Archive for the ‘Engineering Leaders’ Category

Companies don’t innovate, people do.

Big companies hold tightly to what they have until they feel threatened by upstarts, and not before. They mobilize only when they see their sales figures dip below the threshold of tolerability, and no sooner. And if they’re the market leaders, they delay their mobilization through rationalization.  The dip is due to general economic slowdown that is out of our control, the dip is due to temporary unrest from the power structure change in government, or the dip is due to some ethereal force we don’t yet fully understand. The strength of big companies is what they have, and they do what it takes only when what they have is threatened.  But once they’re threatened, watch out. But, the truth is, big companies don’t make change, people within big companies make change.

Start-ups want to change everything. They reject what they don’t have and threaten the status-quo at every turn.  And they’re always mobilized to grow sales.  Every new opportunity brings an opportunity to change the game. In a ready-fire-aim way, every phone call with a potential customer is an opportunity to dilute and defocus. Each new opportunity is an opportunity to create a mega business and each new customer segment is an opportunity to pivot. The strength of start-ups is what they don’t have. No loyalty to an existing business model, no shared history with other companies, and no NIH (not invented here). But, once they focus and decide to converge on an important market segment, watch out.  But, truth is, start-ups don’t make change, people within start-ups make change.

When you work in a big company, if your idea is any good the established business units will try to stomp it into oblivion because it threatens their status quo.  In that way, if your idea is dismissed out of hand or stomped on aggressively, you are likely onto something worth pursuing. If you’re told by the experts “It will never work.” that’s a sign from the gods that your idea has strong merit and deserves to be worked. And this is where it comes down to people. The person with the idea can either pack it in or push through the intellectual inertia of company success.  To be clear – it’s their choice. If they pack it in, the idea never sees the light of day. But if they decide, despite the fact they’re not given the tools, time, or training, to build a prototype and show it to company leadership, your company has a chance to reinvent itself. What causes and conditions have you put in place for your passionate innovators to choose to do the hard work of making a prototype?

When you work at a start-up the objective is to dismantle the status quo, and all ideas are good ideas. In that way, your idea will be praised and you’ll be urged to work on it. If you’re told by the experts “That could work.” it does not mean you should work on it. Since resources are precious, focus is mandatory. The person with the idea can either try to convert their idea into a prototype or respect the direction set by company leadership. To be clear – it’s their choice. If they work on their new idea they dilute the company’s best chance to grow. But if they decide, despite their excitement around their idea, to align with the direction set by the company, your startup has a chance to deliver on its aggressive promises. What causes and conditions have you put in place for your passionate innovators to choose to do the hard work of aligning with the agreed upon approach and direction?

When no one’s looking, do you want your people to try new ideas or focus on the ones you already have? When given a choice, do you want them to focus on existing priorities or blow them out of the water? And if you want to improve their ability to choose, what can you put in place to help them choose wisely?

To be clear, a formal set of decision criteria and a standardized decision-making process won’t cut it here. But that’s not to say decisions should be unregulated and unguided. The only thing that’s flexible and powerful enough to put things right is the good judgment of the middle managers who do the work.  “Middle managers” is not the best words to describe who I’m talking about. I’m talking about the people you call when the wheels fall off and you need them put back on in a hurry. You know who I’m talking about.  In start-ups or big companies, these people have a deep understanding of what the company is trying to achieve, they know how to do the work and know when to say “give it a try” and when to say “not now.” When people with ideas come to them for advice, it’s their calibrated judgement that makes the difference.

Calibrated judgement of respected leaders is not usually called out as a make-or-break element of innovation, growth and corporate longevity, but is just that.  But good judgement around new ideas are the key to all three.  And it comes down to a choice – do those ideas die in the trenches or are they kindly nurtured until they can stand on their own?

No getting around it, it’s a judgment call whether an idea is politely put on hold or accelerated aggressively. And no getting around it, those decisions make all the difference.

Image credit Mark Strozier

What They Didn’t Teach Me in Engineering School

The technical stuff is the easy part. Technical systems respond predictably, but people don’t.

There’s nothing worse than solving the wrong problem, so before you start solving you’ve better done a whole lot of defining.

There is no exact answer; engineering is all about judgment.

Organizational structure is important.  Whatever the structure, see its strengths and make them work for you.  If you try to fight it, it will eat you.

