which of these is the most meaningful and makes us the must-have one we've got to do business with? All things aren't equal. All differentiators aren't equal. You can have the steel. You can have a certain kind of steel or certain kind of treatment that you put on any product and or certain screws that you use or whatever it is.But that might be less valuable in the eyes of the customer. It would be best if you got to the bottom of what is most valuable and meaningful to them, and that's what we want to hang our hats on. Not that the other things are ones that you ignore. You still mention those in your messaging, conversations, and marketing.But as far as how you're going to separate yourself from the rest, it's got to be that one that is most valuable, most meaningful.  Lisa Ryan: How would a manufacturer decide who to connect you with? Do they hand you their customer list, and you go to town? Or do you call other people in the industries who are potential customers to find out about their reputation and why they may not buy from them? What does that process look like to even get started?Jim Huebner: Yeah, generally, they'll give us their list of customers, non-customers, people they've been trying to get as customers. Sometimes depending on the relationships, we've been able to talk to their competitors: really good resources or other vendors in the industry.Sometimes you can get what their accurate perceptions are of the brand you're working with from those other vendors. They'll say, Yeah, those are the guys everybody likes to do business with, or why is that? And then they'll extrapolate on that. But our four steps, or the four ways we do the research, is that we do interviews with key personnel is essential. I always say, this is just a gut number/ I haven't measured this, but I think probably 80% of the things we find out, they already know it's that extra 10 or 20% that is like, Oh wow, people perceive us this way, or they think this about our product, or they, that's where all the value is.You find that out. You don't necessarily find that out with the critical internal personnel so much. So that's where you find the baseline. But then we also do interviews with key customers, either in person or on a Zoom call. We'll do interviews with other key stakeholders, which could be anybody from their attorney or insurance people to anyone associated with or connected to the brand.Again, that's where the vendors come in. In the book, I give an example of a vendor that works in that same industry. And he provides some great insight into the main character in the book. And then we'll do a broader swap with email surveys and those kinds of things to get where it's going. They're rating certain things to give us a general feel.But it's the specific comments, I'll be honest, the specific comments that, that people will make in these interviews that end up shedding light on where they truly, where their real opportunity is. And sometimes they're nailing it. So it might be a slight messaging issue.Other times again, they might need it. And need to refocus on a sure thing that they're doing instead of what they have been doing.Lisa Ryan: What would be an example of a big aha when you were working with the manufacturing and presenting them with the market survey you found? As you said, 80% of the time, they know what's happening or realize it. But what would be some examples of some aha's that the manufacturer did not know that's how they were perceived? Or, could it be something that they were doing well or something that they were doing poorly?Jim Huebner: Yeah, one of the examples is the one the book is about, and somebody that's in makes a product. That is used in underwater sea exploration and anywhere with high pressure and a harsh environment. And they'd gone through 30 years of success, maybe even 40 years of success selling these products. They started getting beat up on price by some knockoffs and those kinds of things. So we went in and did this study, and we found out that they were trying to compete on a lot of the low-end stuff, and that's not your bread and butter. That's not why people buy your product.And it all came down to one conversation with one engineer. This happened. And that engineer said. You got to understand when I'm putting one of these units on a robot that will be skimming the ocean floor. The last thing I'm going to be worried about is that I spent five extra bucks on the most dependable product on the market because I have too much to lose.I have a million-dollar robot down there. I'm not going to screw around with some untested product, or I don't know how dependable it is when this one is 40 years of never failing. So that was the light. It was like, okay, so we've been sitting there talking about quality all along.The problem with the word quality is everybody says it. It's an entirely subjective term. What's quality? For, in their case, the quality. Yeah. It wasn't that it lacked. It needed more quality. It was high quality, but it was dependable. That was the word. That was as simple as that seemed. After doing this for 30 years, I'm telling you that people get so close to it. I'm the same way in my own business. I get so close to things I can't even see them. And that's the beauty of bringing in outsiders.What you probably heard it described is that when you're on the inside of the bottle, you can't explain what the outside of the bottle looks like. You lose that. For them to hear this engineer say, " Wow, " we got to focus on dependability.And then the beauty of that is so all of a sudden. It gives you this new lens of how to look at HR, production, and who you're buying some of your raw material from. All these things, and ensuring that, okay, if we're going to be the most dependable product on the market. We've got to ensure that everybody we're doing business with and internally is in line with that.That is our that's our battle cry. We're going to be more dependable than anybody else's. So how do we do that? That particular manufacturer had a person that was, and this is the example I talk about in the book, is they go through, and they hand test every single piece that comes through off the line instead of batch testing.So why is their product more expensive? That helps explain that they're hand, individually testing everyone that comes off the line as opposed to batch testing. And there are other reasons their price is higher. A lot of it's because they're the most dependable on the market, so that they can command a higher price.And so the result is they can get rid of the bottom feeders to people who want the cheapest on the market, and they can say, with great confidence, then you should buy this one because it's cheaper. But, if the one lasts forever, you need to talk to us. Did that answer your question?Lisa Ryan: Yeah. Because it reminded me of there are many times that people chase these bright, shiny objects. If you stick to your core values and why customers do business with you, something new comes onto the market. But we are taking that third party and getting the accurate information because too many times we either make stuff or listen to people who are making stuff up.Jim Huebner: Yeah. Versus having the basic information that counts. We have a give acronym, G I V e. E is endless quest. It's about keeping your finger on the pulse of how relevant you are. And that takes some work, and it can take either somebody internally doing it or an outside firm doing it. But it is essential to ensure that you're periodically making sure that our messaging is on track. Our products are meeting the needs or exceeding the requirements. In a constant evaluation of where is there greater op, where are there more opportunities for us to become even more meaningful and vital to these customers we sell to?Lisa Ryan: What are the other three letters, then? We started at the end with E.  Jim Huebner: So the G is, and you could probably appreciate this, G is a grateful and generous is grateful and generous. I believe, and I've heard this before, gratitude is the attitude that sets the altitude for living. You have to start by being grateful. To give, to pour out, and be a giver instead of a taker. It must begin with gratitude. And it's interesting. As I was researching all of this, I came across a study by the University of Oregon, and I quoted it in the book.It was a study done by a neuroscientist who studied people who are generally more grateful than the mainstream. And they found that as a result, and it's all chemistry-related. As a result, more grateful people tend to be more generous. Yeah. And I love it. I would've always thought that in my gut, but it was cool to come across an actual study that proved that was true.And I say, A life that, or a brand that gives, is a brand that lives. And what's it take for a brand to give? It's just like life; a meaningful, relevant life pours itself out, not one that takes. And a brand is the same way. A brand must give in some unique way that nobody else is to thrive. And that starts with you got to want to give. You must be, you have to have a generous, you have to have a kind of this sense or spirit of generosity. And then the second, the "I" is inspired difference.It's not just about being different. I threw it in giving because it's inspired because it's different in a meaningful and relevant way that helps make you valuable to that customer that makes your product valuable to the customer. So it's not just about what we were talking about before. It's not just about being different. It's about being different in a meaningful and relevant way and helps them get further down the path to success. So that's I, and then v is the value that exceeds the price. And that stems back a little bit to Warren Buffet's quote of price is what I pay, value is what I get.The more significant discrepancy there is between the value and the price, the more relevant or meaningful that product or service must be. The example I use in the book is Ace Hardware. With Walmart, Home Depot, Lowe's, and Menards for people in the Midwest, you look at that, and you think textbooks would say there's no way a store like Ace Hardware could survive. I have some connections. Ace Hardware, my buddy, owns five Ace Star stores where their family does. I have an affinity for Ace, but it's always dumbfounded me how well they thrive in that market. But it's because they're the value of going in and somebody tell you how to take the thingamajig and fix it with the do-hickey.All of a sudden separates them from everybody else. You walk into the big box, and maybe you'll find that person, but it's not guaranteed that you will find that person. And yes, YouTube helps. Things have changed, but at the same time, there's something about being able to ask that person, Okay, so if I'm going to do this, is this what I would use?And they go, no, I'm not handy at all. And I have to depend on those people. I can't tell you how many times I've gone there just because I want to know if I was doing this right, and I had no problem paying the extra buck or two or...

Connect with Tracy Wieder:Email: TWieder@med.miami.edu LinkedIn: https://www.linkedin.com/in/tracy-wieder-a8a65a12a/Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce you to our guest today, Tracy Wieder. Tracy has worked in the field of biomedical research for 30 years, starting as a lab technician, then moving into lab manager roles, lab director roles, and finally into her current role overseeing all research labs at the University of Miami Sylvester Comprehensive Cancer Center. In addition, she's a recognized expert on disaster preparedness and safety. So, Tracy, welcome to the show.Tracy Wieder: Thank you so much, Lisa. I'm glad to be here.Lisa Ryan: Please share a little about your background and what led you to do what you do.Tracy Wieder: Absolutely. I started just in college, getting a biology degree and going into research laboratories as a laboratory technician. And I minded my own business until one day when I lived in Houston. We experienced a tropical storm in 2001 named Tropical Storm Allison, and it wreaked such havoc on the Houston metropolitan area that I saw it in the laboratory setting. I saw entire careers destroyed by this event, and I have now made it a passion of mine to help out.With disaster preparedness information in any setting that I can get my hands on to help people understand that really disaster planning applies to everybody no matter where.Lisa Ryan: So what caused them to lose their careers in that?Tracy Wieder: So, in this particular instance, because it was laboratory research, they have very valuable samples that are irreplaceable. They're intellectual property, and they store these samples in liquid nitrogen. So at a freezing temperature. Around a hundred and minus 190 degrees Celsius. So even colder, it sounds even colder in Fahrenheit temperatures. And because of this disaster, we couldn't get the samples, and all of the power was out.The backup generators were out, so the elevators didn't work. And we couldn't get the liquid nitrogen supply up to the laboratories, so their liquid nitrogen evaporated off, and all of their samples were lost because of that. And on top of it, there was no power. There was no air conditioning. And in that particular event, we also had the morgue down in the basement of that building.And so there were that had not yet been embalmed that were also part of that there was a large flood, which made the area biohazardous so nobody could reenter for about three weeks when they let us go in to remove some samples. But we were out of the lab for about three months while they were trying to clean up the biohazard zone and dry things.Lisa Ryan: Wow. And I can't think of a time in our history over the last couple of years and actually, the last couple weeks with the hurricanes coming through that disaster preparedness is such a vital issue. But first, we're dealing with all the shutdowns and turnarounds from a worldwide pandemic that we haven't seen since 1918.And it was interesting to see how some companies could turn on a dime and go from manufacturing metal stampings to making masks, and they're making Yes of respirators and stuff. Tracy Wieder: So some companies were able to turn around. Others just weren't. Lisa Ryan: And then, of course, with Ian Hurricane Ian going through in the last couple weeks, you know, that devastation. But I also think that with the hurricane, not the people in Florida are used to hurricanes, but it would seem their disaster preparedness would be a little better than most because, I don't want to say they're used to that, but they get it more than we do in Cleveland.So talk about a few different types of preparedness when you have something unexpected like a pandemic and expected like a hurricane.Tracy Wieder: Exactly. I'll use this opportunity to mention the different types of disasters and answer your question.So as you said, there's the expected, and there's the unexpected. I always categorize it into severe weather events - like hurricanes. In other parts of the country, it can be mudslides, blizzards, and tornadoes. As you said, all things are not natural disasters, so a hurricane, we have some notice. An earthquake, you don't. It's just going to happen. A blizzard, you have a little bit of notice. And tornadoes are pretty sudden. But then there are fires, floods, and power outages. We had a disaster just in the last year involving a plumbing contractor breaking off a fire sprinkler head and instantly flooding the entire building. With that, there's so much pressure behind those fire sprinkler heads. So if you break off that head, you'll flood that whole building.And then, of course, there are epidemics and pandemics, which in the past I would've said, I would've often asked, say if I were speaking to people on this topic, I would ask how many people have been through a disaster at work? And now we've all been through a disaster at work and in our personal lives because of that pandemic.Yeah. So what's most important is just always to be prepared. Because if you prepare in advance, you're not worried about whether it's a fire that you can't predict or something that maybe like a blizzard that you know is coming, right? If you're just prepared, then you have your plan, you're prepared, and you'll be able to recover.To some extent, as opposed to trying to scramble around last minute. There's no big difference between whether you know it's coming and you and a sudden disaster because the best way to approach either scenario is to plan. Lisa Ryan: So, how does one get started even thinking about putting if somebody was starting from ground zero to put together a disaster plan? Where do you start? What does that look like? Tracy Wieder: Yeah, it can seem a little overwhelming and, in some cases, a lot overwhelming, right? So, the first thing anyone has to do in any setting is to determine your vulnerabilities. So in some settings, we might have toxic substances that, if released into the environment, could be hazardous to public health.In other settings, we might not have anything toxic but some very expensive equipment. But if it were lost, it would result in significant financial hardship for the company. And then, in some cases, we might also have intellectual property, meaning any inventions, anything that's unique to that particular company or organization that they have copyrights on, that can't be replaced just by going to a vendor and saying, Hey, send me another one.So everybody needs to sit down. Think about what they do on a day-to-day basis and what you would do if your computer, your records, and all your assets were gone. And when you think of it that way, I think it's pretty easy to come around to, okay, like I can replace this, I put my data on the cloud but this specific thing I couldn't replace, or it would be so expensive to replace it, that sort of thing.And then, so it's really about identifying those vulnerabilities first. Once you know those vulnerabilities, then you can work on them. What can we do to protect these items? The first thing will always be taking pictures because, for insurance purposes, you'll need that documentation. So especially if there are any assets involved, like equipment, you're just going to take pictures of all of it, and you don't have to spend a lot of time on that every year.The first time you do it, you get all the pictures, and whenever you replace equipment or bring something new, You take its picture and make sure you don't store it on a hard drive, right? Like we want that data to be stored in the cloud, where you would still have your data if you lost this particular computer.And the same goes for any standard operating procedures, protocols, or necessary documentation that your business requires to survive. The data you need, like your customer database, for instance -anything that needs to be stored on the cloud where you're sure it will be safe in case any individual computer is ever destroyed.And then from there, other things can be done too - depending on the vulnerabilities. But that's where you start. It's sitting down and saying, if everything were lost, What would be the most difficult to replace? Can we replace it, and what would it take to replace it? And then going from there.Lisa Ryan: So, thinking of what's going on with the cloud. I've had experts on the show in cyber security because that could be a disaster too. My husband's company was gotten into by ransomware, and they were shut down for about three weeks. It took that long to get their data back.Thankfully they had some backup. So yes, they still lost a week or two worth of data. So is there a happy medium between what you can keep on the cloud and how you ensure that you keep that data? Tracy Wieder: Yeah, that's an excellent point because you're right. In the cyber security world, it's hard to imagine anything safe. But again, I advise people to keep it on the cloud and a thumb drive for anything that's super critical. I don't want people to feel like disaster preparedness is. Oh gosh, now, I have to transfer things from here to there every day. So you want it to be manageable for people.So again, have to be like all of your data, but for anything that would be important, it's worthwhile to put it on as an external drive, another backup source. Lisa Ryan: So we've taken a look at the vulnerability standpoint. After that, what are some of the critical things that manufacturers should do to prepare for disasters at their workplace?Tracy Wieder: Yeah. And this question has evolved now after having gone through the pandemic, right? So I used to think much more about physical, animal, and equipment chemicals. And these are all still very important, but now we also need to consider our staff and how we can keep the business continuity going with a business continuity plan. So for organizations where they can send their staff home to work, even if you've called everybody back at this point, we must continue to cultivate that as an option when needed. I recommend that everybody who can do that, who can send staff home when needed, do work-from-home drills like twice a year where you send everybody home, you say, We're going to have a day where we work from home, and what are your problems? For example, Bill couldn't make his printer work. Sonya couldn't make her camera work. You go through all these things because these can change from month to month. The last time we did the drill, everything worked. Now this time, Tracy can't make anything work at home. So work-from-home drills are super crucial for those sorts of things. Taking pictures of anything that's a tangible physical asset is essential. I lived through that event in Houston, and it is incredible what the insurance companies will say. You can have a room where it's clear that the roof has fallen in, and they'll say how do we know it didn't look like that before?It's essential to take long shots of the warehouse or your work setting and close-up pictures of the equipment itself. And it's not that this will keep you from losing that equipment, but it will make it much easier for you to recover.When you're making insurance claims, also, as we said, store things on the cloud, and have backups on external drives. It's imperative to keep updated contact information for all of the teams that you work with. Because at the end of the day, we must take care of each other and look out for each other. But in addition to saying Hey, maybe I have power at my house. You guys don't have power. Oh, come over here. It's two degrees outside, come to my house. Other than that, it's also how you stay in touch about what your organization has made announcements about coming to work or not coming to work.And it's just vital to have that contact information. And then, if you have anything on an alarm, often high-end equipment can be on alarms if it goes out of its operating range. So, make sure you test those alarms regularly and that they're working and making contact in the way they're set up to do.That's important. I've seen cases where people have a freezer go into alarm and need updated contact information. Or something needed to be fixed with the connection for the alarm monitoring system, and it's only when they come in Monday and find their freezer thawed, and everything inside of it lost that they realize that their alarms were working.So testing those alarms is essential. And if you do have anything that's intellectual property that if it's something that it would be possible to distribute, like with collaborators or other branches of your company, it's a good idea to have everything in a variety of places.Whereas if that place were lost, it's all just gone. Where maybe you have other locations. Again, it's very broad with manufacturing, so it's hard to speak precisely to any particular environment. But that's the general gist of it. And then also being able to move things if you see the need.So having a plan in advance, like if we know something is coming, do we have a location that we could contract with in advance where, say, I'm on the first floor, maybe we get these things up to the fifth floor? So depending on the disaster, if it's something you can plan for, moving equipment, assets, or intellectual property around can be helpful.But you have to think that through in advance. If needed, you must have the