Manufacturing 201: Next-Level Skills

Ed Ballina
Hi, I’m Ed Ballina, coming to you with another episode of MMU.

Alvaro Cuba
Hello guys, great to have to be with you. Alvaro Cuba here.

Ed Ballina
So hey team, this as you know is a  fairly frequent event that Alvaro and I get together and we talk about events and what’s happening on the shop floor, but we also are wearing hats. So this time mine is from a favorite new product. I’m plugging a friend of mine. His wife developed this product that  helped her daughter who had some allergies get good nutrition and I fell in love with it.

Okay, so  I’m wearing a hat in their honor. It is really good stuff. Check it out. It is not a plug, but I love the taste. So I thought I’d wear his hat. Alvaro.

Alvaro Cuba
Yeah, this is Revelstoke. It’s a beautiful town in the Selkirk Range and by the Columbia River in British Columbia. And I was there during the summer, amazing adventure sports. We were hiking, we did parasailing, we did water skiing in the lake. Amazing experience, and that’s why I now have my hat to remind me of all those adventures.

Ed Ballina
Amigo, your adventures just thrill me. I live vicariously through you. Anyway, welcome to the Manufacturing Meet Up podcast. This is where we kick back. On our downtime, we talk about real experiences on the shop floor and tackle the topics that you want to hear about. So welcome to MMU.

Well, awesome. Let’s kick this off.  So welcome to graduate school.  So you graduated, back to school, you graduated from high school, you somehow made it through all the pitfalls of a high school time, and now we’re progressing to graduate-level courses in school. So we’re trying to give you a little sip of what we think is important for an advanced education in manufacturing.

Alvaro Cuba
Let’s go for it! Yes! Back to school!

Ed Ballina
 Our previous podcast, part one, was an introduction. So this is the next level up from that. It really isn’t graduate school, but it’s a natural growth of skill development. And surprise, surprise, we’re gonna tackle the same three topics or areas people, technology, process, and technology so to start us off on the people side I think Alvaro is going to kick this part of it off.

Alvaro Cuba
Yeah, thank you. And in the previous episode, we talked about some essentials like conflicts resolution, professionalism, communication, team building. Now we are going to the next level, and I choose leadership and mentorship. When you progress in your career,  you do from doing things to being a leader.

A leader does not necessarily mean you have a team and you lead the team. Yeah, that’s also leadership. But when you mature in what you are doing, you can be also a personal leader. Imagine when you are in safety, the way you behave, the way you help your peers to behave safe, that is leadership. So in manufacturing, there is a lot of opportunities to show leadership in safety, in quality, just the thinking of we are not going to allow defects or we are going to think customer and remind you always what the customer wants. All that is leadership. And the other part is mentoring. The leaders always mentor and also leaders are always  mentees. It’s important to keep both sides.

And when you do that, you are building the next generation in manufacturing, you being part of that. So you can shadow, you can train, coach, develop. There is plenty of things that you can do. I have an amazing example when we were doing TPM, the first line that we got to real level three in actually Mexico.  At some point, that line became what we call an autonomous line, which meant that the people that operated the line, they were their own bosses. No supervision. They managed their KPIs. They made their meetings. They did continuous improvement, they went to the shelf and saw what the customers were thinking or the consumers. They went and talked to the suppliers. They were thinking on how to improve in the line. So it was a true example on how everyone was a leader in its own area. And they were as a team, effective. And an example, more than an example, it’s just telling my experience in mentoring. I’ve worked in seven different countries, lived in seven different countries and traveled in different roles, different industries. Every time I was going to a new country, a new role, a new industry, first thing I was getting a mentor.

And the value that I got out of that was amazing because a mentor not only teach you or train you, it gives you the lay of the land, what’s happening, who is important, what are the important things you should do, what are the pitfalls you should avoid, what are the wrong things you are doing. So it always served me very well.

Ed, What else you have for us?

Ed Ballina
So I’m gonna pick up where Alvaro left off and talk a little bit about cross-functional collaboration, agility, and strategic thinking. Look, our first class taught you how to be, or gave you skills to be a really good individual contributor, as Alvaro was saying. Now we’re giving you skills to leverage your capability beyond your personal contribution to other parts of the enterprise and to your team.

