AutoCulture 2.0: Shifting Leadership and Culture in the Auto Supply Chain

[Transcript]

[00:00:00] Jan Griffiths: This is the Auto Supply Chain Prophets podcast, where you'll hear from experts of all facets of supply chain in the auto industry to help you prepare for the future. I'm Jan Griffiths, your co-host and producer.

[00:00:17] Terry Onica: I'm Terry Onica, your podcast co-host. Let's dive in. Welcome to another episode of Automotive Supply Chain Prophets. Today, we're going to do something a little bit different. I'm going to turn the tables on Jan as we talk about her new book, AutoCulture 2.0. But before we get started, Jan, what have you been up to?

[00:00:41] Jan Griffiths: Wow. I'm so not used to you turning the question on me, Terry.

[00:00:45] Terry Onica: I did a good job, didn't I?

[00:00:47] Jan Griffiths: You did. You did. Thank you. I've been up to launching the book. Well, you think when you launch a book, you think, okay, so you launched a book. So, we're done, right? Project done. Oh, no, because then there's the Kindle version, and then there's the audio version, and then there's all the marketing, and then there's setting up the book signing tour. It's a whole thing, and there's a lot more to it. Again, Terry, I completely underestimated the work that's involved, but I am loving it. Thank you. What about you? What have you been up to?

[00:01:14] Terry Onica: So, this week I got the email that the Wayne State University Mentee Program is just about up. I can't believe how fast this year went. And I'm so proud of my mentee, Remy. She reminds me so much of myself in her age, just passionate, dedicated, hardworking. I'm just so excited about what she's going to do in the future. She's just one amazing young woman.

[00:01:40] Jan Griffiths: Yeah, I love that. I love what Wayne State is doing with supply chain management. As you know, I'm on the advisory board for Wayne State Supply Chain Management, and they really are focused on making sure that those students are ready for industry. So, they tap into industry to make sure that they understand the needs. They're not just over here in the left field, in this world of academia, clueless as to what's happening in the real world. So, I really love what Wayne State is doing.

[00:02:09] Terry Onica: Speaking of that, I need to get you to sign a copy for me from my mentee. So, as she's going out into the world to remember what good leaders should do going forward, so, let's get started with this. So, your book is so timely today for industry leaders as we're going through this amazing transformation of the industry. I one hundred percent agree with the premise of your book that the old ways of doing business just have to be changed. Leadership has to have a new way of thinking going forward. And I tell you, it was so exciting to be a part of your book launch. Jan, you are so loved. There are so many people out there to support you. It was just amazing to see. And I know it's because we all believe in you and what you're doing in the industry. Most of all, I want to congratulate you on AutoCulture 2.0, which reached number one in the Amazon bestseller category for leadership. Wow, kudos.

[00:03:13] Jan Griffiths: I know, right? I'm still in shock. I can't believe it myself.

[00:03:16] Terry Onica: I know.

[00:03:16] Jan Griffiths: Above John Maxwell of all people. And I know, I mean, Terry, that's nice, right? And I love that. Believe me, I love it. But as you and I both know, those are just vanity metrics, right? What really matters, and the reason I wrote the book, is to impact an entire industry. So, the question now is not how many books are we selling. It is what people are doing with these books. It's written in a way so that leaders in the auto industry can use it as a tool to open up dialogue about culture and about leadership. So, that's what I want to see, Terry. The real impact that we're going to feel in the industry.

[00:03:59] Terry Onica: I know, and I have no doubt that anybody who reads your book is going to have a lot of things to think about. It was just a great refresher for myself as a leader to think about things. Am I doing these things? I love that at the end of each chapter, you have some questions. It's just awesome. So, for our listeners out there, just give us a brief overview of the book.

[00:04:19] Jan Griffiths: Yeah, sure. The easiest way to describe the book is this: you have to get your head in the right place. We know the automotive industry right now is going through a massive transformation: EV adoption, we talk about batteries, we talk about technology, we talk about autonomous driving, smart cities, and on and on. We talk about this all day long, but what we're not talking about is the people and the culture required to go along with this change. Think about it this way. You wouldn't try to run a 4k video on a Windows 95 operating system. So, what makes you think that we can run this industry with the massive transformation that's going through right now, all the technology, the speed and agility that's required, the innovation, and on and on? What makes you think we can run that on the same leadership model and operating system in our culture that we've used in the past?

[00:05:11] Terry Onica: We just can't.

[00:05:11] Jan Griffiths: We can't.

[00:05:12] Terry Onica: No way.

[00:05:13] Jan Griffiths: We're not spending enough time talking about it, and more importantly, taking action to do something about it. So, the book is meant to shine a spotlight on that aspect of the change.