right electrical in place—the proper utilities and space where this is coming from. I'm going to move these items. And then, as you had alluded to, it's different in the sense if you know it's coming, and you don't know it's coming in the way it hits us, but the way we prepare for it would pretty much be the same. Just plan and understand what you're going to do. Lisa Ryan: And one of the things that I never really thought about before, which was brilliant, is the go of the work-from-home drill, just sending people home. I know that some companies are all bent on bringing everybody back to the odd, back to the office 24/7, bring everybody back, which is a mistake because I did too.Yeah, people were perfectly capable of working from home for two years and getting the work done. Does it matter where they're working? It's nice to get people together and have some core hours or days. Yeah, but the thought of Just like you have a fire drill. Which is always a bummer when it happens in front, in the middle of a training program,Just tomorrow's a work-from-home date, with no notice except for the night before notice to see what does work and if we need to do that. So I like that. And then the other thing, when you talk about getting dated contact information, that goes hand in hand with workplace culture because you have to create a workplace where your employees, especially your hourly employees, trust you enough with that information, with their home phone number, with their personal email address. So you can get ahold of them when needed. And even that example you said of, it's two degrees outside, and we find out that one employee doesn't have heat and somebody else does. So we can start connecting people and making it about the people because they are your greatest assets. So those two were good, simple tips for people too.Tracy Wieder: Yeah. And at the end of the day, we must take care of each other. So I hope that in most work environments, people trust that they understand. But, of course, if people aren't comfortable sharing their home contact information, that will probably make it a more significant issue.Yes, it's probably a bigger issue going on there. They need to look for a better work environment because these are really how, other than just being a humanitarian and wanting everyone to be safe and well. This is how companies show the employees they care: keeping them safe, saying to them, we're going to prepare for a disaster so that you don't have to be without a paycheck for longer than is necessary if something happens. And some employees who, if the work shuts down, are without a paycheck. And so that's another way of showing that we care for our employees is to say I'm going to prepare so that we can recover quickly and get you back to earning money. If there were a fire or the worst were to happen. Lisa Ryan: And so yeah. It's really, it's part of the culture, too, of does the organization care enough. Because we think about, again, in disaster planning, our intellectual property, our machinery, our equipment, but when things happen, And I think that we saw it during the pandemic, the importance of empathy, of reaching out to employees and saying, Hey, are you okay?What do you need? How can we support you? How can we be of assistance to you? And sometimes just making the call. For example, as a member of the National Speakers Association, I was on the task force that we reached out to every member in the state of Florida after Hurricane Ian. It was amazing that people said, Wow. I'm in four different associations, and nobody else called, and they're in the middle of the state. They're not affected, but we don't know if their loved ones are. So it's reaching out to people in times of need and seeing that there are people on that other side of the equation because, really, you don't have a lot without those assets.Tracy Wieder: And it just means a lot. I'm in Miami, and although it looked like Ian was going to hit us at one point, it turned, and it didn't. That's common with hurricanes. So we're okay, but our heart is breaking for our neighbors just north, right? The pictures are horrible. Some people say it's the worst hurricane that ever hit Florida.So I agree with you. But, again, just showing some empathy and concern. And even if we go back to my example, which you referenced, you like how easy it is to say open your doors to someone who doesn't have power. And maybe it's 115 degrees outside, perhaps two degrees outside, but I got power.You don't like how hard it is to say, Come over and stay safe. Don't freeze. We're in this together. Let's get through it together. And it's important to form cultures like that in the workforce so that people feel they are a team and a family.Lisa Ryan: Exactly. And as we end our time together, what is your best tip regarding disaster planning? Whether you're getting started or just. Make sure you have some plan in place. Tracy Wieder: Yeah. So the best tip is just what you said, is to have a plan. That's the number one best tip. So once you're there, you're in really good shape. But yeah, and as I said earlier, but I'll emphasize it again, as you're making that plan, think about it. What are your vulnerabilities, right? What are your most vulnerable? Or sometimes, for some organizations, those vulnerabilities are going to be, what are your most critical functions?How can we shuffle people from here to there? Cross-training has become vital for this. What if you have a team of six, and five...

Lisa Ryan: Hey, it's Lisa Ryan, and welcome to the Manufacturer's Network Podcast. I'm excited to introduce our guest today, Jason Azevedo. Jason has had the heart of business development since an early age, starting a very successful apparel company that grew from humble garage beginnings to annual gross billings of over a million dollars at age 15.By age 18, Jason was doing millions in business with Starbucks, Nike, Disney, Marvel, Volkswagen, Audi, Lucas Films, Dodgers, and countless NBA teams. Jason, welcome to the show.Jason Azevedo: Awesome. Thanks for having me, Lisa.Lisa Ryan: So, I know you had an early start, so share a little about your background and what led you to do what you've done. Jason Azevedo: Yeah. I'll tell you a story about what it is. First, I've got to set the stage. It was February of 2007 when we started our first company. I'm 15, my brother's 20, and we came from a household where our father worked in a factory, where he worked the graveyard shift for 28 and 29 years for the same company. In the last six or seven years of working there, he got laid off about that many times because there were so many changes in ownership.My brother and I were watching what the most profitable plant in the country for these companies was. That's why they're able to keep on selling the plant. But they had messed up the relationship between the management and the employees so badly that the plant was almost impossible to own. So we got to see it from the employee side and what that does to a family. There's a person's dynamic when there's all that turmoil going on within manufacturing. So we launched our first company at 15, believing we could do something special for the people. And really, it didn't have to be that toxic environment in a manufacturing plant.We started with t-shirts of all things. And because it was February of 2007 when the market crashed, about a year later. So we took a left turn, went with the most complicated production possible, and got ourselves onto the cutting edge of that industry.What ends up happening is a ton of clients are available because companies are going out of business left and right. So it left very strong clients that needed cutting-edge work to stand out in a tough market, which launched.Lisa Ryan: Besides t-shirts, what exactly, what were you doing when you saw the economy taken a dump, and all these companies were looking for help? What were you doing for them?Jason Azevedo: We started in t-shirts, and that, frankly, that great of a business. As I said, the market fell out, and at that time, a lot of what we were doing was for a 15-year-old kid, and it was family reunion shirts or giveaway shirts. All those budgets disappeared, whether it be on the personal side or the corporate side. We cut and sewed the shirts, doing the craziest things possible. Also, there was a massive push to switch to more environmentally friendly inks. We were helping develop those with the ink companies on how to use them worldwide.It became a movement into the current apparel cycle, and we even got into doing cup sleeves for coffees made from denim. So just making anything based on apparel or textile and trying to develop it in a more modern, more cutting-edge way throughout the product's life cycle.Lisa Ryan: What were you doing with Nike, Disney, Marvel, and all of these? So just so talk a little bit about this. Why did they reach out to a 15, or maybe by this age, 18-year-old kid to do this for them?Jason Azevedo: So interesting things happen when markets crash. Prominent players will start having cash flow issues, which we saw happen in 2008. A company servicing Disney, Nike, and Adidas will typically be this massive conglomerate in the space. Those guys started having problems and couldn't keep the doors open because of cash flow. Suddenly, a company like Disney of the world or a large organization like that they don't have a place to go, and they're searching for somebody to take something on.The other part is it has to be somebody that, when you've got your marketing budget. There are two schools of thought. There's either spending way more on fewer items or less on more things, and it's a volume versus a quality issue. Many companies realized, hey, I can't give away a hundred thousand shirts a year anymore. I can't give away a hundred thousand pieces of apparel.But what if I can give away 10,000 that makes an impact? And that's what we are going to people and selling them is, hey, the those free the ugly chintzy things that you were doing that doesn't work anymore.I'll give you an example. We worked with a prominent cybersecurity company and helped them develop their trade show booth. And when you would walk into the booth, they gave out shirts with the company logo on them, and it was okay, whatever. And they told me where the shirts are, and we'll give you a giveaway or some of that. So people would walk into this trade show booth wearing this piece of apparel they were given that looks like a cheap giveaway. As soon as you walked into their booth, we had embedded photo chromatic inks into it. And suddenly, all these cybersecurity terms would start showing up all over the clothing you're wearing has the company sitting there going, See when you're with us, you can see all the problems. Wow. So that's what we were doing. We were selling way more than, Hey, this is cool. We were trying to ensure those marketing budgets were going as far as possible.Lisa Ryan: Oh, that is so interesting. So then from t-shirts, where did you go?Jason Azevedo: We ended up moving into the retail display, another transition point. We got into producing the in caps in all the major box stores and Best Buy and Fry's Electronics. And this was really during that time when everyone called the retail apocalypse.But really, it was a change in the market and how you market in-store and what you were looking for and embedding a lot more communication between the client and the display, whether that be buttons or integrating control systems that turn on lights and interact with the person that's looking at the display.What ended up happening is we started that display, that company largely assembling components bought by other people. So we would design them, send them out to somebody, they would make our sheet metal, or they'd make our plastic, or any other combination of people couldn't hit the standard that we were looking for regularly.We started buying or building all of those sub-companies, whether a button manufacturer, sheet metal company, injection mold or print division.We started honing in on all these different manufacturing types to build these displays. You went out, but you weren't finding the quality of the needed products, so you just started buying from companies.What did that buy or build the companies? And it wasn't necessarily the quality as we were in the marketing sector. Marketing's a very fast-paced industry, and we noticed that American manufacturers we were talking to in our local area are quoting 12 to 16 weeks lead times. In the marketing world, 12 to 16 weeks is insane. That that there's just, that, that timeline doesn't exist. We couldn't get the responsiveness we needed, so we started building the companies ourselves.Lisa Ryan: What were some things I know we talked a little bit about before the show that you are working with legacy manufacturing companies and helping bring them to that next level? So what are some of the things you've done that have set you and those companies apart to get them into a different way of thinking?Jason Azevedo: What we do nowadays is we buy legacy US manufacturing companies. Usually, they're going to be second, third generation companies with no planned-out succession plan. So they're giving away to make sure that the company stays safe in the community that it's in but also adds that energy level that, and new processes that we develop whether that be real new age automation and how we have robotics or automation or computer systems control more and more of the pro the process or just modern processing in general?During the late nineties, the big one was kaizen and all these buzzwords. There's a new age of mixing that with technology, and how do you work with that? And because many of the companies we purchase from are second or third-generation. They haven't gone through that transition to becoming, to use a buzzword, a lean organization, or focused on how we bring the production size down or up as much as we want but not have it affect our internal plan.Lisa Ryan: There are so many things you said regarding succession planning because when you pass that second or third generation, who will you give it to them if the kids are no longer in or the grandkids are no longer in there? And then, of course, there's always the fear of automation of people coming and what jobs will replace, or how will that modernize us? If somebody listening to this show is in that space where they don't know what the next thing is, what are some of the things that you've helped these manufacturers do, or I guess look at it differently when it comes to creating that legacy that they worked so hard to build?Jason Azevedo: Yeah, so you hit on something that I like to take on head-on, and it's something that we have to take on head-on when we go into companies. It is a fallacy that automation removes American jobs, right? On the contrary, it gives them because automation and innovation are why the competition from low-wage countries is fading quickly.That tool allows American manufacturing to grow and fulfill its need; if manufacturing companies do not automate, there is a considerable problem—why we're consuming products three to four times faster than we did in 20 years? Yet have the same manufacturing force. If we cannot produce three to four times faster, we cannot have the products that the industry requests. So we always take that head-on if automation is not something to be feared. On the contrary, automation is the tool that allows American manufacturers to compete with anyone in the world because now you can pay a good wage and get products.Lisa Ryan: Not only that, but many younger people also coming into manufacturing have this idea of it being dark, dirty, and dangerous, and now you're showing something clean and modern. Somebody walks into a plant, sees a robot, or sees automation. It brings a whole new level of attraction to manufacturing because it busts what they thought it would be because you have to have a clean environment to have robots.Jason Azevedo: You hit on another thing that's near and dear to our hearts because of that mentality that people have stuck in their heads that Charles Dickens dirt floors, machines throwing grease everywhere. That's most people's picture of a manufacturing plant. That has directly caused an issue with succession planning in the space. An entire generation of kids was told to do anything but go into a plant, whether from the leadership side or the floor side.They were told about any industry on earth other than manufacturing. I was told that my brother was told that. We didn't listen very well, but we were told that. So that is causing this gap: not a large class of people coming into the industry. And we're trying to get as many people into plants as possible and show them, Hey, this is not what you used to think about it.If you look at the Tesla drone footage going through their plants, they look like dealerships, not plants anymore. They're white floors and bright lights like they're gorgeous. And if we can get people to break that stigma, now you've got a strong industry brewing around you.Lisa Ryan: If you look at it from a parent or guidance counselor, the kids' thoughts begin regarding what they will do with their career here. You have a great job, good money, and excellent benefits, and when you leave work, for the most part, you leave work. It's not so work-life balance - not that there's ever any balance, but work-life integration is a lot easier if you're looking into some of these types of jobs in manufacturing for that reason. Plus, you're making good money without a lot of student loan debt because you don't necessarily need to go to a four-year college.Jason Azevedo: That's where the beauties of manufacturing are. Throughout the manufacturing industry, pretty much every job will pay you to train you on-site. This is not a, Oh, get an education, hope you get a job.They will walk into most manufacturing companies and say, " Great, let me show you how to help me. Let's do this. And that's a massive step in the right direction. Also, I think you've talked about it a little bit, but the technology and connecting these new employees with the mission.Lisa Ryan: I often run into this conversation about these people saying these kids don't have a work ethic. They won't pay their dues. Nobody is paying their dues anymore. We're connecting differently than we had, knowing they see the world differently regarding technology.So there's a lot of this old mentality that we have to, little by little, start to get out. Because if we're looking at 3 million manufacturing jobs going unfilled and not enough people to them, to begin with. It's a cleanup job. We have our work cut out for us.Jason Azevedo: We've got a generation that was told to stay away from the industry, and if not two generations, unpacking that will take time and what it's created. This is somebody who was told not to go into this industry and that it was a horrible place to be. So it takes showing that it's not an awful place yet. There was a period when it got really ugly because we had a sudden issue competing against low-wage countries, but Americans did what Americans do, great. They innovated their way out of it. And that understanding is from craftsmen who have been in the manufacturing industry.For 40 years or a new person coming in, you need to convince both of them that the times have changed, and if the second you can do that, the two can learn from each other. Huge. And one of the things that we run into is there. One of the significant parts of automation is that it's taken away many painful jobs that destroy your body. So any plant should first consider getting rid of those jobs with automation. So that whole pay-your-dues side is part of its running away because there isn't a machine to stick the young guy inside and make him turn a wrench all day on it. So it doesn't exist anymore throughout a lot of these.Lisa Ryan: The other thing we have to consider is workplace culture. You said at the beginning of your career that there were a lot of toxic companies out there, and believe me, there still are, but creating the workplace type of culture brings people in where they feel valued, acknowledged, and depreciated. And I know that you have also explored the opportunities of ESOPs where not, you're not only getting people to buy into their mission, but you're helping them to become owners of the company, which would create that loyalty. Can you talk briefly about what you're doing from a workforce standpoint to make that great environment?Jason Azevedo: Yeah, so every, because we buy legacy companies, you also purchase legacy attitudes, legacy quality, let you buy what this company has Been. So we purposely do look for companies that have a better culture than most because it, frankly, it's easier to start from there. But one of the biggest things you put on you went to the ESOP. We, the general partners for MRCA. When we got together to build this company, we promised to give ESOP 100% of the share in under ten years. So the entire national portfolio, if you work for MRCA, you're getting the share, which was the promise we made to everybody. And frankly, that goes a long way with culture when people feel they have a piece of it and are part of it.But I'll give an example. We're very fortunate. One of our heads of manufacturing was one of the early Tesla people. He came in the other day. He says I want to put plants on the shop and the plant floors. Okay. Why? Because working in a concrete bunker isn't, it's not comfortable. So why doesn't the shop floor get plants if the office gets plants? Excellent point. Okay, let's get plants on the shop floor. And so it's simple stuff like that. We have a company of ours that we just took it, that all office engineering, and all other employees, now sit on the shop floor.There are no offices at all. Because the question came up, why is one different than they have to take phone calls? Great. Then we've got phone meeting rooms, but you're in the plant the rest of your day. And so stuff like that goes a long way. A couple of years ago, 4th of July, we're an American Manufacturing company.The 4th of July is a big day for us. So we were running for 24 hours. And we could not because, and this was, there were still some covid rules going on. So the only way we could do a barbecue for everybody was for the owner personally do the barbecue for 24 straight hours and individually package everybody's lunch that day.Lisa Ryan: Wow. You can't replace that. We talked about paying your dues as ownership. You got to pay your dues. People must know you're willing to go to any portion of the company, and the culture starts building itself. You start getting people that genuinely believe in what's going on. And it's funny because it sounds like that takes a lot of time to do something like that. Would you instead spend time connecting with those employees by having something fun like a barbecue they've probably never experienced in their career before?Or would you rather spend your time interviewing new candidates for jobs because you keep losing them? So when we build that strong culture, it gives us the time and the creativity to do new things because you're not spending all of your time trying to recruit and attract new people in a market where they're just really hard to find.Jason Azevedo: There's a famous Richard Branson quote that I, that we live by, and it's, people, ask me what if you invest all that money and time in people and they leave? What if you don't, and they stay? But it is a lot of work. Culture is a lot of work, and the reality is that manufacturing, specifically in every industry, loves to say we're in the people business. No. We are in the people business. We use more person-hours than pretty much any otherindustry. And the reality is manufacturing companies sell person-hours. So if you don't realize that your number one asset is the human, you'll be you won't get how the industry runs.Lisa Ryan: Yeah. There was another Richard Branson quote that I love, and I'm probably going to get the words wrong, but basically, he said, train your people so that they can leave, but treat them so that they won't.Because, like you just said, you're investing in your employees. You're giving them the tools and the resources to be better tomorrow than they are today.And when you treat them well so that they feel connected to...

