Shipulski On Design

Archive for the ‘How To’ Category

As an engineering leader you have the biggest profit lever in the company. You lead the engineering teams, and the engineering teams design the products. You can shape their work, you can help them raise their game, and you can help them change their thinking. But if you don’t win their hearts and minds, you have nothing.

Engineers must see your intentions are good, you must say what you do and do what you say, and you must be in it for the long haul. And over time, as they trust, the profit lever grows into effectiveness. But if you don’t earn their trust, you have nothing.

But even with trust, you must be light on the tiller. Engineers don’t like change (we’re risk reducing beings), but change is a must. But go too quickly, and you’ll go too slowly. You must balance praise of success with praise of new thinking and create a standing-on-the-shoulders-of-giants mindset. But this is a challenge because they are the giants – you’re asking them to stand on their own shoulders.

How do you know they’re ready for new thinking? They’re ready when they’re willing to obsolete their best work and to change their work to make it happen. Strangely, they don’t need to believe it’s possible – they only need to believe in you.

Now the tough part: There’s a lot of new thinking out there. Which to choose?

Whatever the new thinking, it must make sense at a visceral level, and it must be simple. (But not simplistic.) Don’t worry if you don’t yet have your new thinking; it will come. As a seed, here are my top three new thinkings:

Define the problem. This one cuts across everything we do, yet most underwhelm it. To get there, ask your engineers to define their problems on one page. (Not five, one.) Ask them to use sketches, cartoons, block diagram, arrows, and simple nouns and verbs.  When they explain the problem on one page, they understand the problem. When they need two, they don’t.

Test to failure. This one’s subtle but powerful. Test to define product limits, and don’t stop until it breaks. No failure, no learning. To get there, resurrect the venerable test-break-fix cycle and do it until you run out of time (product launch.) Break the old product, test-break-fix the new product until it’s better.

Simplify the product. This is where the money is. Product complexity drives organizational complexity – simplify the product and simply everything. To get there, set a goal for 50% part count reduction, train on Design for Assembly (DFA), and ask engineering for part count data at every design review.

I challenge you to challenge yourself: I challenge you to define new thinking; I challenge you to help them with it; I challenge you to win their hearts and minds.

Rumor has it, manufacturing is back. Yes, manufacturing jobs are coming back, but they’re coming back in dribbles. (They left in a geyser, so we still have much to do.) What we need is a fire hose of new manufacturing jobs.

Manufacturing jobs are trickling back from low cost countries because companies now realize the promised labor savings are not there and neither is product quality. But a trickle isn’t good enough; we need to turn the tide; we need the Mississippi river.

For flow like that we need a fundamental change. We need labor costs so low our focus becomes good quality; labor costs so low our focus becomes speed to market; labor costs so low our focus becomes speed to customer. But the secret is not labor rate. In fact, the secret isn’t even in the factory.

The secret is a secret because we’ve mistakenly mapped manufacturing solely to making (to factories). We’ve forgotten manufacturing is about designing and making. And that’s the secret: designing – adding product thinking to the mix. Design out the labor.

There are many names for designing and making done together. Most commonly it’s called concurrent engineering. Though seemingly innocuous, taken together, those words have over a thousand meanings layered with even more nuances. (Ask someone for a simple description of concurrent engineering. You’ll see.) It’s time to take a step back and demystify designing and making done together. We can do this with two simple questions:

• What behavior do we want?
• How do we get it?

What’s the behavior we want? We want design engineers to understand what drives cost in the factory (and suppliers’ factories) and design out cost. In short, we want to connect the engineer to the factory.

Great idea. But what if the factory and engineer are separated by geography? How do we get the behavior we want? We need to create a stand-in for the factory, a factory surrogate, and connect the engineer to the surrogate. And that surrogate is cost. (Cost is realized in the factory.) We get the desired behavior when we connect the engineer to cost.

When we make engineering responsible for cost (connect them to cost), they must figure out where the cost is so they can design it out. And when they figure out where the cost is, they’re effectively connected to the factory.

But the engineers don’t need to understand the whole factory (or supply chain), they only need to understand places that create cost (where the cost is.) To understand where cost is, they must look to the baseline product – the one you’re making today. To help them understand supply chain costs, ask for a Pareto chart of cost by part number for purchased parts. (The engineers will use cost to connect to suppliers’ factories.) The new design will focus on the big bars on the left of the Pareto – where the supply chain cost is.

To help them understand your factory’s cost, they must make two more Paretos. The first one is a Pareto of part count by major subassembly. Factory costs are high where the parts are – time to put them together. The second is a Pareto chart of process times. Factory costs are high where the time is – machine capacity, machine operators, and floor space.