Innovation isn’t about ideas, innovation is about commercializing ideas.

Engineering analysis can win minds, but not hearts. And hearts govern minds.

The engineer’s role is not to minimize risk; it’s to understand the commercial reward and take risk accordingly.

What people believe is far more powerful than what they think.

New technology threatens status quoers, and, in turn, they block it.

There is no problem unless someone important thinks there’s one.

All technical systems are really human systems masquerading as technical systems.

If you let it, fear dominates. Be afraid and do it anyway.  But along the way, keep in mind that others are too afraid to try.

Engineering is not sane and rational; engineering is about people.

Engineering Will Carry the Day

Engineering is more important than manufacturing – without engineering there is nothing to make, and engineering is more important than marketing – without it there is nothing to market.

If I could choose my competitive advantage, it would be an unreasonably strong engineering team.

Ideas have no value unless they’re morphed into winning products, and that’s what engineering does. Technology has no value unless it’s twisted into killer products. Guess who does that?

We have fully built out methodologies for marketing, finance, and general management, each with all the necessary logic and matching toolsets, and manufacturing has lean. But there is no such thing for engineering. Stress analysis or thermal modeling? Built a prototype or do more thinking? Plastic or aluminum? Use an existing technology or invent a new one? What new technology should be invented? Launch the new product as it stands or improve product robustness? How is product robustness improved? Will the new product meet the specification? How will you know? Will it hit the cost target? Will it be manufacturable? Good luck scripting all that.

A comprehensive, step-by-step program for engineering is not possible.

Lean says process drives process, but that’s not right. The product dictates to the factory, and engineers dictate the product. The factory looks as it does because the product demands it, and the product looks as it does because engineers said so.

I’d rather have a product that is difficult to make but works great rather than one that jumps together but works poorly.

And what of innovation? The rhetoric says everyone innovates, but that’s just a nice story that helps everyone feel good. Some innovations are more equal than others. The most important innovations create the killer products, and the most important innovators are the ones that create them – the engineers.

Engineering as a cost center is a race to the bottom; engineering as a market creator will set you free.

The only question: How are you going to create a magical engineering team that changes the game?

More Risk, Less Consequence

WHY? To grow sales in existing markets and create sales in new markets.

WHAT? Create innovative technologies and design products with more function and less cost.

HOW? Educate the engineering engine.

This is easier said than done, because for years we’ve set one-sided expectations – new products must work and timelines must be met – and driven risk tolerance out of our engineering engine. Now it’s time to inject it back in.

The message – Our thinking must change.  We must take more risk, but do it safely by reducing negative consequences of risk.

To reduce negative consequences of risk, we must learn to localize risk through the narrowest and deepest problem definition, and learn to secure the launch so it’s safe to try new things.

We must do more up-front technology work, but learn to do it far more narrowly and deeply. We must learn to hold ourselves accountable to rigorous problem definition, and we must put our best people on technology projects.

To focus creativity we must learn to set seemingly unrealistic time constraints; to focus our actions we can look to a powerful mantra – spend a little, learn a lot.

The trouble with new thinking is it takes new thinking. If you don’t have it, go get it. If you already have it, figure out why you haven’t used it.

You might be a superhero if…

You might be a superhero if…

  • Using just dirt, rocks, and sticks, you can bring to life a product that makes life better for society.
  • Using just your mind, you can radically simplify the factory by changing the product itself.
  • Using your analytical skills, you can increase product function in ways that reinvent your industry.
  • Using your knowledge of physics, you can solve a longstanding manufacturing problem by making a product insensitive to variation.
  • Using your knowledge of Design for Manufacturing and Assembly, you can reduce product cost by 50%.
  • Using your knowledge of materials, you can eliminate a fundamental factory bottleneck by changing what the product is made from.
  • Using your curiosity and creativity, you can invent and commercialize a product that creates a new industry.
  • Using your superpowers, you think you can fix a country’s economy one company at a time.

 

Heroes of the Company

If I was a company, the first thing I’d do is invest in my engineering teams. But not for the reasons we normally associate with engineering. Not for more function and features, not for product robustness, not technology, and not patents. I would invest in engineering for increased profits.

When it comes to their engineering divisions, other companies think minimization – fewest heads, lowest wages, least expensive tools. Not me. I’m all about maximization – smartest, best trained, and the best tools. That’s how I like to maximize profits. To me, investing in my engineering teams gives me the highest return on my investment.