That’s how you leverage your personal ability. One thing that historically manufacturing people have been accused of is of being very, very tunnel visiony and only focus on what’s happening on the line. So very few operational people like to hear that marketing is coming up with 15 new SKUs that now you have to fit into your line. But the truth of matter is some of those SKUs, some of those new products, may sell for two or three times the stuff that you’re making today. And even though you have to make a change over, you have more waste for the company, it’s a huge win. So big, big idea here, break down those silos between departments, right? We’re all in this together. And sometimes you have to take a bit of a shot to your functional organization because it’s what’s right for the business, right?

That also means that you should understand the impact, strategic impact that you have on the operation. You can be a really good manufacturing person, but I would rather you be a really good business leader that just happens to specialize in supply chain. I mean, this guy on the other side of the mic here, Alvaro, he epitomizes that because he’s had roles in pure supply chain operations, GM, sales, et cetera.

The more you learn about other parts of the business, the more effective you will be as a leader. So example, man, SKU deletion. If you’re a manufacturing person and you’ve ever been put in charge of that, it is almost the kiss of death, right?  Because as a manufacturing person, you’re looking at all these SKUs right? Some of them don’t run well. Some of them age out in the warehouse and you have to throw it out because it’s not selling enough.

So my mentality, you know, typical mentality is go in, I want to cut all the SKUs I can. Well, you know what? You have to work with your sales folks. You have to work with your marketing people because things are entwined. I remember one time I went after deleting some bag in the box flavors that weren’t selling that much and I didn’t want to make it. Okay. It cost me a lot of changeovers. And when I started talking to my sales partners, they were like, you understand that if we lose that SKU we’re going to lose the bargain at such and such a place. You’re not only going to lose that, you’re going to lose the main flavor, you know, blah, blah, blah. So when you understand the business as a whole, right, you can do a much better job of partnering with your sales and marketing folks and really trim the nonproductive flavors and the nonproductive SKUs. But realize you may have to take some pain because it’s right for the company.

Think about the price of a regular cold 20 ounce cold soda in a convenience store. You’re going to pay anywhere from $2 to $3. What do you think you pay for an energy drink? $4 or $5. Energy drinks are harder to make than regular carbonated soft drinks, but they generate a lot more revenue. So you have to understand that as a true business leader. Alvaro, process and end.

Alvaro Cuba
Yeah, before that is SKU rationalization. Huge opportunity, but any company I know, they continue to work on that and it’s always up and down and up and down. So it’s a great example, I think.

Ed Ballina
Alvaro, I learned the one moniker that I would tell people is every SKU that you have has a godfather or godmother somewhere, okay? And the moment you try to get rid of that, you’re stepping on their toes. You’re gonna get phone calls, so.

Alvaro Cuba

Yes. Yes. So in process,  in  the previous episode, we talked about ⁓ lean fundamentals and problem solving, which is the very basic. But when you start going, that’s not enough. You need a very robust process methodology. No, and you can choose TPM, Lean Six Sigma, continuous improvement, many names. All of them are good if you take them serious. And the methodology follows the culture. The most important thing is the culture of ownership, is the culture of lean, is the culture of efficiency. And Ed was bringing an excellent point about the end-to-end in the business. So this TPM, this Six Sigma is not about manufacturing alone. You own out of the 10, 12 pillars, you own probably half of them. The other half are in procurement, are in product development, are in logistics. So you need to have this view of the business and you need to develop your talent, your personal talent and the talent of the people that you work with to have this broader view and to tackle it with this culture of end-to-end. Also black belt thinking, we talk about waste and how to minimize waste and fat.

Well, in this part is not only minimizing, it’s taking it to the very, very minimum where really the process is efficient. And thinking about quality systems. And quality is not only customer expectation, it’s also brand protection. It’s also brand growth. So it’s multiple areas.

