Leadership vs. Management: What Manufacturers Get Wrong

Transcript

[00:01:50] Josh Santo: Rich, welcome to the show. It’s great to have you here.

[00:01:55] Rich Nave: Excited to be here, Josh. It’s always fun to, uh, chat with you.

[00:01:59] Josh Santo: It is always fun. So for those of you listening, this is not Rich and i’s first rodeo. We’ve, uh, covered a couple of different topics through various mediums, particularly webinars so far. So really excited to get you on the podcast.

[00:02:13] Rich Nave: Yeah. Little, little bit of a new format for us, but, um, I, I like the little bit longer format so that you and I can dig deeper into some of these topics that we’re both interested in.

[00:02:21] Josh Santo: Absolutely. And speaking of those topics, we’re chatting today about one that you’re particularly passionate about, leadership. So first question to you to kick us off, why are you passionate about leadership?

[00:02:34] Rich Nave: So, you know, we all kind of make up models about how, how we see the world and, um, one of my models is that, uh, you can break things down into people, process and tools. And, um, you know, so a, a common one that, that might talk about might be that there’s, there’s a risk analysis process the tool that we use is the FMEA, but it’s people who do the FMEA. But without leadership, gonna motivate those people to do the FMEA, what’s gonna motivate those people to really dig into their process, their manufacturing process, and really look at where is the risk in that manufacturing process? And so I, I think that these tools that we talk about so often, whether they’re software tools, hardware tools, quality tools, really based upon the people and the leadership of those people.

[00:03:38] Rich Nave: And so I’m, I’m really passionate that in order to get effective use of these tools, we’ve gotta have strong leadership.

[00:03:48] Josh Santo: So then without leadership, what is gonna motivate people to use those tools is it just shouldn’t expect people to use the tools. Are you leaving things to chance? What happens if leadership isn’t there to motivate people to use those tools?

[00:04:03] Rich Nave: Well, you know what, what you end up with is check the box

[00:04:06] Josh Santo: Hmm

[00:04:07] Rich Nave: you know, a term that you and I have used often is pencil whip. You know, people will, will go through and they’ll turn in a piece of paper, they’ll, you know, submit a form. Um, but, you know, at, at the simplest level in our manufacturing world, you know, they’ve, they’ve taken the part number off the top of the form, substituted a new part number, and they, they call that doing the job.

[00:04:31] Josh Santo: mm.

[00:04:31] Rich Nave: And it’s not, um, you know, as a matter of fact, sometimes it’s even worse than not doing the job at all because it, it gives us the fallacy that something’s been done.

[00:04:40] Josh Santo: Hmm

[00:04:40] Rich Nave: And, um, so, you know, without leadership, people don’t understand why, okay. aren’t motivated to participate as part of a team. happy to say, I’ll let Josh do it rather than do it myself.

[00:04:56] Rich Nave: Okay. And so it’s really, you know, it’s, it’s a big deal to truly lead the people rather than just manage the process.

[00:05:06] Josh Santo: hmm. Okay. And I’m curious, you know, let’s say there is a lack of leadership. Whenever I hear the term leadership, I’m thinking the boss at that point. Um, but that doesn’t have to be the case. From your perspective, would you say? I.

[00:05:21] Rich Nave: No, not at all. Um, this is one of those things where, you know, you ask a group of people you know, who’s a leader, and you know, only three people raise their hand. Everybody’s a leader at different times. Maybe you’re a leader within your church. Maybe you’re a leader within, uh, your family. Maybe you’re a leader on a sports team.

[00:05:39] Rich Nave: Maybe you’re, you know, a leader at work, but everybody leads at different times. And you know when, when you’re leading, really what you’re doing is you’re inspiring a team of people to achieve a goal. Okay. Not necessarily achieving the goal yourself, not necessarily telling the people exactly how to do this, but inspiring them to do that. so, you know, you’re creating that focus where the whole team is, you know, I like to use the term true north, the whole team is marching true north. Okay. We don’t have some people going to the east, some going to the west, you know, and, and we say, oh, well, we’re doing okay because we averaged out

[00:06:16] Josh Santo: out

[00:06:17] Rich Nave: north. pulling together, everybody’s, you know,

[00:06:21] Josh Santo: going,

[00:06:21] Rich Nave: north.

[00:06:22] Josh Santo: I love that we’ve averaged out going north, so we’re, we’re kind of making progress to our goal. In that example,

[00:06:31] Rich Nave: that’s, you know, because I got two

[00:06:33] Josh Santo: two people,

[00:06:34] Rich Nave: east, two people going west, and one

[00:06:35] Josh Santo: one person

[00:06:36] Rich Nave: north.

[00:06:37] Josh Santo: averaged out.

[00:06:38] Rich Nave: north. What, what, what good is that

[00:06:40] Josh Santo: Exactly. It’s all, it’s all. Okay. Don’t anyone freak out. Don’t worry. We made 2% progress on our expedition northwards. Well, that kind of gets us into the heart of the topic today.

[00:06:52] Josh Santo: We’re talking about leadership, and I’m curious from your perspective, working in your 30 years in manufacturing through various leadership type roles, what have you seen that manufacturing professionals typically get wrong about leadership?

[00:07:12] Rich Nave: well what, what they typically get wrong, Josh, is that they confuse leadership and management. Okay? And they believe that because they’re managing that they’re leading it. And leader leadership and management are actually two very different things, and they’re both very important. You know, sometimes we somehow almost get this connotation that leadership’s better or more important than management.

[00:07:37] Rich Nave: And it’s not, they’re both really important for success, but they are different. And one of the things that happens, or at least you know, I’ve seen happen in manufacturing people get promoted because they’re good managers. But that doesn’t mean that they are prepared to lead and they may not be trained to lead because I also believe that leadership isn’t some, you know, you’re born with or you know, don’t have or you know, type of thing. You can be trained in how to lead. And so, you know, as we look at that, that’s one of the things that people get get wrong is they think that leadership and management are the same thing.

[00:08:15] Josh Santo: They think they’re the same thing. And it sounded like a little bit, you were describing leadership even being seen as a higher. Of the two, uh, more important of the two, but from what you shared, it’s, it’s important to have both of those. I think it would help if we further defined what is leadership versus what is management so that we can see the differences between the two.

