Archive for Strategy

Start a Business Face First

Previews - Winter Olympics Day -2

Ride face first down a slippery track at uncomfortably high speeds. If you make it down successfully, do it again. Fast. Scary. No, not the skeleton luge. I’m talking about starting a company.

OK, perhaps this comparison is a bit far-fetched.  The sport’s first organized competition took place in the late 1800’s in Switzerland. People have been starting enterprises since civilization began. Back in Switzerland riders raced down the frozen road and the winner received a bottle of champagne. If you win with a company you can afford champagne for life. When you race down the chute in your skeleton sled, the path is cleared for you. You get to practice out of the public eye. You are protected with a helmet and a cool, slick suit. When you start a company, obstacles are thrown in your path by the competition. Everyone is watching. Cool, slick suits are frowned upon. It is, however, a good idea to wear a helmet.

I am not an expert at starting companies. But I have a story to tell. I am working in a start-up company now called Grabit, Inc. and have been on a steep learning curve. And I’ve lived in Silicon Valley for most of my adult life. Here, one can easily observe that starting a company takes guts, perseverance and a willingness to plunge without all of the information. Oh, and it is good to have a brilliant idea.

Summing up some advice based on my early experiences and observations:

  1. Learn fast. There isn’t time to study all of the options. Thank goodness for the internet. Learn from others. Gather information quickly. Make decisions fast based on what you can learn fast. Recently, I’ve had to make a call on a Product Life cycle Management (PDM) system for my new company. This decision could have taken months and could have been complicated. Instead, we relied on recommendations, best practices and low entry cost. If the decision is not a good one it can be undone and we can go on quickly. If it is the right decision we will be well on our way.
  2. Pick the right team. Synergy is your goal. The group that is put together should be greater than the sum of the parts. The skills are important but the ability to work together is more important. At Grabit we have formed a team that works together well. Egos are in check and everyone pitches in.
  3. Consider culture and pace. In the first few months of a company the culture and pace is established. Will the office be casual or formal? Will meetings start on time? What is acceptable dress code? Will people work on the weekends? Is work done in the evenings or on weekends? How does the group celebrate together? The imprint made at the beginning is hard to change. Purposefully driving values and norms will give you what you want in the longer term. We are “pot-lucking” monthly before our lunchtime staff meeting. This breaking of bread brings people together to share something personal. It is building community.
  4. Don’t spend too much money. Don’t overdo the stuff. Grabit’s used furniture isn’t elegant but it is perfectly functional. Shop for deals. Pay as you go for services to keep the risk down. Set an example as leaders in a new company. Fly coach and keep the frill factor low. It is all about cash. Start with careful investment, grow the value and options will open for later stages.
  5. Spend enough money. There is a time when it does makes sense to spend money and that is when it will accelerate your time to volume (TTV) or greatly lower your risk.  The decision can be made by calculating net present value (NPV) but the calculation is an estimate so can be jiggered to give you the answer you are looking for. Use you gut to balance cheap with reasonable. At Grabit we are trying multiple materials paths simultaneously in order to optimize the product while minimizing the time.
  6. Don’t confuse a brilliant idea with a product to sell. Designing something isn’t equivalent to building something and building one isn’t the same is as manufacturing in volume. Launching a product involves creating a controlled, documented design, picking parts and suppliers, developing a process, controlling costs and then marketing to, selling to and satisfying customers. Back to point #2, the team dynamic is critical. It takes a cross-functional team to ship a product. The CEO of Grabit understands this need and has brought in a cross-functional team to drive functional threads simultaneously. I am working on the supply chain design now so that we will ramp efficiently later.
  7. Eschew obfuscation. Or in other words, keep it simple. The most successful companies focus on a few things and knock them out of the park. Grabit’s technology can be used in multiple ways. We are focusing on a narrow set of applications in order to thoroughly solve those problems before moving to a broader set. It is tempting to answer all inquiries but deciding what NOT to do is as important as deciding what we WILL do.
  8. Enjoy the ride. Given that you will work hard to start a business it should be enjoyed. Find the joy in creating something that wasn’t there before. Make your mark. Stick your face out front and sail down the track.

Lizzy Yarnold of Great Britain won the gold medal during the women’s skeleton at the 2014 Sochi Winter Olympics.  She trained hard and competed well. Like Lizzy, if you are fortunate enough to be part of a start-up team, face into the challenge and enjoy the ride.