To make it stick, use design reviews. At the first design review – where their design approach is defined – ask engineering for the three Paretos for the baseline product. Use the Pareto data to set a cost reduction goal of 50% (It will be easily achieved, but not easily believed.) and part count reduction goal of 50%. (Easily achieved.) Here’s a hint for the design review – their design approach should be strongly shaped by the Paretos.

Going forward, at every design review, ask engineering to present the three Paretos (for the new design) and cost and part count data (for the new design.) Engineering must present the data themselves; otherwise they’ll disconnect themselves from the factory.

To seal the deal, just before full production, engineering should present the go-to-production Paretos, cost, and part count data.

What I’ve described may not be concurrent engineering, but it’s the most profitable activity you’ll ever do. And, as a nice side benefit, you’ll help turn around the economy one company at a time.

For the foreseeable future, there will be more work than time. Yet year-on-year we’re asked to get more done and year-on-year we pull it off. Most are already at our maximum hour threshold, so more hours is not the answer. The answer is productivity.

Like it or not, there are physical limits to the number of hours worked. At a reasonable upper our bodies need sleep and our families deserve our time. And at the upper upper end, a 25 hour day is not possible. Point is, at some point we draw a line in the sand and head home for the day. Point is, we have finite capacity.

As a thought experiment, pretend you’re at (or slightly beyond) your reasonable upper limit and not going to work more hours. If your work stays the same, your output will be constant and productivity will be zero. But since productivity will increase, your work must change. No magic here, but how to change your work?

Changing your work is about choice – the choice to change your work. You know your work best and you’re the best one to choose. And your choice comes down to what you’ll stop doing.

The easiest thing to stop doing is work you’ve just completed. It’s done, so stop. Finish one, start one is the simplest way to go through life, but it’s not realistic (and productivity does not increase.) Still, it makes for a good mantra: Stop starting and start finishing.

The next things to stop are activities that have no value. Stop surfing and stop playing Angry Birds. Enough said. (If you need professional help to curb your surfing habit, take a look at Leechblock. It helped me.)

The next things to stop are meetings. Here are some guidelines:

• If the meeting is not worth a meeting agenda, don’t go.
• If it’s a status meeting, don’t go – read the minutes.
• If you’re giving status at a status meeting, don’t go – write a short report.
• If there’s a decision to be made, and it affects you, go.

The next thing to stop is email. The best way I know to kick the habit is a self-mandated time limit. Here are some specific suggestions:

• Don’t automatically connect your email to the server – make yourself connect to it.
• Create an email filter for the top ten most important people (You know who they are.) to route them to your Main inbox. Everyone else is routed to a Read Later inbox.
• Check email for fifteen minutes in the morning and fifteen minutes in the afternoon. Start with the Main inbox (important people) and move to the Read Later inbox if you have time. If you don’t have time for the Read Laters, that’s okay – read them later.
• Create an email rule that automatically deletes unread emails in two days and read ones in one.
• Let bad things happen and adjust your email filters and rules accordingly.

Once you’ve chosen to stop the non-productive work, you’ll have more than doubled your productive hours which will double your productivity. That’s huge.

The tough choices come when you must choose between two (or more) sanctioned projects. There are also tricks for that, but that’s different post.

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.

At every turn, lean has increased profits in the factory. Its best trick is to look at the work through a time lens, see wasted time, and get rid of it.

Work is blocked by problems. You watch the work to spot blockages in the form of piles, otherwise known as inventory. When you find a pile, you know the problem is one operation downstream.

As lean works its magic, inventory is reduced, which decreases carrying costs. More importantly, however, it also reduces the time to see a problem. Whether the problem is related to quality, delivery or resources, everything stops immediately. It’s clear what to fix, and there’s incentive to fix it quickly because with lean, the factory is more sensitive to problems.

What works in the factory will also work in the supply chain, and that’s where lean is going.

Link to full article

There’s an unnatural attraction to lean – a methodology to change the value stream to reduce waste.  And it’s the same with Design for Manufacturing (DFM) – a methodology to design out cost of your piece-parts. The real rain maker is Design for Assembly (DFA) which eliminates parts altogether (50% reductions are commonplace.) DFA is far more powerful.

The cost for a designed out part is zero.  Floor space for a designed out part is zero. Transportation cost for a designed out part is zero. (Can you say Green?) From a lean perspective, for a designed out part there is zero waste.  For a designed out part the seven wastes do not apply.

Here’s a recipe for unreasonable profits:

Design out half the parts with DFA.  For the ones that remain, choose the three highest cost parts and design out the cost.  Then, and only then, do lean on the manufacturing processes.

For a video version of the post, see this link: (Video embedded below.)

A Recipe for Unreasonable Profits.

It’s been a long slide from greatness for US manufacturing.  It’s been downhill since the 70s – a multi-decade slide.  Lately there’s a lot of hype about a manufacturing renaissance in the US – re-shoring, on-shoring, right-shoring.  But the celebration misguided.  A real, sustainable return to greatness will take decades, decades of single-minded focus, coordination, alignment and hard work – industry, government, and academia in it together for the long haul.