[00:08:41] Rich Nave: So it’s an important question. um, you know, it’s funny because I even went and, uh, you know, started doing some research on this because you and I were gonna do that, and I figured I ought to ask people smarter than me, uh, what it is. But, um, know, first off, leadership does tend to be more strategic, okay?

[00:09:05] Rich Nave: And management tends to be more tactical. Um, leadership deals with guiding and inspiring. Individuals and teams to accomplish a goal. Managing involves overseeing and optimizing aspects of that process to reach that goal. Okay. But it doesn’t involve what should that goal be, or where should that goal be? It just involves, if this is the goal, let’s optimize getting to that goal. That’s management. But leadership is, you know, inspiring the people to achieve that goal.

[00:09:46] Josh Santo: So let’s go back to that example of making progress towards true North, right? And, and instead of averaging out to the 2%, you’ve got leadership saying one. We’re going north. Two, let’s get excited. Here’s why we want to go north. Here’s what’s in it for you. And everyone is inspired to use your words to head north.

[00:10:07] Josh Santo: Okay, well, super excited. Now what? And so from your perspective, management is here’s how we accomplish that together.

[00:10:16] Rich Nave: Yep. And so that’s the process and the tools that I talked about is that management is the process and the tools, but those people need to be led. And another example, uh, you know, Josh, uh, that I I like to think about we’re onboarding 10 new employees, And those employees are gonna turn bolts at our, our manufacturing plant. So how do you lead? People whose job it is is gonna be to tighten bolts. I mean, you know, you think, wow, it’s really not, you know, it’s not inspiring. if I were to approach those people and say, you know, our company manufactures a really critical aspect of vehicles and without our product and our product being right, the vehicle will not stop people could be injured because of this.

[00:11:11] Rich Nave: And it’s not just other people, it’s our families. It’s the, you know, our children, our parents, our brothers, our sisters, our neighbors could all be injured if we don’t build our product correctly. Okay? Now we’re gonna train you on the tools to use to do this and how to use those tools within our process. But you know, we’re really counting on you, is our employees to get this right so that everybody is safe. Now, I didn’t tell them that we want you to tighten, you know, 12 bolts a minute and that we want you to do it by doing, you know, A CBD in that order. I didn’t tell them that, you know, the bolt has to be 32 Newton meters.

[00:11:57] Rich Nave: Right. I told them why the bolt was important. Okay. And not only to them, but to people that they love and that’s leadership.

[00:12:08] Josh Santo: What I think is great about that example that you shared is that using that analogy that we’ve established of heading North, you are finding a way to make that direction personally resonate with the individuals with whom you are leading and. Also in your example, I don’t know if you realize it or not, you demonstrated, uh, this idea of autonomy.

[00:12:32] Josh Santo: You, you were giving them the permission to make it their own, to, to have some control in how they help contribute towards the progress of that goal that now ideally personally resonates with them.

[00:12:45] Rich Nave: Yeah, that’s a, that’s a great thing because, um, you know, that’s part of satisfaction is having that ownership and autonomy that you just spoke of, and I hadn’t really thought of that in that example, but yeah, that’s a, a great observation.

[00:13:00] Josh Santo: Well, to to be honest, it stuck with me because you had called it out in a previous conversation and I’ve been thinking about it since then. Okay. Well, so that’s, that’s leadership. Now in that same example, where does management come in?

[00:13:15] Rich Nave: So management is gonna be tracking that task. They’re gonna be, you know, looking at the execution of it and how that then, You know, results in the output that we’re looking for. So management’s gonna be looking at those, those inputs, you know, the, the torque gun, the people, the bolts, you know, all those things that go into our process of tightening that bolt. That then allows us to have the output of the brake system or the suspension system, or whatever it is that we’re, uh, we’re building. But management is gonna track all of those inputs. They’re gonna track the process, okay, how many per hour we do, how many good parts, how many bad parts, all those types of things.

[00:14:00] Rich Nave: And then they’re gonna track the, the output, you know, how many parts did we produce that that shift, you know, and then they’re gonna be able to do the, you know, all of our favorite ratios of the labor per part and all that, all that kind of jazz. They’re gonna be able to do all that type of stuff because they’re managing the process. And that’s what they’re doing. So they’re the ones who are gonna talk about, you need to tighten a bolt every 12 seconds so that you tighten five bolts per minute. And we need each bolt tightened to 32 Newton meters. You know, plus or minus five Newton meters. They’re, they’re gonna, you know, they’re gonna do all of that, whether it’s they engineering management, quality management, you know, logistical management in terms of having the bolts at the work cell.

[00:14:45] Rich Nave: You know, all those things are the management part of it.

[00:14:48] Josh Santo: So now that you know which direction we’re heading, why we’re doing it, why we found a reason for it to personally resonate with you, here’s the plan for us to get there, and here’s how we’re going to figure out if we’re going according to plan, if we’re off track, if we need to reset. And that really starts to highlight the differences from your perspective of leadership and management, leadership, setting that direction and strategy and the inspiration to even take that journey to begin with management really coming in and saying, here’s how we work together to get to that point.

[00:15:22] Josh Santo: Now let me ask, are these two different roles, is this the same person in this scenario? What are your thoughts on that?

[00:15:29] Rich Nave: Well, I think that we all have to lead and we all have to manage. And so I think it can be one person, I think that it’s maybe what the, the statement would be. It’s in different percentages. Um, it at different levels of the company. Okay. you know, an engineering manager might do a lot of managing and a little bit of leading. Okay. but a shop floor supervisor might do a little bit of managing. He’s keeping track of the production numbers and, but he’s also doing a lot of leading with the people. Okay. You know, keeping the people on task, motivating them, even coming back to them is another form of leadership and saying, Hey, you know, you’re the expert on this job now.

[00:16:16] Rich Nave: You’ve been tightening these bolts for six weeks, six months, six years. You know, you help us improve this? You know, what are your thoughts about this? Because you know it better than anybody. And you know, that person comes back and says, well, you give us a rigid drill. If we had a drill with a flexible bid on it, it would be easier to get it located and started.

