AME Author, Fulcrum ConsultingWorks, Inc., 2017 Inductee Million Dollar Consultant® Hall of Fame, www.fulcrumcwi.com
The leader of a manufacturing company walks a tightrope. On one side is the choking dust left behind by competitors and creators moving faster and wiser than he. On the other side is the charred remains of those who tried to move too fast and broke organizations. And in front of him is the future he so desperately wants to create. How does he keep the organization moving along the rope?
Most leaders lean to the left, hoping that slow steady progress will win the race. It won’t. But neither will stressing people, processes and technology beyond current limits. And now the pace of available change continues to increase, as we learn about Industry 4.0, IIoT (Industrial Internet of Things) and every other capability our automated futures offer.
Small manufacturers believe they can’t afford to invest in new technologies while larger ones know they must. As you struggle with making the “right” decisions, remember these facts:
- Automation does not solve the majority of manufacturing challenges.
- Technology is not, of itself, the path to profitable growth in any manufacturing business.
- Automation without strategic purpose is wasting resources.
- And profitable manufacturing will require extensive leveraging of technology within a few short years. Not decades. Years!
Those facts are only reconciled by business and operations strategies that specifically include technology as enablers of high priority capabilities. Leading with technology drains limited resources without compensating gain. Applying technology everywhere you can dilutes your priorities.
Believing you are now a technology business, no longer a manufacturer, is only true if your market buys technology. Most customers still want ‘things’ – ‘things’ that are more efficient, reliable and value-adding than ever before. Boeing still wants jet engines, regardless of changes in GE’s business model. The fact is that GE uses technology to make those engines more efficient, reliable, and value-adding than they used to be. Yes, Boeing truly wants thrust, but jet engines are the best way to obtain that today.
As you walk the tightrope, consider Elon Musk and Tesla. Musk has spent more money on automation and new technology than most of us will ever have access to, and yet the company delivered only 222 Model 3 cars in the third quarter.
Tesla operations reflect three strategies:
- Vertical integration that Henry Ford demonstrated over 100 years ago. That requires both breadth and depth of expertise, along with product flow.
- Creation of automation to redefine vehicle manufacturing. That requires extensive investment and a very long view.
- Integrating unproven technologies into both production and product. That necessitates a patient and risk-tolerant customer and investment base.
Combined, those strategies have little chance of success. Musk recently doubled-down by deciding to insource seat manufacturing while his battery factory and assembly operations continue to choke. A rabid fan base that keeps laying down money is his only hope.
You may think Tesla is an entirely different universe than yours; it is. But we can learn from anyone. Take advantage of the lessons Tesla is reinforcing for all of us pushing towards that side of the rope:
- Passion and commitment are necessary but not sufficient.
- Falling in love with a solution before understanding the problem doesn't work.
- Even amazing people have limits.
- When everything is a priority little gets done.
- It's okay to want to change the world. A strategy of rapidly executed breakthroughs to the vision can succeed; chasing all variables at once won't.
So not too slow, or you’ll die from lack of oxygen. Not too fast or you’ll go down in flames.
Only the best leaders of manufacturing companies can find and adapt that pace that keeps them moving toward the vision, learning and creating along the way. Middle managers focus on the changes themselves, ensuring they actually matter and take the organization the right direction.
Focusing on the “right” pace of change for a given organization is a very special skill. Yes, we can learn from looking on both sides. But reaching our vision requires keeping our organization evolving along the tightrope at the fastest speed it can handle. Not too slow. Not too fast. Just right. That is the leader’s responsibility, and a skill he must master.