Leap and the net will appear         Zen Saying

Let The Game Come To You

BBpicJust be patient. Let the game come to you. Don’t rush. Be quick, but don’t hurry.  “Earl the Pearl” Monroe

Earl Monroe played basketball for the New York Knicks in the 70’s. Monroe was not especially fast nor was he a high jumper, but he had spin moves, hesitation dribbles and fake shots that threw off his opponents. He played the game with finesse. He let the game come to him. The advice in his quote is the most helpful given to me over my career. I’m not a basketball player nor am I even a very well-informed spectator. But I understand the idea of timing and of patience when it comes to winning a game. And the applicability to business and perhaps to life in general is many fold.

  • White Space:  Be slow to speak. Allow others to move first and talk first when gathering information or making a decision. Take the information in before making a call. Most people have an issue with silence. Don’t be one of those people. Listen for the white space.
  • Fools Rush In:  Gather the facts and don’t be fast to judge. Expressing an opinion is fine but take care not to take a strong stand too early from which you can’t back down. I’ve often changed my mind about something after hearing all sides and letting the other point of view sink in.
  • Collect Puzzle Pieces:  Puzzle solving and basketball? I am mixing my metaphors, but there is one similarity. The game and the puzzle unfolds. At the beginning, it isn’t clear what the picture is, but soon the pieces fall into place. The right strategy becomes clear in time. Sometimes the strategy or technique used needs to change to react to incoming information. In business, be willing to change your plans with new information.
  • Be Quick But Don’t Hurry:  Fast action is better than no action. I’ve said that in previous posts. But thoughtful action trumps all. Move forward with a reasonable amount of knowledge, a willingness to adapt and an awareness of your surroundings.
  • Believe In Your Own Ability:  If you don’t understand it all to start with, believe that it will become clearer over time. Believe that you can learn what you need to learn. Don’t be afraid of ambiguity. Go forward trusting your ability to understand…eventually. You’ve done that before and you can do it again.
  • If You Don’t Like the Weather, Wait An Hour: That is what they say in the Sierras. The weather changes frequently so just wait if you don’t like the status quo. That is true with bosses, the economy, policies and most situations. Be patient with the current set of circumstances and it is likely that things will shift in your direction.
  • Don’t strive: Don’t struggle and fight. Don’t waste energy. This doesn’t imply that hard work isn’t important. Work diligently and keep progressing toward your goal but give yourself a break and stop the worrying and fussing. I have learned this the hard way too many times. Let the game come to you.

Earl Monroe was also a business man. After playing basketball he went on to manage entertainers, open a restaurant, license his name with an NBA candy company and start a venture capital fund. Apparently, “The Pearl” is still letting the game come to him.

Patience is the companion of wisdom.   Saint Augustine

Transformation

yosemite-valley_1304_100x75There is a bucolic meadow over the next hill. It is filled with just the right amount of sun and shade. Crystal clear water flows over a little waterfall into a pond. A sumptuous picnic is set out for you. The temperature is a balmy 74 and there is a hammock with your name on it. Ahhh, but to get there you have to climb up the hill in front of you. You have to make this climb while tieing complicated knots. And…it is raining on this side of the hill. This hike could take hours… Would you go for it or would you hunker down under an overhanging rock to tie your knots?  You might chat with your fellow hikers and suggest:

  • What if there is just another hill after this one?
  • What if the picnic isn’t that good after all?
  • What if there are bears over there?

How do you motivate humans to climb a hill in search of a better state? In business-speak, how do you get your employees to embrace difficult change even when there is a promised bright outcome? This is a problem faced regularly in the fast paced world in which we live. It is no longer ok to slowly evolve. Companies, functions, teams and individuals need to adapt more quickly or they will lose to another.

I have been steeped in the art and science of transformation recently as I’ve tackled challenging change projects with my corporate clients. It is a fascinating subject and one that I long to master. Given the rate of change I’ve just discussed, I don’t think it is possible to master anything completely. As soon as you “get it” more information is available.  But I am going to climb the difficult hill to get to a better place of understanding.

