Leadership, Leadership, Leadership: The Real Root Cause of Quality Failures

Transcript

[00:00:10] Josh Santo: Welcome to the Shop Floor Top Floor Talk Show, where we have casual conversations with manufacturing pros. Each episode digs into the challenges and opportunities for improvement that steer both frontline execution and big picture progress. No fluff, just real world practical perspectives from the people driving the industry forward, from the shop floor to the top floor.

[00:00:37] Josh Santo: Let’s get to the show. Welcome. I’m Josh Santo, and I’m joined by Rich Nave. Rich, why should people pay attention to what you’re about to say?

[00:00:54] Rich Nave: Well, you know, Josh, it’s a funny thing. They should listen really carefully to us, and they should think about whether or not they value what we say. Because you know what? Everybody can podcast. Everybody can put out a newsletter or anything like that. You really gotta think about what people are saying and listen carefully. And so I do have about 38 years of experience in manufacturing, most of it in automotive related manufacturing. But, I hope people will come back and listen a few times and make a decision on their own.

[00:01:23] Josh Santo: I think that’s a very humble call-out. You should always be open to advice from sometimes the most unexpected places, but you should also critically evaluate whether or not that’s something that applies to your situation or resonates with your circumstances, et cetera. But to what you called out, you’ve got significant experience in manufacturing.

[00:01:43] Josh Santo: In fact, to this day, people come to you for help accomplishing their goals, turning operations around. So you’ve got credibility here.

[00:01:53] Rich Nave: All right. I will accept that hat and, you know, it’s one of the things that is really a goal in my life. I group it under something I call servant leadership. And, you think all these battles that you’ve gone through in life are just one battle after another, but I’d like to think that they have some value and build to something. And if I can pass on some of that experience, and as you said, it resonates with somebody, so maybe they don’t have to go into that same trench that I did, it would make me feel good. Make my little heart feel good.

[00:02:23] Josh Santo: Well, speaking from experience, I’ve learned directly from you. I’ve enjoyed our conversations, not just on manufacturing either, not just continuous improvement for the sake of self-improvement, but also before we started recording, I was telling Rich about how my calves are killing me every time I run. I think it’s my form, and Rich was like, “Nope. I hate to break it to you, but you got some weak calves, bro.”

[00:02:44] Rich Nave: Well, unfortunately, Josh, I think maybe one of my strengths is giving bad news to people. I’m willing to tell it like I see it.

[00:02:51] Josh Santo: Oh, in that case, it’s not bad news. It’s the opportunity for improvement, which is the good news that I needed to know that it wasn’t my form and something I have a little bit better understanding of what I can control. Rich, I’m glad to have you here. For those of you listening, Rich was actually the first guest on this show, so if you want to sample some of Rich’s work, go check our first episode out.

[00:03:15] Josh Santo: You’ll be able to see firsthand that you have plenty to learn from Rich, and then I’m here too. I’ve helped manufacturers deploy digital technologies across the front lines of their operations for about a decade or so. So together, we’re introducing a new show segment. We’re gonna be exploring different topics, either topics that come up in our work with different manufacturers or questions, ideas, thoughts sent in by viewers and listeners.

[00:03:42] Josh Santo: So today’s topic, we’re talking about quality, but not just any quality, built-in quality, and this idea of how to move from inspection to prevention. So Rich, before we go any further, this idea of built-in quality, let’s level set on the definition. How do you define built-in quality?

[00:04:03] Rich Nave: First and foremost, Josh, when we talk about built-in quality, we’re talking about a transition from what I will call reactionary quality to proactive quality. And so when we say built-in quality, what we’re talking about is rather than inspecting something after it’s been made, we’re setting up a reliable process that builds the same part with minimal variation every time. So it has built-in quality. And at that point, no longer are you looking at parts a week or a month later, or when your customer complains. Instead, you’re looking at your process, and you’re looking at reducing variation in your process, and that’s what built-in quality really stands for or means.

[00:04:49] Josh Santo: So, who should care about this concept of built-in quality?

[00:04:53] Rich Nave: Well, candidly, not only should every manufacturer care for this, but anybody that operates a process should care about this. If you wanna make sure that you’re delivering the correct order in a drive-thru restaurant, you should care about built-in quality. And so every manufacturer wants to do this. Some people are further along the path, and they are working on things like closed-loop feedback and things like that, but everybody can improve. And so there’s nothing that wouldn’t improve from this.

