– All right. Hey Matt, how you doing today?
– Good, how are you?
– I’m good, good. Hey thanks for jumping on this call with me. So, thought it would be interesting to get your perspective on the cultural implications of ERP, or really any kind of major initiative in a company, an ERP transition is probably the crown achievement of a company that’s going through a major change. And I think, I’ve just watched you guys over the years seem like you’re pretty successful. And I was hoping you could share some of your experience with other shops that are looking to do this, or are going through it right now.
– Well, our story is pretty simple. It was the story of failure. We had tried to implement an ERP for about 12 years, and we struggled and failed the whole way through. Finding that the reason why we were failing, wasn’t by lack of effort, it was just lack of context understanding that the ERP was just not built for job shops. We were struggling to find anybody that had implemented ERP successfully and that everybody in their shop was happy from the owner all the way down to programmers, set up, shipping, what have you. That’s when we found ProShop and it was perfect timing cause we were involved we were just getting to a point where we were gonna do a gut rehab on our company. We decided that if we were gonna get serious about an ERP, that we were gonna have to change our culture to make sure, cause we had one more shot to do it, right or I was gonna quit. I had been running a pirate ship for a lot of years and I just got tired. It wasn’t scalable. So we watched into a culture change and that was the bedrock foundation of our rehab project was getting the right people in the right seats. Right. And changing our culture to get ready for the wave that turned out to be ProShop.
– That concept of right people in the right seats on the bus. I’ve heard that before. Where does that come from? Oh, that’s “Traction”. “Traction” is one of the foundations that we used for the rehab project. I know that you’ve read the book “Traction” before by Gino Wickman, it’s really popular book. That’s an entrepreneurial operating system and yeah that was it’s called GWC, just getting the right people in the right seat. So I just quickly, I think everybody can identify with most shop owners have issues in shop management. They take their best CNC machinists, and guys, maybe they have a great personality. They’re trustworthy, just all around great people. And they rise up through the work chart to the point of management. That’s usually where those guys fail, great machinists the way their minds are built. Right, everybody’s built differently. Aren’t typically good at high level management, right group thing. So you just run through their system of GWC A. Does a person get their job. Are you constantly having to explain to them that their job is actually solving problems? Most managers don’t like all the issues that are flying at them, but that’s their job. That’s what management is right. So next one would be, does the person want it? How many machinists want management positions right? Actually, right. What that actually is, right. And then again, the capacity or capability, right. Are they trained? Have they been trained in management or they had just been dumped in there because they’re so good at their job, right. So we walked through that process with everybody in our company and we ended up actually let it go about 33% of our employees. in the ProShop.
– That’s a huge percentage.
– Yeah that concept of having this skills to do their job versus like a machinist versus a manager. The same is true for company owners. And that’s the same idea that comes from the book, the E-Myth right.
– You’re a technician in your craft. You’re really excellent at being a machinist and making parts and you decided to start a company but you’re not trained as being a business owner.
– So it’s often a struggle.
– Oh yeah. I was the first one to burn in the fire of traction. I had held 12 different seats at my company in the work chart. Actually ProShop helped me understand that when I implemented ProShop, when my favorite things about ProShop is your work chart. Right. How you guys define each job role, it’s just genius. It’s great. As we started to walk them through, it was shocking. No wonder I’m not gaining any traction. The owner, right, I wasn’t doing my presidential duties. My CFO duties. I was too busy doing the other 11 jobs I had on the org chart. So yeah, I lost see it would have been seven of them.
– So I still would be fine.
– So talk about when from, so we have a really high success rate with our implementations but it’s not 100%, I’ll be honest about it. And the biggest challenge that we’ve seen with customers that are not successful is they have sort of an internal struggle with alignment of team members just not being on the same page as the management team or the owners of the company about what’s important and the priority. So I’m wondering if you could speak a little bit about that.
– That goes back on Traction as far as like the vision. So Traction’s main focus is taking the owner’s vision and sharing that with the team, right. Again, all the way from my right-hand integrator all the way down to shipping, right. So I’ve watched other people try to implement ProShop and other ERP softwares. And I think you’ve talked about it before you have to resell the system after you sell the system to the owners. So I’m sure it’s frustrating for you. And again, going back, I mean I’m really glad that we took the time to get everybody in the right seat and get everybody on the same page, right? One of the things that we did and I know you and I talked about this before to show everybody how serious we were, we had a large meeting with everybody in the company and we told everybody in a nice way, the first one that complains about this process, okay, we’ve, defined it, okay, we’re getting everybody ready. You have months of prep work. We’ve replaced people. Everybody’s in the right seat. We’ve spent all this money, all this effort. This is our proven process. If anybody’s not on the same page as us we’re gonna let you go. And so afterwards, and I went and talked after the meeting and it shook everybody up. Went around and talked to everybody personally explaining to them that how serious I was. And we knew we were gonna have a sacrificial lamb. And the next day we did, it was our EDM lead. He had a bellyache about having to punch in his time thought he was being he didn’t he felt like big brother was watching. And that was it. We walked him out the door right on the spot because we’re not babysitters. We don’t want to do anything like that. We just want data. That’s all, right.