Here are the truths I know to be the foundation of transformation:

  1. Pick a grand vision with some heart. Continuous improvement is another subject. It is a good thing but not the same thing. And if you plan to involve more than a few people, you need to tug at heartstrings.
  2. Get on the same page. The leadership team needs to have a shared view of the future state. How to get there can be up for debate but the vision needs to be clear.
  3. Debate and even disagree. Transparent concerns are much better than passive aggressive resistance. Get it all said out loud and then pick  a path and move forward.
  4. Stay nimble. There will be redirects. Adapt to them but keep the direction constant. Success isn’t a straight line but it should be measurable and should track in the right direction.
  5. Make room. Carve out the bandwidth to do the work. Stop doing some things to take on this new work. Come on. People were already busy.  If you really believe in the future state then you can justify either a redirect or an investment of resources.
  6. Anoint the right leaders. Pick change leaders who are both good managers and good leaders. Execution, details, driving for results are hallmarks of good management. Picking the right path, inspiring others and breaking through inevitable obstacles are outcomes of good leadership.
  7. Build a change engine. The skill to transform organizations is becoming a key differentiator. There are very few companies that can avoid this need and those that can are probably small and stagnant. If a company is growing, shrinking or evolving these skills are critical. Train, develop, practice, reward, repeat.

The truth is, we are good at changing. Think of where you were 20 years ago. Now, harness that energy and knowledge of how far you have come  to fuel your own change engine.

Manufacturing: A Bond Adventure

182_100_100M: “Bond, I need you back.” 
James Bond: “I never left.”
Quantum of Solace

Recent articles written about reshoring manufacturing bemoan the fact that we’ve lost our manufacturing expertise. We don’t have the people or the passion in the USA for a strong manufacturing culture. So, while we might want to bring manufacturing back and it might even make sense to bring it back, we just don’t have a population equipped to do the work. Common wisdom is that it would be too hard to lure people back into manufacturing and without trained engineers, technicians and line workers we would be unable to grow our manufacturing capability in North America. We could never regain our former strength because too much has been lost. Besides the difficulties in ramping up this expertise, there is also the issue of attraction. Who would want to be in manufacturing? Don’t our best and brightest want to be entrepreneurs, venture capitalists or iPhone app programmers? There is no attraction to building products in the USA. We are a service oriented culture.

Malarkey. Hogwash. Nonsense. Balderdash.  The potential of more manufacturing in the USA is “James Bond” cool.  Who wouldn’t want to be part of the fun?

  1. Adventure abounds – Building products is an adrenaline rush from start to finish. Partnering with all parts of the company to maximize the product’s value while minimizing the costs starts the adventure. Dealing with the political and environmental influences in a global supply chain while meeting the needs of customers who want it now in their chosen color and size can only be compared to solving James Bond sized problems.
  2. Intrigue and Mystery – Trying to shorten time to market while hitting the highest quality marks at the lowest cost is a puzzle worthy of the brightest minds. Working cross-functionally with design, marketing and sales to hit a promised delivery date requires social skills and Bond finesse.
  3. Global Plot – The stage on which this drama unfolds is always international. Even if manufacturing ramps back up in the USA we will work across time zones to get parts delivered and to get product shipped. The world is a Möbius strip.
  4. Flashing lights and non-stop action – The nature of manufacturing has changed for the better. Automation will increase in importance as labor rates go up around the world. In the USA, we have to use our innovative skills to drive highly productive, less labor intensive manufacturing plants. These will run 24 X 7 and will need skilled workers to design the processes and to keep things running. These will not be monotonous manufacturing plants of old.
  5. Always get the girl – Given the complexities of relationships, cultural intrigue and the problem solving nature of manufacturing the need for diversity is obvious. We need the best minds and the best combination of ideas to win this global competition. As automation takes over to build products it will be brains, not brawn that will rule. Manufacturing is gender neutral.
  6. The good guys win – The best and the brightest will design and manufacture products for the world. It will take leaders with a vision for a better paradigm. It will take young engineers who get a kick out of building things. It will take men and women who aren’t afraid to learn about competitive ways to work cross-functionally with the latest technologies. The combination of creative talents will come together to win.

I’ve always loved manufacturing. Even as it has evolved over the years it remains challenging, fun and intriguing. Consider a career in Manufacturing. Talk it up with your friends and neighbors. Encourage your children to move into this area of expertise. Aspire to this great profession. It will only get better in the future. Manufacturing is coming back as the coolest job out there.