[00:16:35] Rich Nave: And, you know, I could do six bolts a minute instead of five. Well, now that leader has come back and he’s asking those people for their opinion, which once again goes to that autonomy thing that you mentioned earlier and really makes them feel like. they’re doing is valuable to the company and their feedback matters. And that’s where, you know, the person, that leader then comes back into the process again, because it’s not just lead and forget it. The leader is continuously involved in that process. Just as the manager is, you know, managing the process every day. There’s leading every day that’s going on.

[00:17:13] Josh Santo: Now from your perspective, let’s talk about the topic of creation. How does creation factor into the differences between leadership and management?

[00:17:24] Rich Nave: Well, I think of creation, um, thinking of a, a leadership task usually I’m

[00:17:34] Josh Santo: I.

[00:17:34] Rich Nave: of the creation of the goal. And I’m thinking of the creation of the direction. And so I think of creation, as very much the leadership task in this, uh. So that, that’s where I come down on creation. I will tell you that at the Loneliness Group where I work, we actually have people who do work on, you know, creation as a process that you can manage a design process and things like that. But in manufacturing, I really see creation as a leadership role.

[00:18:26] Josh Santo: I am thinking through right now.

[00:18:28] Rich Nave: No problem.

[00:18:29] Josh Santo: No problem. Take a note. Uh, yeah, and if there’s ever moments where like this, where we can just, we can always pause and like cut these pieces out. So, um, okay. So creation as leadership, creation of the goal, the direction creation as a process. Uh, I guess the next thing I’ll ask you about is around, um, creation as a process.

[00:18:53] Josh Santo: So that’s where we’ll pick up Sound good?

[00:18:56] Rich Nave: Creation as a process. Okay?

[00:19:01] Josh Santo: Or we can move on to the, the next question.

[00:19:04] Rich Nave: Whatever I can do, I can talk on either, you know me

[00:19:07] Josh Santo: Okay. Okay. Uh, lemme just make a note of time and I’ll ask you in just a second.

[00:19:16] Josh Santo: Now, one of the things that you just mentioned was creation as a process. Tell me, tell me more about what that means.

[00:19:24] Rich Nave: well. So you may have heard of terms like, uh, six Sigma for design.

[00:19:31] Josh Santo: Mm-hmm.

[00:19:32] Rich Nave: Um, that looks at design as a process. We can do design FMEAs to look at the risk of getting a design wrong. these are all tools that apply to a process. So if design is a process or creation of a product, um, from that standpoint is a process. We can manage that process and we can also lead that process, uh, or lead the people, I should say, involved in that process. And so when we, when we think about creation in that way, you know, there are steps that we go through from, you know, ideation to concept, to, uh, formalized drawing to design, validation to, uh, process, validation to approval. And so as we go through these steps, we can manage that design process. But we also have to lead the people who are involved in that design process.

[00:20:34] Josh Santo: Leading them, inspiring them, connecting to their own individual accountabilities. Okay. Well, you know, in this discussion of what people get wrong and that’s seen, uh, leadership in management, confusing management for leadership specifically, uh, but you’re really emphasizing this idea that you have to have both.

[00:20:55] Josh Santo: You have to have someone setting the direction, inspiring folks, connecting it to their own personal why, and instilling with them, within them autonomy so that they can take accountability. And then you also have to have a role to. To support that, that helps bring the structure, the tools, the how we actually make this happen and become a reality.

[00:21:17] Josh Santo: It sounds to me like both are essential. You have to either have people in roles of leadership and management, or have people who can work both as a leader when the time is appropriate and a manager when the time is appropriate. From your perspective, are you able to have a leader without a manager or a manager without a leader?

[00:21:40] Josh Santo: What are your thoughts?

[00:21:43] Rich Nave: So you’re, you’re bumping up against what I think is one of the major gaps in particularly North American manufacturing because I know that better. So I don’t wanna necessarily say global manufacturing, um, people get promoted because they’re good managers and that’s what happened to me. I was a good manager. I got promoted and I got promoted, but nobody taught me how to lead. There was no course that I took that taught me to lead. And so one of the issues that we have is that we’re promoting these people who are managers and they don’t necessarily have the leadership skills. And we’re not addressing that through training or through recognition of that as a trait that should be promoted. And so with that happening, we end up with a lot of people who can manage. so we really focus on process and process improvement and our tools and all of that. And we actually have a lack of focus on the people that are involved in this. And you can even hear it sometimes when people talk about soft skills versus hard skills, like somehow, you know, things like making people feel psychologically safe things, you know, like the, you know, HR are, are soft or, uh, things like that versus engineering that are hard skills because they involve calculus and chemistry and physics and you know, electrons and things like that. but my experience is that projects fail the people, they don’t fail because the tool doesn’t work. Okay. There are a lot of great software packages out there that companies buy never get adopted. And you know, literally this week, Josh, I was at a company sitting in the corner was a 3D printer and the thing had to have had an inch of dust on it.

[00:24:03] Josh Santo: Hmm.

[00:24:03] Rich Nave: And I happened to be sort of a nerd about that stuff. And so I, I said, you know, what do you guys do with that? The guy’s like nothing. I’m like, what do you mean nothing? And he’s like, well, they bought it, but they didn’t buy the CAD software to go with it and they didn’t buy the material. That’s similar to the material we process.

[00:24:23] Rich Nave: So even when we did produce things, we couldn’t really use ’em for testing.

[00:24:27] Josh Santo: Hmm.

[00:24:29] Rich Nave: Well, the people who were supposed to lead that support it. They said, here’s the tool, here’s the 3D printer, ideo. Okay. And when the engineer said, I need different material, on his own, he was left a float. Okay, now a real leader would’ve stepped up and said, okay, we’ve got some friction here.

[00:24:54] Rich Nave: We’ve got some pushback. We’ve got, you know, what, what, why do you need this material? Let’s identify what our real needs are. Okay? How’s that fit in with what we wanna do? And then we could have gotten the real material that we needed, the, you know, in this case, nylon or poly, um, amide material. But it just, you know, what, what was going on with that?