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network podcast. I'm excited to introduce you to our guest today, Jonathan Klane.Jonathan is senior safety Editor for Lab Manager Magazine and has been in the field of environmental health, safety, and risk for 35 years in many roles. He's also a Ph.D. candidate in human and social dimensions of science and technology, where he studies in two large areas risk perceptions, cognitive biases, decision making, and storytelling, how it affects how we see risks, and its many other valuable benefits. Jonathan, welcome to the show.Jonathan Klane: Thanks, Lisa. It's an absolute pleasure to be here.Lisa Ryan: Please share a little about your background and what led you to do what you're doing.Jonathan Klane: I started in Maine as an environmental geologist and an industrial hygienist. My undergrad is in geology. I got hired to do industrial hygiene, which is just exposure science. Your listeners in manufacturing would know processes generate vapors, fumes, et cetera, and someone has to know how to measure that and figure it all out. So I did that and gradually ended up doing training. Then taught college for several years and enjoyed that, exposing me to different clients.And from there, I got back into consulting on my own. I did that for a few years before finally migrating to Arizona, where I worked for Arizona State University as a safety director. On my card, it said bald-headed Safety guy. That was my title. People would say, How did you get that on the cards? And I would always say, Oh, I figured out how to hack the system. But it was that no one cared. So it was a nice joke. I did that for ten years and a couple of different colleges of engineering.And then that eventually took me to this wonderful role I'm in, where I finally write for a living, which I enjoy doing for a lab manager magazine. It's a great place, Wonderful people. And we write about all sorts of stuff dealing with labs, Senior safety editor. So I write primarily about lab safety, about risk. And, of course, as part of the Ph.D. program, I write a little bit about storytelling, or I engage in storytelling as part of it.Lisa Ryan: Both are important to the manufacturing office audience because the risk is inherent in working in a plant environment. And what you said earlier with the fumes, you want to ensure that you're keeping your workers as safe as possible. But that also brings us to storytelling, where you can convey to your employees the importance of what they do and how you care for them. What is the reasoning behind why what they do is so important?So let's start with risk. That's what you want to avoid the most in manufacturing. How would you describe risk and some? What are some of our perceptions as far as risk goes?Jonathan Klane: Risk is a much better concept than just safety. In safety. We always say you're safe or not safe, and it's such a binary concept that it's not usually helpful. There are so many nuances to it, but risks. I'm sure a lot of your audience is familiar with this. You can look at it as two factors or three factors. So, the two in particular to start. What is the probability of something happening? Basically, what are the odds, right? And then, of course, how bad will it be?What's the severity of the consequence, right? And so, besides processes that generate vapors and fumes and dust and all of that stuff, or maybe it creates dust that collects. And then the worst thing that could happen is they could have a combustible dust explosion. That has occurred across many industries.It could be guarding issues, so the worst is someone can get devastatingly injured or even killed if they bypass the guards, if the machinery doesn't have the proper guards, or if someone starts up equipment, et cetera. So, we can analyze things by severity and probability.The third factor that I like to use, and others don't, is exposure. How exposed are we? An operator, let's say of a system that's got product moving past them, has to check if they're within touching distance of the operation. So they have a significant amount of exposure to that risk, probability, severity, what can happen, et cetera, et cetera.And as opposed to someone much further away, they have far less exposure to it. And thus far less probability. And some people embed exposure into the probability part of the equation. So perhaps the better analogy, and I'll use some risk perceptions for this as well, is biking, or the better example that many of us can relate to.I don't know. Do you bike by chance, or do you know how to bike?Lisa Ryan: Yeah, and I make, I wear a helmet, and I make my husband wear a helmet. Much to his dismay.Jonathan Klane: I wear a helmet. I have no protection except the helmet. And in my skin, as we said. I've been hit by a car I've wiped out on my own. I don't know how many times my head has hit the pavement. I don't know how many times with a helmet on. It rings my bell, but I can always walk away because I've got that protection. So I perceive the risk, and I've taken the step where I think I have the most critical exposure to the hazard.Here's a good way of looking at it, Lisa. When I used to work at Arizona State, it was about a nine-mile bike commute. And one night, on the way home, on a major drag, a very big road university drive, I got hit by a car. So the police officer responded the guy drove away and never found them. And the police officer said you had the right of way, et cetera.So sorry. Glad you're okay and all. And the next day at work, I told a buddy of mine, Rick, and he said, John. You got to get off the major roads, right? There's just too much traffic, right? You're exposed to a lot more traffic at a lot higher speed. They're not paying attention. So you said get on the side roads where there's less traffic. They're going slower.Follow me home. I'll show you the way. All of a sudden, by changing my route, I could reduce all the risk factors, right? Exposure, probability, and to an extent, severity. Getting hit by a car going 45 is different from getting hit by a car going 25, right? Odds on. This how do I recognize the risk factors, and then how do I control them?Plant managers do health and safety. People do supervisors online. Maybe the maintenance crew does. I used to work with many maintenance crews in all sorts of manufacturing and other facilities, and one person will perceive risk differently from another. I live in Arizona, and we get dust storms. We had one last night. Now our shingles have been upset by the winds. Our shingles are going to be replaced. And the roofer was on the house, right? The guy was inspecting it, and we were joking back and forth, and he said it doesn't bother him in the least, right? But he's got a brother-in-law who is in law enforcement and has been shot twice.To each or their own, how do we perceive the risks? And we're, and the science speaks to this very clearly. We're very comfortable with the chances that we know that we take on ourselves willingly, not forced upon us. If I want to wear a mask for Covid, I feel okay about it. If someone makes me wear the mask and I'm resistant, I probably don't feel good about it. And if I'm doing it willingly, I don't see it as a considerable risk. If I'm being, if it's being forced on me, I'm probably going to assign it a negative. We call it a valance, but a value. And therefore, I think that there is a much greater risk. So the risk is about our human perceptions, which are incredibly subjective and vary tremendously.Lisa Ryan: When you said at the beginning, you're either safe, or you're not, that's black and white, where with the risk, there's a lot of grays thrown in there. And in the manufacturing, and I don't remember if this was an audience member or a podcast guest, but what they had implemented, I think they called them "gotcha" cards, something like that. So if they saw somebody participating in risky behavior, they called him on it. They said, Hey, you're at risk. The funny thing is the person I was talking to was the manager who implemented this program, and one of his employees busted him because he was unsafe on a ladder reaching for something and could have gotten in trouble.He could have gotten hurt as a result of it. And the manager was like, Yeah, of course. Give me a part because you legitimately caught and perhaps prevented me from getting hurt. When we look at the maintenance environment, we must create a safe environment where people don't feel like they're snitching. It's if nothing terrible happened, nothing bad is going to happen. There's this little, tiny chance that it's going to, And then are you going to feel bad because you didn't quote-unquote snitch on that person? But we're looking at keeping everybody safe.Jonathan Klane: And our brains are great, but they create heuristics mental shortcuts because our brain is about 2% of our body weight, but it consumes 20% of the energy we use. It's an energy hog. Fuel hog, but it's our brain. It needs it. Part of the way we've evolved is to create these mental shortcuts. They're called heuristics. And all sorts of stuff, right? And it's very subjective to us. So, it might be that a heuristic might be this operation has never hurt me. Therefore, it is safe. And not addressing the fact that odds have a way of catching up. I would bike and go through neighborhoods instead of on the major roads.I live on a grid system. Everything is 90 degrees off, but there are neighborhoods that I could cut through, so it lowered the risk, and I might drive dozens, hundreds of times. I measured it because of the nature of what I do with risk and studying it that on like the 500th time, all of a sudden, there's a car coming in this place that there's never been a car before.But I might have been hit if I was not paying attention to it because I didn't expect the car. He didn't expect the biker. But after doing it hundreds and hundreds of. It finally happened, and I remembered my dad telling me his story. So I wrote long-form creative nonfiction about it.My dad said, Hey, Johnny, now that you've got a ten-speed bike, I was a kid. You got to remember something. I said, What's that, dad? He said there's always someone coming. And it's like gun safety. The gun's always loaded, right? You're biking around neighborhoods; you're not paying close attention. There's always someone coming. And the other one my dad would use. I don't know where he got all these things. I'm pretty sure he didn't come up with them, right? But they were good. They lasted with me over the decades. Lisa, he said, Johnny, there's a lot of people in heaven who had the right of way. And it's just such a great, powerful metaphor, right?Lisa Ryan: And that's the thing. It only takes that one time. I think about what we just went through with the devastation from Hurricane Ian, and there were a whole bunch of people that evacuated who were probably mad because they evacuated and didn't need to.And then there's a whole bunch of other people who didn't evacuate, who wish they would've because they lost everything. So that's a thing we never know when that. An incident is going to happen. That changes everything. Or, like you just said, it causes us to go to heaven.Jonathan Klane: And it's about our consistent behaviors, habits, and even so, think that work teams are rituals. Like sports. . Sports figures, right? Like Nadal and so many different, different sports, right? Whether it's tennis, baseball, football, or whatever, they have rituals and excellent science.I just read another paper where rituals help our brain in putting us in the right frame of mind and preparing for what we're trying to do rituals. Don't mean anything. They don't have a physical construct, meaning they haven't changed something that's going to occur, but they have so much meaning to us.For instance, a wedding. A wedding isn't a legal mechanism. There's paperwork and legal stuff, but the wedding itself is a ritual that has tremendous value and meaning not just to the couple but to everyone involved. And they've even done studies to look at oxytocin levels, human love, and bonding chemical, and the closer people are to the people that matter the most.In the case of a wedding, a bride and a groom. Or two brides. Or two grooms. And they did oxytocin levels, and the closer they were to that, The higher the oxytocin levels. I think the quote was the bride's level was just off the chart. Her oxytocin level was like through the roof, so these habits that we got into my habit of biking on side roads helped protect me. But more significant than that, my writing that long-form story about biking risk, about conversations with my dad in episodes I had or witnessed, including my crashes and others that I helped take care of or tried to avert, caused the behavior change in me.That the writing of the stories and the meaning of the stories, and how powerful they were, caused me to reflect on whether I would wear earbuds and listen to music, which I loved to do. I remember it fondly, but because it was so meaningful in such an emotional way to write those stories. I realized I was driving up the risk by having earbuds where I couldn't hear traffic and by trying to see how fast I could get to work and time myself and see if I could beat my times.Those are risk-increasing behaviors, right? And so it was only through this self-storytelling that I could eliminate those behaviors. So we're back to the power of stories, which can be used for health and safety purposes.Lisa Ryan: And that's what I was going to do now because when I think about storytelling, and I think of manufacturing and specifically attracting people into manufacturing, opening up as a viable career path, part of that is bringing employees in, with the story.So what are some of the things you see regarding companies using stories? I know you've talked to many people in your Ph.D. research, but how are companies using accounts to attract new people and use them as an engagement tool to keep their people?Jonathan Klane: Absolutely. In so many ways. It's amazing to me how much I'm exposed to this. And it's a great question, Lisa. So just one example I've seen for several companies, including ours, LabX Media Group, that we have, instead of an employee handbook or manual, it's a playbook. And the playbook is about culture.You've probably seen this with a lot of your clients. I saw this with another local company here. I read through the entire playbook, and it tells the story of the culture because an employee wants to know what it will be like there. I understand the job because I've done similar jobs, but what do people like?What's the culture like? And the same thing goes for the company. They want to know about that person. So a great way of learning is to ask someone, so there's the usual question, Tell me a bit about yourself or whatever. And you and I were chatting a little bit before, and I shared the advice I had gotten, which I think is great, which is if you want the truth, don't control the answer.It's scary. You get the truth, and sometimes that's helpful. And there's good research on vulnerability, how we can bond and relate, and how people connect. So, a good question, instead of telling me about yourself, is, tell me a story.Tell me a story that has meaning for you. And stories are just such an excellent way to create meaning-making. Researchers consider them as meaning-making and sense-making tools. They allow us as the storyteller and the story receiver, listener, reader, and viewer to better understand the world around us as described, whatever that world is. And that story, real or fictional. It could be middle earth like Lord of the Rings, right? It can be outer space—Tattooine with Luke and Leia and all that stuff. And we have the willful suspension of disbelief where we're so wired for stories, Lisa, that we're willing to give up the reality and let ourselves be what's called transported into this story. The best thing a storyteller is looking for is that the viewer, reader, or listener feels like they're part of this story where time has a way of slipping away. So stories can be a great way for work groups.To better relate stories can be a great way for different groups to understand each other and for different people within a group, to understand their diverse perspectives and perceptions of the same situation. Maybe it was an incident. Perhaps it was a close call. What was going on? What was What were people doing at the time? So thinking and stories can be a great way. People can collaborate on a story. People can tell different stories about the same thing and tell each other, and then there's so much wonderful relatability to it and context and meaning-making that it can help make teams much more effective. If it's done well, it can also be done reasonably quickly. And I know this is something that you and Scott discussed to build psychological safety because stories are a great way to express one's vulnerabilities, which we all want to relate to. I think it also makes it easier for people to remember.Lisa Ryan: If you're, trying to share numbers and statistics and all of these things with your employees, they don't care. They don't remember it two seconds after they leave the meeting. But if you show them specifically a story that ties into what they're doing, the difference they're making, and what the increase means over something else. One of my favorite books is Bill Bryson's, a short history of nearly everything, and he talks about the size of the atom in a molecule. And he said that if you put a piece of paper next to the Empire State Building, that is the neutron of the atom compared to the size of the rest of it. In my whole life, I would never think of the size of an atom, but it was the story that he told me, and I read that book years ago. I just reread it because I like it so much. But yeah, that's the thing that makes a difference, that we remember stories, we don't know numbers, we don't remember percentages as such.Jonathan Klane: Oh. Yeah. You're getting it. So much of the research is almost as if you could be teaching this stuff, Lisa. ? It's been studied since, God, I think, the seventies. Eldon. Tell that we have all sorts of different memory aspects, but a couple includes semantic memory, which is, like you were saying, facts, figures, data, and statistics, which we, the brain, is not wired well to recall, easy to forget type stuff. And then we have something called episodic memory, which is obvious. It's about episodes. What's an episode? An episode is what life is. Life is stories. That's how we're wired, right? And stories are a wonderful way to get people to remember things.I did a study with others when I was at Arizona State, and it was whether or not humor or stories worked better in safety. And so in manufacturing, you got to do a lot of safety training, right? In this case, it was biomedical engineering students, and we had to do fire safety, lab safety, and biosafety three courses in seven class sections. So that's 21 courses every semester. That's a long, And I told the faculty person in charge, I. I don't know what's working. And she said they...