James Bond:  “Everybody needs a hobby.” 
Raoul Silva: “So what’s yours?”
James Bond: “Resurrection”         
Skyfall

Product Actualization: Bento Box or Potluck?

During the many trips to Japan I’ve made over the years a bento box for lunch is common sup. Everything is neatly presented and fits into its section. There are many flavors but they don’t run together. Stuff stays where it is put because the box is compartmentalized. Sometimes there are familiar looking little finger sandwiches made out of white bread and what could be tunafish or chicken salad. Sometimes there are creatures of unknown origin. Always there is a neat lid that can be used to tidy up at the end.

It would be lovely if launching and ramping a product was like a bento box. If only we could keep things from blending together. If only the bad things could be ignored in their little compartment and eventually sent away with the lid on top. In the world of new product development, supply chains, manufacturing and logistics, stuff runs together.

As an operations executive I see the organization’s bias to keep things organized, separated, clean. Let the development team work their problems. Don’t slow them down. Let the marketing team think about product roadmaps and forecasts. Don’t second guess. Customer service can deal with quality issues in the field. There is no time to get to root cause with an angry customer on the phone. Just ship them a new one. But alas, without the messy cross-functional conversation and real-time data exchange the results are non-optimal. Sometimes the results are disastrous.

The international economy fluctuations have made the job of forecasting consumer goods next to impossible. I’ve worked hard in a previous position to shorten lead times to allow for faster reaction to changes in demand. But that wasn’t good enough. The breakthrough took place with a move to design the product so that we could postpone differentiation. The work was upfront with the design and marketing teams to design for postponement. The payoff is that a few “assets” could be built into many end products to meet localized needs. The result is less inventory, more availability, better customer satisfaction, lower lead time.

Potlucks are a messy, yummy, eclectic, out of control smorgasbord. When a manufacturing organization puts on a potluck it is the best darn eating you can find. There are typically dishes from all over the world. The tastes mix together on your paper plate…with any luck.

Product actualization done well is more like a potluck. The lines blur and true concurrent work happens naturally. Customer data is vigorously collected and then it flows freely to the cross-functional team. Manufacturing partners are brought in at ideation. The development team thinks about how to design for postponement. Marketing is working alongside the other functions to anticipate the localization needed and to make the product configurable as a last step. There are blurred borders and no compartmentalization and the result is a much more successful business.

Simplicity follows complexity. Business is messy.

Manufacturing for Dummies

Acmestartup has a breakthrough security product. The software bits have lovingly been stuffed in a white box server platform and volumes have been manufactured at a reputable contract manufacturer who just so happens to have designed the basic server. These initial beta boxes will be sent to early adopters of this new breakthrough product. First impressions are everything. It matters what they think. These first users will be the evangelists and the potential investors of this nascent company. Alas, when the product arrives it doesn’t work. What could possibly go wrong? How hard is it to customize an off-the-shelf server and load software and firmware. Apparently it is hard enough that the CEO of Acmestartup has made the resolution of this manufacturing problem his number one priority. When he should be worrying about the next great security algorithm, he is losing sleep over why the box shows up dead on arrival.

Startups and small companies are all about the product and customer and should be. In the same way that these small companies should get professional public relations, accounting and legal advice, these companies should be getting professional manufacturing advice. Some engineers have both development and manufacturing experience but not many of them have ramped products to volume nor have they had to choose partners, negotiate contracts or set up manufacturing processes.  And even if these engineers have had manufacturing experience is it good to divert attention away from the critical path of product development and maturity? When in doubt, hire a professional. Here are a few key pointers for those not in the field.

1. Pick the right manufacturing partner – The right partner has a focus on small companies and they have a good reputation. Ask for references. Talk with your start-up peers with similar products. Make sure that they have some local presence. Don’t rely on a company that is only in asia. You need help close to your development team. Ideally your partner should have some local manufacturing, not just reps close by.

2. Put together a cracker-jack virtual ops team – You probably can’t afford to hire all of the elements of a dynamite operations team but you can piece together experts through consultants and through your contract manufacturing partner. Make sure your collective team is thinking about purchasing, planning (and the systems that go along with the purchasing and planning), customer service, assembly and test, quality, metrics. Yes, you are small and volumes are small but all of these elements could stop you dead as you are ramping.

