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Manufacturing's IT Professionals are Ignoring Their Biggest Customer -- the Shop Floor

July 12, 2016
Ask the Expert: Lean Leadership: Have a question about lean leadership? Let Larry Fast tackle it for you.

I recently had the opportunity to speak at a conference attended by a large group of information technology (IT) professionals from manufacturing companies. What a great forum for witnessing how these people think and communicate and demonstrate their commitment to providing service.

It was also a forum for observing how well they related to and understood the manufacturing function's needs for their expertise. We also had numerous opportunities to interact in one-on-one discussions. These are my reflections on the experience.

First, these IT experts were all highly professional, committed and well-intentioned people. They were passionate about meeting their external customers' needs as well as constantly seeking enhancements to further improve their software products. It was impressive to see how they have advanced the state-of-the-art on their shop floor systems and branched into other useful products since I left the manufacturing arena nine years ago.

What if we reprogrammed our brains to eliminate the reference to system 'bugs' and called them what they are -- quality defects? "

During the presentation I discussed the critical role that IT can play in supporting enterprise excellence and directly enabling manufacturing excellence in their factories. I asked for a show of hands for how many in the audience always had a manufacturing person at the table in their first project meeting regarding a new system or a system change that affected manufacturing. Zero hands went up. To make a long story short, the accounting team got the calls on the cost and inventory systems; sales, marketing and design engineering got the calls on new product needs and new product introductions, etc.

The major omission was that manufacturing wasn't at the table even though they needed to understand all of these systems and how they impact the shop floor. Manufacturing also is the biggest user of most of these systems. Even within a manufacturing company, it was not intuitively obvious that manufacturing was IT's largest internal customer--by a lot. But manufacturing leaders weren't being treated as such. It's also likely that their internal manufacturing leaders had been either ignorant to the developments or simply hadn't taken a sufficient level of interest to communicate directly with IT leadership. After all, communications are a two-way street. But these are two functions that typically don't communicate well or often enough to extract the obvious synergies.

As the day progressed I sat in on a workshop session where a software company expert was announcing his company's initiative to provide manufacturing leaders additional information on labor variances within their cost accounting module. (Readers:  PLEASE, no sermons on the standard cost system -- we've heard them all! ;-) This is a subject that resonated with the IT folks from manufacturing customers as a real need their companies have. As he began to detail the specifics of this enhancement, the software company expert got some rudimentary questions about the formatting of data and other cosmetic suggestions. The finished product as presented was simply the separation of labor variances from a giant bucket of unidentified variances.

What if IT thought of themselves as a factory that makes software for manufacturing companies?"

As the only manufacturing person in the room I complimented the presenter on beginning to separate variances by category to aid shop floor leaders in identifying opportunities to eliminate waste and improve the process. However, I felt compelled to point out that, in its current form, it would only raise additional questions that would require more data before corrective action could begin.

For example, what is the size of the labor variance by component: rate, efficiency, utilization? The report as conceived was not actionable. If labor is an important source of unfavorable performance, then more detail is required. What changes would be necessary to change how the reporting is done so as to capture actionable data? It should work similarly for materials variance. Is the variance due to purchase price variance (PPV)? Material usage (over/under)? Material substitutions?

I also saw a few lightbulbs go on when I suggested that the last question in any problem-solving exercise should be: "How can we poka-yoke (mistake-proof) this process?" IT already applies this tool frequently, with sign-in screens as the most prolific example. But how can they help us in manufacturing using the same thinking throughout the company's ERP system and all other authorized, formal systems?

No function besides IT has the understanding and visibility of the interactions, i.e., the connections, of integrated systems. Countless times during my career I was exposed to situations around my staff table and in the factories where actions were being taken without the initiators understanding what the impact would be of their decisions. The analogy I often used was this: "If I squeeze the balloon here then where does the balloon pop out next?" When we understand those answers, we anticipate. We communicate inter-functionally with other necessary stakeholders. We educate co-workers. We collaborate. We make better decisions and forego the chaos we might have otherwise created with unintended consequences.

If all manufacturing leaders and all IT leaders would regularly collaborate for process improvements, wouldn't it be amazing to see what could be accomplished? For example, what if IT thought of themselves as a factory that makes software for manufacturing companies?  What if they routinely used the lean and Six Sigma toolbox?  What if we (and they) knew IT's cycle time for new product development? What if we knew the cycle time for delivery, start to finish, of great products the first time? What if we knew the on-time delivery performance of system promise dates? What if we reprogrammed our brains to eliminate the reference to system "bugs" and called them what they are -- quality defects? Every quality defect is a learning opportunity to improve the process and eliminate customer defects. What if manufacturing folks stopped accepting "bugs" as the norm when working with new systems or system modifications and demanded better quality that was right the first time? What if IT experts were more proactive with process-improvement ideas across the company?

You get the idea. It's not a technical issue: Tt's a mindset issue by the leadership around the staff table and is represented by all functional areas. Why don't we elevate our expectations? Why don't we educate and train away the ignorance? Why don't we unleash these synergies that exist in our businesses?

"It takes a really sick mind to think it's funny or 'clever' to plant bugs in computers." --Malcolm Forbes

"We are stuck with technology when all we really want is just stuff that works."  --Douglas Adams

Larry Fast is founder and president ofPathways to Manufacturing Excellenceand a veteran of 35 years in the wire and cable industry. He is the author of "The 12 Principles of Manufacturing Excellence: A Leader's Guide to Achieving and Sustaining Excellence." A second edition is planned for release in 2015. As Belden’s VP of manufacturing Fast led a transformation of Belden plants in the late '80s and early '90s that included cellularizing about 80% of the company’s equipment around common products and routing, and the use of what is now know as lean tools. Fast is retired from General Cable Corp., which he joined in 1997. As General Cable's senior vice president of operations, Fast launched a manufacturing excellence strategy in 1999. Since the launch of the strategy, there have been 34 General Cable IndustryWeek “Best Plants Finalist awards, including 12 IW Best Plants winners.Fast holds a bachelor's degree in management and administration from Indiana University and is a graduate from Earlham College’s Institute for Executive Growth. He also completed the program for management development at the Harvard University School of Business.

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