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. I'm here today with mark Lilly. Mark is president and CEO of Lilly Works, and he helps manufacturers to solve the late problem. I'm going to let Mark explain a little bit more about that. In the meantime, Mark, welcome to the show.Mark Lilly: Thanks very much, Lisa. Appreciate you inviting me on. Lisa Ryan: Please share a little about your background and what led you to work with manufacturers and create Lilly Works. Mark Lilly: Sure. We've been doing this for a long time and referred to the team behind Lilly Works. It's a family endeavor.My dad started several manufacturing E R P systems, including one in the 1980s called Profit Key. Another called Visual Manufacturing in the nineties is currently owned by Inform. They're both designed for make-to-order high mix-manufacturing types of companies used by thousands of manufacturers.And they both also had very strong, traditional finite scheduling embedded in them. However, despite this great functionality in either of these products and what we've since learned, any E R P system has this traditional approach to scheduling and managing production that most manufacturers struggle with for several reasons.So a few years ago, the team got together in the 2014-15 timeframe, and we started a third manufacturing ERP system up in the cloud. And as we were designing it, recognizing that while that scheduling functionality was good and the previous folks struggled with it, we said, what can we do differently?We came up with an entirely different approach to managing production. So, from a material and a scheduling standpoint, we called this approach, or the software part protected flow manufacturing. The process is the dynamic production method.And we would go out into the marketplace and show folks the E R P liked this approach to managing production, but they didn't necessarily want to replace their E R P right now. So that's because that's so much work. So we extracted that part of the software. We made it its own product offering called protected flow manufacturing that ties into any E R P system, whatever you're using today.So what's nice about that is we can go into a company and help them in very short order. We're talking six to eight weeks and solving the late problem, right? Give them visibility and production of their true priorities of when and if the material is here or not to execute the prior.And so everybody can see and know what they should be working on for future visibility. So that is when my customer will be able to get their order based on my capacity and material availability. Lisa Ryan: So what exactly is the late problem, and what is the extent of the problem you're seeing?Mark Lilly: Sure. Many companies are struggling with this today, and very simply, it's not being able to get their orders out on time when they want to. I did a presentation at IMTS in Chicago last week, and I pulled together some macro data. In reality, there are over a trillion dollars in unfill fulfilled orders across American manufacturing in July. That was the latest statistics that came out of basically the fed. And that's about half of the entire manufacturing GDP. To put that into context, the manufacturing GDP is approximately just over 10% of the national GDP.So there's a tremendous amount of opportunity. And I think anyone who works in a manufacturing company realizes an experience is this, whether it's for material or the supply chain issues we're having. Internationally, whether it's the workforce or not being able to find people, most companies are struggling because they would be able to ship if they had the capacity. If they had better management of what's happening in their production environment and better visibility of what's happening.Lisa Ryan: Sure. I think about this, the late problem, and the first thing that came to mind was, okay, supply chain, everybody's struggling with the supply chain. We can't get parts. They're sitting in ports in LA or whatever is go that whatever we've been seeing the last couple of years.How can people turn that around when many think that's just part of the process? It seems that if somebody could turn around, that would make them stand out from everybody else too. Mark Lilly: Yeah. I think it's making folks look because even before all that happened, folks still struggled with getting their orders out on time.People realize this. So I think it's just bringing the shining a light even more. A lot of it can be helped internally. If they genuinely had visibility of when materials are coming in or even if they had the materials right now and also what their priorities should be based on the dependencies of what they're manufacturing and what jobs or work orders are through.Most are in danger of being late rather than trying to schedule things based on a due date. However, this is one of the things we find in a high-mix environment, and most scheduling programs or tools will attempt to prioritize your work on the due date, especially in a high-mix environment.You will have jobs that are due earlier. But that is less in danger of being late, just by how much work needs to happen on a job and whether it needs to go outside or back. So you could have a job that's due two months from now. That's much more in danger of being late today than if you don't get started on it than a job due even a week from now. Lisa Ryan: So how would you even figure that out?Mark Lilly: That's a great question. And that's what we do. We work with whatever data they have, whether in an E R P system or not.And we bring that into an approach where we create an execution plan for every work order. So you can see how much work needs to be done or for the quantity you're making when the due date is. And then there's actually, and whether folks realize it or not, they're using a lot of buffer time.So when you ask somebody, Hey, what's, what lead time are you quoting your customers? They may say six weeks. And then you ask this, the follow-up question to that. Okay. Of that six weeks. How much time is actual production time, right? Touch time. That will be on a machine, or somebody will be explicitly adding value to it.And that's typically their estimates of the routing from this operation steps that need to get done. So you often find that on a six-week lead time job, the actual touch time is a fraction of that. Sometimes only a week, sometimes days. Sometimes even hours. So companies are using a fair amount of buffer time between the actual time that's going to be needed and the due date.So we consciously look at that. We work with the clients that say, is that, say, five weeks of buffer time? Is that working for you? Is that, is it too much? In which case, maybe we have an opportunity to reduce that, or perhaps it's even too little, and maybe you need to expand that a little bit, be conscious about how much buffer time you're putting in there.The dynamic is then that the execution plan will flex based on quantity. Which lead times, don't lead times a static type of information but should be flexing based upon the quantity. And then that also designates when you need materials upfront. And when that job should start.Okay. Now when the job should start is important because what the other thing we often find. Manufacturers have this idea in production that, you know, gee, as soon as we have material, let's get it out into production. Because then it'll come out the other side as quickly. And no, you don't want a flood WIP with too much work.There's a principle called Littles Law, which says that there are more things or items in a system. So the longer the time, any of those items will be in the system. A good example is simply a highway. I live in the DFW area. And as you can imagine, we've got certain five-lane highways during rush hour, and you come over the, over the on-ramp, right?All are brake lights. And, you're going to be on that strip of highway, say it's, for five miles for 20, 25 minutes because there are so many cars on that highway. The flip side is you come up in the middle of the day or at night. And everybody's flying by you these fewer cars; you're going to be on that strip of the highway for five minutes or less.The same way in a production environment. The more work orders, the more jobs, and material you send into production. There's so much traffic. The longer the wait times are going to be on each of the work centers. A more extended period each it's just going to take to get through. That's why there's a lot of expediting at the end of the month.So you don't want to starve production, but you want to control how much you send out. And when you do that, whatever is in production has the best chance to flow through its work centers as quickly as possible to shorten your lead time and get out faster. Lisa Ryan: So that certainly sounds like some of the struggles manufacturers have with that traditional method of managing their production. But what are some of the other struggles that you're seeing that they're having when they're doing it the old way? Mark Lilly: Sure. So one of the things with the traditional scheduling model is that you are running a computer program. So you have to run a computer algorithm to get your plan.So you try to set up your parameters as best you can. You run this computer program that you, some folks, may understand precisely what it's doing. Others may not. And then you get this list then of priorities from the program. And even if it's, there's no such thing as a perfect plan, but let's suppose you have a good plan. That gets to the reality of production, especially in a high-mix environment where things constantly change. Then something does change. Whether a customer calls and changes a due date, a tool breaks your best setup person doesn't show up.The beautiful plan you had now doesn't make sense anymore. So it's probably not worth very much, so we realized there needs to be a dynamic production method. It recognizes, acknowledges, and anticipates that change will constantly happen in a production environment.So instead of devising a plan and executing it based on that, we do what we do and use those. So an individual execution plan for every work order and job also calculates a real-time priority. And it's very simple using where we are today.And how much is remaining on the execution plan, whether it's all the work or just a portion? And then, how much time protection or buffer do we have left to our due date? We call that a threat level. So based on that ratio, How much in danger of being late is each one of your jobs?And we publish that in real time, out in production, so that everybody in every department and every work center on every machine can see and know precisely which job they need to work on. So what is the top priority regardless of the due date, right? Like because, as we described, there may be jobs that need your attention now that are due later rather than other jobs.Lisa Ryan: So how much do you think this is costing the average manufacturer to have this late problem happening? Mark Lilly: That's a great question. As I mentioned, it's in the trillions on a macro level. When you ask most individual manufacturing companies, and if they're being honest, most will recognize that.Maybe in the eighties percentile in terms of on-time delivery. And many struggles with being in the sixties or seventies, even lower. So it's not easy, but you can imagine. And actually, we can pull their data in and show them what it would mean.To be able to ship, on the extreme, if they were, and they could do this math as well, certainly by looking at their backlog, if they were able to ship everything on time, what that would mean from a revenue standpoint. But knowing that they're not going to be, that 30% or even 20% of their orders will not make that deadline mark, they're going to fall into a later period.What is the financial impact of doing that? So you can imagine there's a tremendous opportunity if you can shift the bar even a little bit, so if you can go from 70 to 80 90 percentile, that change. So you're now shifting when you're going to be able to recognize that revenue, and it's a tremendous financial impact. Lisa Ryan: So when manufacturers are shifting and going to that dynamic production method, what are some of the results they're seeing? Mark Lilly: That's a great question. So there are three components, and I've touched on all of those in different ways. One is anticipating the variability. So have to make sure there's, you're acknowledging you're using a buffer today and talking about that. Where should that be? In terms of when we start jobs and when we need materials. So anticipating that variability using the proper priority.So instead of using the due date to schedule, use a risk level of how much in danger of being late. Or of having a stockout, if you're a make-to-stock tech company, are you that's the second one? And then the third is controlling WIP. So how much WIP do you see is once the method is in place and you're doing all three of those things, there's almost an immediate reduction in work and process.So if you are in a situation where, you know, and many manufacturers do just by walking out on the floor, they realize we've just got too much whip out here. Just so much an immediate reduction happens in just a few weeks. And that's a tremendous cost saving, right?So you can go to the cost accountant or the CFO of the company and ask them how much WIP are you carrying right now. And with this approach, we can reduce that in very short order. So do the math 30%, even 40% of your whip gone within a few weeks.That's a tremendous cost saving. But the bigger part is getting work out faster with the resources, the machines, and the people you're already using or paying for today. And now that becomes a contribution margin in the equation or some call that a throughput dollars equation. With our toolset, you can see this as well. Financially. You can see if I was, if I'm doing things the way I'm doing, now I can see how many dollars I will be able to ship. But if I could make these improvements or get things out faster, how much more in a given period would I be able to ship boats from a revenue standpoint, but even more powerful contribution? The neat thing about contribution margin is that any additive contribution margin you can bring in a given period goes right to the bottom line. So it's a direct profit increase for the company. So it's a very powerful lever to help a company grow and improve its finances.Lisa Ryan: When you have a high mix manufacturer and face it, nobody has enough time to do anything today. Everybody's plates are overflowing. So how would you even start prioritizing as far as figuring out your most significant risks and knowing where to start? Mark Lilly: That's a great question. And companies are in different stages of being able to implement something like this, right? So we go into some companies that already have an E R P in all their routings and data or are pretty, pretty accurate. So they reflect how production is happening, and we can tie in, but they may still struggle with its scheduling components or material visibility.We can tie in very quickly. And within a few short weeks, they can get those priorities. We talked about other companies in the future, and I've been in several of them even recently where they don't. They may have a system, but whatever data is in there, they don't believe it either. So here's how production happens.Maybe those routings were set up from a costing standpoint, accounting used, but when you get out to the shop floor, that's not how material flows. So they need to rework those. And then there are dependencies, often manufacturers who make the complex product where sub-assemblies are involved.So are those sub-assemblies specifically for a parent? So they need to be aligned very tightly, or are they common parts, common sub-assemblies that maybe even need to be stocked, in which case they also need to be aligned, but a little bit differently to make sure they're going to match whatever the first parent is, that's going to need them.So, that does need to be looked at. The good news is. Now we can't create data out of magic, but most folks have it in their heads or often have it on spreadsheets. That's what we usually see where folks have struggled with the traditional scheduling model. They have scheduled in their E R P.They may have even purchased a bolt-on. But, unfortunately, they've just struggled with it, and they revert to spreadsheets. So the good news is we can use those spreadsheets as a data source to help them move forward in this direction. Is there some trigger or sign or something to pay attention to that? Lisa Ryan: Wow. This is an issue that we need. Take care of it right away. Is there a timeframe or anything again that would be like that siren that, Hey, this is something you should be paying attention to right now? What does that look like? Mark Lilly: Yeah. If companies aren't already monitoring or measuring, they're on time delivery percentage. So they're not formally doing that. There are likely a few folks in the company who know how good or not that is undoubtedly sales customer service. And that's where the issue arises with customer relationship management, whether it's an existing customer complaining about not meeting the due dates they had established. Or not being able to win new business because of the lead time. If you're being honest and quoting a lead time, it may be longer than some of your competitors.Lisa Ryan: And face it, nobody on the planet likes change. So if you're bringing this kind of change into a manufacturing plant, how do you get buy-in from the employees to let them know that this isn't one more program, that it will fail in the next couple of weeks, or that this is going to help them? How do you incorporate the system so everybody sees the value and benefit? Mark Lilly: That is a great question. And a critical question. So typically, we don't get to the point where there's a financial commitment from the client to move forward without at least introducing this to production and getting some in that regard.But to your point, We have encountered situations. For example, we've got a modern machine shop article about keeping schedules on track. About that, that very point. We implemented this. We got management's buy-in. We had the big screen TVs and the workstations in production, showing the real-time priorities.Everything was wonderful. And eight weeks went by, and management said nothing had changed. We're still on time. Delivery is the same. Our WIP seems to be the same. So we did a deeper dive and realized we hadn't gotten buy-in from the production folks.They were still using their old message on a piece of paper,...