3. Put a manufacturing geek on the team – Do this early. Embed them with the engineers. Think about the component suppliers and final assembly process early. If possible, have your contract manufacturer supply someone to sit on your team. It is not too early to design for manufacturing if your intention is to supply a quality product to the customer as quickly as possible. Don’t design, build, ship crap, recover or try to recover.

4. Kick the hell out of the product before you ship to a customer –  HALT is Highly Accelerated Life Testing. This test will vary temperature, vibration, voltage levels until the unit fails. In other words, add variation to the process ahead of shipping. If you plan to ship your product any distance, make sure that you know what the product can withstand in terms of temperature and vibration. In addition to HALT testing, if you have multiple suppliers for a component, vary what you load on the board or use in the product and see if you can make the product fail. Ship the product across the country to your mother. See if it arrives ok and have her set it up. This works less well if the product is for the enterprise or for the construction industry but find the analogy (ship to your buddy in an IT department).

5. The devil is in the details – The small things are what get you. This is true for all companies but is particularly dangerous for smaller companies without the resources to recover. Don’t forget about customs, import taxes and regulations. Don’t ignore documentation, labeling, packaging. Watch out for long lead times for components…all it takes is one part that you can’t get fast enough. And finally, consider how you will repair and/or upgrade your product. What is your “reverse supply chain”?

While all of these considerations could seem obnoxious when you are working on a product that solves man’s or woman’s most pressing problems, they can stop you in your tracks or at the least will slow you down enough for the competition to catch up. So, consider manufacturing as a competitive weapon when launching your business. Seamless ramp coupled with highest quality at no cost to time to market should be the goal. It can be done. You aren’t a dummy!

Bring (Some) Manufacturing Back

Yesterday a riot in a Foxconn plant in Taiyuan, China got out of control and police were called in to stop the violence. The reason for the unrest is unclear. The news articles coming out of China are stating that there was a disagreement in a dormitory between guards and employees. The articles are saying that 1000 workers were involved (out of the 79,000 in this facility)…and yet 5000 police were called in. This conjures up a disquieting image.

Warning: the following numbers are my guesstimates and are just a way of framing the problem. I have read that if Apple were to build the iPhone in the USA the cost would increase by $50 which is about 2 hours of fully loaded labor. Since that is just too much time to assemble, test and package the phone I am going to assume that the $50 includes space, logistics and even a tax differential so it is an “all in” number. The consumer price of the phone is about $650. If the gross margin is 50% (surely Apple doesn’t get all of this but it is spread amongst distributors/carriers) then the total cost of goods sold (COGS) is about $325 for material, logistics, overhead, depreciation, labor, etc. Adding $50 to this is an increase of over 15% to COGS which isn’t small change. What if that increase in cost could be offset with benefits that either manifest now or in the future? Could we find a way to bring some manufacturing back to the USA? What is the tipping point?

1. Grow your own workers – There is value in having access to trained and local electronic assembly and test technicians, engineers, manufacturing leaders. We have lost the training grounds for good manufacturing prowess in the USA. The last of us “hands on manufacturing nerds” are going to leave the workforce eventually and the next generation will not have experience on an actual manufacturing line.

2. “Next bench” experience for development engineers – The engineers who are developing the next big thing can walk down the line, ask questions, observe and learn from the people doing the assembly work.

3. Faster quality resolution – If a problem is found it is easier to be all over it if manufacturing is close at hand. Thus, faster resolution.

4. Faster ramp – Once the manufacturing expertise is solidified near the development and marketing arm it is easier to take ideas and ramp them to market. Less travel is needed. Less translation and more cooperation is possible.

5. Disruption insurance – Spreading out risk is a good idea. If all of a company’s manufacturing is in China and there is a labor strike, natural disaster, logistics event, fuel crisis you have a longer and more expensive recovery. Put your eggs in multiple baskets if you have the volume.

6. Good will and free advertising – Surely it is worth something to a company to get the good will associated with “made in America”. I know people who won’t buy an iPhone because of the “slave labor” association and noise. That is an unreasonable response since all phones and frankly almost all electronics are made in China. But there has to be some consumer value to “made in the USA”.  Maybe it would just be a willingness to buy the brand but not a willingness to pay more. But even that has value. Volume helps a company get to lower costs and more margin dollars associated with that volume helps cover more operating expense even if the margin per unit is lower.