Engineers create the products I sell to my customers. I’ve found when my best engineers sit down and think for a while they come up with magical ideas that translate into super-performing products, products with features that differentiate me from my cousin companies, and products that flat-out don’t break. My sales teams love to sell them (Sure, I pay a lot in bonuses, but it’s worth it.), my marketing teams love to market them, and my factory folks build them with a smile.

Over my life I’ve developed some simple truisms that I live by: When I sell more products, I make more profits; when my products allow a differentiated marketing message, I sell more and make more profits; and when my product jumps together, my quality is better, and, you guessed it, I make more profits. All these are good reasons to invest in engineering, but it’s not my reason. All this increased sales stuff is good, but it’s not great. It’s not my real reason to invest in engineering. It’s not my secret.

When I was younger I vowed to take my secret to the grave, but now that I’ve matured (and filled up several banks with money), I think it’s okay to share it. So, here goes.

My real reason to invest in engineering is material cost reduction. Yes, material cost reduction. My materials budget is one of my largest line items and I help my engineers reduce it with reckless abandon (and the right tools, time, training, and teacher.) I’ve asked my lean folks to reduce material cost, but they’ve not been able to dent it. Sure, they’ve done a super job with inventory reduction (I get a one-time carrying cost reduction.), but no material cost reduction from my lean projects. I’ve also asked my six sigma organization to reduce material costs, but they, too, have not made a dent. They’ve improved my product quality, but that doesn’t translate into piles of money like material cost reduction.

Now, I know what you’re thinking: Why, Mrs. Company, are you wasting engineering’s time with cost? Cost is manufacturing’s responsibility – they should reduce it, not engineering. Plain and simple – that’s not what I believe, and neither do my engineers. They know they create cost to enable function, good material cost – worth every penny. But they also know all other cost is bad. And since they know they design in cost, they know they’re the ones that must design it out. And they’re good at it. With the right tools, time, and training, they typically reduce material costs by 50%. Do the math –material cost for your highest volume product times 50% – year-on-year. Piles of money.

I’ve learned over the years increasing sales is difficult and takes a lot of work. I’ve also learned I can make lots of money reducing material costs without increasing sales. In fact, even during the recent downturn, through my material cost reductions I made more money than ever. I have my design engineers to thank for that.

Company-to-company, I know things have been tough for us over the last years, and money is still tight. But if you have a little extra stashed away, I urge you to invest in your engineering organization. It makes for great profits.

WHY, WHAT, HOW to Improve Engineering

When asked how to improve manufacturing, the recipe is clear: lean.  When asked how to improve engineering, the recipe: there isn’t one.  Each engineering improvement effort is unique; though there are common themes and building blocks, each has its own fingerprint.

Each company has its own strengths, weaknesses, opportunities and threats; each company has unique products and markets; each its own goals; each its own culture; each its own future state. Informed by uniqueness, the recipe is unique. To create your unique improvement recipe, I suggest WHY, WHAT, HOW.

WHY
Before your engineering improvement recipe can be formed, the fundamental shaping question must be answered.  Take a breath, fire up your laptop, put on your headphones, and queue up your best music. Type this question:

WHY does our business demand we improve engineering?

Now, type the answer. (Literally.) Use nouns and verbs to explain why engineering must improve. If you can’t, stop. Without a clear, concise, jargon-free answer nothing can be done to advance the cause.  (Though there can be plenty of activity, there can be no progress.) Without the WHY, you cannot pass GO.  You must create a clear, concise WHY.

Seek out help from trustworthy people to create the WHY. Don’t move forward until you understand it well enough to explain it to the engineering organization.  Now, with WHY in place, it’s time for WHAT.

WHAT
Informed by WHY, it’s time for WHAT. Secure a quiet spot, scare up a big piece of paper, and grab your favorite pen. On the top of the page, write this question:

WHAT does engineering improvement look like?

Now, draw the picture. (Literally.) Use sketches, scribbles, arrows, blocks, and people’s names to describe what improved engineering looks like.  Sit in the future and describe it in present tense.  Once drawn, review it with folks you trust, revise it, and repeat.  If you cannot draw the future, keep trying.  Once you have something, review it with folks you trust, revise it, and repeat. Don’t move forward until you draw it clearly enough to explain it to the engineering organization. And with WHAT in place, it’s time for HOW.