– Yeah, I think it would be good to hear from an owner’s perspective. Cause we get that sometimes with machinists people that, they think that ProShop is a tool until they really understand it. When they’re first getting introduced, they think it’s a tool just for management to monitor them. And that’s certainly not how we ran our shop. And so I’d love to hear just from your perspective what are the important aspects? If it’s not oversight or big brother, really, what are the things that are important for those employees to be doing that is goes to the benefit of the company? Not just
– I can talk about that for hours. Such a big question, but let’s just see. Okay, so fundamentally the most important thing for me as an owner was being able to have meetings, good quality meetings, right? Interaction, they’re called Elton meetings. We rank, everybody ranks the meeting at the end of the meeting from one to . So what everybody would feel like they’re that we had a level 10 meeting. The only way to do that is a takeout ego to take out opinion and just have facts, right? Data, hard data. You can’t argue data, right? So as people start to use that data, the meetings are now there’s no argument, right? We’re just using logic, using facts and hammering through issues. Right. We don’t have to sit there and discuss is that a problem or isn’t? You use ProShop the right way. Use the work chart. You have your proven system, you follow the rules, everybody’s following the rules. Jesus, solves like 90% of the problems on its own, right? Just by getting people to follow the rules. Right. I love rules. ProShop It’s great for that. So as a rule break right in, right. I mean, you guys spent a lot of time on this, on the software. I always tell people it’s genius because it was, you could tell it’s built by machinists right? The whole thing is just intertwined and everything connects together for a reason. And it took us a little bit of time to understand what your vision was for building it, right. We ran into what we thought were issues with your software. I’m not gonna go into them right now. But in hindsight, now looking back, they weren’t issues. We had the issue because we didn’t understand the context of the software right.
– Now that we do, well I don’t see any holes personally.
– So if you were gonna give advice to a shop owner similar to yourself, that’s considering doing an ERP switch or they did one and it didn’t it wasn’t particularly successful. What are the things they should be really thinking about and looking out for, or going back and doing over if they’ve already been through the process?
– Well, I do work with donors, so I do a business consulting on the side for a manufacturing and other industries as well, but mainly manufacturing. The thing that I would stress things that I work with people on when I’ve got it written down here. Number one foremost is our core values like your core values. So that is the most important thing. And believe it or not implementing the ERP software, right. Everybody’s got to have integrity. They have to have what I call numa. I don’t know if you familiar with that word numa. It’s like being creative but not outside of the box. Right. Too much or too little. So it’s like stoic, creative thought, right? You have be agile. You have to be creative. You have to have fanatical attention to detail. Period. You have to have emotional maturity, which is a big one, right? And then you have to be able to have a deep respect and understanding of logic. Right? You have to find out what your core focus is, right? I’m sure you’ve struggled with that, right? You had a big job shop doing all sort of aerospace and medical. And now that you’ve been able to go around to the different shops, I bet you, if you start it over again, you might, it’s good to diversify but you’re gonna want to have as as much of a core focus as you can. I think most job shops are spread too thin. You gotta work on your 10 year plan. Three-year plan. My analogy is always write if you’re gonna travel to the moon and if you’re off just a degree you’re gonna miss it by what, 50, 100,000 miles or whatever.
– Yeah sure.
– So I work with donors on that marketing strategy and sales. Most people don’t have a sales plan. Right. Which is, and which is great because going back to ProShop, I tell people that ProShop is our sales tool. It’s everything, right. So when manufacturers are talking to you about what, look, how do you sell them? I’m like, I just get people in the door. I tell them what our proven process it’s all built around quality. And when they come in, we popped it open. I mean, everybody’s gonna wanna buy from me, right? So it’s, if you have a proven process you could show them that their parts are being taken care of, right. With quality first, right. With all that data, I mean, you open up ProShop and they’re just they’re eyes just pop up. Like I said it before, it’s my greatest sales tool, right.
– And of course working with you you gotta get your work chart, right. There’s no point in firing on ProShop and once you get to, we talked about that GWC and then you have to get your people ready for problem solving, right. Not symptoms right, It’s really easy to sit around and bellyache about symptoms, right. But what’s hard in these meetings is finding that root problem, right. I’m sure you’ve dealt with that with your own company, right. Cause you’d get a symptom, symptom, symptom and you’re like, well, you know, what’s causing this right. You can track it back to maybe yourself.
– That’s the five whys, right. Ask why five times to get to the root of what the issue really is.
– Right, so what would I do? I mean, it’s just basically giving everybody a helicopter tour and with owners, right. When I’m interviewing guys, people call me for consulting and I kind of do what you do. Right. And when I first met you, I felt like you were interviewing me to see if I was gonn be a good candidate for ProShop. And we talked a little bit, I’m must remember that we talked a little bit about that when we first met.
– Yeah that’s certainly a part of our process.
– Yeah and when you left, I was like, I love this guy. And that’s it. I mean, that he has a product and he wants to make, because there’s no point in launching into something that serious spending all that money unless your customer truly gets it, right. And so I think that’s it. That’s what that is. When people call me to consult them or you’ve had a lot of shop owners call me and ask me about my experience with ProShop. And I just start my interview process with them, you know? And honestly, most people, they do get it now, right. The guys that are left are pretty strong and manufacturing. All the weak ones have been weeded out, right. They all want what you’ve built, right. They all want ProShop. It’s just, they don’t know how to get there, right. It just seems like it’s too big. It’s too, you know? And so to kind of get rid of that anxiety I just slowly walk them through all these processes. And it’s just, it’s actually I always say it’s simple, but it’s not easy, right.
– Yeah, so true. Well, Matt, thank you very much for that. If people wanna reach out to you what’s the best way for them to reach you. And you can, if it’s just your email or website, we’ll put it in the link of the video. So you don’t need to spell it all out.
– I can click on that.
– Oh look at you.
– There’s you go, I’m ready.
– That is awesome. All right, there’s your numbers. So yeah, back up, hit pause and grab that. So, all right. Well, Matt, thank you so much. This has been great. I’m sure there are folks out there that will find a lot of wisdom in what you have to say and that can help them through their journey.
– All right my friend and hey, and thank you. You guys are the best. One of the best experiences I’ve ever had in manufacturing, for sure. Easy.
– No man, all right. Thanks so much, Matt. I appreciate it.
– All right take care.
– Take care, all right. Bye.