[00:05:27] Josh Santo: Well, speaking from your leadership experience in manufacturing, you’ve got plant management leadership experience, is it more of a quality-specific focus point, or would you argue that this is an operational necessity and that every leader needs to shift their organization to this mindset?

[00:05:46] Rich Nave: Actually, it’s a shift away from quality as we traditionally think of quality. This is actually shifting the quality of the part back to the design of the part, the design of the manufacturing process, and the operation of the manufacturing process. So it’s like a quality department wanting to drive itself out of business.

[00:06:10] Josh Santo: Now that’s, that’s kind of a shocking perspective, I’d say, the idea of putting yourself, if you’re responsible for quality, eliminating your role or eliminating the need for your role. Tell us a little bit more about that.

[00:06:23] Rich Nave: Well, if you think about it, quality as we traditionally think about it, sometimes gets grouped into this policeman activity or this gatekeeper activity, where we make the widget, and then quality measures the widget, and they throw out one and then give one a good part, you know. And it’s all this stuff that is after everything has gone into the part. All of the material, all of the labor, all of the inputs, water, electricity, whatever, compressed air, all of that stuff got used up, and then we decide whether or not the part is good, and that’s incredibly wasteful. And so what we wanna do is we wanna shift this back, and we wanna start with a resilient design that has a large manufacturing window, and then we want engineering to set up a process that can make that part repeatable. And then at that point, then we want our operations team to use that process and to stay within the parameters that have been designed in that process. And no longer then do we really need to inspect the product. Instead, we’re inspecting operations’ use of the process. Is the compressed air at fifty psi? Is the mold temperature at forty degrees Fahrenheit? Is the pressure of the machine twelve hundred psi or whatever it is? Because if it’s twelve hundred psi, and if the mold is the right temperature, and if we have the right material, we know we get the right part, and that’s built-in quality.

[00:07:51] Josh Santo: Now, you mentioned this is a shift from how manufacturers traditionally view quality. Back to your earlier example, this reactionary approach as opposed to a preventative or proactive approach. You talked about this idea of essentially quality needs to be built into the design of the product itself, design of the process there to create the product, and then the execution of that process, assuming quality materials should then reasonably produce consistently a standard that is acceptable, and now the quality team’s not having to say, “Hey, actually rerun that thing.”

[00:08:30] Rich Nave: So Josh, I wanna really put this back into your digital tools framework. Okay? And so if you think about it, if design does a design FMEA or failure modes and effect analysis, and plant engineering does a PFMEA, a process failure modes and effect analysis, and they use those tools to design out the risk in the product design, design out the risk in the process development, and then we use your layered process audit to make sure that the, operations team is using that process stably. At that point, we know what we’re going to produce. And if we don’t know what we’re gonna produce, then we could use tools like design of experiments to further hone in those parameters or those process steps. But those tools have all been in existence, and yet we end up using the tool that is my least favorite tool, which is things like 8D or DMAIC or something like that to solve problems afterwards. So let’s use our digital tools that are proactive. We have them in our toolkit, okay? And EASE produces one of the best ones, which is layered process audits to make sure that we, you know, remain true and stable with our process. Let’s use those digital tools upfront and design in or quality.

[00:10:01] Mid Roll – Review Section: All right, quick pause before we jump back in. Like you here on the Shop Floor, Top Floor Talk Show, we believe in continuous improvement. You don’t wait for an annual audit to fix what’s broken. You make small adjustments every day to get better. And this show works the same way, but the only way to improve is if we hear from the people that are actually doing the work.

[00:10:25] So if this episode has helped in any way, maybe it sparked an idea. Saved you from a mistake or even just gave you a knowing laugh. Please do us a favor right now. Wherever you’re listening, tap the rating button or leave a quick review. It takes less time than a toolbox talk, and it helps other manufacturing leaders find conversations like this.

[00:10:46] Think of it as leaving a note for the next shift. Now we read every review and we use them and we genuinely appreciate you being a part of the Shop Floor, Top Floor Talk Show community. Alright, now that’s all I had to say. Let’s get back to the conversation.