HOW
The first step of HOW is similar to WHAT. Pick up your favorite pen, come back to the now, and draw a picture of today’s engineering capabilities, engineering’s current state.  Again, use scribbles, blocks, arrows, and names.

The second step is to define the difference between future and current states.  With future and current state pictures side-by-side, perform a mathematical subtraction: future state – current state.  The difference is HOW. A block in future state that’s not part of the current state is a new thing that must be created; a new arrow in the future state is an activity, interaction, or relationship that must be created; a new person, named or unnamed, represents new thinking. Things that appear in both states are strengths to build on.

The third step, prioritization.  Start here:

What engineering strengths will we build on?

It’s important start with strengths. It sends the right message to the engineering organization: we must build on build on what works, build on what got us here. Engineers need to know that, fundamentally, their work is good, and major building blocks are in place, the foundation is solid.

What development areas will we improve?

Take care with this one.  To avoid a demoralized engineering team, there should be fewer development areas than strengths.  Though there may be many development areas, call out only the most important.

What’s the right first bite?

The most important improvements are those that strongly support the WHY; there’s a natural sequence of things (socks before shoes) that must be respected;  and there’s a finite amount of work that can be done.  Use these three lenses as the start of a prioritization framework.

Building blocks for engineering improvement are the same for all companies: people, tools, and processes, but there are many types of people, countless engineering tools, and all processes can be improved. WHY, WHAT, HOW can help define your unique improvement fingerprint: the right people, the right tools, the right processes, shaped by your unique company goals, and improved in right sequence.

Money out the wazoo

There’s a huge untapped source of profits out there – a virtual gold mine – with profit opportunities so large you can’t see them, and if you do see them, too large to believe. These profits larger than you’ve achieved with your traditional lean work. (Actually, what I’m talking about the next evolution of lean.) Want to see what I’m talking about? Go to your factory and watch. The gold mine will be hiding in plain sight – it’s your product.

Huge savings blah, blah, blah. How significant? Here’s the formula:

material cost x volume x 50%.

Now, for your highest volume product, do the calculation. Go ahead. Do it. Humor me. It’s worth it.

Go get your best pen, and calculate by hand. Write down the number. Go ahead. Write it down, but make sure you put the dollar sign in front, and, please, put in the commas. Don’t abbreviate thousands, millions, or billions (or trillions, Mr. Gates) – write the zeros.  All of them.

There. You did it. Not so hard. Now, sit quietly, and contemplate the number. Look at it for an hour. Don’t say anything, just sit with it.

Now, get bigger piece of paper, and re-run the calculation, but this time write big. Repeat with a poster board, and finish with your biggest whiteboard – big zeros, lot’s of them. (Don’t forget the commas.) Marinate for an hour. Don’t say anything, just sit.

Now that you appreciate the significance of the number, go make something happen.  If you’re a CEO, tell your engineering leader to do DFMA; if you’re the manufacturing leader, grab your engineering leader by the ear, and walk to the whiteboard; if you’re the engineering leader, do DFMA.

You likely don’t believe the number. I know. It’s okay. But, a number that big at least deserves a Google search: save 50% with DFMA.

Your product costs are twice what they should be.

Your product costs are twice what they should be. That’s right. Twice.

You don’t believe me. But why? Here’s why:

If 50% cost reduction is possible, that would mean you’ve left a whole shitpot of money on the table year-on-year and that would be embarrassing. But for that kind of money don’t you think you could work through it?

If 50% cost reduction is possible, a successful company like yours would have already done it. No. In fact, it’s your success that’s in the way. It’s your success that’s kept you from looking critically at your product costs. It’s your success that’s allowed you to avoid the hard work of helping the design engineering community change its thinking. But for that kind of money don’t you think you could work through it?

Even if you don’t believe 50% cost reduction is possible, for that kind of money don’t you think it’s worth a try?

WHY, WHAT, HOW, and new thinking for the engineering community.

Sometimes we engineers know the answer before the question, sometimes we know the question’s wrong before it’s asked, and sometimes we’re just plain pig-headed. And if we band together, there’s no hope of changing how things are done. None. So, how to bring new thinking to the engineering community? In three words: WHAT, WHY, HOW.