[00:25:13] Rich Nave: That they had this machine sitting in a corner not doing anything. Okay. that, that’s, that’s when I really think you see a lack of leadership. Now, there should have also been some manager that says, I’ve got an asset that’s not producing anything, but that apparently wasn’t getting measured. So,

[00:25:30] Josh Santo: Well, lack of leader to drive the manager to be inspired to, to do that. Right. A bit of a train chain impact. I, I think it’s interesting that you call out leadership as a skill. ’cause that does sound very much like a. Well, yeah, no, duh. At least to me. And that would then mean if it is a skill, it’s something that can be developed, something that can be taught, it can be refined, it can be improved.

[00:25:54] Josh Santo: Sure. Some people may start at different starting points. I know a lot of people who I would point to and say that like, no one’s taught them just the way they think, the way they operate lends itself well to a leadership type position. But to your your point, there’s a, a big focus on the management side, on developing and introducing tools and skill sets for folks that are really related to the management side of things.

[00:26:22] Josh Santo: I, in your example, you called out an impact, and that leads to my next question on this idea of not effectively developing leadership or having leadership presence or, or skills, uh, in place. What’s the impact of that? What’s the impact when you overly focus on management?

[00:26:45] Rich Nave: Well, there, there’s a couple of key things Okay. That, that happen. first off, you overly focus on management, you know, you start to get to that term that we call micromanagement, which

[00:26:59] Josh Santo: Mm.

[00:26:59] Rich Nave: knows, you know, is a, you know, a bad thing and nobody wants to be micromanaged and all that. But what does that mean happens?

[00:27:09] Rich Nave: And the first thing that I’ve noticed is that when people are being managed instead of led, taking risk. Because they feel everything’s going to be evaluated and measured. So I can’t have a misstep, I can’t have anything that might not, you know, be right on, on track to where you know, where we’re going. And so people stop taking risks. And the other thing that I, I’ve noticed in those situations is I’ve noticed that people start to operate individually and they stop working within a team. And another thing, when, when there’s not strong leadership, lose what I call a culture of challenge, which is people do what they’re told without challenging it, without talking about, you know, am I doing this?

[00:28:02] Rich Nave: What would be best? What are my ideas? They just start to do it by rote

[00:28:07] Josh Santo: Mm.

[00:28:07] Rich Nave: actually contributing everything that they could. Okay. so. We really want, you know, these people to be willing to take risk. We want them to work in teams and we want them to, you know, be looking for what’s the best continuous improvement or, you know, process.

[00:28:25] Rich Nave: And so we want them working on that. And that’s what you lose when you over manage and under lead.

[00:28:31] Josh Santo: So it sounds like you’re saying to, to some degree, you lose out on improvement, continuous improvement, um, in that case, would you say that’s fair? I.

[00:28:42] Rich Nave: Absolutely. Because continuous improvement come from management. Okay? Managing gets you to the established goal, okay? And it measures how well you do getting to the established goal, it takes leaders to say, what’s the best way to get to the goal? Okay. It takes leaders to say, want to, you know, make this as efficient as possible. Lemme give you a, another sort of example, um, that I, I’ve always been bothered by in manufacturing. If someone says, well, you know, we, we wanna add some automation, we wanna add a robot, the first question they get asked is, how many people will that eliminate? Like, somehow that would be good. we add a robot, then we manage those inputs and then we drive down the number of people. Okay? A leader says, if we add this robot, how will it increase the efficiency of the people? Okay, not how will we eliminate? ’cause my people are valuable.

[00:29:52] Josh Santo: We hear these

[00:29:53] Rich Nave: Josh, how many companies have you heard

[00:29:54] Josh Santo: s say,

[00:29:55] Rich Nave: our people are our most valuable resource.

[00:29:59] Josh Santo: yeah, I can’t think of a single one that would say, Nope, just kidding.

[00:30:04] Rich Nave: all add robots to eliminate people. Is that treating people like they’re the most valuable resource. And so now there’s a, a whole new field, called Cobo, okay. Where we have robots working in conjunction co-working with people to where the robot is doing certain tasks that robots are good at, and people are doing the tasks that people are good at.

[00:30:30] Rich Nave: And that makes that cell as efficient as possible. That comes about because of leadership, not because of management. And so this whole concept of a field even called Cobo, is a leadership concept, uh, being applied.

[00:30:47] Josh Santo: Well, I wanna break down a couple of things that you shared, including that, that last example on the Cobo Cobo side of things. ’cause on that topic in particular of like people are our most important asset, uh, people are also a type of cost when it comes down to the business. And so you’ve got this situation where the business wants to be as profitable as possible, and one of the ways to do that is to.

[00:31:19] Josh Santo: Have as low costs as possible. Uh, so is it an, from your definition, a leader is putting the people first and the manager is the one that’s seeking to put profit over people in that case. But in that example, wouldn’t a leader need to also be conscious of profitability costs, et cetera?

[00:31:43] Rich Nave: All right. I think you’re, you’re actually. Caught in an illusion, Josh.

[00:31:48] Josh Santo: Okay. Dispel it for me.

[00:31:50] Rich Nave: um, examples like the Toyota production system, uh, contradict, okay. We aren’t trying to be as low cost as possible. We’re trying to be as efficient with our resources as possible and eliminate waste at every opportunity. Now, if a, if a person is truly not needed, then that may be wasteful, But usually what we want to do is improve efficiency and eliminate waste by giving that person the tools that they need and optimizing the process that they work within, and that creates an efficient employee and an efficient. Uh, production, and that’s what will give us the lowest cost basis or the highest value, because that’s really what we wanna provide to our customer. Our customers, you know, I truly believe looking for high value, they aren’t necessarily looking only at low cost. if we get caught up in only low cost, I believe that that’s a, um, a misnomer or a, you know, a, apples and oranges type of thing because they really want high value. And, you know, strong companies position themselves as high value.

[00:33:12] Josh Santo: Okay. Interesting. And to your point, that changes the direction that you’re heading and thus the tactics that you use to get to that point. So leadership comes in and says, we want to be high value to our customers, not, we want to be the lowest cost solution that our customers can find, and that changes the different tactics.

[00:33:35] Josh Santo: That’s a great way of tying things together. Now, one of the,

[00:33:37] Rich Nave: Let me, let me make one other observation here, Josh. And it,

[00:33:40] Josh Santo: sure.