[00:05:26] Terry Onica: And that's so important, Jan. I just don't know how we can transform the industry without changing the leadership. And like I said, your book is so timely in that respect. So, what is the relationship between advancing business technology and culture? When we think of information technology, what are your thoughts there?

[00:05:45] Jan Griffiths: Yeah, that's a great question. Do you know that it's a well-known fact that 70% of change initiatives fail? And when you say change initiatives, that's a pretty broad category, right? Technology falls into that category. So, if you're trying to implement a new technology, whether it's for supply chain, whether it's anywhere in the business, typically 70 percent of those initiatives fail, and we know it. You and I have lived it, Terry. We've been there.

[00:06:16] Terry Onica: We've watched it.

[00:06:18] Jan Griffiths: We've seen it happen. And why does that happen? It comes back to leadership and culture. And there are a few reasons: the company didn't do a good job of painting a picture of the future state, of the vision, of the benefits of what the change actually meant to the people, what it means to you as an individual, whether you're way up in the organization or all the way down to the shop floor. Getting stakeholder buy-in, taking the time to really explain the buy-in, and then explain the technology. How many times, Terry, have you and I seen a company that buys an ERP system or an upgrade or some type of technology for supply chain, and then they think they're saving costs, and they say, 'Yeah, but we don't need the training module. We're good.'

[00:07:07] Terry Onica: Oh, God. All the time.

[00:07:10] Jan Griffiths: Right? And that's the craziest thing ever because if you didn't do a good enough job of painting a picture and a reason why upfront. Now, you've got this new technology. People don't exactly know why they're using it, and then you're not going to give them the training to help them be successful. This is why these initiatives fail, and it all comes back to leadership and culture. Now, in a more authentic leadership culture, you are taking the time to understand all its stakeholder inputs. You're taking the time to paint a picture to communicate a compelling vision, to get people inspired and behind that vision. Let's refer to the episode that we did with TS Tech. Talk about MMOG/LE implementation. Most people, including me, would be, 'Oh gosh, that sounds awful.' You know that sounds painful, but no, not the TS tech; they got the buy-in, they took the time, and they did it right. They painted a vision. They brought all the people engaged into the actual implementation, and they found a way to make sure that it's driving a benefit on a bottom-line impact to the business; that's what it's all about, Terry.

[00:08:27] Terry Onica: I know that was so inspirational. I love that episode. You know, it's all about people, processes, and systems, and really, when the three of those are working together, you can do amazing things. And when leaders recognize that, especially the people part of it, again, we just see so many great things and look at what TS Tech is doing; they're already getting benefits, and they're not even completely through the implementation. And that's because the people are engaged. They believe in it. And I love that quote in your book; let me quote it here, 'People want to know what they're working towards and believe in it,' and I personally have experienced that in my career. I feel so blessed at QAD. They are behind me. Any suggestion I bring up they have always supported me. And I just love my work at QAD. And I love that they offer me the opportunity to go out and make a change in the industry, with our customers, and with our prospects. When I saw that, I thought of my own job, and it could be contagious. Leaders need to recognize, let their people flourish, believe in them, and watch what they can do.

[00:09:34] Jan Griffiths: It comes back to the idea that you have in your head as to what a great leader should be, and many of us in automotive think that we need to be tough, we need to drive the numbers hard; drive the people hard. That's certainly the model that I grew up in. And nothing could be further from the truth. Now, having said that, yes, you have to achieve the numbers. Yes, you have metrics that you have to achieve. But Doug Conant said it best, the former turnaround CEO of Campbell Soup Company. He said, 'You have to be tough on standards and tender-hearted with people,' not either, or you have to have both. And our beloved auto industry has to develop more of a focus on the people side, not let go of the metric side. We've got that. We know how to do that. We've got structure, we've got processes, we've got systems. We know how to measure things. We've got that, but it's the people side of it, and if we can focus more on the people side of it now, we can really accelerate the rate of transformation in this industry. Without those two pieces coming together, we're not going to be successful.

[00:10:52] Terry Onica: Well, you know, an interesting thing that I want to ask you about is some would argue that command and control has worked. In my career, when we mandate MMOG/LE, barcoding, and EDI, suppliers will rise to the occasion, and they'll get it done. Now, I agree. Sometimes, they're not happy about doing it. But we have moved the industry command and control. Why do you think that's worked? But how should we change that going forward?