I remember one experience, I’m Peruvian, and when I left the country, we had good manufacturing, not great, but good manufacturing. Then I went to Canada, North America. Then I came back to Latin America and Peru was in a terrible situation. Morale went down and the culture was not there. The KPIs, if we had a GE of 75, now we’re in 60s or 65 and people were blaming each other. And then there is no way to reinvent the wheel. You have to go back, you have to sit down, you have to start with people. We have to bring all together. Then you need to do the right process. So they decided, okay, it’s our time. They took TPM. We put a coach there. They understood that. The union understood it. Everyone start work. Don’t get me wrong, hard work. Couple years, once you go back, it takes a lot of time to go back. But once they did, they put the people elements. And then they put the methodology and they were serious about the methodology and then made tough decisions.

That became the number three plant around the world. More than 200 plants, two years later from being at the very bottom, they went to the top three plants recognized by the entire company. So it’s a great example that it works. It’s hard work and it takes difficult decisions, but when you get to an advanced level, you have to do it with the methodology and the process improvement.

Ed Ballina
Absolutely. There’s, I think Alvaro said it great, right? It almost doesn’t matter what you call your improvement process, right? Because some companies use different three-letter acronyms and all that, but that focus drives results and it brings people with you. The point around if you let it go and you have to relaunch it again, let me tell you, in some places that’s a death knell because any change you make in a factory takes salesmanship and takes getting the hearts of the people to follow it. It’s change. And if we as management come in and do that, and then shame on us, we walk away from it and it collapses, you have just lost a lot of faith and credibility. The shop floor was like, okay, you got me once, I’m not sure I wanna do this again.

Alvaro Cuba
Once you lose the trust, rebuilding is so tough. Yes.

Ed Ballina
Three times harder.

So  I’m gonna talk a little bit about  within the context of process, finances and cross-functional KPIs. To be honest, it’s a bit of a segue of the comments I was making before about growing as a business leader and as a business owner, not just a manufacturing or supply chain guy. I will share the secret with you. I’ve been involved in a number of people planning sessions.

This is where you sit around and you try to figure out, you know, where are the up-and-comers, how you develop people, how do you rate folks? And if you’re a manufacturer, by the way, we’re sitting there with sales, manufacturing, HR, finance, right? All it takes is for one of those people, your stakeholders to say, I like Ed, you know, he’s a good operation guy, but he is so functional. Ta-da! Brother, you’re done.

Okay. You have got to overcome that negative, negative, you know, connotation because that means, all you care about your particular part of the business. Who cares if they’re out of stocking product? I’m not changing my line over because that’s going to cost me an hour and I’m going to have to waste product. So you at this level, you are, a business owner and you need to understand the KPIs that are important to sales. Right?

If you work closely with a general manager, most of the time the first question they’re gonna ask you is, what’s my percent stock, right? What’s my order fulfillment? That’s their lifeblood, man. They don’t wanna hear about this other stuff that’s going on in the line. They wanna know that my trucks get loaded and is my product gonna wind up on the shelf? Really, really important. So your stakeholders care about things like that. Their marketing and sales folks, they really care about new product introductions.

So it doesn’t matter if they gave you a bad forecast for your load-in of this new product. If their stuff starts selling like hotcakes, brother or sister, you better find a way to get more of that product. Because they don’t want to hear, ⁓ you didn’t forecast. That doesn’t work either. So  the best example that I can give you on this one was one time in my career, we decided to start blowing our own bottles internally into plants. We used to purchase them.

In this particular location, we were partnering with a bottle supplier. They were going to take over part of our warehouse, put in their equipment and blow the bottles right to us. Terrific idea, right? The only problem, it eliminated 90% of my warehouse space. And it was like, how do I run? Well, that’s where when you have an activating force and a restraining force coming together, you need to make what’s right, the right decision for the business. So what did we do? We invested in AGVs.

And everything that came off the palletizers only stayed on the floor for a little bit until we got it on a truck and it went to another location. So by working together, we reduced cost, improved service, and frankly, we got better blown bottles. Because when bottles sit in a trailer, they want to go back to being a preform. So they don’t fill very well. Here, the bottles come through the wall, run into our filler, and we all saved money. But we had to be bigger business thinkers and not just be functional.