WHY – Don’t start with WHAT. If you do, we’ll shut down. You don’t know the answer, we do. And you should let us tell you. Start with WHY. Give us the context, give us the problem, give us the business fundamentals, give us the WHY. Let us ask questions. Let us probe. Let us understand it from all our angles. Don’t bother moving on. You can’t. We need to kick the tires to make sure we understand WHY. (It does not matter if you understand WHY. We need understand it for ourselves, in our framework, so we can come up with a solution.)

WHAT – For God’s sake don’t ask HOW – it’s too soon. If you do, we’ll shut down. You don’t know the answer, we do. And, if you know what’s good for you, you should let us tell you. It’s WHAT time. Share your WHAT, give us your rationale, explain how your WHAT follows logically from your WHY, then let us ask questions. We’ll probe like hell and deconstruct your WHY-WHAT mapping and come up with our own, one that makes sense to us, one that fits our framework. (Don’t worry, off-line we’ll test the validity of our framework, though we won’t tell you we’re doing it.) We’ll tell you when our WHY-WHAT map holds water.

HOW – Don’t ask us WHEN! Why are you in such a hurry to do it wrong?! And for sanity’s sake, don’t share your HOW. You’re out of your element. You’ve got no right. Your HOW is not welcome here. HOW is our domain – exclusively. ASK US HOW. Listen. Ask us to explain our WHAT-HOW mapping. Let us come up with nothing (that’s best). Let us struggle. Probe on our map, push on it, come up with your own, one that fits your framework. Then, and only then, share how your HOW fits (or doesn’t) with ours. Let us compare our mapping with yours. Let us probe, let us question, let us contrast. (You’ve already succeeded because we no longer see ours versus yours, we simply see multiple HOWs for consideration.) We’ll come up with new HOWs, hybrid HOWs, all sorts of HOWs and give you the strengths and weaknesses of each. And if your HOW is best we’ll recommend it, though we won’t see it as yours because, thankfully, it has become ours. And we’ll move heaven and earth to make it happen. Engineering has new thinking.

Whether it’s my favorite new thinking (product simplification) or any other, the WHY, WHAT, HOW process works. It works because it’s respectful of our logic, of our nature. It fits us.

Though not as powerful a real Vulcan mind meld, WHY, WHAT, HOW is strong enough to carry the day.

I don’t know the question, but the answer is jobs.

Some sobering facts: (figure and facts from Matt Slaughter)

  • During the Great Recession, US job loss (peak to trough) was 8.4 million payroll jobs were lost (6.1%) and 8.5 million private-sector jobs (7.3%).
  • In Sept. 2010 there were 108 million U.S. private-sector payroll jobs, about the same as in March 1999.
  • It took 48 months to regain the lost 2.0% of jobs in the 2001 recession. At that rate, the U.S. would again reach 12/07 total payroll jobs around January 2020.

The US has a big problem. And I sure as hell hope we are willing do the hard work and make the hard sacrifices to turn things around.

To me it’s all about jobs.  To create jobs, real jobs, the US has got to become a more affordable place to invent, design, and manufacture products. Certainly modified tax policies will help and so will trade agreements to make it easier for smaller companies to export products. But those will take too long. We need something now.

To start, we need affordability through productivity. But not the traditional making stuff productivity, we need inventing and designing productivity.

Here’s the recipe: Invent technology in-country, design and develop desirable products in-country (products that offer real value, products that do something different, products that folks want to buy), make the products in-country, and sell them outside the country. It’s that straightforward.

To me invention/innovation is all about solving technical problems.  Solving them more productively creates much needed invention/innovation productivity. The result: more affordable invention/innovation.

To me design productivity is all about reducing product complexity through part count reduction. For the same engineering hours, there are few things to design, fewer things to analyze, fewer to transition to manufacturing. The result: more affordable design.

Though important, we can’t wait for new legislation and trade agreements.  To make ourselves  more affordable we need to increase productivity of our invention/innovation and design engines while we work on the longer term stuff.

If you’re an engineering leader who wants more about invention/innovation and or design productivity, send me an email at

mike@shipulski.com

and use the subject line to let me know which you’re interested in. (Your contact information will remain confidential and won’t be shared with anyone.  Ever.)

Together we can turn around the country’s economy.

Mike Shipulski Mike Shipulski
Subscribe via Email

Enter your email address:

Delivered by FeedBurner