To return to greatness, the number of new manufacturing jobs to be created is distressing. 100,000 new manufacturing jobs is paltry. And today there is a severe skills gap.  Today there are unfilled manufacturing jobs because there’s no one to do the work. No one has the skills. With so many without jobs it sad.  No, it’s a shame.  And the manufacturing talent pipeline is dry – priming before filling.  Creating a sea of new manufacturing jobs will be hard, but filling them will be harder.  What can we do?

The first thing to do is make list of all the open manufacturing jobs and categorize them. Sort them by themes: by discipline, skills, experience, tools.  Use the themes to create training programs, train people, and fill the open jobs. (Demonstrate coordinated work of government, industry, and academia.)  Then, using the learning, repeat.  Define themes of open manufacturing jobs, create training programs, train, and fill the jobs.  After doing this several times there will be sufficient knowledge to predict needed skills and proactive training can begin.  This cycle should continue for decades.

Now the tough parts – transcending our short time horizon and finding the money.  Our time horizon is limited to the presidential election cycle – four years, but the manufacturing rebirth will take decades. Our four year time horizon prevents success. There needs to be a guiding force that maintains consistency of purpose – manufacturing resurgence – a consistency of purpose for decades.  And the resurgence cannot require additional money. (There isn’t any.)  So who has a long time horizon and money?

The DoD has both – the long term view (the military is not elected or appointed) and the money.  (They buy a lot of stuff.) Before you call me a war hawk, this is simply a marriage of convenience.  I wish there was, but there is no better option.

The DoD should pull together their biggest contractors (industry) and decree that the stuff they buy will have radically reduced cost signatures and teach them and their sub-tier folks how to get it done.  No cost reduction, no contract.  (There’s no reason military stuff should cost what it does, other than the DoD contractors don’t know how design things cost effectively.) The DoD should educate their contractors how to design products to reduce material cost, assembly time, supply chain complexity, and time to market and demand the suppliers.  Then, demand they demonstrate the learning by designing the next generation stuff.  (We mistakenly limit manufacturing to making, when, in fact, radical improvement is realized when we see manufacturing as designing and making.)

The DoD should increase its applied research at the expense of its basic research.  They should fund applied research that solves real problems that result in reduced cost signatures, reduce total cost of ownership, and improved performance.  Likely, they should fund technologies to improve engineering tools, technologies that make themselves energy independent and new materials.  Once used in production-grade systems, the new technologies will spill into non-DoD world (broad industry application) and create new generation products and a sea of manufacturing jobs.

I think this is approach has a balanced time horizon – fill manufacturing jobs now and do the long term work to create millions of manufacturing jobs in the future.

Yes, the DoD is at the center of the approach. Yes, some have a problem with that.  Yes, it’s a marriage of convenience. Yes, it requires coordination among DoD, industry, and academia.  Yes, that’s almost impossible to imagine. Yes, it requires consistency of purpose over decades. And, yes, it’s the best way I know.

The new product development process creates more value than any other process. And because of this it’s a logical target for improvement.  But it’s also the most complicated business process.  No other process cuts across an organization like new product development. Improvement is difficult.

The CEO throws out the challenge – “Fix new product development.” Great idea, but not actionable. Can’t put a plan together.  Don’t know the problem.  Stepping back, who will lead the charge? Whose problem is it?

The goal of all projects is to solve problems.  And it’s no different when fixing product development – work is informed by problems. No problem, no fix. Sure you can put together one hell of a big improvement project, but there’s no value without the right problem. There’s nothing worse than spending lots of time on the wrong problem.  And it’s doubly bad with product development because while fixing the wrong problem engineers are not working on the new products.  Yikes.

Problems are informed by outcomes.  Make a short list of desired outcomes and show the CEO.  Your list won’t be right, but it will facilitate a meaningful discussion.  Listen to the input, go back and refine the list, and meet again with the CEO.  There will be immense pressure to start the improvement work, but resist.  Any improvement work done now will be wrong and will create momentum in the wrong direction.  Don’t move until outcomes are defined.

With outcomes in hand, get the band back together. You know who they are.  You’ve worked with them over the years. They’re influential and seasoned.  You trust them and so does the organization.  In an off-site location show them the outcomes and ask them for the problems. (To get their best thinking spend money on great food and a relaxing environment.)  If they’re the right folks, they’ll say they don’t know.  Then, they’ll craft the work to figure it out – to collect and analyze the data.  (The first part of problem definition is problem definition.) There will be immense pressure to start the improvement work, but resist.  Any work done now will be wrong.  Don’t move until problems are defined.

