Inside Advanced Scale Challenges|Wednesday, January 25, 2017
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Why Smart Manufacturing Can Be So Dumb 

(Matej Kastelic/Shutterstock)

Someone recently asked for my thoughts on smart manufacturing, or the so-called IT revolution in the factory. They couldn’t believe I didn’t see it as the salvation of American manufacturing.

Don’t misunderstand. Smart manufacturing has a place in reviving American manufacturing. I have a smart factory. We employ the latest in pick-to-light systems that use light displays to direct operators to specific stock locations. We also employ automated numerical control machines and seamless integration from order inquiry to accounts receivable.

But that isn’t where I started my revolution. And you shouldn’t either.

The problem with many CEO’s today is they have turned away from the astonishing potential of the workforce and turned toward automation instead. That's a big mistake. But I hear it all the time.

What is the sense in spending millions on automating your factory if the workforce couldn’t care less? What is the sense in buying expensive machine tools if your workforce can’t wait to get to the bowling alley after their shifts are over and then drag themselves to work the next day?

I’ll tell you why: Because too many CEO’s view their employees as expandable assets. Instead, they should view them as renewable resources. And renew them.

Don’t bother with smart manufacturing if you have a workforce that senior management doesn’t care about. An alienated workforce is a dumb workforce. If your workforce is dumb, it’s your fault, not theirs. Don’t bother with an IT revolution. Your revolution has to start with a “Smart Workforce”. You have to make a new compact with your employees.

You need to ignite the human spirit in your workforce.

Imagine this: What would happen if every day your employees came to work excited to do better today than they did yesterday? Imagine how your company would soar if your employees were absolutely dedicated to supporting the mission and each other in attaining it?

This is where I get blank stares from many CEO’s. They don’t like the “soft stuff.” “Give me the hard stuff,” they say. “Tell me how to build a smart factory, not a smart workforce.”

It has to be the other way around. Start by building a smart workforce. A workforce that is engaged, enlightened, and empowered. You need a workforce that trusts its leadership; a workforce that believes in its leadership. Tall order to be sure – especially if the leadership is a bunch of boneheads that care more about equipment depreciation than employee engagement.

The key to building a motivated, smart workforce is one that’s treated with respect and integrity, which in turn builds leadership credibility. In a recent Harvard Business School study of 20,000 employees half of them did not feel respected by their leaders. And respect was rated as more important than anything else, including compensation. Imagine how the company performance would skyrocket if you solved this one problem alone.

Leaders need integrity in everything they say. You can’t be like many managers and “tell half the truth, hoping the other half doesn’t show up”. You have to be completely honest all the time. You have to tell workers what they need to know. If the company is headed for trouble, tell them. If the company needs to pivot into new markets or products, tell them. And tell them why. Tell them everything. You would be amazed at how smart your workforce can be if you give them half a chance. As I always say, “Trust in truth”.

This is not just for the top managers. Your entire workforce has to embrace the values of respect and integrity. But you cannot expect “people below to do what the top will not”. You may have leaders that lost credibility long ago. They can’t get it back. You have to replace them.

Smart manufacturing starts at the top, not the bottom. Smart manufacturing starts with creating a new compact with the workforce. Smart manufacturing starts with people, not machines.

Steven L. Blue is the president and CEO of Miller Ingenuity.

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