BioTechnology Supply Chain Conference – interview with speaker Adam Zak
CAREER MANAGEMENT IN SUPPLY CHAIN: PERSPECTIVES FROM AN EXECUTIVE SEARCH FIRM FOUNDER
Biotech Supply Chain Conference, October 19-20, South San Francisco Conference Center www.biosupplyalliance.org
Devendra Mishra, Executive Director of the “Bio Supply Management Alliance” which organizes the Annual Biotech Supply Chain Conference, had the opportunity for a focused discussion on Career Management with this executive recruiting entrepreneur.
“Lean’s greatest impact on executive performance in both manufacturing and service sectors is that it helps management and associates at all levels in the organization uncover and identify the problems that, from your customer’s point of view, need to be solved in your business. This is its real strategic value.” Adam Zak, Founder and Principal, Adam Zak Executive Search.
ZAK: Lean came into being as the concept called J-I-T (just-in-time) back in the 1980s. In North America we started referring to it as Lean Manufacturing in about 1990, and today it’s more accurately known as Lean Management, having moved way beyond those production-focused origins. Lean spread readily from its automotive beginnings and is now firmly rooted in a broad cross-section of industries. Today we find Lean performance improvement initiatives in everything from banking and financial services, to U.S. military and state and local government operations, and even the fast-food business and dentistry.
Lean’s greatest impact on executive performance in both manufacturing and service sectors is very clear to me. Lean helps management and associates at all levels in the organization uncover and identify the problems, from your customer’s point of view, that need to be solved in your business. This is its real strategic value. As you become faster and more adaptable in meeting customer requirements at ever higher levels of quality, you build customer satisfaction. And that translates into top-line advantage – organic growth – and bottom-line success – profitability – with the added benefit of enhanced employee engagement at all levels within your company. And aren’t these major factors in how we define and measure successful executive performance?
MISHRA: What is Lean Manufacturing in the context of Supply Chain Management?
ZAK: Lean strategy becomes operational reality only when you implement Lean principles and practices within your organization. But of course, no organization is an island, so even the most aggressive Lean transformation will eventually encounter a road block which will impair your continued progress. You need to take it beyond the “four walls” of your own company. On the premise that your business wants to keep delivering ever-better customer value, your only solution is to optimize the whole supply chain system, which delivers that value. Doing this well, I believe, is critical to the future of world-class supply chain management.
MISHRA: Searching for executives with lean manufacturing expertise appears to be the missionary zeal of your enterprise. What have been the results of this focus?
ZAK: Yes, I’m somewhat of a missionary or evangelist when it comes to Lean, and my approach to seeking out and recruiting A-player Lean executives exemplifies this. I should clarify that my work involves pursuing both staff executives, say a Vice President of Lean Six Sigma or VP of Operational Excellence, as well as senior and mid-level line managers in roles such as COO, President, VP Supply Chain, or VP Operations, and so on – executives who champion or drive continuous improvement as a part of their day-to-day functional responsibility.
As a CPA, my first foray into executive search was working with clients seeking CFOs, controllers, accounting managers and the like. And in analyzing why certain companies, clients or otherwise, seemed to stand out in their successes, I recognized that well-defined and executed processes based on rigorous and robust operating systems seemed to make a major difference. My eyes really opened up when I read The Machine That Changed the World by Womack, Jones and Roos, in about 1991. I became an instant convert.
My results have been nothing short of fantastic, personally and professionally. I’m doing work that I love with people who also believe in striving for continuing positive change and improvement. I believe that I’ve made a major impact on, and added value to, every single one of my clients. And I’ve transformed my own business operations and personal life based on Lean principles and concepts. Sort of practicing what you preach, isn’t it?
MISHRA: How do you assess the desired skills and capabilities of executives in the areas of lean manufacturing and service?
ZAK: Back in the day when every company simply wanted to recruit someone who had worked for or been trained by Toyota or their kieretsu companies, it didn’t take all that much effort to make an assessment. But most North American and European companies learned pretty quickly that they were not a Toyota, and what they really needed was to identify Lean leaders who could adapt their experience to the existing company culture and environment. Today my work is traditional in that I look for traits which are considered consistent with strong executive leadership. But what really super-charges my evaluations of candidates is another layer of filters I employ for these additional critical skill sets: change management, empowerment and respect for people (a key pillar of the Toyota Management System), collaboration, passion for continuous improvement, process focus, and drive towards outcome-based activity.
How, you ask? Ah, that’s the secret sauce! But I can tell you that we use a proprietary methodology called pdcaSearch™ which I created based on Dr. Deming’s principles of Plan-Do-Check-Act (P-D-C-A). This is also a key tool in Lean transformation, and we’ve used that tool for the foundation of our executive search process.
MISHRA: How has this core competency enabled the executives achieve exceptional results in their organizations?