So  that was one example. How about technology? Fun stuff.

Alvaro Cuba
That’s great, great, great example.

As always, you have great examples and yeah, it’s that big view, overarching view, and in technology it’s not different. We talk about in high school, we talk about machine health. Well, in college, and if we graduate, we talk about process health and then production health. And the difference is, yeah, you have to walk or crawl if you want before you walk and then you can run. Well, machine health as we were saying in the previous episode, you cannot build on top of that if your machine is not working. Not stopping every minute, but working four hours with no stop. Then you can start working on the process and improving the process because then you have a reliable machine. But the machine itself, it’s good to have it up and running, but it’s not going to give you the ultimate result if it’s not intertwined with the process health and the process improvement. Because if the machine is running perfect, but your process is not right, you are only producing waste all the time.

But once you have the basic and your machine is running, then you can go and start working with process health, which still is in the plant, the end-to-end of the plant. But then if you really want to impact the business and become what every supply chain wants to become, a competitive advantage to the business, then you need to go one step farther and talk about production health, which as Ed was mentioning, it goes beyond the walls of the plant. And then you need to start thinking even in different KPIs,  you need to start with the customer. You need to understand your supplier. You need to understand these dynamics inside the plant. And it was very hard. So, in my career, and Ed, you can give us your take as well, but just getting the machine running well was quite a challenge. No? And process even more. We were talking about TPM and processes that were taking a couple of years to get to level one and another couple of years to take to level two. And it was a journey of seven years, eight years sometimes, and sometimes you were never getting there.  I think talking about machine health, process health, production health, in these times of technology where you can put AI sensor, as we were talking, sensing everything, not only the machine, but the process, but the results. Every minute, every second, put artificial intelligence on top of that. And once you start getting the results, you can automate the way you go and make the line to work. Now it starts feeling, okay, it’s possible. And I don’t need seven years to graduate on this to make a stride. No, I can do it as fast. I have seen examples.

Now you go into a plant, you detect, not even detect a problem, but you just say, I think the problem is in this area. You put sensors, you get the data, you very quickly, you understand where you need to, what you need to do. It comes even into your mobile. You start putting that, you start tricking your line. And in three months, you can start seeing some significant results that make your people to believe on it and get you approval from the company, from the senior executives. And then you can continue doing that and rolling out to your entire plant. I’m  seeing great examples.

I’m a big believer that this kind of technology can help us really achieve that in a same people, same mentality, same process and methodology, but accelerated amazingly with the new technology that we have.

Ed Ballina
Yep, Alvaro, think one of the biggest issues in all of this is lack of patience. I have seen many efforts in companies to launch TPM, to do Lean Six Sigma, the whole spectrum. And the problem is, folks, there is no instant pudding. This is a three to five year journey at minimum. It requires investment upfront.

And you’re probably not going to see the full value until you’re towards the end of that three to five. But there are gains to be had that are literally like falling, know, like tripping over diamonds. Those you got to find quick so you can feed the beast, right, of finance that says, where’s my money? But this is a long-term commitment. If you’re a company that’s thinking about rolling out TPM or some of these more advanced manufacturing methodologies, if you’re not willing to invest three to five years, don’t bother. You’re just going to upset your people because you’re going to make a big deal of it. You’re going to launch and then you’re not going to want to commit or, it’s not working. No, it’s working. It’s just doesn’t happen overnight.

Alvaro Cuba
But technology I think can help it, can help make people to believe faster and put this process on rollers and go for a fun ride.

Ed Ballina
Yeah, the time to value now, right, to your point is in some of these applications, it’s months, folks. It is months. I’m going to jump into automation and advanced AI applications. Listen, we’ve had some level of automation for quite a while. We don’t have people hand stacking cases anymore. There’s palletizers and there’s packers and all that. But you’ve got to start thinking beyond that, right? What else can we automate?  How can we take on new capability that helps make our operators more monitors and line specialists versus a part of the line that’s always doing something.

