Process INVESTING!

Process INVESTING! What’s this about, you say.

Interestingly, INVESTING is very similar to the concept of Process Stewardship, a frequent topic in this newsletter!

Some synonyms for stewardship: safeguarding, preserving, and protection. Don’t you want to safeguard your investments, preserve your investments, and protect your investments? I certainly do.

Investing areas of focus include: risk management; non-emotional decision-making; diversification; seeking alpha (above market returns), and, a long-term orientation.

Let’s think about each of these investing themes from the Process Perspective…

Theme #1: Risk Management

• Be sure you can consistently make key samples of interest at will, and that you have not supplied a customer a “lucky” sample they love but you cannot make again.

• Look at manufacturability ruthlessly and early.

• Understand the impact of incoming material variations before committing to high-volume production.

Theme #2: Non-Emotional Decision-Making

• Have an innovation gate-stage passage system, and use it.

• Base key decisions on data, and make the source data available to all.

• Review previous projects for lessons that can be incorporated into best practice documents.

Theme #3: Diversification

• Do not depend on a single supplier for a critical item in the process, unless there are no alternatives.

• Have parallel paths for potential solutions to project “stoppers”.

• Look for the second application while developing the first application, in case the first application does not pan out for some reason.

Theme #4: Seeking Alpha (above market returns)

• Understand your competitors’ processes, and how yours stacks up to theirs.

• Protect important process knowledge either as trade secrets or patented intellectual property.

• Try to iterate the process concept to make dramatic improvements.

Theme #5: Long-Term Orientation

• Robust processes have advantages that compound over time, this compounding creates long-term benefits.

• Understand how your product is used by your customers, and if there are any reductions in variation that will be beneficial to your customers.

• Build processes that are (ideally) granular enough and scalable enough to consistently meet demand while minimizing capital investments.

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My main learning from this discussion has been the striking parallels between INVESTING and Process Stewardship. These considerations and factors are like many things: simple to understand, but not simple to do in practice. Motivated process stewards know that nerves of steel and a non-negotiable commitment to robust processes are needed during the inevitable tough times that occur when building great manufacturing processes.

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CHALLENGE TO READERS

Please think about your key process engineering projects over the past 5 to 10 years…

• Do the above themes have application and relevance to your important process projects?

• What are some specific items that may be directly relevant to a current high-priority project? What action can you take to improve your current efforts?

I’m interested how the concept of “process investing” resonates with you. What are your thoughts about this? If you email us, we will get back to you promptly. Thanks!

All the Best,

Marty

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