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. I'm excited to introduce our guest today, Jim Ver Woert. Jim is an enterprise solutions executive with tooling-U SME, a Society of Manufacturing Engineers division. Jim travels the country and collaborates with world-class manufacturers to develop workforce performance and training solutions. Jim, welcome to the show. Jim Ver Woert: Thanks so much, Lisa. It's a pleasure to be here. So share a little bit about your background and what ultimately led you to Tooling-U SME. Jim Ver Woert: Sure. I began my career in manufacturing, working for a very small industrial distributor out of Moline, Illinois. Unfortunately, they're no longer in business.They've been acquired like many industrial distributors have in the past. The company was called Deion Thompson, and my territory was central and Western Iowa. So the John Deeres, the Vermeer, and the Scour Dan Fosse, Dan FSEs of the world in my territory, and we supplied metal cutting tools and metalworking fluids to our customers.And it was interesting because this is, coming up 15 years ago, I would get the questions like, "Hey, Jim, do you know any good lathe operators? Do you know any good mill operators? Do you know any good welders?" And my answer was always the same back then, "I do know some of those people, but they already have a job."So even back then, I saw a significant need for a skilled workforce because help was hard to find. So along comes at the time Tooling University. As a workforce training and development tool, our company's management connected us with Tooling University. And that was one of them. I called bullets in my holster.It was one of the lines we represented, and it was a great marriage because of that tremendous need I kept seeing. Fast forward to about six and a half years ago. ToolingU SME had since been acquired by SME, this Society of Manufacturing Engineers. About six and a half years ago, they gave me a phone call, and here I am today and happy to do it because that need is as prevalent as it was 10, 15 years ago out in the middle of the cornfield of Iowa. I see it everywhere. I go coast to coast and border to border.Lisa Ryan: Yeah. And that's, it's such a huge aspect right now because you look at not only have we had the pandemic for the last, two and a half - 10 years is what it feels like. We had lots of baby boomers retiring beforehand. But now, there's even more of a mass exodus as we reassess our priorities. People are thinking, do I really want to end my career, or keep doing what I'm doing, or do I want to go and play with my grandkids and enjoy the rest of my life?So I'm sure you see that from both a training and an employee attraction standpoint, but let's talk first about how you see manufacturers retain that brilliance - the industry knowledge, the expertise, the skills that are walking out the door so that the next generation of workers can get a jumpstart.Jim Ver Woert: Great question. They are doing everything they can to retain them. But like you said to the worker, that's been, on the floor or in the office, 25, 30, 35 years. They're ready to play with their grandson and go fishing off into the sunset of retirement. Some of those employers don't retain them completely, but they will have them come back on a part-time basis as consultants.So they will retire yet have a gentleman's agreement, if you will, that, Hey, if we get in a pickle on the floor, and Bill was the only one that knew how to finish this part or to run this machine or to fix this machine when it went down, please be on call, and you'll agree to come in and help us out.Lisa Ryan: When we look at the flexibility, that is an expectation of employees too. We look at flexibility from younger workers coming in. That sounds like such a great way to take advantage of our more tenured employees, our skilled employees still keeping them relevant while giving them some money. But then again, addressing their need for spending time outside of work. So do you have examples or specific stories where you've seen that work? Jim Ver Woert: Yeah, I have one, I won't mention the name, but they're down the road from me here. They, I call it the Monday morning factor. They offered a bunch of early retirements because COVID really put into warp speed. A lot of these practices gave employees early retirement. Let's cut the budget. Back then, no one knew what was happening and then what the long-term effects were going to be.But they found out one of the immediate effects. They had let the wrong person go on Friday. And literally, on Monday morning, they were standing there trying to figure something out. Nobody knew how to do it because the person that knew how to do it was already retired. So that's, that's just the reality that we went through.Now, one thing that we have started helping customers with is, first of all, raising that awareness. And look at your pipeline of your employees. And look at that retirement pipeline - who's coming up in the next six months, year, two years? What is their skill set? What do they do? Are they in that a department of ten people that all do the same one person with that specific tribal knowledge that's getting ready to retire?But I've literally gotten those phone calls three or four years later. Hey, Jim, we got so and so retiring at the end of October. Can you folks get in here and help us capture as much as possible from this person before they walk out the door? Lisa Ryan: And it makes them feel relevant regarding the knowledge they're bringing, but then they're, you're really cutting down the learning. From the people coming up who don't necessarily know the history of why that job is being done that way, they're getting to hear it from an expert. Jim Ver Woert: Absolutely. You just hit on a very critical point - the whys behind something. We do so many things in our daily lives that become second nature. But, not knowing the whys behind things, why are we approaching this part at this certain entry angle? Why are we changing the tool at this point and not going another ten parts, all these things? And that's something that can get lost in a black-and-white world. There's AI. Robots and all these things are fantastic, but there's still that human element.Some parts are just irreplaceable until you do that mentoring or that one-on-one O J T or that training of the whys and the tribal knowledge to fully comprehend and understand and be able to produce a good part and continue. Lisa Ryan: So mentoring is another big area to do that where you're putting together your tenured employees and maybe your new kids on the block coming in and have them build those relationships and learn from each other. There could also be some reverse mentoring going on, with the younger folks being able to share their thoughts about technology and apps and the things that they're seeing. So again, let's look at and talk about mentoring for a couple of minutes. What are some of the best practices that you are seeing manufacturers do?Jim Ver Woert: Yeah, that's a great question. And you hit on a great point, too, that multi-generational mentoring, there's sometimes the more seasoned workforce, if you will, is not as familiar with technology as the younger workforce is. And if they could learn just a few little tricks or implement just a few things and apply them to their job, it would make their job much easier, faster, and quicker.But they've never had anybody they've been able to talk to and develop a relationship with. And the same goes the other way where, the whys, why do I have to manually do this when I can just punch a couple of numbers on my phone or punch a couple of numbers here?Certain things must be done a certain way to explain that and develop those mentoring relationships. And not only that, it's a passing of the guard, if you will. It's cultural, on a more personal level, to develop that sense of pride and that sense of workmanship and craftsmanship that so many of our seasoned workforce have developed. I call it the good old American know-how.Let's try to try to define that in one sentence. There are examples all across the country. I'll never forget one time, in my former job, there was a foundry that I called on. They made castings for the aerospace industry and the US military, and the guy kept telling me these are handcrafted castings. And I was like, what do you mean? What do you mean they're handcrafted? So he said they poured the castings and cut off the risers and the gate. So they do all this stuff but then take it to their shop. And by hand, they sand it here, and they sand it there, and they do this, and they do that.And then, there are different kinds of wood and various places in the castings and all these processes that took years, if not decades, to perfect. And that has to be a mentoring environment to pass that kind of craftsmanship onto the next generation. Lisa Ryan: And it works when that person shares the passion for it. You could hear that passion coming through just in you relating that story. It's castings, for goodness sake, but there was so much pride in what went into that process that a newer worker is coming when somebody is mentoring. And conveying some of that, listen, I've done this.You can do it too, and it will not happen overnight. So we will work together, and I will try to shortcut the process but let you experience some of that success. I think that too many times in manufacturing, we don't give people enough. Enough credit for their pride and what they do because they're pieces, parts, and components.We think they're doing the same thing every day, but it's magic when you find the right people, and they love what they do. Jim Ver Woert: It really is. And it becomes a family. I'll never forget a shop on the west side of Des Moines that I used to visit. This was a group of guys and gals whose number one goal was to be able to do things that all the other shops in the area could not. That was the work they wanted so that they could carry that banner higher than anybody else.And pat themselves on the back and fist pump and high-five each other at the end of the day. And it was a magical place to be in sometimes because when they got the secret sauce and cracked the code, I tell you what it was. So it was quite a special moment.Lisa Ryan: Yeah. And that's the thing, and you can feel culture. You can walk into any plant just by walking there and feeling the energy. Do people like working here? Do they not like working there? So not only from a customer standpoint but if you're interviewing applicants with a culture that doesn't feel good, there's no way they're accepting your job offer.Jim Ver Woert: Exactly. Exactly. And people pick up on that. People pick up on that. Lisa Ryan: So we've talked a lot about the more tenured workforce and the fact that we're losing them. But we also have to look at the opposite end of the scale of attracting more people into manufacturing, changing the conversations so that parents, guidance counselors, and the public generally realize what a great career path is.So when it comes to the training solutions, what do you see that world-class manufacturers are doing? What are some of the things that they're implementing? Jim Ver Woert: Yeah. Great question and great point. You mentioned parents and guidance counselors. That's precisely where it was at another large aviation company. The vice president said, if we don't get them at the junior high level or before, we've already lost them, and that's just critical, and it's literally retraining our culture.Here in the United States, and with all due respect to college graduates, that's great. We need them, but I think everybody could agree that not every single person that's drawn a breath of air is queued up and ready and a good fit to go to a four-year college. So just being able to give them options and letting them see different career pathways at an early age is critical. I sit on a board at a local high school with a great shop. They have about eight welding booths. They have a lay of the mill and a plasma cutting table. And when I go to those meetings a couple of times a year to listen to those instructors, talk about their students and the things that excite those students where they got their first small 3d printer.And they let them pick whatever they wanted to print, like a small airplane or a small guitar pick or whatever their passion was, go ahead and do that. And boy, those kids were walking up and down the hallways of the school, showing them off to all their friends, saying, Hey look, what I made I had, of course, had to program it, had to get the machine set and do all these things. It really energized him. I think it's that energy, that spirit we were talking about before. Capturing that and generating that in the younger generation is essential. Because again, and excuse me if I'm going on and on. I remember going to Southern Wisconsin for training in my former job and hearing about all the shop classes, high schools, and community colleges closing left and right. And that's such a heavy German, industrial part of the country. So many German tool companies are headquartered there in the Milwaukee area. And to hear that it's just really a cultural blow to our country.So I think the good news is you're doing things like this. Those conversations are happening. There are people like Mike Rowe talking out there on a higher, even bigger stage, maybe just raising this awareness and engaging anybody and everybody that'll listen. We need manufacturing for security, safety, and services that our people are accustomed to.Lisa Ryan: Yeah. In high school, I took both wood shop and metal shop. Primarily because I didn't want to take home EC, it was just fun, and you're right. And then, for years, all those programs disappeared, and it is so nice to see them returning. Our community college here in Cleveland, Cuyahoga Community College, has a whole manufacturing technology Center.We're starting to see the schools that are opening up. But, still, you made a significant point that if you don't get them by junior high, you've lost them because that's the generation that's coming into the workforce now that by the time they graduate high school, they already have an idea of what they're going to do.So using things like manufacturing day, the first Friday in October, and trying to get into the schools talking to people, talking to parents, doing plant tours. I was just at a facility a couple of weeks ago. And when I was pulling into the parking lot, they had all of their signs, join our team, great hours, great work culture. And the thing that, of all the signs, the one that gets the most action is, "work with your hands." So they have a billboard that says if you want to work with your hands, join us. Because there's something that immediate gratification of being able to create something of being able to see, this is what I made. And you're right. Why go to a four-year college if you're not cut out for it and come out with all that student loan debt and flip burgers? Jim Ver Woert: Can I share some stories from the road? Lisa Ryan: Absolutely. Jim Ver Woert: To highlight this. And again, it's to, to no fault of their own. I always joked about myself when I started in this industry. I didn't know the difference between an end mill and a windmill. Cause you don't know what you don't know. And it's not your fault. But I'll never forget. I drove through South Carolina four years ago and listened to one of the local radio stations. The University of South Carolina studied high school students in the state and concluded that around 80% of high school students did not know how to change a light bulb. Why? Because they've never had to do it before. I'm sure their parents love them dearly. I'm sure they would do anything for them, but I think sometimes parents might do a little too much for children.Go ahead. How do you think we should change that light bulb? What do you think? Maybe turn it off. Let it cool down for a little bit. So when you touch it, it's not hot going back to some of that tribal knowledge to some of that mentoring, you know why you have to do this. So there's one story.The other story is that I got this in many places. One of the first things they would do when they were looking to hire an applicant is to give them a tape measure and ask them, "Show me five and three quarters." They didn't. They had no idea what they were saying because they'd never held to take measure in their entire life.And the last one was the screwdrivers. They had some new maintenance, younger people, and they were talking amongst themselves, and they said, oh, that's not the minus. That's the plus screwdriver. Wow. That's a description for Flathead and Phillips. Lisa Ryan: Wow. That just highlights what we were talking about earlier - the need and opportunity ahead of us. The good news is that the only place we can go is up now.It's just so funny you say that because my dad had his wood shop in the basement while I was growing up. I can't tell you how many hours down there. I'd be down there watching him look at the tool, work with the tools, and stuff like that. And just things that you take for granted.I had one of the guests on my show a while ago, Miranda Martz, who I actually met at ToolingU. Her dad fixed cars, and she would go and watch her dad, and fix cars along with him. And just that little thing is what decided her whole career. So that's a thing. Maybe parents aren't necessarily changing their oil and stuff, but getting your kids involved in your hobbies, what you're passionate about, looking for ways to introduce them, changing a tire. Now, mind you, I know how to change a tire. I just have AAA. So I choose not to.I think about light bulbs. It's like these things blow out once every ten years. So none of us are really changing light bulbs that often. But it's the point of just knowing the necessities and exposing kids at as young of an age as possible because there's going to be a small percentage of them that are going to say, that's what I want to do.Jim Ver Woert: I will say the good news is the, I think, what is it, the gen Z this latest generation is taking the bull by the horn. There's some really good interest being generated. So maybe we're already generating some interest and lighten that spark and thank the good Lord that's happening because manufacturing is so important and critical to our country. Especially in this day and age, you don't want to depend on other countries.I won't name any names for things that are just important, medicine, food, shelter, energy. There's so much that goes into us. Just being able to live a good life comes from the manufacturing industry. I'll never forget one of the best t-shirts I saw "And on the eighth day, God created tool and die makers."There you go, just let that set and sizzle for

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. Our guest today is Mark Gilham. Mark is a rebate expert, director, and evangelist at Enable, a SAS solution for B2B rebate management used by manufacturers, distributors, and wholesalers across 50 states. Mark started his career at a major financial institution and progressed to senior finance roles in the construction industry, where he witnessed firsthand the strategic value of rebates. Mark, welcome to the show.Mark Gilham: Hi, Lisa. Thank you for having me on.Lisa Ryan: Please share a little about your background and what led you to be an evangelist for rebates.Mark Gilham: Sure. It's quite a job title. I started nearly a decade ago after moving out to the financial industry. And I went into the construction industry, where I went to an organization with hundreds of millions of pounds of rebates.And what they realized was they needed financial controls. So, for example, a bank would have to manage all this money because this rebate was multiple their profit. So I was brought in and worked with them for many years optimizing the administration side. And as we optimized that, we moved into how to enhance the management and laterally into how we add strategic value with our rebates and look at how they're used commercially. And yeah, it's been, as I said, a big journey, and then more recently, I transitioned over to Enable. as you mentioned, they provide software that manages rebates. We were inclined to use Enable throughout this whole time. And what's been great is that they're coming over to help the industry rather than just the company I was working for. So for me, it's not about the software. This is more about how we strategically use rebates to add commercial value.Lisa Ryan: And when you're talking about rebates, I know in the past they have had a bad reputation where people have used them to either mask pricing or come up with these complicated schemes that made it almost impossible for you to get your money back. What's changed? And how is it benefiting manufacturers?Mark Gilham: One of the biggest challenges I see now is this reputation in the past about rebates. When I started at Grafton, you could see that they were not used for mutual growth. There were a lot of schemes there that were benefiting one side more than the other.And there were almost seen as a necessary evil in business relationships. And what's changed is that companies have become more digitally aware and mature. So I think that the whole business relationship has changed. In the old days, I believe businesses were not as collaborative as they are today and didn't recognize back then the importance of working together for mutual benefits because of that shift. That's how trading deals are structured to benefit everybody. And rebates are part of that shift. By making them more transparent and bringing them out into the open, everybody can see their influence on a business starting to take them into place. I want them to be a strategic tool, but for mutual benefit.Lisa Ryan: Can you give examples of what a manufacturer would use a rebate for? How do they work?Mark Gilham: There are many use-case scenarios, but if we go to a simplistic scenario, let's say you manufacture two product ranges. You've got one product range, which is your staple product which you sell high volumes of. But that's not where your margin is. That's not your highest margin range. Then you have a second range in which the lower volume, the higher margin you could offer your customer.A rebate that says, if you buy in this particular ratio of the two ranges from us, 25% of your sales are in that, in the higher margin range, I will provide you with a rebate across whether it be just that range or all your buying. So you're trying to subtly have the customer buy both ranges from you and not just press on the low margin where you, as a manufacturer, are working hard but without the return you want. And that's one scenario, another where say, the margin isn't as important. It could just be a simplistic growth incentive.For example, our customers spend for last year, add a certain percent to it or do it on, on, on a volume basis and incentivize them for growth. And you can tier that as well, that as their growth keeps going, they keep getting more rebates. And the beauty of both schemes is that it is also building loyalty.There's a secondary benefit. These are typically annual terms, meaning the customer will spend with you all year. And then, at the end of the year, you will give them cash, but my advice would always be to pay credit notes. So you put a credit on their account for this rebate, which they then got to spend with you again through the credit.There are quite a few benefits. First, your customer is getting what they want, which is always crucial. You're already giving them excellent service, but this is now giving them control over their pricing. And you are getting what you want. You are either influencing your mix or your volumes and incentivizing loyalty.Lisa Ryan: Yeah, that certainly sounds like you're developing relationships because everybody likes to get a nice check or a nice rebate at the end of a year. I know we have Costco in the United States here, and we look forward to that rebate check we get every year. But I liked what you said too, about the opportunity to sell a wider variety of products to get more of your product line. Because often, customers may not even know that you carry that one product because they've been buying the other thing for you for a long time. That gives you additional opportunity to penetrate that customer with more and more products and, as you say, builds some nice loyalty there.Mark Gilham: I think people don't realize how rebates are part of our everyday life, whether it's I see point schemes as a form of a rebate, anything where you are incentivized to do something, and then you receive something retrospectively as a reward for me is a form of a rebate type arrangement.And all the big retailers have been using them for decades. And clearly, they're doing. They're achieving something for themselves. And yeah, there is something, as you say, about seeing how you are performing and stretching yourself to that net next tier. And if I