[00:33:41] Rich Nave: I, I’m bringing it up because it’s, it’s really pertinent, know, on, on May 1st, when, when you and I are talking, I believe that there’s going to be a new competitive frontier that’s going to emerge, and that competitive frontier is going to be in supply chain management in the optimization of supply chain. And currently there was this huge drive that said we wanna get the low cost suppliers in our supply chain. so we went from United States to Mexico to China, and then from China to to Vietnam or Cambodia or Laos or African countries because we always thought that we could get a lower cost. And now that’s really coming back to potentially bite some of these companies in the proverbial butt. Okay. And I think in the future that real leadership is going to look at the supply chain as an opportunity to lead our suppliers into using better tools and processes to become more efficient as suppliers to us as a tier one or a, a manufacturing company or whatever it is. But once again, I think that that’s going to be a case where. You know, large assembly companies will lead their key suppliers into optimizing their processes and localizing their processes so that we don’t run into the supply chain issues that Covid brought on and that, you know, now the current tariff situation potentially is going to, uh, bring on. And so I think there’s a real opportunity here to lead in supply chain management

[00:35:27] Josh Santo: That’s an interesting take. So it’s not so much about finding the lowest cost supplier, it’s about finding the most efficient supplier in that case. Mm-hmm.

[00:35:36] Rich Nave: in, in making, getting the most efficient supply chain.

[00:35:40] Josh Santo: Got it. Yeah. I think that’s a, a great thing to call out. You know, you’re talking about the offshoring that happened and the focus there being, how do we reduce our costs? How do we produce, uh, product for the lowest possible costs? And you’re reframing that to focus not on, to your point earlier, not on being the lowest cost, but the most efficient, so that the impact focuses on the value being brought to the customer as opposed to the profitability necessarily of the company being first and forefront.

[00:36:16] Rich Nave: And, but I think those things go hand in hand. If you bring high value to your customers, you will be profitable. You know? ’cause you can, you can charge for that.

[00:36:25] Josh Santo: Right. Right, right, right. Yeah. Again, it’s just, here’s the direction we’re going and that defines the tactics that we’re going to use. And one of the things you called out earlier about the impact of, of, um, uh. One of the things you called out earlier about the impact of, why am I blanking on what we just said?

[00:36:47] Josh Santo: 34.

[00:36:48] Rich Nave: me bring one up for you that, uh, I think we could dive deeper into Josh,

[00:36:52] Josh Santo: Sure.

[00:36:52] Rich Nave: which is that we don’t really have a, I’ll call it track. In other words. People get promoted for certain reasons, and leadership isn’t necessarily one of them. And we also don’t really have a, a set of training for leadership. We have things like, you know, business administration degrees, but that’s, you know, an MBA is really about management it doesn’t focus on leadership. And so I, I think one of the things that we’ve missed here is this, you know, this concept of how do we bring about leadership within our organizations. Now, I was very lucky growing up to play sports and to learn leadership in some of the sports that I was in. And then I also was involved in, in ROTC in the military. And so I learned leadership in the military. But if you even think about, particularly our military, they train leaders all the time they really focus on leadership heavily. Okay. Um, and so, you know, there, there, there are models for training leaders and we need to bring those into manufacturing and, you know, when you talk about shop floor top floor, You know, this is something that I think we’ve been ignoring on the top floor.

[00:38:12] Josh Santo: The leadership focused development. Yeah.

[00:38:15] Rich Nave: Yeah.

[00:38:17] Josh Santo: Well, I think that’s an interesting call out that other, other organizations have. Tackled this issue before in a repeatable way. They found a model to to have success and scale that success. And that’s something for organizations to explore and adopt. So you don’t have to start from square one.

[00:38:37] Josh Santo: You can look at what’s working within these other industries, bring those into your own, make it your own for your organization, but still get the benefit of that.

[00:38:45] Rich Nave: absolutely.

[00:38:46] Josh Santo: Now, one of the things we were talking about earlier was the impact, the impact of not developing leadership as a skill.

[00:38:54] Rich Nave: Mm-hmm.

[00:38:55] Josh Santo: Some of the things, just as a recap that you called out is that people stop taking risks.

[00:39:00] Josh Santo: People operate individually, aste instead of as a team. And then you have a culture that doesn’t challenge. That doesn’t push back on some of those, you know, at, at a high level glance, they don’t sound like bad things. And I’m assuming I need you to, to dispel the illusion again for me, but let’s talk about people stop taking risks.

[00:39:26] Josh Santo: Do you want people taking risks?

[00:39:30] Rich Nave: So I, I would contend in my experience. That. Yes, I want my people taking risks. Okay. Do I want them to be calculated risks? Yes. Do I want them to be well supported risks? Yes. But I need them to take risk. And the example that I will give you that quality that we produced yesterday or last month or last year, isn’t going to be acceptable quality tomorrow, next week.

[00:40:01] Rich Nave: Next year. And so if people don’t take risk to continuously improve our process, we’re going to fall. Fall behind. And there will be somebody else who will, you know, make that part, who will make that product for our customer. so risk to me is that willingness to try something that may not work perfectly the first time, but know that you will be supported so that you know, if you get 60% of the

[00:40:31] Josh Santo: Degree there.

[00:40:32] Rich Nave: you’re not criticized for that other 40%. You’re recognized for the 60% that you achieved and supported to get that other 40% accomplished. And so I think that risk is actually critical to business success and that without it businesses stagnate and you get the Xeroxes and the Kodaks and people like that, that we’re all familiar with.

[00:40:57] Josh Santo: So then in that case, would you consider a risk to be something outside of the norm, something outside of the status quo? Is that. A decent definition of risk in this case.

[00:41:09] Rich Nave: Yeah, it’s it, it’s something out of the standardized process.

[00:41:13] Josh Santo: Okay? So we typically do things this way. I really think we should try this other way.

[00:41:19] Rich Nave: Yep.

[00:41:20] Josh Santo: And you need that support and that guidance to see the opportunity, the opportunity of making that change, and maybe the opportunity of listening to the person, bringing the idea. ’cause maybe this is a, something that it turns out is just not gonna work for your operational organization.