[00:11:04] Josh Santo: Well, you’re absolutely right. The tools can certainly help. Now, they won’t overcome anything that’s broken in your overall process. They might be able to provide some visibility into those areas for improvement. So there’s a number of things that have to come together, but I absolutely agree that digital tools make it a little bit faster and more efficient to get the information you need to make the best decisions that you can make, and then measure the results over time. So I totally agree with you, on that side. Now, Rich, these concepts, these aren’t new concepts. These tools, they’re not new tools. Yet the current state, and this is not just according to you, I’ve talked with a number of different folks on the show who have shared a similar perspective. We are being reactive to quality. We’re treating quality as a department and not as a mindset, which is what it needs to be, and it needs to be pervasive throughout everything that you do, like you called out, from design, from process, from the actual execution. Why is there a gap? Why is that not the standard?

[00:12:09] Rich Nave: Well, now you’re onto my favorite topic, Josh.

[00:12:12] Josh Santo: Let’s hear it.

[00:12:13] Rich Nave: Leadership. Leadership, leadership, leadership. If real estate gets to say location, location, location, the answer to your question is leadership, leadership, leadership. Okay? You’re right. We’ve been doing FMEAs since the early ’80s. NASA started doing FMEAs in the ’60s. Okay? We’ve been doing LPAs since I think, two thousand and four or something was the first LPA that one of my plants did. I think that, uh, Stellantis had six names since the first LPA that I did for them, um, at that point. But it’s leadership, and there has to be a commitment to these tools. When I say commitment, you could substitute the word investment into these tools. And traditionally, we have been very, very bad at truly investing into our manufacturing processes. Now, most people, when they think about investing, they think about, “Oh, I need to buy a capital piece of equipment. I need a new CNC machine, or I need a new injection molding machine,” or whatever that… I’m talking about investing the time into understanding your design and your process upfront and evaluating that risk, and then implementing systems like layered process audit to hold those systems in place. And if we don’t invest that time upfront, then we can’t have built-in quality. And so the only way that we can do that investment, though, is through leadership. Frontline engineers are gonna do what their leaders press them to do. And if that’s firefighting and that’s just solving problems, then that’s where they’re gonna focus their effort. They’re not gonna invest in the development of those processes that you talked about. And you’re absolutely right. The tools are there. Uh, you know, the first FMEA that I did, we did on graph paper with pencils. We weren’t even using Excel at that point, okay? ‘Cause this was like nineteen ninety, nineteen ninety-one, okay? The point is, these tools like FMEA or layered process audit, which layered process audit, by the way, the first one that we did was just with Excel and all that kind of stuff, and we had a full-time person running our LPA system at that point. But the point is all these tools can work with a lot less technology, but they can’t work with a lot less leadership.

[00:14:43] Josh Santo: So if the answer is leadership, what’s the failure that’s happening there? Is it an awareness of understanding that, listen, any performance metric, anything that you’re trying to improve or you notice needs to change ultimately comes back to you. So if you’re not seeing the change you expect to see, it’s your fault/your responsibility and you need to do something with it. Is there something deeper driving this gap in leadership?

[00:15:13] Rich Nave: It’s a great question, Josh, and here’s what I’m gonna tell you I’m doing practically about that. As the COO of the Luminous Group, we’re out there selling our services, and we’re out there trying to talk to companies and say, “Hey, if you’re willing to invest in any of these things, lean transformation, LPA, FMEA, whatever it is, okay, you know, we can help you.”

[00:15:42] Rich Nave: And we’ve done that with the Luminous Group for over twenty-five years. But one of the things that I am pushing my sales staff to do is to get the CFO in the meeting that we’re talking about. So why the CFO? Because the reality is leadership is driven by the almighty dollar, okay? And if we can convince the CFO that there’s a return on whatever tool it is, then we get in the door and we start working with a company.

[00:16:14] Rich Nave: But if you can’t convince a CFO, a bean counter, then no leadership team is gonna commit to it. So when you talk about something like an FMEA or an LPA system, okay, why should they commit to it? They have to understand really clearly that payback, and we think that goes back to getting the finance departments involved in these manufacturing decisions.

[00:16:39] Rich Nave: We are doing that. I have a meeting Monday morning with a multinational global company, and their divisional CFO will be in the meeting.

[00:16:49] Josh Santo: So dollars being important for the understanding of why this should be a priority. But there’s a little bit of just that lack of understanding, awareness. There’s something there that, the fact that you even have to show these activities save you money or help you make money, to me that sounds like there’s a deeper issue, maybe an expertise issue or, just something about…

[00:17:15] Josh Santo: I guess what I’m saying, Rich, is there’s an existing gap between these tools, this idea of built-in quality and leadership to deciding to invest in it. What is that gap? Is it expertise, experience, complexity? What are your thoughts?