put the boots on the other foot here as a distributor as the.We would sit through multiple meetings in the latter part of the year and look at all our trading relationships with our manufacturers and say, where have we got an opportunity to spend a load of money and earn more rebate? And the manufacturers aren't even their salespeople aren't even having to come into our office.We're proactively discussing how we can spend more money without a manufacturer. And to add to that, we're then bringing in our sales teams and saying we're about to spend twice as much with this manufacturer as we usually would because it will make us this tremendous sum.We're going to take half about six big of sum, and we're going to throw that into a sales promotion. So how do we all work together? And then we knock on the manufacturer's door and say, Hey, good news. We're about to spend a load of money with you. And that, for me, is what these things are about. And like you say, we are just looking forward to that reward.Lisa Ryan: Now, how would you start the conversation? Because, as I said, we're from a consumer standpoint, I understand rebates because for Discover Card, that's how they built their whole reputation with 2% cash back. But how do you structure the conversation when you're in a business relationship with people so you're promoting the benefit and it doesn't sound icky, or it doesn't sound like a bribe? Ooh, if you buy this, I'm going to give you this. How would you get into that conversation? that you're going, that win, win that you've been talking about?Mark Gilham: Sure. I think what's important is understanding what your client wants. Then, in going into that conversation, what you want. And I believe in most business or negotiations; there is a negotiation. And for me, that's where rebates play well. I'd be surprised if they don't always knock on your door and ask for a lower price. You can offer them that lower price using a rebate.You can say we can't just give something out, nothing, but if you do X, Y, and Z, we can get you to that price. So for me, they're an alternative to saying no, they the other thing as well is I think in the modern world of transparency, it's essential to be open and genuine with your customer.More recently, it was packaging material. This company was developing an Ecoline that's good for the environment. And they came and knocked on it and said, we'd like you to buy or this Ecoline, but surprise price is higher. And we're sat there going; you know what, we want to be green. We want these, our eco credentials. But we don't want to damage our profitability in the process. How can we do this? And that's where that ratio element came in. They said okay, let's start slowly. But they didn't want to discount the range because what if they'd have discounted their eco range to make it credible or competitive?Should I say it's challenging to recover from that you've created a pricing point or a price perception in your product's market? Whereas the net price is subtly arranged behind the scenes. It is about understanding what each side wants and working toward that narrative.Lisa Ryan: And it also sounds like it brings in the element of fairness because you can justify why I heard this person got this pricing. It's no. We're getting the same. You're getting the same price, but because of the quantity they're buying and the rebate they're receiving, they're doing it.It gives you that justification instead. Somebody thought they got a higher price because they didn't negotiate as well as the other company. Would that play a part in it? Am I reading that right?Mark Gilham: Yeah. And I think this is where you can empower your clients to be in charge of their own pricing.We've encountered scenarios before where one of the most where you get the most friction in a negotiation is right at the start. When you talk about the price because as much as the client can promise volume, you never know if it's genuinely going to be achieved, and the seller does not want to give the discount because they haven't got the volume yet.And the buyer doesn't want to buy anything because they haven't got the price they want yet. Whereas you, with a rebate, can take it away. You can tell them that you promise me if you deliver the volume. You will get this price, which is the price. Hopefully, you are asking for it. If you do even more volume, it gets cheaper.If you do less volume, it gets more expensive. What it does is it allows related pricing in volume. Driven relationships to be dynamic without having to have awkward and challenging conversations. Lisa Ryan: And especially at the beginning of a relationship when the two have not built trust yet. Both are trying to think that the other is trying to take advantage of them, where you had mentioned earlier about that level of transparency and putting it out there and making it easy for them to understand that they can see how this is more of a win.Mark Gilham: Yeah. And it comes back to that word again, that transparency.It is critical in modern supply chains that both sides work together and collaborate for mutual benefits.Lisa Ryan: have you seen other ways these B2B rebates improve margins and drive revenue from manufacturers? Yes.Mark Gilham: If we look to another real-world scenario at Enable, we had a case where a business didn't have any rebates.And yet they came to a rebate management software provider and said, Hey guys, we don't have rebates, but we're thinking about having some, but we're not quite sure how they can benefit our business, but somebody has told us rebates will help. So I was brought in, and they explained the scenario.The scenario for them as they had two different types of customers, and those customers were competing with each other and driving the value of their product down because one customer bought in bulk and had a lower price. And the other customer bought in single units at a higher price. They had different prices.The one who bought in bought did have a lower net price. And the suggestion there was you, what you could do is you could increase the invoice price of the one who buys in bulk and give them that back as a rebate. So on the face of it, both sides are paying the same amount. Because in many B2B worlds, many people in charge of pricing tend to be cost-plus.If you affect that cost without restricting it to trading, you can stop that kind of that competition. Hopefully, any manufacturer agrees that the more money your customer can make from their product, the better it is to be you because the less likely they will come knocking on the door, wanting it cheaper.Your customers getting into pricing competitions is the last thing you do. So that was a real example of rebates used in a scenario where it was just leveling the playing field at the front end but rewarding at the back end. And I suppose; secondly, another good one is new product ranges.If you've got a new product range, again, you can go with the discounting option and push it out at a lower price. But the danger is that the market never then recovers from that initial price point, or what you can do is incentivize using rebates to try. What you can do with the rebate is it doesn't just have to reward what you bought in that range.It could reward all the customers spend. Again, looking at that 25% ratio, you can tell your customer that if you buy X of this, I'll give you an extra 2% back on everything. You can make it quite appealing. I think the key always is to do the math and make sure you're happy with it, but the good thing amount of rebate is that you know what you're going to pay out because if you've done all the maths, they should always be rewarding.And yeah, self-funding scheme. And they can be undone. Whereas a discount is harder to undo once somebody's paid the price, rebates the following year, you can renegotiate the rebate structure and say it was 25%. For example, we now want it to be 30% in this ratio.Lisa Ryan: And again, it goes back to that loyalty because if somebody knows that they have a significant rebate coming from you from the business they've done with you. They continue to be happy with the product, service, and everything else they're getting; the chance of them going elsewhere seems to decrease.Yeah. It makes you very sticky as and I think, being completely honest, there were manufacturers in my last role at Grafton that we probably would've moved away from. But, still, we couldn't because we were in this kind of rebate circle where rebates were that rewarding tool, so when we had paid them out, we had to keep spending to spend them through.At that point, we'd already earned another round of rebates that we didn't want to forfeit. So it creates a stickiness, but it's a positive stickiness. It is rather than a threat. It's a reward, if that makes sense.Lisa Ryan: if somebody was intrigued by the idea of rebates but has no idea how to get started or what types of products would be suitable, to begin with? How does somebody even consider, with a wide range of products that they manufacture, how they could start offering rebates or getting involved in a rebate program?Mark Gilham: I think that there are two sides to that. I think the first is I would always recommend keeping it simple to start with and do not offer if you've never worked with VH before, don't offer them to every customer, like a couple of customers, some simple agreements.And monitor, understand what you're expecting, and you can monitor if the customer's mix is currently at 23% and you've incentivized them to go to 25, you can monitor that. You can see if it's working. Is the reward big enough for what you're trying to incentivize? So that, that's my kind of, one of my biggest caveats. Because I accept as much as the company I work for offers rebate software doesn't mean everybody will go out and buy rebate software. Don't. Start small. And you probably won't get it right the first time. So, start small and keep learning from it. Understand what incentive, how much incentive is required to drive behavior and what type of incentive.And then secondly is the important transparency piece. Suppose you are trying to reward somebody's behavior over a while. In that case, they need to see how they're tracking because otherwise, if you are, I think if you look at any high-performing activity in the world, it's essential to know where you're at to push your performance further.They're the kind of the basic tips, but then secondly, I think, Enable as an example for us, we're not just about the software. We're trying to build a community where people can use rebates correctly. My role was the evangelist. This is what I'm evangelizing.I'm trying to move beyond. The concept of these rebates is creating friction and using rebates the right way. I'm happy to help people and learn how to use rebates correctly. I'll, for example, be doing a few webinars on that type of thing, but I'm always happy to speak to people one-to-one. And you explain to them how we may benefit them.Lisa Ryan: would you maybe take a look at a pilot program? You said there'd be a couple of customers, perhaps they pick a couple of great customers that have a relationship with, and they say, listen, we're putting together a, we're experimenting with a rebate program, and we'd like you to be part of the pilot.Would that be something else they could do, or does that not?Mark Gilham: Yeah. I think that's a good piece of advice. A couple of customers you trust and ask them, get, and gain their feedback throughout the process. And because again, it comes back to that, to me, transparency and collaborative or not selective, you're either collaborating, or you're not, you're either transparent, or you're not, you can't pick and choose when you're going to be those things.And for me picking a client you can work with and working to those fundamental principles throughout is good advice. And yeah, you will learn much because, coming back to the first point, this incentivizes a behavior. So, you've got to make sure you can measure two things there: the incentive's size and the behavior you're trying to dry. So, the behavior is what you are getting back, and the incentive is what your customer is getting back. So, you need to ensure that the behavior reward is greater than the incentive you're paying.And hopefully, the two are very easily trackable. And both from your side and your client's side.Lisa Ryan: Okay. Awesome. As we get to the end of our time together, if somebody did want to continue the conversation with you, what's the best way for them to do...

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturer's Network Podcast. I'm excited to introduce our guest today. Scott Hanton. Scott is a Ph.D. chemist with over 30 years of experience in the lab who has recently changed careers to media. He is now the group editorial director at lab manager, responsible for the editorial team for four science-based brands. So Scott, welcome to the show.Scott Hanton: Thank you, Lisa. I'm happy to be here.Lisa Ryan: Scott, please share a little about your background and what led you to do what you're doing.Scott Hanton: It's an interesting story. I was a good student. I liked math and science. So I got a Ph.D. in science, and I thought my path was clear until one day, my boss came to me and said he wanted me to be a supervisor. And then he wanted me to be a group manager - and that's not what science is. But he saw things that I didn't see in myself. So it's been a great journey being a lab manager for a long time. And then, more recently, taking this knowledge into the media, working for some magazines where my goal is to share my experience as a longtime scientist and lab manager with people who are in those careers or who wish to be in those careers.My goal is to help them prevent the scrapes, bumps, and scars I have from learning it on the job, and maybe I can facilitate a little learning and make their journey a little more pleasant.Lisa Ryan: One of the things that you just said about your manager seeing more in you than you saw in yourself. That's a mark of what makes up a good manager because they are not always the easiest people we report to, but for some reason, they see bigger things than we see in ourselves.See, what happens is that people get it. I was one of them. I was so focused on the tactical work that needed to be done that I didn't realize I had broader strengths and skills that could benefit the organization. So I needed someone to point it out. And that lesson wasn't lost on me. I've done it as a manager as well.Lisa Ryan: You and I connected at an event I was speaking at, and I was intrigued by a couple of things you're doing. Number one, the focus on the workplace culture that you have. But also the fact that you have a remote team right now. It has been a real struggle for some people in these last two and a half years. How do you connect with people when you're not sitting in the room, drinking coffee with them? With culture, what are some of the things that you've seen, that you've done, that you've incorporated, that have helped you in your career?Scott Hanton: When it was time for me to leave the lab environment and start something new, one of the things I specifically looked for was a company with a positive organizational culture. One of the things that I liked about the LabX media group is right on their webpage. When talking to potential recruits, they state that we have a positive culture. I was looking for that as part of my next career, I'd had enough grind in the laboratories, and I needed to do something surrounded by people enjoying themselves. I can see it in this culture. Some of the things that I like about this culture is they know how to celebrate.We stop and cheer each other on. We thank each other for the work that we've done, and it doesn't always happen at year-end. It occurs along the way when the projects get done. Another thing that I like about the culture is that it's candid. We can speak our minds. We say what's important, and that's everybody in the room. It could be the newest employee in the most junior position. The room will stop and listen, no matter how many gray-haired people like me are around the table. We value everyone's opinion, and we can candidly discuss what we want to accomplish or what's going wrong without anybody feeling like that was a dumb idea. I don't have the authority to speak, or my experience isn't noteworthy. Those things make for a fun place to work. And besides the fact that the people are awesome, it's just an absolute joy to work with them.Lisa Ryan: I think it's about creating that safe environment. I was listing to an audiobook by Gary Vaynerchuk, and he was talking about radical candor and being okay with being respectful, but that open, honest what's going on, no matter what position they are in the organization. So everybody feels safe sharing their opinions.Scott Hanton: Yeah. Our leaders are responsible for providing emotional and psychological safety for everyone in the organization. You can't.Lisa Ryan: How do you think that happened? Was it always like that, or did it take somebody to come in and start the process? Because in the beginning, it seems that employees would test you as far as how much they can get away with before they realize that this is real, and we really can.Scott Hanton: The company started small with people who trusted each other. They needed every idea they could get their hands on in an entrepreneurial spirit. And so they were successful by trusting people, taking their ideas, and pushing them out into products and the marketplace. And that then became part of the culture. I think our owner, Bob Kado is just a wise man; he attracts talent and listens to them. That's a hallmark to me of a successful business.Lisa Ryan: Being open to people who may not know the industry but see the world differently. They have different access to technology. They have additional knowledge levels. Even though they don't know your industry doesn't mean that they can't come up with some really good ideas if they just listened.Scott Hanton: For example, we hired a new person maybe a month ago. The project that we hired her for was a little late to start. She had a little time on her hands at the beginning, and now she's come up with a software application that none of us had ever heard of. But it will now be a critical new product for all the four brands I'm responsible for.And it was just a blank sheet of paper; on it was a new idea. But she had skills, knowledge, and understanding none of us had. So even though she was in her first month, this idea was recognized. It's been celebrated, and we are pushing it forward right now.Lisa Ryan: Wow. So what are some of the things that you do to celebrate?Scott Hanton: One of the things that I do specifically remember is that every meeting I host is a remote team. We're all squares on a screen. The very first agenda item for every meeting is celebrations. Every team member is encouraged to participate. No one's forced to share, but we encourage people to share and want to get well beyond the work celebrations.We want the family, the children, the grandparents. We want all the celebrations. And that starts a lot of nice discussion at the beginning of our meetings and allows us to get to know the people better and what's important to them. So I budget 10% of every meeting I run as this informal sharing time starts with celebrations.Lisa Ryan: Wow. And that's so important because let's talk about that from the remote team standpoint. You're starting with celebrations. What are some of the other ways? Because not only are you running a remote team but you were hired remotely. So it's not like you ever worked together in person. All of a sudden, poof, overnight, you started that way.So take us back to the beginning regarding initial contact, building the relationships, and how that has blossomed into what you've made it today.Scott Hanton: I was hired during the pandemic, and we were still figuring out how to do remote onboarding. It was a struggle, but one of the things that benefited me was I was given a mentor or an onboarding coach, somebody I could go to any time with any kind of dumb question.And I did. I asked lots of dumb questions. And that process benefited me so much that now we use it for all our new hires. They get an onboarding coach. Who's not their supervisor, right? People are reluctant to ask their supervisor what they think might be dumb questions or to ask the same question five times.But the whole role of this onboarding mentor is to do that. And to make them feel comfortable and show them access to information, but also model for them. What behaviors are a success? And so we choose the people we want, their behaviors modeled, and copy them.Lisa Ryan: So, are they peers? Are they colleagues? What level in the organization do your onboarding coaches come from?Scott Hanton: They can come from anywhere. Most of the time, it's peers, simply because we have most of those employees. But if the right onboarding mentor is above them, hierarchically in the organization, or below them in the organization, that doesn't matter. It's about how they can help the new employee.Lisa Ryan: In many of the programs I do, onboarding is a vital part of the retention process because you have that vulnerable time between when the offer is made and when the person starts.And if they don't feel connected with you, whether it be phone calls, a welcome email, a welcome package, or a swag bag in the mail sent to them, you want to make that first day magical. In your case, it sounds like they have the onboarding coach. But whoever that connection is, just make it as memorable as possible.It sounds like you've done some great things with onboarding. Anything else besides that coach that has also helped in that process?Scott Hanton: We actively plan a new employee's first day, the first week, and the first month. The hiring manager is responsible for long checklists of activities that need to be accomplished but that all of us on the team contribute to. We won't make that just what you said. We want to make that experience memorable and magical to make them feel included quickly. Belonging is a really powerful force for most of us as humans. We want most people want to belong, and we want people to feel like it's easy to belong with us.We sand down the rough edges, fill in the potholes, and make that path to complete belonging as easy as possible. We also craft 30, 60, and 90-day objectives so they know immediately what's expected of them, and they'll get feedback right away to help correct issues or to help them find the people or the information they need.Most people want to feel like they're contributing. They're getting paid and want to be attached to the organization's purpose and mission. And they don't want just to be reading all the time. So we want to get them to the point where they're actively contributing to the organization as quickly as possible.Lisa Ryan: Taking that extra step, being remote, and letting them know the goals, so they're not flailing, like where swim with the sharks and see if you sink or swim.Scott Hanton: As a remote organization, it's hard for someone unsure to wander down the hall and ask questions. The hallway is virtual. They may not know who they need to wander into. And so a lot of what we're doing in the first month is introducing them to a wide range of people, not just the name and the face and the role, but what are they doing? How can they help? What sort of knowledge do they have and then set up meetings?So they get comfortable talking to these people and feel like they can set up a little zoom call, a 10-minute one, and get a question answered, just like they might wander down a hallway in a brick and concrete environment. Is that something that you set the one-on-one meetings with different people, the various introductions for those 10-minute meetings? How do those happen?Scott Hanton: As soon as their email is active in our system. Before day one, we schedule meetings for them. The hiring manager will prepare a wide range of meetings with people. It shows up on their calendar right away when they show up and shows them the people that they need to know.We'll review that list of people with them, so they have context, and they're not just going into a meeting blind.Lisa Ryan: Wow. It makes so much sense to do that. Let's go back to day one. What does day one look like for that person?Scott Hanton: So there's a formal company onboarding run by our HR department, and they're going to go through the whole company and the procedures, the employee handbook. One thing I like about this company is it has an employee handbook that makes sense. It's not legalese. We document. They go through that in detail. We'll go through it. Where is information stored? How do the different systems work? And it's not a 15-minute. She usually schedules two hours.There is lots of time for questions and interaction to ensure that the person has a good foundation. The next step is to talk to the hiring manager directly; they should