ZAK: What Lean-thinking executives do very well is primarily this: they set a clear vision (sometimes called policy deployment or policy management) for the organization at the highest level, and then cascade down the organization chart via relentless communication activity, exactly what that vision is and what it means to every single person within the company. Then these Lean “champions” give their VPs, Directors, Managers, and even entry-level associates, the permission to think and act as if they had an ownership stake in the business (and of course, some actually do). When you have that level of alignment of purpose across the board in any organization, when people really understand what’s expected of them, and when their contribution is welcomed and valued, that’s a powerful force for delivering outstanding results and getting them consistently over time. No secret sauce here.
MISHRA: How would you describe the current landscape of application of Edwards Deming’s QA Principles and Toyota’s Lean Manufacturing?
ZAK: It has not yet lived up to its potential, so we still have quite a way to go. And I believe that there are three key factors underlying this deficit.
The first is that many companies have been led somewhat astray and gotten bogged down by all the great tools which Deming and the Toyota Production System provide for us. But Lean is not about the tools. It is about using the appropriate tools within the context of a systemic, top-down transformation effort within the organization. Lean needs to become “how we do things around here” and not just a lot of periodic shop floor level activity led by “Kaizen Kowboys” whenever the mood strikes us. Only under such circumstances can Lean become so deeply ingrained in our corporate culture that it will withstand changes in markets, products, technology, competitors and yes, even changes within our own management ranks.
Secondly, a different perspective. To a disappointing degree, we sometimes see even formerly strong Lean-thinking companies begin to slide backwards. They lose the ability to build on past progress and to sustain improved outcomes and financial gains. Partially this is directly related to the “Kaizen Kowboy” mentality just mentioned. But often it’s just really a case of no one minding the store. The solution here, I believe goes right back to Deming’s P-D-C-A cycle. Our Lean leaders and champions must periodically and regularly go back to the basics and audit, if you will, the activities and processes in every value stream within the organization, clearly report on these, and have the responsible individuals and teams take action towards desired outcomes. In other words, we need to build in a process for continuously improving our continuous improvement methods. This will further strengthen the walls of the Lean fortress.
And thirdly, by limiting ourselves to seeing only what goes on within the “four walls” of our enterprise, we’re missing what is possibly the greatest potential pay-off from thinking Lean: the tremendous hidden and untapped operational and financial kinetic energy which lies across our integrated supply chain. If we can use Lean to dramatically improve the operations of our outsource partners and eliminate the weaknesses inherent in non-Lean supply and distribution channels, just imagine the collective impact we could make on people-planet-profits. Sorry, I didn’t mean to get into a Green/Sustainability discussion. But maybe we’ll have some time a bit later.
MISHRA: Has the Jack Welch pool of executives been a source for your executive placements?
ZAK: Surprisingly perhaps, not as many as you might expect. Under Jack Welch, Six Sigma was the primary GE religion. Some of GE’s business units, notably Aerospace and Medical Systems, had begun experimenting with Lean based on the model of GE “workouts” which were in some ways similar to Kaizen events. Within the last few years, Lean has become widespread as the continuous improvement umbrella across GE’s business units, and the combination of Lean and Six Sigma at all level is proving to be a powerful influence on operations. We expect to be seeing more and more executive candidates coming out of General Electric.
MISHRA: What have you found to be the educational background and on the job experience you select for executive placements?
ZAK: I’ve found that our clients’ search requirements vary so considerably that it’s difficult to offer a compact and precise answer to your question. However, there are some patterns which I discuss in a special report that I’m just putting the finishing touches on titled (tentatively) Supply Chain Executive, Generation 3.0. This report will be available as a PDF download at http://MySupplyChainExecutive.com right after the conclusion of the 2009 Biotech Supply Chain Academy conference on October 19 and 20.
MISHRA: At what levels of management, do you think supply chain management capabilities become a strategic strength?
ZAK: I see evidence every day that in the Fortune 1000 and beyond, companies view the way in which they manage their supply chains as being critical to their long-term success. Senior-level supply chain executives today are being tasked by their CEOs to show what they’re worth by making their companies’ integrated supply chains a competitive weapon in the battle for market share, growth and profitability. The senior-most supply chain executive in the organization, and all who aspire to attain that level, needs to acquire deep cross-functional expertise in SCM component arenas, trust-based internal and external relationships (customers, suppliers, partners) a global outlook, and a highly-curious Lean change agent’s mentality. So I would ask, at what management level is supply chain management capability NOT a strategic strength?
MISHRA: What other industries could the emerging biotech industry look to for best practices in supply chain management?
ZAK: I’ll suggest some industries which might present fertile grounds for hunting. These organizations have delivered consistently great results operationally and financially over time, and you only get that from the efforts of outstanding people. I’ll mention those, which I think, are most relevant. Pharma companies come immediately to mind, as do medical devices and health products distribution companies; consumer electronics: Dell, Apple and H-P; consumer food products: Dreyer’s Grand Ice Cream, Kraft, P&G Frito-Lay (PepsiCo); chemicals manufacturing: Nalco, Eastman Chemical, DuPont, Dow, Monsanto; and automotive: Autoliv, Delphi;
ZAK: Devendra, again, thanks so much for the opportunity to speak with you. I look forward to participating in the supply chain career management panel this October 19 in San Francisco.