[00:17:33] Rich Nave: Well, I’m glad you closed that with what are my thoughts because, it is an opinion. I don’t have empirical research on this, but I think that gap comes from poorly implemented tools in the past. And so whether companies were sold a bag of goods or, whether they tried something and they didn’t stick with it, there have been a lot of bad experiences. And so everyone basically just says, “Well, get the FMEA done for the PPAP and get through the PPAP, and then we’ll start making parts, and we’ll figure it out.” Okay? And that’s because they didn’t have a good experience with that PFMEA adding value or even that PPAP adding value or any of these tools adding value. And so we’re talking with a company right now, they literally said to us, “We’ve had lean training four times.” Okay? “What’s gonna make it different this time?” Okay? And the question is, or in my mind, will the leaders behave differently this time? Okay? The Joshes and the Riches on the floor, they understand Kanban, or they understand whatever lean tool you wanna bring up.

[00:18:53] Rich Nave: The question is: Will the leaders’ behavior change? Leaders have to change their behavior. The reason they’ll change their behavior is because it will make money for the company.

[00:19:04] Josh Santo: So my takeaway is a couple things. Like you said, the greatest motivator is, look, you’re responsible for the profitability of this aspect of the operation, so you need to make sure to accomplish that. A great way to do that, built-in quality. It does sound like there’s just in general a gap in knowledge and expertise to some degree.

[00:19:26] Rich Nave: There’s some subjectivity and, maybe even gaps in discipline to what you’re calling out, right? Is behavior going to change?

[00:19:34] Rich Nave: Two points there, though, Josh. Discipline for sure, okay? But there is a gap. People say they know these tools, and oftentimes they know what I’ll call the broken tool. They know the wrong way to do the tool. So there is also that literally technical gap in what some of these tools are supposed to be. So, you know, you’ve got people who might need training. You’ve got a process that has to be adhered to and behaviors that have to be held in place by leadership. And then you’ve got the tool, yeah, that’s really where we’re at. But Josh, when you sum this all up, it still comes to the top of the pyramid, okay? That’s where it’s gotta start, and that’s where it’s gonna be successful or it’s gonna fail.

[00:20:17] Josh Santo: Something near and dear to my heart. Rich, this has certainly been an insightful topic. We started with the concept of built-in quality, and we ended with how really it’s all centered around leadership. So if you’re not practicing built-in quality, it’s probably because your leadership has not prioritized that concept and is okay with the results as they are today because, to quote a previous guest, “Your system is perfectly designed to deliver the results that you’re getting.”

[00:20:46] Josh Santo: So with that, Rich, thanks so much for joining us on this new segment.

[00:20:50] Rich Nave: And everybody, make sure if you are in touch with Josh to ask him how his 5K goes this spring.

[00:20:56] Josh Santo: Yes. All right. I appreciate that. Now I have to do it. No, I’m actually excited about it. This is the Round Rock Donut 5K. So once you finish the 5K, you get a box of donuts. So I’m looking forward to that.

[00:21:09] Rich Nave: It’s amazing what we’ll do for a banana or a donut, right?

[00:21:12] Josh Santo: That’s right. That’s right. And these are Round Rock Donuts. It’s a thing, so look ’em up. All right, Rich, thank you for your time.

[00:21:19] Rich Nave: Hey, look forward to it, and we’ll get back together next month and talk some more.

[00:21:22] Outro: The conversation doesn’t have to end here. If you got value from this episode, be sure to follow the show in your favorite podcast app. And while you’re there, leave a review. It’s the best way to let us know that you’re enjoying the show. You can also connect with me, Josh Santo, on LinkedIn, or you can shoot me an email at josh.santo@EASE.io.

[00:21:50] I would love to hear from you. I really would. The Shop Floor, Top Floor Talk Show is brought to you by EASE.io. Manufacturers all over the world use EASE to catch issues early, fix them fast, and keep them from coming back. With EASE’s, well, easy to use digital tools, they can audit and inspect what’s happening on the factory floor, dig into problems when things go off track, train and engage their teams, and ditch the busy work that usually eats up time.

[00:22:20] That means fewer headaches, more productivity, and staying ahead of industry and customer requirements without all the hassle that you’re used to. Check out www.EASE.io to see how EASE can help you use digital audits to get quality results.