have had multiple conversations. That person who led the interview probably communicated the offer, right?There's been a lot of interaction between the new person and the hiring manager before day one. But now it's to reinforce. We are so excited to have you here. Here are the reasons we are so excited, and let's start talking about how you can help. First, we'll go through our objectives. Then, we'll begin with the roadmap.We'll give the background information about the people we're going to meet, but we also want to leave time for questions. And in every meeting along this onboarding journey, we'll probe the new employee for what questions they have because none of us are mind readers, and I might think the onboarding process was designed very well.We make it tailored to the individual. And the only way to do that is to make it safe enough for them to speak their mind. And that starts on day one. Then the group manager will interact with the person to discuss the broader role, the bigger organization, and the purpose. And in many times day, one's done.But now we're going to get into meeting the teammates and figuring out how they fit into this team so they can learn from them. They can bring their skills and talents, and we can do something new and exciting.Lisa Ryan: Let's back it up a little bit, even more. How do you determine the right people even to hire? How do you figure out who will be successful in this remote environment?Scott Hanton: I saw this line from Southwest airlines years ago, and it was a higher attitude and trained skill. We are looking for people with the right attitude who will join and contribute to our group and company culture and not detract from that culture. We have certainly looked at resumes that are fantastic, right? You would expect all the big gold stars from a resume, but after a phone screen, it's like, No, it doesn't mesh with where we want to go. Isn't showing any kindness, compassion, or empathy, and those are things you've got to have to be successful in this virtual environment? As far as the skills, we can train them.We have people who can train them. Suppose we find somebody with the passion and perseverance we're interested in. If they don't have a particular skill, we'll teach them, and we're not going to let you know some perceived gap in a resume stop us from hiring the proper human being.Lisa Ryan: Wow. And this is all the remote, but before you started, before you had this remote career, you also saw a culture from the in-person. One of my favorite things that we've talked about is, of course, the red bandana. So tell us some of what you did with your culture and what I'm talking about.Scott Hanton: What Lisa is referring to is a long career in analytical research labs and contract labs, and the lab life can be a grind. People are executing these tactical bench experiments, and their hard life in a research lab is complex and challenging. We have to support each other. One of the ways that I wanted to support the lab staff was to be directly available to them in times of crisis. Every new employee received a red bandana on day one from me, and the concept was here is your red flag. I'm the general manager of the organization. And I'm a very busy human being.And I attend meetings all the time, and I'm on calls all the time. I can't walk down the hallway without somebody stopping me. But if there's a problem and you think I can be part of the solution, seek me out and throw that red banner at me. If I'm in the middle of a meeting, maybe I'm in on a call with a customer, and if that red flag comes flying, you are now my top priority. If it comes washing with tears, blood, or some other indicator of urgency, then I'm going to excuse myself from that meeting. And I'm going to give my full attention to that employee. It worked. I would get about one red bandana monthly with something truly important to the individual.And sometimes, they were things that I could readily fix a decision that I needed to make. Other times they were complex, big picture, strategic issues that took time and energy to address. But if they don't throw the red bandana at me, I don't know. It's a crisis for them. And it may be a lower priority for me.One of my best days in the lab was walking past a conference room and hearing two employees talking, one saying you should throw that red bandana and the other saying, " Oh, I don't know. I'm not sure it's that important. And the other one's saying, do you believe it's that important?Yes. Then you should. And I kept walking down the hallway, but within minutes, somebody chased me back to my office and threw a red bandana at me. And that told me that this process worked, that the staff reinforced it. And they trusted that things might not be solved if they threw the red bandana, but they would be better. The person was going to be supported through whatever their crisis.Lisa Ryan: I think the fear that people listening to that idea would have is that you would just have people throwing willy-nilly, throwing red bandanas at you all day long. But when you take the opportunity to trust your employees that these are red bandana moments, they trust you that you will act.Scott Hanton: That's right. It was never a problem from the first day that I instituted it. I bought 30 or more red bandanas because I had to start one day with all the employees in the lab. It was never a problem. Did I get two in a day? Sure. But did I get one from one individual every day or every week? No, it was not a problem.Lisa Ryan: You have a good point. It is valuable to leadership to trust the staff. If you correctly do your recruiting, hiring, onboarding, training, and developing, they've earned our trust.Scott Hanton: Exactly. It's creating that culture where it's safe for people.Lisa Ryan: There are way too many times too, that, and in, in your case, it doesn't sound like you had a lot of those people, but there's always going to be employees that are going to take advantage of you. There's a tiny percentage. You try these things, and they try to jack the system. But unfortunately, many managers make their...

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturers' Network Podcast. I'm here today with Claude Goguen. Claude is a civil engineer from Canada and works for the national precast concrete association, a trade association representing precast concrete manufacturers throughout North America.He's been with NPCA for 14 years and mainly works on training and outreach. So Claude, welcome to the show.Claude Goguen: Thank you very much for having me.Lisa Ryan: So share a little about your background and what led you to do what you're doing with NPCA.Claude Goguen: I graduated with a civil engineering degree in Moncton, New Brunswick, this little town on the east end of Canada. And it was poor timing for me for graduation because the local economy was in a bit of a rough shape. So I expanded my job search and got hired by a precast manufacturing company in Columbus, Indiana. So I packed my Chevy cavalier at the time and drove 30 hours Southwest to a new land of new opportunities.And I ended up working there for ten years or so and then worked for general contractors and developers in Indianapolis, staying in Indiana. And finally, I ended up back in precast, where NPCA hired me in 2008.Lisa Ryan: wow. So what is it that you like best about precast? What's kept you in the industry for so long?Claude Goguen: Good question. I love concrete. I've always since I've been in construction. I've loved working with concrete, and precast concrete is a great industry because we get to make these amazing things out of concrete and then let them cure, and you can ship them out. It's almost like making art pieces, even for a manhole, sewer, or things. But just the idea and working with members and manufacturers have been a great industry from both sides. I've been on the precaster side and also on the association side. And it is a growing industry. It's something that even though concrete's been around for such a long time and seems such an ancient construction material, the technology behind concrete and the increasing new technologies that are coming out are so exciting. So it's still an evolving material in a sense. So I gravitate toward that.Lisa Ryan: And especially since you're talking about concrete being the number two most used material resource on the planet with water being number one. And you said it'd been around forever. So what are you seeing in these new technologies that are super cool?Claude Goguen: In a world of admixtures, these chemicals that they put in the concrete. Concrete is cement, water, and aggregates. From time to time, some of us will make our own concrete to put a fence post in or something like that in the backyard.And that's still what's used today, except for the cement. The cementitious material varies more and more. You've got your regular Portland cement, and then you've got other types of cementitious materials. Some of them that are from another industry. They're waste from a different industry, coal or steel manufacturing. The chemicals they're making that make the concrete do one thing or another, either in its fresh state or hardened state, are just amazing.And now, they are looking at concrete on a nanoscale. They study how to alter its properties and make it even better and more durable on a nanoscale. If I were to tell you that a nanometer is about my hair growing, my hair grows about a nanometer a second. So that gives you an idea of how small a nanometer is, and they are studying concrete on that smaller scale. And then 3d printing of concrete they're working on, and new things are always coming up.Lisa Ryan: Wow. So what are they printing? I saw one of those home shows where they printed houses out of concrete. So what other things are they printing out of concrete?Claude Goguen: They're printing bridge components for small pedestrian bridges. I know there was a bridge overseas in Europe that they 3d printed. But mostly, it's above-ground structures. For example, you said, a house or building panels or things that because the technology's still relatively new. The challenge is putting reinforcing in that printed concrete so it can withstand the intended loads. But it's an exciting industry, not just printing the concrete itself but printing other things that can be used to form and make precast concrete. So there are other uses for it.Lisa Ryan: Yeah. That's what I love about my speaking career. And it's what I love about my podcast is being able to connect with people who are passionate about things that people don't think about. They put that spin on them—encouraging younger people to see the vitality of an industry that has been around for so long and perhaps consider that an option for them as they're looking at what to do with their lives.Claude Goguen: Absolutely. In my role, I do outreach and speak to many students in universities and colleges, sometimes in high schools or even once in an elementary school. My passion for concrete comes out no matter who I'm talking to. I love talking about concrete and making it sound as exciting.And I will get that feedback where the student will come and say, that's not even a career path I had considered, but that does sound exciting. And it is. Yeah. And so what are some of the things that we've talked a little bit about this, but that you see the concrete, precast, concrete industry heading well, what's happening is a lot of construction sites.They are getting leaner, the term leaner, even you've heard of lean manufacturing, right? Finding ways to find efficiencies, reducing waste, finding efficiencies in production, and the same thing applies. To a construction site. How can we reduce the waste that occurs on a construction site? The waiting for materials, stuff like that.And that has led very much to precast products because if you think about it, it's a pre-manufactured structure made elsewhere. It's ready by the time you need it. So when it arrives, it can be put into place right away, and it can be used right away. If you're using conventional concrete that you're pouring, you see the trucks going down the road with the big rolling drums, and you pour it on a construction site, then you have to wait for it to cure and wait as one of the wastes of lean manufacturing.So in that sense, we've seen precast starting to be used in more and more traditionally cast in applications. So that's where the industry is continuing to grow. It was growing before the pandemic, and it continued to be busy. And then now it's gotten busy, but we see more and more applications.And along with the technologies I mentioned earlier, it's giving the industry the versatility to meet the architect, to meet the engineer where they are, and produce whatever their imagination would come up with.Lisa Ryan: So we talk about the industry from a technical standpoint, but I know that one thing that not only your members but manufacturers, in general, are struggling with is, finding people to come on board. So what are some things you've seen your members do to attract and retain people to join them?Claude Goguen: Yeah, that is, in fact, a struggle, as it is with a lot of other manufacturing businesses. The thing about precast concrete is we're not. It's not well known if somebody is looking for jobs and they see that Amazon is hiring for a warehouse and fulfillment, you have an idea of what you're going to be doing more or less. If you see something about precast concrete manufacturing, it's not we're out there, and people know right away what that is. So we have an image issue. Not that we have a negative image, but we just don't have one.We just, we're not out there. And so that's one thing that many of our members are doing now is just getting out there a lot more in many different ways. Visit local schools and universities, and they are opening up their plants for tours. They're going to job fairs, participating in your community, donating a structure for something in the town square, or sponsoring a little league team or Cub scout pack.But things that, just getting the name out there so that people go, what is that anyways? And you can explain a little more what's involved.So just opening the awareness of the industry is one thing we're doing. And then we're learning as everybody else is to think differently about how to attract and retain today's generation of young employees. So using social media, meet them where they're at and just offer them something that's going to be attractive to them. That will speak to their motivations and aspirations, and that's significant learning.Lisa Ryan: Compared to doing the same for, let's say, a baby boomer or a generation X. And when it comes to because I love the fact of plant tours.I know I've worked with several precast concrete companies and just going and seeing the size of the plant, the scope of what's being made, and the beauty of some of the pieces. And then also the pride that goes along with that immediate gratification of creating something that. But do you have specific stories or examples or a how-to if a person listening to this was thinking about opening up their plant for maybe using manufacturing day or just opening it up? How does that look? What do they do? Do they have activities during the day?Claude Goguen: Yeah, we have this thing, first of all, that we've done for about three years now. It's called precast Days, where it's a coordinated effort amongst many of our manufacturers across the country, across North America, to open their plants about the same time of the year, usually around October and November, but some plants will do it differently.We'll offer them some guidance on how they should advertise and what they need to think about in terms of safety and just Somehow make it as educational as possible to the people coming to see the plant. So some of them. We'll try to continue manufacturing, which can be a challenge regarding safety because we have buckets and things moving around.And if you have people walking around, it's a sensitive thing. So you have to cord off some areas, but ideally, if you're going to have people in your plant, they will want to see the mud flow. They will want to see you mixing concrete, placing it in a form, and then having somebody explain the process so everybody can hear and understand.So those are the challenges. We're helping our members with that. We're making the most of that experience so that people leave there. And with a good understanding of what precast is all about. And actually, precast days have turned out to be not only a good thing for increasing awareness, but it's resulted in some of our members hiring people from that plant door.They came back, submitted a resume, and a couple of our plants still have people working there that they first met on the plant.Lisa Ryan: Wow. Now, do they reach out to local schools? At what age do they start focusing and bringing people in for these plant tours?Claude Goguen: Some usually won't reach the high school level. I've not heard of anything beyond that. And then, of course, universal level college at level schools they'll reach out to just, I don't know, just groups. But, first, they will bring in a few of their customers. One thing is some of their customers who purchase precast products have never actually seen the product made.So they'll prioritize and invite all their customers; maybe some specify the product, some work for state authorities or private contractors, and then students, just community members. So it depends, but probably not any, not much younger than high school age that I've seen so far anyway.Lisa Ryan: I know you've talked a lot about onboarding, and you have a background in engineering, and yet you developed an onboarding program for your members. So what does that onboarding program look like? Where do you continue to get ideas for the content of it?Claude Goguen: So the onboarding program in, in, in a briefly its sort it's for our members, and it's set up into two pieces.One component is an onboarding guide, and it's meant for the employer. And it just takes you through what onboarding means and how it differs from orientation. It's what you can do from the hire date and before that, with preboarding starting from that phase beyond a year.Having a checklist that they can go through to make sure that they're getting the most out of that employee, the employees getting the most out of their experience so they can find out if they're a good fit for each other and that they're going to want to stay. And then, on the other hand, we have a suite of videos that we made that they can play for the candidate or the employee, and the videos range from there's some that talk about the industry in general.And just the fantastic things that we do. So, for example, there's one video called the day and the life of a precaster. So some of it is first-person based. And, you arrive at the plant, you go in, you go through your day, you have lunch, we cut out the bathroom breaks, but things that that they can, see what a typical day in a precast plant is.Then there are some safety videos, and Then there are videos that are role-based for further on, in, in the employment where they can learn to do specific things in a precast plant. So that's helpful to help the member educate the candidate, the employee who assists in retaining them.How it came about or how somebody else had the idea. I wish I could claim the idea, but somebody else here had the idea to do it and asked me if I wanted to do it. And I was I'm the engineer. I usually deal with varied designs and the technical side of things. So this is a bit outside of my comfort zone, but at the same time, I was excited about it. So, where I got my information, I did a lot of reading materials, looked at stuff from experts, including yourself, and listened to some seminars read a lot, but also drew a lot from my own experience.I just sat there and tried to remember how it felt during my first day. At NPCA or my first day at that precast plant in Columbus, Indiana. And how I felt in terms of little things, little stressors. I remember I didn't know what to put on or wear. I didn't know what to bring for my lunch.Are they going to take me to lunch? Should I bring a brown bag lunch? Should I, where am I going to park? Little things add stress to an already stressful day. And they are then getting into that new environment, not knowing anybody. Things like that. And taking that and molding this onboarding program to try to address that, to make the employee as comfortable as possible when they arrive, they have a set parking spot they're taken out to lunch.On the first day, clear instructions are sent on what, where, and what to expect. They get a schedule in the morning when they get there. Things that I remember and even. While you're interviewing them, and you remember something about, let's say, they love root beer than having a root beer sitting on their desk on their first day of work, there's nothing better than little things that make this different than other experiences, oh, they listen to me.I don't even remember saying I like root beer. And making it very much as if you've just joined a new family. Whenever I listen to a new podcast or read something, I get a new idea to add to version 2.0 over our onboarding program. It's worked right so far. Plus, I'm getting feedback from those who have used it to try to make it better.Lisa Ryan: When you look at these little things you can do, they don't take a lot of time. They don't cost any money. And yet when you think about that employee, they probably sent out a whole bunch of applications, and that you happen to be, they happen to accept the job from you, but that doesn't mean that everybody else will stop calling.So if they don't have that great day and don't know where to park, what to wear, what to do for lunch, and all these things. It's just a matter of communication. Who knows what will happen when one of those other companies calls? And so say you, you're still looking, yeah. What you got, which brings us to another interesting point.And that's the preboarding of connecting with those people, right after the interview and in that vulnerable place of time, between the time they accepted the offer and their start date, because I'm sure that you have heard many horror stories that people ghost you.They're not calling. They're not doing anything. They are just not showing up. So the more preboarding you can use to build that relationship and build that commitment beforehand is probably assuring that you're not going to be ghosted as often. So what are some of the things you're seeing that they're doing before the start date?Claude Goguen: And we're trying to get our members to do more of this, but the thing is to make it personal right off the bat. It's either sending a video from the president or the company's owner saying, Hey, I want to welcome you to this company. I understand we've got an offer, and you're coming to work for us.This is what we're all about—and telling the story. People love stories, telling the company story because of a lot of our members. Our smaller mom-and-pop companies are big, but they started small. And then we have larger corporate-type companies, but everybody's got a story, and they can share that story and make it a little more personal.And then give them and keep in communication with them throughout that period, because you're right. They, it's a prime time for them to get, it's almost a buyer's remorse after buying a house or a car, but it's hiring remorse, or I don't know what you would call it, you have friends saying, Hey, we're, where'd you get a job at precast?What's that? Have you heard this other place is hiring? And so, if you just go quiet during that time, expecting them to show up on day one, you may get surprised. So we encourage our members to spend that message send some material for them to look at, get some paperwork done up front, if you can and do it in a way that's going to be, send them electronic files.If they're younger folks, have it, meet them where they're, I said, and Yeah, just keep that line of communication going. Don't you think that's important?Lisa Ryan: Oh yeah. And even when putting together my programs and slide decks when I use them and using people's pictures, the actual client, for NPCA, I went to your Facebook page to find several people. And the funny thing is, as I walk through the event, I'm so that person's in my slide. Oh, that person's in my slide, and coming from a speaker standpoint, it made me feel more at home because I thought I knew some of these people or knew something about them. The same thing for that brand new person coming in. They get a video from the president or from somebody in leadership that is welcoming them. So it's, oh, they're putting a face to the name. They get, I've heard other organizations that they will put together. Then, what is it? The org chart, but it's all people's pictures on it. So again, you can start to see, oh, I know that person. And even if you don't remember their...