With outcomes and problems in hand, meet with the CEO.  Listen.  If outcomes change, get the band back together and repeat the previous paragraph. Then set up another meeting with the CEO.  Review outcomes and problems.  Listen.  If there’s agreement, it’s time to put a plan together.  If there’s disagreement, stop.  Don’t move until there’s agreement.  This is where it gets sticky.  It’s a battle to balance everyone’s thoughts and feelings, but that’s your challenge.  No words of wisdom on than – don’t move until outcomes and problems are defined.

There’s a lot of emotion around the product development process.  We argue about the right way to fix it – the right tools, training, and philosophies. But there’s no place for argument.  Analyze your process and define outcomes and problems.  The result will be a well informed improvement plan and alignment across the company.

To do good for the planet and make lots of money (or the other way around), I think companies should shift from an economic framework to a social one. Green products are a good example. Facts are facts: today, as we define cost, green products cost more; burning fossil fuel is the lowest cost way to produce electricity and move stuff around (people, products, raw material). Green products are more expensive and do less, yet they sell. But the economic benefits don’t sell, the social ones do. Lower performance and higher costs of green products should be viewed not as weaknesses, but as strengths.

Green technologies are immature and expensive, but there’s no questions they’re the future. Green products will create new markets, and companies that create new markets will dominate them. The first sales of expensive green products are made by those who can afford them; they put their money where their mouths are and pay more for less to make a social statement. In that way, the shortcoming of the product amplifies the social statement. It’s clear the product was purchased for the good of others, not solely for the goodness of the product itself. The sentiment goes like this: This product is more expensive, but I think the planet is worth my investment. I’m going to buy, and feel good doing it.

The Prius is a good example. While its environmental benefits can be debated, it clearly does not drive as well as other cars (handling, acceleration, breaking). Yet people buy them. People buy them because that funny shape is mapped to a social statement: I care about the environment. Prius generates a signal: I care enough about the planet to put my money where my mouth is. It’s a social statement. I propose companies use a similar social framework to create new markets with green products that do less, cost more, and overtly signal their undeniable social benefit. (To be clear, the product should undeniably make the planet happy.)

The company that creates a new market owns it. (At least it’s theirs to lose). Early sales impregnate the brand with the green product’s important social statement, and the new market becomes the brand and its social statement. And more than that, early sales enable the company to work out the bugs, allow the technology to mature, and yield lower costs. Lower costs enable a cost effective market build-out.

Don’t shy away from performance gaps of green technologies, embrace them; acknowledge them to amplify the social benefit. Don’t shy away from a high price, embrace it; acknowledge the investment to amplify the social benefit. Be truthful about performance gaps, price it high, and proudly do good for the planet.

The Founding Fathers got it right with three branches: legislative to make laws; judicial to interpret laws; and executive to enforce them. Back then it was all about laws, and the system worked.

What the Founding Fathers could not realize was there was a powerful, pre-chrysalis force more powerful than laws, whose metamorphosis would exploit a gap in the three branch system. Technology has become a force more powerful than laws, and needs its own branch of government. We need a Supreme Court of Technology. (Think Ph.D. instead of J.D.)

Technology is the underpinning of a sustainable economy, an economy where citizens are well-educated, healthy, and happy, and where infrastructure is safe and supports the citizens’ needs. For countries that have it, technology generates the wealth to pay for education, healthcare, and bridges. Back then it was laws; today it’s technology.

The Founding Fathers knew interpretation of laws demanded consistency, consistency that transcended the election cycle, and, with its lifetime appointment, the Supreme Court was the mechanism. And it’s the same with technology: technology demands consistency of direction and consistency of purpose, and for that reason I propose a Supreme Court of Technology.

The Chief Justice of Technology and her Associate Justices set the long term technology policy for the country. They can be derided for its long time horizon, but they cannot be ousted for making the right decisions or their consistency of purpose. The Justices decide how to best spend their annual budget, which is substantial and adjusts with inflation and population. Since they are appointed for life, the Justices tell Congress how it goes with technology (and to stop with all this gridlock gamesmanship) and ask the President for her plan to implement the country’s technology policy. (Technology transcends political parties and election cycles.)

With the Supreme Court of Technology appointed and their first technology plan in place (think environment and energy), the country is on track to generate wealth sufficient to build the best educational system in the world (think creativity, art, science, math, and problem solving) to fuel the next generation of technology leadership.

There’s a big push to be green. Though we want to be green, we’re not sure how to get there. We’ve got high-level metrics, but they’re not actionable. It’s time to figure out what we can change to be green.

One way manufacturers can be green is to reduce their carbon footprint. That’s one level deeper than simply “being green,” but it’s not actionable either. Digging deeper, manufacturers can reduce their carbon footprint by generating less greenhouse gases, specifically carbon dioxide. Reducing carbon dioxide production is a good goal, but it’s still not actionable.

Looking deeper, carbon dioxide is the result of burning fossil fuels,

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