[00:41:37] Josh Santo: Not even, not the 60%, not the 30%, like we’re talking 0%. But the impact of listening to someone and showing them that you’re gonna give them that space to try something new and see how it, how it works out, could lead to some big things as well. Now, another risk that you talked about was the lack of challenge.

[00:41:59] Josh Santo: At a cursory glance, it sounds like it might be a little similar to this idea of taking risks, but talk to us a little bit more about what’s the importance of having people who push back and challenge?

[00:42:12] Rich Nave: Well, the, the, the first thing I’ll, I’ll do, uh, Josh, is I’ll once again another one of these things. How many times have you heard about cross-functional teams, Josh?

[00:42:22] Josh Santo: It’s a word that I’ve heard almost all my life.

[00:42:25] Rich Nave: And it, it, it’s an absolute buzzword, isn’t it? Right. Well, why do we have cross-functional teams? What’s the value of a cross-functional team?

[00:42:34] Josh Santo: Diverse perspectives, different skill sets, bringing them to the table.

[00:42:38] Rich Nave: But we only need a diverse perspective if people are going to actually use that diverse perspective to, to say something.

[00:42:48] Josh Santo: Got it. Okay. So if you wanna cross, go ahead.

[00:42:53] Rich Nave: know, when we talk about a, a, a cross-functional team, we’re asking for challenge. So if we put this cross-functional team together and then tell ’em to shut up and do the job, why have the cross-functional team okay. You know? And so the, are some of these concepts like I was talking about with, you know, employee.

[00:43:15] Rich Nave: Our employees are our most valuable resource or cross-functional team that only work if you’re providing leadership. Okay. If someone’s saying, Hey, you know, we had a purchasing person on this team because, you know, we wanna know what we can ask of our suppliers and what we can’t. Okay. Well, if we never challenge the purchasing person to say, let’s bring this product in in smaller boxes so it has less footprint in our work cell. then why have the purchasing person on the team, if no one’s gonna challenge that person, that purchasing person to go back to our suppliers and you know, do whatever, let the purchasing person sit in their office and, you know, issue purchase orders. Okay? recognize that purchasing person’s gonna be bored.

[00:44:06] Rich Nave: Who wants to just type in purchase orders all day? Okay. You know, they wanna be on that team and they wanna help add value to our product. the way that they can add value to our product is to bring in that supplied component in a smaller box so it fits into the work cell better, all of a sudden they’ve contributed. Now how do they feel about their role in the company? Okay, they mean something. That’s what we want. only works if people feel free to challenge.

[00:44:41] Josh Santo: And a prerequisite for that, I would imagine is you, you have to be open to that challenge, which means you have to be open to getting things wrong and hearing that feedback from your team.

[00:44:55] Rich Nave: yeah. You know what? If you have a tyrant, is your purchasing manager or is your materials manager? And as soon as someone says, Hey, could you talk to the supplier about this? Says, no, that’s

[00:45:07] Josh Santo: that’s,

[00:45:08] Rich Nave: supply products. Well, that’s the last time person’s gonna bring it up.

[00:45:12] Josh Santo: yeah.

[00:45:12] Rich Nave: Plus why have that person on the team,

[00:45:15] Josh Santo: Yeah,

[00:45:16] Rich Nave: okay, the person has to be open to it.

[00:45:19] Josh Santo: yeah. Yeah. So there’s

[00:45:23] Rich Nave: there too, by the way.

[00:45:24] Josh Santo: opportunity. That’s where a leader,

[00:45:27] Rich Nave: in and coaches, okay? that can be difficult. All right. To, to talk with somebody about, the, there’s the, the five behaviors and things like that, that, uh, people talk about, but, you know, coaching your on how to accept, you know, input and, you know, those kinds of things. That’s part of being a leader is, you know, coaching and leading that team to accept criticism, to take accountability, you know, things of that nature.

[00:46:02] Josh Santo: and let’s say in that example that there’s resistance to that coaching, that the methods that you are trying don’t seem to click, resonate or, or have the intended impact. What do you do?

[00:46:21] Rich Nave: Josh, I live in a perfect world and that never happens.

[00:46:24] Josh Santo: Ah.

[00:46:25] Rich Nave: When I speak to people, they immediately change. Okay. They, they feel the goodness flowing over them and they immediately, uh, begin to change.

[00:46:35] Josh Santo: Now, was that a skill that you were taught or did you, were you just born with that?

[00:46:39] Rich Nave: Apparently I was born with that and, and with the, um, the God complex that I’m exuding it, it happens all the time, Josh. Okay. and that’s why, know, the idea that I’m going to lead one time a fallacy, I, I was trying to stress that at the beginning that it’s not just about, you know, onboarding those employees.

[00:47:02] Rich Nave: It’s about continuing to engage with them as a leader. not a one-time engagement. Now, a couple months ago I was at a plant and I was out on the plant floor with the plant manager. Now, this was not a huge plant, but it, they did have about 250 employees at this location. We were, we walked into a work cell that had about four or five employees in that work cell, the plant manager walked over to one of the employees and began to ask him, was his son ready for the state wrestling championship that week? Okay, now that’s incredible leadership right there. Now, it has no impact on how fast that guy was grinding the parts in the cell. But that guy now knows that he’s a human being, that he matters. And it didn’t come about because of one interaction between the, uh, plant manager and that person. Okay? That plant manager knew his people and interacted with them regularly. That plant manager ate his lunch in the employee cafeteria. Okay. That plan manager was involved with those people. And so when you talk about how do you create that change and what if people don’t accept it at first, there are a few things.

[00:48:36] Rich Nave: First off, you have to role model that. Am I as a leader accepting criticism? Am I accepting input? Okay. Secondly, am I challenging people in a healthy way? You know, we all, we all know you’re supposed to fight fair and not personalize things. Well, am I doing that? Uh, am I role modeling, uh, those behaviors?

[00:48:59] Rich Nave: All right. And lastly, you have to be consistent. And you know when, when there is something that’s unacceptable, you have to call it out every time. And you have to talk to that person regularly about it. And over time, that behavior changes. I’m not saying that there won’t be some time when you absolutely have to get rid of. An employee or, or make that change. but I fully accepted in my career as a plant manager that if I had to fire somebody on my staff, that was my feeling not theirs. And maybe it was my feeling that I hired the wrong person. Maybe it was my feeling that I didn’t coach them well. Okay. Maybe it was my feeling that I didn’t put them in the position that they would succeed at, but I had to accept responsibility for that.