Connect with Gil Bar Lev:LinkedIn: https://www.linkedin.com/in/gilbar-lev/Website: www.homeroots.coLisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturers' Network Podcast. I'm here today with Gil Bar Lev. Gil is the CEO and founder of HomeRoots. He is a serial entrepreneur. Filled with creativity and a hunger to thrive in the current digital world, Gil founded HomeRoots, combining his passion for furniture e-commerce and technology to disrupt the way selling and buying furniture is done with a novel wholesale platform.So Gil, welcome to the show.Gil Bar Lev: Lisa, it's a pleasure being here.Lisa Ryan: So share a little bit about your background and what led you to do what you're doing.Gil Bar Lev: Sure. So, in a nutshell, I came from the software engineering world specializing in web development. So I started my career as such, and one thing led to another. One day I was leading a project that connected toys R-Us with Amazon when Toys R-Us wanted to explore the.com or the internet, the e-commerce capabilities but didn't want to go all in. So I led it from the toys R-Us side, exposed me to e-commerce and my passion for technology. I found the proper marriage for what I want to do moving forward with my career.After I departed from Toys R-Us, I spent my other time in e-commerce, combining it with technology building and helping different brands sell online. And through the following ten years or so, I spent a lot in the direct-to-consumer world, up to the point where I realized we're doing with Brent and also went back to the manufacturing side of things and we want to do whole.So I realized it's 2015, 2016, and the internet has evolved a lot. We've got a lot of marketplaces. I want to see a wholesale and where do I. I realized I got nowhere to go The traditional ones where you go to a trade show you need to exhibit. I was looking at different verticals and categories and noticed that furniture is very complicated. Very complicated because of the logistics side of things, but also, the trade shows themselves are super expensive because you can't just put in a booth in some show, you got to rent a whole showroom, and that's very expensive.And so, all those issues combined led me to want to tackle the furniture world or the furniture space. And that's what led me eventually to HomeRoots, which is a platform or B2B selling platform that enables manufacturers from all over the world to penetrate and expand their market share in the US.Lisa Ryan: So what are they doing? Is it like an Amazon, but only for furniture where people can go and get all the specs they want without having to go to a furniture showroom?Gil Bar Lev: Pretty much it, that's pretty much the basics of it. It works because manufacturers will upload their product specifications down to our platform and alongside their inventory levels and everything else. Then, we push those and promote those products to various retailers. And we ensure that those retailers will offer those products to the end consumer for purchase, whether online or offline, in their stores.  Lisa Rya: I'm sure the last couple years, or I shouldn't say I'm sure, but it would seem to me that the last couple years were a boom for you, with everybody looking for furniture and doing it online. So tell us about your experience over the last couple of years.Gil Bar-Lev: Yeah. It's been a rollercoaster over the past. I will say two to three years up and down with different things, different challenges. So at first, it was a challenge. If we're looking back in 2019 or pre-COVID, let's look at COVID. Let's put it this way.It was more about proving our capabilities to retailers and manufacturers and getting them to buy into the idea. Then, 2020 came along with COVID, and everybody wanted furniture. Everybody, stores got closed. There was only online, and manufacturers had difficulties promoting their products online.They're very good at manufacturing. They were producing items. How about marketing? That's a different topic, and they needed someone to help them. And that's where we came in. Then 2021 was, everybody wanted furniture. But nobody can get it. There are logistics issues. And then it's becoming, and then from the flip of, from 2020, manufacturers were trying to push inventory because many of their sales channels got blocked. After all, retail store physical brick mortar stores were ordered to shut down.In 2021, that slipped to the outside on the demand side, where there was insufficient inventory. Whether with their physical stores and now they wanted merchandise, everything got caused in the logistical supply chain backlog that took a long time. So they were hungry for merchandise.We came in as a good fit because we have a vast assortment of products we can offer retailers. So that expanded our ability in our market share in 2022. That's a different volume. Now you've got a recession. So now you've got retailers that are overstocked.You've got manufacturers who are still having some logistical issues, and they need some good partners on both sides that can help them navigate this landscape, which is very challenging. And it's not something that you see every. Lisa Ryan: That is quite the roller coaster. And it's interesting because it seems, on the one hand, the pandemic came at the right time from an education standpoint because they had no choice but to go online.Gil Bar Lev: Yeah. And then when everybody was going online, now we have the supply chain to deal with, followed by a recession. So it's yeah, it's a perfect storm. I was not kidding. It's very interesting to see the dynamics between how things are getting pulled between the supply and demand.And every year, it's just a different strength to either side of pulling an influence in the market one way or the other.Lisa Ryan: And I'm sure too. We have a lot of manufacturing in the United States as far as furniture, but I know you're also dealing with a lot of international manufacturers of these products. So what are you seeing regarding some of their concerns with the conditions? How are you working and advising them right now?Gil Bar Lev: Their primary concern is whether they should enter the market in this condition. A condition that maybe has not officially been called a recession but is slowing down the market in demand for potential goods.And my advice to them is that if there's a good time to get into a market, if it's the best time, it's a time where others are retreating. That's the time that you can gain a market share. So, my advice is not to be afraid to step in, yes, there is some slowdown, but if you're in right now, the customer still requires goods.They still require furniture and are looking to partner with manufacturers that can supply them with goods. And if you're not. Recession or not. If you're not here, they're not going to remember you. And now they're going to close in the tide. They're going to tighten up their relationship with their existing suppliers.Now at the time, you want to get rid of the loose ends in business. Relationships are the most crucial in this type of economy. And if you're not here, you'll miss that. So, I advise many manufacturers to step into the market, gain market share, work with us, advertise their products, and promote them.Lisa Ryan: There is an audience for that. People are looking for merchandise. It's not the market has been saturated. It's not. It's just people shopping differently than what we used to shop. A year ago, two years ago, that was it. And we're so used to buying things online. It's almost, I mean, with furniture, there's always this the point where I want to sit on my couch, sit on it, and see how it feels.But. It's almost reaching the point that we need to get over that and realize that even though manufacturers believe that's what the consumers want, the consumers want to be able to go on their phone, look at a couch, look at the dimensions of it and say, cool. Send it to me. Gil Bar Lev: Yeah, listen, the beauty of what we're doing in the HomeRoots is that from a manufacturer standpoint, supply standpoint, you don't know or care, sorry, you don't care from where the orders will come.Now, HomeRoots knows how to work with its retailers to collect the orders, whether they're getting submitted through a brick-and-mortar store or online or through other forms of marketing or sales channels that are out there that are not necessarily related to rebuilding.There might be other ways like designers, stagers, and builders. They still buy furniture, and all those orders get passed on to us faster. This is something that we're focusing on a lot. And this is what we're telling the many factors that listen. Yeah, it might be that e-commerce has slowed down.Not might be, but it has slowed down. We've seen that. However, customers now see a trend of buying more from brick and mortar than last year. So, on the one hand, compared to 2020, sales have gone up with brick-and-mortar stores, and sales have gone down with e-commerce, but it's still the same.Lisa Ryan: It's just a different buying experience. Now people are looking just to return to the way it was. Not that I'm giving up on e-commerce, I will not give up on that. But I'm saying this is just the trend we're seeing. So what are some of the issues that you've seen with manufacturers?Not only in the process itself but converting their way of thinking from strictly brick and mortar to looking at more eCommerce and online offerings. So many of them are looking for when we first reach out to manufacturers. So many are still looking for direct order, direct import business. And what we've been offering them is a way to eliminate the middleman, let them be the importer, let them play domestically, and build directly with the retailers in understanding the consumer better—than relying on someone else, like a middleman.So the challenges we've seen with those manufacturers have been that they don't know how to do it. They don't know how to export their goods overseas. Maybe they have done it for others, but they have not gone all the way with the actual import process. And then they're not sure where the merchandise will get to the store.They're not sure how it's going to get marketed. They have a lot of concerns because they have not done it before. But, on the other hand, they are eager to do it. They want to. Just lacking the experience, right? So we're guiding them through this and giving them our fulfillment centers where they can handle the fulfillment.We're guiding them through the import process. We're taking care of all the marketing. We're taking care of all the back-office operations for them. And by that, we're eliminating many of the risks and their concerns of entering into the. But that's what the major challenge is, moving between changing a little bit, the mindset between someone else on direct import and the direct importer to drive my business, to drive myself forward to a mode I want to play. I want to play directly in the market. So I don't want to rely on someone else that doesn't want to rely on the middleman.I'm taking a specific risk. Yes, but the reward is much bigger, right? Cause of its impact financially. The margins are higher; you get more control over the sales channel. You are just more in control of your own business. If you do it well with our advice and best market information, we can give you the sky is the limit.Lisa Ryan: But just the initial open-minded. Some require that of the leaders in those manufacturing companies. And we've been talking a lot about furniture, but it also seems. A shift in mindset to more eCommerce can help manufacturers in many different products. So talk about that in terms of, maybe other products, various industries as somebody who's not in furniture may be able to relate. So start to think about doing that, what you're doing with.Gil Bar Lev: The beauty of eCommerce is the ability to collect data faster than other forms. At least in my opinion. So when you're putting out there, when you're putting products out there online, and it doesn't have to, as you said, it doesn't have to be just furniture.It can be any category when you're putting products out there and trying to promote them. You're starting to get feedback from the audience. Whether they're visiting the page, whether they like who you're offering, and then whether they convert, if they convert, you know, a lot about your price points and your content and the way you package the product to the consumer.But if they're visiting it, then they're not buying it. Then you may have a problem with the pricing, or just the offering is just not attractive. And you learn a lot from it. So before even you go on a massive distributor manufacturing. You could test a few things online and see and gather feedback from the consumer.What are they going to, what you're going to have to do, what you're offering, whether the price point is the right price point, and also a little bit about the quality, the first couple of iterations, you get a lot of feedback, right? But, whether you have returns or a lot of customer inquiries, I'm not sure how to operate this product or this, and then you get improved.You get iterations. You go through iterations. You're improving the product. The quality of it until you go to a point until you get to the point where you have excellent quality, high-quality product that you feel confident that the consumer wants. And then you're ready to go all in, manufacturing it and promoting it.In the destination market that you're looking for. But that stuff you can relatively do fast with e-commerce with brick-and-mortar stores or other forms. But, on the other hand, it takes significantly longer, and you're limited with the selections of offerings that you can go to if you want to put 50 products out there online or 500.I'm not saying there's no effort, but the step is not huge. It's doable. But you cannot put a product in the store that easily. That's very challenging, and it doesn't mean just furniture. Forget about it. There's no way because there's a space, but now you got to go to other stores, 500 different skews in a store.Lisa Ryan: It is a challenge. It's fascinating from a knowledge standpoint because somebody walks into a furniture store and walks right out. You don't know why they walked out. You don't know if it was the pricing, the furniture quality, and everything. And again, we're so used to leaving our Amazon and our restaurant reviews on Yelp and all this stuff for people to leave reviews for brick and mortar.It is a lot more challenging. Getting that feedback as far as pricing quality reviews from others, all of these different things that speed up that whole marketing and decision process, as far as what you're going to be manufacturing, unless I raise a good point. So because what it is when if you go to for example Google business.You're not rating the furniture or that piece of item that you just explored or were interested in. But you're not, which might be an interesting new business. Can arrive from our conversations here on how to drive reviews for brick-and-mortar stores for their product.But online, you're not just reviewing the seller. You also review the process. That's something that's missing in the physical world. And that's what makes it more challenging to test, do your AB testing, and figure out what actually might sell better. So again, there are different techniques to go about samples, but it's a much longer process.And in our economy, especially in the past three years, I remember that you've got to move as fast as you can. Because anyway, the market will slow you down. So you can't, you, you can't waste your time on those things.Lisa Ryan: Yeah. And it's funny, too, because when you think about your, you just said you are reviewing the business. I can leave a horrible review for somebody because the sales rep or the manager treated me poorly, which takes away from anything I may have. I may have loved the furniture but hated the store. So again, Just different ways of looking at it, even to try it out and say, you know what?Gil Bar Lev: maybe we'll start testing this product and do some AB testing online or do something. Lisa Ryan: So if a manufacturer is thinking about bringing a portion of their business to e-commerce, what's a good way to get started?Gil Bar Lev: First, I advocate for HomeRoots that we're an excellent way to get started. Cause we have put many different eyeballs on a product because of our distribution in the market. So a good way is to work with us and upload the products. And if there are in the furniture for home decor, they will go on to our platform and start their journey there.But if they're not, I recommend going with a particular business-to-business marketplace per se, or any marketplace and even a direct consumer marketplace. And test it. That's trying to put something out there to see whether you can gain page views and get feedback.See, there is a lot of involvement, whether there's some traction or interest. There's time. There's I also want to say that this is I'm mentioning all those points. Still, those points require investment on time, of someone knowledgeable about the product and dedicated to ensuring that selling online will be successful or will do everything they want.To make sure that it's successful. Otherwise, it will not work. And that goes to another point. So I'm sorry that I'm jumping between different things here. You need to. If I weren't a manufacturer and going back to your question to start selling online, I would pick marketplaces.If they're in the furniture business, that's our specialty. So I will pick a specific marketplace but hire someone. That knows how to do it, and they have done it well in the past, but you can try to do it on your own, and that's. And sometimes, you do need to do things on your own, but if you decide to do it on your own, have a mentor or someone to guide you through it.So you're not wasting time on weeks or months and a lot of money on things that don't make. Just avoid all this. You can speed up the learning curve. So my advice is to find someone who can mentor you or mentor someone you delegate that task to, and then try to play with that.And one last thing is to be passionate to have patience. Clicks don't come in immediately. It takes time. You need to test different things. You need to try different keywords. You need to test different. Then, later on, once you do get clicks, you need to test different image areas.You got to know what's more attractive to the consumer. Every consumer likes things differently. So you got to figure it out. It's just a lot of baby testing. And you just got to be patient. Yeah. Yeah. I know. We want things to go viral, and most things, no, they don't. It's just most things don't. It's just getting lucky that something does get viral, but in most cases, it's not.So don't plan for it. Don't plan that you're going to upload some type of product and then the whole world. I...