And the best example that I can give you there is,  as I mentioned before, we blow our own bottles in these plants, in many plants. So the plastic bottle gets blown and we have to check to make sure we have the right amount of plastic in the bottle. The way you do that is you cut the bottle in three pieces and you got to weigh top, bottom, and the middle. And then you make adjustments. Well, that takes an operator, right, to take the bottles, cut them with a wire cutter, put them on a scale, et cetera, et cetera. There is a system out there, and it’s not new, it’s been around for a while, that will measure the thickness of the wall of the bottles as it’s coming out of the blow molder. It has like goal posts of LEDs that go back and forth.

And it measures the thickness at 18 to 20 points from the top of the bottom to the bottle. It then utilizes its knowledge, I won’t call it AI, it’s getting there, but its knowledge to change your blow molding parameters to always keep your bottle within spec. The operator has now been liberated from being this control point. I gotta cut my bottles, I gotta weigh them, ⁓ what do I do with this? And some of them don’t have the capability to make all those adjustments.

Now you’ve taken that out, you’ve made it part of process control, and it’s made a huge difference to our operations. So look for those opportunities to think about automation past just removing the brute force, but even some of the more kind of drudgery work that we’re asking our people in the plants to do and let AI provide the better solution. So lots of exciting stuff out there.

Alvaro Cuba
Very, very exciting stuff, very exciting times. I tell the people that where I work now is I would have loved to continue to be working in those plants with the technology we have today.

Ed Ballina
Yeah, they are. Yeah. The data, we would be more dangerous than we were before. We would be like, Hey, look at this graph. Chat GPT told me, ⁓

Alvaro Cuba
Yes. Yeah. Yes. Where are you, man? Yes. Yeah. Very dangerous.  But just summarizing, doing a little bit of a wrap up of the last two episodes, we talk about some of the basics going into manufacturing for people, for process and tools. And in this episode, we talk about more of the advanced capabilities or the advanced possibilities on technology that helps. But I think the message continues to be the same. You have to start with your people, with the culture, with the organization. Once you have that, you have to work in your process. You cannot jump to automate or to put technology if your process is not right because otherwise you are only accelerating the speed that you are producing waste. So technology is not a replacement for that. It’s a big accelerator as we have been talking, but you have to have the other two components, clear and solid, and then you automate.

Ed Ballina
Exactly.

Alvaro Cuba
Hopefully you can see as we are seeing out there in what we are doing is a quicker payoff and a quicker way to bring the benefits, starting benefits to the people so you can feed the beast, as Ed likes to say. And then…give the benefits to the company and get to that point of competitive advantage that we all think about.

Ed Ballina
Absolutely. The analogy that I would use is you’re building a house, right?  When you build a house, you got to start with a strong foundation, right? And then as you have a strong foundation, right, you think about things like insulation.  You may decide to do geothermal, but you got to start with a good foundation and an enclosed Dembla for your house, or else it doesn’t much matter. So. Hopefully you’ve enjoyed our little trip down back to school lane and you’ll graduate it with honors.

Alvaro Cuba
Yes. Well, this would have been a great time to have our hats, graduation hats and throw it to the air. So imagine that guys throwing your hats through the air and now the fun stuff comes. It’s go for it. Friends, thank you for  joining us. ⁓ This is the wrap up for today. ⁓ It’s always great to be here in the Manufacturing Meet Up Please keep sending us your feedback, your input, your questions, and we’ll make sure that we put special episodes for all of that.  If you are watching us in YouTube, please like us or give us a review in iTunes. And more important, bring your friends and let’s have a good time in this meetup.

Ed Ballina
Terrific.  So it’s been fun. this has been a lot of fun, the whole back to school. We always have fun, is the truth. So we’ll keep it going, keep the conversation going.  Email us at mmu@augury.com. We’d love to get your feedback. We’ll also have those links in the show notes.  But hey, let us know what you want to talk about, right? We get input, we get feedback. The more we get, the better off we are. And our next episode may wind up having to do with Hispanic Heritage Month, which is coming up here in September. So we’re planning big for that one as well. Hasta la próxima, amigos.

Alvaro Cuba
Hasta la próxima, bye guys.