[00:49:50] Rich Nave: That wasn’t their fault. It was my fault as a leader. Okay. And that was a, uh, a weight that I bore heavily, um, as a plant manager. And when you

[00:50:01] Josh Santo: Talk about?

[00:50:01] Rich Nave: know, why is that type of job hard? found it difficult because I accepted a lot of responsibility for the success of the people that worked for me. And if they weren’t successful, that was a reflection on me.

[00:50:15] Josh Santo: Mm. Yeah. What I, what I love about that is that you’re asking what could you have done differently? Or you’re accepting that there was something that you could have done that could have influenced the outcome, and because of that. You’re probably more open to improving or trying something different or just being better.

[00:50:37] Josh Santo: And that idea of extreme ownership, that’s something that, that I certainly resonates with me, and I, I love it because it, it, it focuses you on what you can control as opposed to pointing to outside external circumstances and saying, well, couldn’t be successful because this thing was outside of our control.

[00:50:59] Josh Santo: It flips the script to say, what could you have done? What could you have done? I think that’s great. Well, we, we’ve been talking about this topic of what folks get wrong about leadership and it’s thinking about management as leadership as opposed to leadership being a distinct skill that needs to be developed and it needs to be seen as something with a completely different tool set, set of goals, et cetera, and how it works well with management.

[00:51:25] Josh Santo: We’ve also gotten into some points about the benefits of leadership, the benefits of management, and it’s pretty clear that both are needed and in a lot of cases, the same individual will have to, at times, be a leader and at times be a manager. My last question for you originally for now is how can I tell when I need to be a leader versus when I need to be a manager?

[00:51:52] Rich Nave: Well, one of the distinctions that I made is if you’re dealing with people, you need to be a leader. if you’re dealing with a process, you need to be a manager. Okay? sometimes that can be a little bit blurry, uh, and challenging, but if you think that you’re managing your people. You’re probably on the wrong foot. And you know, if, if you, you’ll really think that you’re going to be able to, you know, you, you, you hear the, the term, hurting kittens.

[00:52:23] Josh Santo: Mm-hmm.

[00:52:25] Rich Nave: That’s when I hear people, what I hear is I’m trying to manage people. Okay? I’m not trying to herd the kittens, I’m trying to lead the kittens to play in the, the bedroom. Okay? And if I lead them there, whether it’s with treats or whether it’s with, you know, putting the, the mama cat in the bedroom. So the kittens go where the mama cat is. What, what am I doing to lead the kittens? Not trying to herd the kittens into the, you know, into the bedroom.

[00:52:59] Josh Santo: Mm mm.

[00:53:00] Rich Nave: And so I, I do really think that the, the, the key is, are you dealing with a process?

[00:53:06] Rich Nave: And if you’re dealing with a process, you should manage it. You know, I was, we were talking about the, you know, the inputs. You’re, you’re managing the inputs, you’re managing the process, you’re managing the outputs. You need to do that. Okay. I think you lead the improvement of the inputs, the improvement of the process, because those, those deal with people and the efficiency and the continuous improvement and

[00:53:29] Josh Santo: Hmm

[00:53:30] Rich Nave: improvement isn’t gonna come from ai, it’s gonna come from people.

[00:53:36] Josh Santo: Hmm. Back to your point about putting people first. AI supports the people, right? Robots support the people. Leadership supports the people well, great. Well, rich, I know that you’ve got a story for us.

[00:53:55] Rich Nave: Okay. I wasn’t sure if we were gonna go to the story, but, um, know, it’s, it’s may, which is for those of us in the, the northern climbs, not for, for you down in, in Texas, Josh, but, uh, it’s hockey playoff season. So we’re all thinking about, um, hockey right now. And I grew up in what’s, what’s known as one of the three m’s. Okay. Massachusetts, Michigan, and Minnesota, where most of the US hockey is developed. Now. There are, there are some other places now, but back when I was growing up, especially, so I grew up playing hockey and, um, I was never a, a great hockey player. I never, you know, was gonna be an NHL player or anything like that.

[00:54:38] Rich Nave: But, um, when I was about, uh, 12, 12 years old, I was the, uh, captain of my hockey team. And I was on a team that was decent, not great. And we’d been playing together since, you know, August when hockey teams form, and it was now December or maybe even January, and even as a 12-year-old, looked at this team and I said, we’re 16 individuals. Some of these kids are good, some of these kids aren’t as good, but we’re 16 individuals on this team. And yet I was supposed to be captain of this team, and it wasn’t, this team was not gelling together. um, one night we were playing, I can even remember the, the barn that we were playing in, um. And it was a, a, a pretty rough game, even for 12 year olds. We, we could get pretty chippy at the time. I’m a defenseman and I’m standing at the blue line because we were in the offensive zone and a relatively big defenseman on the other team. one of my smaller forwards in the back in front of the net, and it was a clearly dirty play.

[00:55:54] Rich Nave: The puck wasn’t even close by. It was clearly a dirty play, and the referee wasn’t gonna call a penalty. So I took off from the blue line and I skated in. And when I got about halfway there, I dropped my stick, I dropped my gloves, and I tackled that big kid and we were gonna fight. And, you know, we’re understand something.

[00:56:19] Rich Nave: A, we’re both 12 years old. B, we’re wearing helmets with face masks. Okay? This isn’t like the most dangerous thing in the world. Don’t get, don’t, uh, don’t get your hopes up for a great story like that. um, we were gonna fight. Now, this kid was a lot bigger than me because I’m, I’m not a particularly big kid, and I definitely took the worst of this, okay?