7. Wild card government help – Maybe it is coming at the federal level. Surely there is help to be found at the state level. Look for it. Find a deal. Make a splash in the news. Start some momentum.

It is certainly time to take some manufacturing out of China and to spread it across the world. The risks are just too high in China to put all of your manufacturing in that one country. I believe it is time to bring some manufacturing back to the US. If the differential to bring work back is about a 15% hike in COGS with no mitigation let’s chunk the problem. Find a way for government to mitigate 5% with tax breaks or deals on land or capital. Be willing to eat 5% in the company if margins are good and if the future benefits can justify the investment. Pass on 5% to the consumer. Since this is 5% of COGS it is a smaller percent of the price to the consumer. Perhaps the impact shows up as a 2-3% increase. I think it would fly.

But what do you think?

Top Ten Global Supply Chain Mistakes

A global supply chain is the norm for almost any company in business today. In order to take advantage of the capabilities throughout the world and in order to reach markets around the world it is important to create a system that reaches across borders. Creating that system is a difficult process especially for smaller companies focused on technology and marketing as first priority. How do you build a robust supply chain that is a competitive weapon rather than a necessary evil? Below is a summary of mistakes commonly made.

1. All eggs in one basket: It is risky to partner with only one contract manufacturer, logistics partner or key component supplier. Comparing price, quality, locations and practices can give you the information you need to drive your supply chain toward best in class. Having some tension in the relationship will also give your partners a good reason to offer you the best prices, quality, technology and lead times. But if you don’t have the volume to support more than one supplier without compromising cost or attention, put your eggs in one basket…and watch that basket very closely. Even with one partner you can quote annually to keep the tension in the relationship and to give you additional information. Ask for a transparent cost model so that you know what you are paying for and can more easily disaggregate the work to look for the best combination of suppliers. Even if your volume won’t support multiple production suppliers of key components, qualify more than one supplier ahead of time to give you options if there is a problem later.

2. Out of sight, out of mind: Once a global supply chain is set up and running it is a mistake to assume that the job is done. Weekly conversations should be held with your partners either in person or on the phone or via video-conference. Virtual meetings can be set up to review metrics, current action items and future work. Monthly visits should be made to meet with the key players eye to eye. Walk the production floor. Talk with the people on the production line even if they don’t speak your language. Use a translator and convey your thanks and interest in their work. That will help you later when fast action is needed and you are not there to oversee. Observe and ask questions. Make sure that you are getting what you expect. Remember, people respect what you inspect.

3. Too little, too late: It is unwise to assume that a verbal contract or purchase order with legal sounding words on the back is good enough. Draw up a contract and negotiate the details. While you are unlikely to ever sue your supplier, the value of a solid contract is that you have talked over the problems before they occur. Don’t wait until you have a field quality issue to decide who will take lead and drive to root cause. Don’t wait until there is a sub-tier issue to decide who is liable for the resolution and cost. There are templates available for supplier contracts and it is okay to start there but don’t stop there. Think about what is important in the relationship and write it down. Even if it doesn’t end up in the final draft at least the conversation has been held and documented and there is some understanding of expectations.

4. It’s not my job: Don’t sit back and assume that your supplier will watch your back. Supply chain design and development remains the responsibility of the product company. The inputs to strategy are targeted markets, technology needs and growth plans. Yes, the inputs also include changes to the supplier landscape and cost shifts, but it is unwise to rely on the supplier to tell you when to modify your supply chain. I recommend an annual review of labor and logistics costs, shifts in the market, tax changes and other macro-economic factors. What are the implications to your supply chain? Is it time to manufacture in a region for tax purposes? Are labor rates changing enough to consider a shift to another region of the world? Do you have a change in your product roadmap that will require new process technologies?

5. Only sure thing is death and taxes: Death is hard to control but don’t overlook the impact of taxes. The tax implications of your supply chain decisions can outweigh the labor cost benefits. Have a tax expert examine your plans ahead of time. Understand your target markets and if there are import taxes based on manufacturing content. Are you selling into government agencies? Some have restrictions about where the product is made.

6. Count the costs: Don’t make the mistake of just looking at the price tag from your supplier. Remember the cost to move the product to the market. Remember inventory carrying costs for a longer pipeline. Remember the cost of travel to manage a remote supplier. Quality costs are higher if your pipeline is longer and if the time to resolve is longer. And finally, what is often overlooked is the cost of time. If your new product slips a month due to the challenges of remotely ramping with the wrong partner, the costs are large. Do the math on the full costs of your alternatives.

