If you don't have the shop floor people on board, things will go sideways.
In most discussions of digital transformation, technology is the star. New tools are essential. Because innovative technology unlocks so many new capabilities and captures so much executive attention, it usually dominates discussion.
But that focus by itself is both mistaken and dangerous. After a decade of transformation engagements and many mistakes and lessons, we have developed a strong conviction about technology, transformation and trust: no trust, no transformation.
Here’s an example from one of our first engagements—years ago in Detroit—that will be familiar to anyone who has worked in a plant. Well before AI was all the rage, we deployed an AI-based quality solution for a large automotive line. We used machine vision and AI to examine the tailgates of vehicles and spot quality problems before a vehicle moved past the inspection station. There was one very important practical step: for the solution to effectively spot defects, the vehicle tailgates had to be left down. During the single four-hour window we had to install the solution (at the time, the plant ran three shifts, 363 days a year) we told the plant management about this requirement. They said, “No problem.”
Yet, after we installed the quality control cameras and data started coming in, we realized that all the tailgates were left up. We immediately learned why. A steward advised us that workers on the shop floor suspected the system would monitor their performance and track their behavior. Though deeply dedicated to quality, plant workers had not been included in the decision to roll out the system. It took a few days to agree on goals and ground rules, and in a short time the system moved from an object of hostility to a strong point of pride. Trust had to be established before technology could work.
To anyone who has led change in a plant, this kind of experience is just plain common sense; once learned, you never forget it. You can have the best technology and smartest systems. But if you do not steadily earn and keep the trust of the people who are doing the work on the shop floor, things go sideways.
Sooner or later, most companies—even the mightiest—learn or relearn this lesson. From 1984 to 2009, General Motors and Toyota collaborated on a remarkable project in Fremont, California, called New United Motor Manufacturing, Inc. (NUMMI). The project took over a shuttered GM plant and re-established it as a joint venture to co-produce cars. The workforce was GM’s team, managed by Toyota. GM wanted to learn about Toyota’s Production System. Toyota wanted a foothold in the United States and was seeking ways to reduce tension.
By almost every measure of plant success, the NUMMI plant was off the charts. The plant produced nearly 8 million trucks and cars at high-quality levels. NUMMI Fremont went in one year from 20% absenteeism and the worst quality in the GM fleet to best attendance, best quality. GM workers who learned the TPS methodology spread the gospel to other plants, sharing their knowledge. At NUMMI, management and unionized workers collaborated to create an environment of true continuous improvement.
Despite its compelling success, NUMMI for many years remained an island within GM. To build on NUMMI’s success, GM (without Toyota) attempted to set up a clone of the successful Fremont NUMMI plant in Van Nuys, California. There, the culture of shared risk and responsibility never took hold. Workers and management could not get aligned. A plant with literally the same physical footprint using the same methodologies as the one in Fremont failed to improve profitability and was shuttered.
The real missing ingredient in Van Nuys was not technology or planning or domain expertise. It was trust. Without trust between management and workers, big change and growth were impossible.
Whether the focus is new methods of working, new technologies, or some other type of change, we believe the story is always the same. It takes time and effort but in the end, building trust is the only way to launch and sustain a successful manufacturing transformation. Here are some suggestions from our experiences:
Give all stakeholders a real, not ceremonial seat at the table from project inception
Operators have decades of experience, and their trust makes or breaks the project. Don’t seek their “buy-in.” Seek their wisdom. And feel free to challenge people respectfully with facts and data.
Develop shared KPIs that all stakeholders believe in and are easy to measure and verify
Good plant teams take pride in their work and push each other to perform. In the best manufacturing facilities, everyone is proud of their work and keeps some kind of score. If you want to drive change, pick something concrete and real, show that the score improved, and repeat. In the end and when the numbers are clear, good companies make decisions and advance work more around neutral principles than politics. And deep down everyone wants to win.
Establish a culture that rewards wins rather than penalizes losses
Change is hard. And it invariably reveals insights that hurt. Maybe we’re not as good as we thought. Maybe we have to give something up that we like. Many plants we work with discover unseen problems (which is of course the goal). How leadership responds is everything. If the reaction is to punish, the newly surfaced problems will not be addressed and nothing changes. If, however, leadership embraces the insight, encourages problem-solving, and uses new tools to seek out new problems, change takes hold.
Understand that every interaction adds to or reduces trust.
The best transformations are not static and they are necessarily diverse. They require teams of very different people who often don’t understand and don’t trust each other: operators, engineers, IT types, data scientists, partners, and business leaders. Transformation works only when everyone in the effort feels safe raising their hand and sharing. Every interaction builds or reduces trust, and trust is a fragile thing. Tell the truth always. When you don’t know something, just say that. Think about the risks the people bringing change are taking on and have their back, so change can continue.
If you’re lucky, you’ll get one real shot at transformation. Just to get to the starting blocks, you have to get the technology right. Sadly, there’s enough confusion, ambiguity, and challenge in deploying technology that many transformations will fail there. But even when the technology solution is a true “silver bullet” and can deliver perfectly on transformation’s promise, in the end success turns fully and necessarily on people. For that reason trust, not technology, is what makes or breaks transformation in manufacturing.
Check out Peak Performance's Leadership Development Series. Lesson 1: Trust, Respect & Credibility is a key component of the series and serves as the foundation for establishing high performing leaders. The 3-hour course defines the relationship between trust, respect and credibility, covers the importance of follow up and honoring commitments, provides tips for gaining trust, and reviews the five dysfunctions of a team – how lack of trust will inhibit execution.