[00:56:42] Rich Nave: It was not like I, you know, put some beat down on this kid, but the question was then why the heck do it Rich? Why rush in from the blue line and do this? And I knew in that instant when I saw that big kid crosscheck our little kid, that if I didn’t do something about it, we would continue to be a bunch of individuals because that little kid would think, nobody has my back. Nobody is gonna be there and protect me if something goes wrong. And so I saw that happen, I felt like I really had to take action at that point. And so I went in and I made sure that kid knew I had his back. Now, I’m not saying that we have to, you know, go in and, and create fist fights at work or anything like that, as a leader going on from there, I always wanted the people who were working for me to know that I would have their back. Josh, we talked about taking risk. We talked about a culture of challenge. Uh, you know, we even talked about working as a team and not individuals, and I always wanted people to feel like if they took a risk and it was either that 60% or maybe it was even the zero that you talked about, okay. knew that I would have their back. Okay. And that I would take the brunt of that. there were some times when I did that specifically and, you know, one instance of that dealt with an A PQP, uh, an advanced, uh, product, AP product quality plan. And, um, we failed, were failing at a launch. And, um, I took all of the heat for my team okay.

[00:58:40] Rich Nave: And completely made it my responsibility. And at that point then my team came back and said, this is what went wrong. And I realized that one of the big things that went wrong is I was managing my team. I wasn’t leading that team and they didn’t think that that team of engineers that I had their back, I. And I was literally that 12-year-old kid again going, oh my God, a group of individuals. They’re all relatively talented and none of them think that I have their back and I’m supposed to be the captain. And just, it brought me right back to being a 12-year-old on ice skates and, you know, at the Melvindale Ice Arena. and I realized, hey, these guys have to know I have their back. And, um, so, you know, we, we, we changed how we did our A PQP process. We changed our, our, you know, process development process. And we, you know, became much more successful over the next two years. Was it uniformly successful? No. were, you know, the three steps forward, two steps back. Uh, a lot of the times there were things that were partially good and not perfect the first time, but we implemented a new process. That was something that you mentioned, Josh. It wasn’t the standard, it was what worked for our plant and for our product type. um, it had a lot of successful aspects to it. But it started with a 12-year-old kid getting in a fight in a hockey game being an engineering manager when I was, you know, 29, 30 years old in a plastics manufacturing company.

[01:00:17] Josh Santo: Wow. What a, what a butterfly effect that was, right. Faced with a moment, you had a decision, you could just keep playing the game or you could go in and, and throw down, literally throw down in that case and

[01:00:32] Rich Nave: I like to think of it as take a beating.

[01:00:34] Josh Santo: take a beating. Yep. Yeah, I’ll be the one. Well, I’m, I’m curious, so thinking about that experience, you know, that was a clear moment that stood out to you in which you really solidified that idea of leadership, or at least the concepts of it.

[01:00:47] Josh Santo: This is, you gotta be someone who sticks up and has the back of your teammates in order to foster that experience. Um. I’m, I’m curious ’cause you, you talked about the A PQP component. You said that you realized that you were managing the team, you weren’t leading the team, that the team didn’t feel like you had their back.

[01:01:09] Josh Santo: So my question to you is, who did you fight in order to show the team that you had their back in order to transition from managing to leading that team?

[01:01:22] Rich Nave: So I, I fought the com, the, you know, the, the term that, you know, hopefully a lot of people who are watching this, uh, podcast. I had to fight corporate. Okay. Um, I had to fight for. Budget to redo mistakes that were made. I had to fight corporate to us to change the process the way we needed to change it. Um, I had to take the responsibility that we were going to miss budgets for, you know, two quarters in a row. I took the responsibility that we were going to delay P paps and that that was gonna be problematic with our customers. And I didn’t send my engineer to the customer to tell them that we were gonna be delaying the PPAP. I went and told the customer that we’re gonna be delaying, uh, the, you know, the product approval. Um, and you know, that way my engineers saw that I was the one who would take the heat. I was the one who would explain what happened. And so those, those were the battles that I fought. That’s how I, I made sure that the people on my team knew I had their back.

[01:02:29] Rich Nave: I.

[01:02:29] Josh Santo: So it wasn’t just about fighting the battles, it was making sure that they saw you, or at least knew that you were fighting those battles.

[01:02:37] Rich Nave: Yeah, and then I was in the trenches with them.

[01:02:41] Josh Santo: Well, rich, I think that’s a, a great story. A lot of great takeaways from this conversation. Management leadership, two different things, both completely necessary, both skills that can be developed, both have their different purposes, different times in place. You can’t really be successful without both, and I love that you brought it all the way around with a, a very specific moment in which you were faced with a choice that you had to make.

[01:03:06] Josh Santo: And in that moment, you made a choice that put you on this path to leadership. And it had an impact on not just your life, but others’ lives as well. Because when we’re working with people, when we’re putting people first, you were making impacts on individual people’s lives themselves, their family, their friends.

[01:03:26] Josh Santo: I think that’s an important concept to keep in mind, and it’s something that you’ve tapped into and I could certainly say inspired me in this conversation. So thanks so much for joining Rich.

[01:03:35] Rich Nave: Well, I, I appreciate that, Josh. And, um, you know, one of the things that, uh, I, I wanna bring out just as a, a, a wrap up around leadership the concept of, of servant leadership. And, the idea that as a leader, not being looked up to, I’m there to help the people that work for me. And, um, I think that that’s something that sometimes, you know, gets a little bit lost.

[01:04:01] Rich Nave: Leaders put themselves on a pedestal or other people put them on a pedestal, and it, you’re, you’re really there as a leader to, to serve the people around you, whether it’s by having that little kid’s back or whether it’s by, you know, helping the, the engineers that we were just talking about. So, um, if you keep, if I can keep that concept front and center, then I’m a better person every day.

[01:04:22] Josh Santo: I love it, and I know I’m not the only one that can learn from you, so I’m curious how can our listeners continue the conversation and continue learning from you?

[01:04:31] Rich Nave: Uh, a couple

[01:04:32] Josh Santo: Couple of

[01:04:32] Rich Nave: that they, they can do. One is, uh, our website is luminous group.com. Uh, and there’s a lot of great resources there, including, uh, some of the webinars that Josh and I have done are, are linked there. Uh, but there’s also some other interesting, uh, resources there that they can look at and they can get in touch with me, um, atRichard@luminousgroup.com.

[01:04:58] Josh Santo: things. Well, rich, thanks so much for stopping by.

[01:05:00] Rich Nave: Thank you, Josh. It was a great opportunity. Really enjoyed myself

[01:05:03] Josh Santo: Same.