7. Time Flies: Time should be mentioned a second time because it is just that important and is often not considered when designing a supply chain. It does take longer to get work done across time zones, cultural and company boundaries. However, if managed well there can be an advantage to having multiple time zones to work a product launch or a quality problem. The key is to set up the processes ahead of time with the right responsibilities and accountabilities. It is a little like a battle strategy in that you want to consider where you position your forces and how you arm them based on where the enemy lies. With new product launches the enemy is lack of documentation, lack of information flow and lack of iteration. Launching remotely needs more of all three. Don’t neglect to make that investment to save valuable time.

8. Risky Business: When natural disasters strike, the companies best able to recover are the ones that don’t ignore the inevitability of failure. Having a documented business continuity and enterprise risk management plan in place will give the troops a jumpstart on what to do. Work with suppliers ahead of time on “what if” scenarios. Know who within your organization will run the war room. Decide how you will respond to a disaster in any part of the world. Of course you can’t anticipate every problem but you can do enough to be in better shape than others. When being chased by a grizzly bear you don’t have to be the fastest, just faster than the other guy!

9. Stunted Growth: Don’t just think about what you need now. It is a big mistake to pick partners based on what you need today and not think about their global footprint, scalability, systems strengths and capacity. There is nothing worse than having to pick up and move your processes while growing just because you didn’t partner with growth in mind. If you need one assembly line now, make sure that your partner has room to give you three without moving you to another building or location. Can you claim dedicated resources now ahead of expected growth? Have you picked a supplier who has bought into your plans and will invest with you appropriately?

10. Flee, fly or flow: Last but not least, don’t staff up with a wimpy team.  Understand the importance of picking supply chain leaders who have lived through global supply chain challenges and can bring experience to the table. Resiliency is a characteristic that comes to mind. There are a myriad of challenges that come up with a global network of suppliers. The challenges can be viewed as a necessary evil or can be managed and mitigated to bring your company a competitive advantage.

Pause Programming

While crossing the Pacific Ocean recently on one of my many journeys to Asia I paid close attention to the instructions on the screen. The sudden halting to the movie or music comes with a flash on the screen: Pause Programming. On this trip I took note and followed the directions. Usually this sign means nothing to me but on this trip I was trying to make a difficult decision about my career. The symbolism worked for me. Let me explain.

In the movie that is my life things move along rapidly almost without time for reflection. That isn’t a bad thing in normal times but what if I don’t know about the emergency landing instructions or the oxygen masks? There is value in knowing ahead of time what an appropriate exit strategy is. What should trigger a job reconsideration? When should I trade-off loyalty for self-preservation or even for happiness? What are my values and what would compromise them? Giving this some serious thought ahead of a major crisis on the job is wise and saves a lot of time when time is in short supply.

Do I know what cabin I belong in? While in flight you can’t move out of your cabin without breaking the rules. There are always exceptions to the rules so sometimes it is a good idea to seek out the better wine in business class. Doesn’t hurt to ask. But during a “life programming pause” it is important reevaluate my aspirations. Is my goal to be an employee or to work for myself? Do I want to work on a business or in a business? Is my job the focus of my life or do I want to have several things to juggle and develop?

When turbulence comes along in a career it is best to have a plan. Certainly it is a good idea to buckle in and face the issues. Dealing with crisis is a true test of one’s character and it is a test of a company’s real capabilities. Turbulence in a career is both a threat and an opportunity. If you are prepared and safe (financially and with strong networks) it can be either a non-event or a chance to grow.

Finally, when the movie is paused for the landing instructions and for information on the gate and other connecting flights it is good to listen. The career analogy here is to manage transitions before getting there.  What is my financial situation?  Can I afford to start my own business? Can I take a break and train in a new area? When can I afford to retire and what does that retirement look like? Nurture the network. Who do I know and what do they do? Where do my interests lie and then what can I do to prepare myself for a transition?

Bottom line advice:  Pause programming every once in a while. Don’t be caught reacting without the knowledge that is available if you pay attention. Keep yourself up to date on the rules, options, gates of life, destination details. Be ready for change because it is going to come up. Don’t go through life without thinking.

Thinking is the hardest work there is. That is why so few people engage in it.          HenryFord