[00:11:19] Jan Griffiths: It starts with communication, and when we think about the supply base, as we know, it is changing. So, we no longer have this linear kind of OEM to tier one to tier two, and down the line, we still have some elements of that, but it's changing into more of a supplier ecosystem. So, we're not dependent on the one above us telling us what to do. So, this ecosystem all has to live, eat, and breathe, if you will, together at this alarming rate of speed. Even though I will have to agree with you, Terry, there are moments where command and control have to come into play. There's no way to get away from that, but it cannot be your go-to leadership model.

If we spend the time really understanding the vision, the mission, why we need EDI, and why we need certain pieces of technology in the supplier ecosystem. If we do a good job of that, then we should be able to get the buy-in, and people will willingly come on board. Instead of this, you know, compliance, 'Oh, well, this tier one or the OEM has told me to do it, so I've got to do it.' That's not the way to really make a program successful. We want people to see the benefits and actually want to do it. There's a chapter in the book when I interviewed Stefan Krause, former CEO of Canoo, former CFO of Deutsche Bank, former head of sales of BMW, and leader in the mobility space. I mean, what a mouthful, but what an amazing background he has. He says that we are moving from a model of leading with compliance to leading with conviction, and he knows it; he worked for a German OEM. And we're very much into this compliance mindset in automotive. We follow the rules. We do what we need to do without questioning. But we need to switch that more to conviction, doing it because we see it. I mean, the conviction is there. We know we're bought into it. We want to achieve the result, and we have an inspiring leader, and we're ready to go. It really is a mindset change.

[00:13:26] Terry Onica: And you know, one other thing I've observed in the industry for many years is that every leader in the supply chain has to open up their mind and listen to, even when an OEM mandates for you to do something. And the reason I say that is because when we look at things like MMOG/LE and EDI, yes, the customer told you to do that, but you know what? It really does add savings at every level of the tier. And oftentimes, I hear tier one says, 'You know, I don't like that the OEMs are mandating things to us. I don't like that leadership style,' but then when you tell them they should do it and why they should and the benefits they'll get, they're like, 'Well, I'm not going to do it unless they tell me to do it.' And I think in the industry, often, throughout the supply chain, we can't talk out of both sides of our mouths. We have to learn how to unite as a supply chain to move it faster. So, there's not this, 'I don't believe in you.' Anybody, like I said, that I've seen implement these technologies look at EDI with Fred Coe. How long have EDIs been around? Since what, 1989? And it hasn't been changed, and if you ask somebody to pull EDI tomorrow, they say, 'Oh my God, no.' So, I think that's really important too. What do you think about that?

[00:14:38] Jan Griffiths: It does come back to leadership at the OEM level. Here's something that I was thinking about just the other day, Terry. If you look at senior-level purchasing persons at an OEM, they get way down into the weeds. Boy, do they get into the weeds? They get into negotiations at a level that I would have never thought that a person who's steering leadership of the supply base for an OEM would get into, and that flows all the way down through the supply chain, where there's this idea of leadership as, you know, you need to be seen as being down into the weeds cause then you're the good leader, right? If you know what's going on with all the details. Well, no, not really. I'm not saying you shouldn't come down into the details when it's a significant issue; of course, you should, but you have a team of people. You have to empower them and allow them to do their job. Your role at the most senior level is to set the strategy, set the direction to inspire the teams and make sure that you develop the rallying cry. You need to be the Chief Meaning Officer driving the meaning. When you develop that type of mindset as a leader, then you're going to get people on board with you rather than, okay, yeah, we need to do this thing, whether it's EDI, whatever the initiative is, and then just bark orders from above. That's not the way to do it. That's not going to work. So, we've got some work to do, and it starts at the OEM level, Terry.

[00:16:15] Terry Onica: You know, I couldn't agree with you more that it starts at the OEM level because how many times have we seen, I'm sure even in your career as a leader in supply chain, eventually we just do what the OEM does to us, to our suppliers, right? So, if the mindset changes at the OEM's level to be more collaborative, I think that will do wonders in spreading that culture throughout the supply chain because, again, suppliers love to mimic, eventually, what the customer does to me, I'm going to do to my suppliers. Would you agree?

[00:16:46] Jan Griffiths: I totally agree, and having been the person leading a purchasing and supply chain organization at a tier one, having to deal with the requirements for all the different OEMs coming in, and then sitting in a executive staff meeting where people say, 'Well, just flow all those down into the supply base okay?' What? That's so hard to do. So, not only do we need the OEMs to be more realistic and more collaborative, but we need them to work together so we don't have five different sets of requirements coming down into the supply base. The survey that I like to look at for data around this because we talk about relationships, and people roll their eyes and they go, 'That's soft stuff.' Well, no, it isn't. There is hard data behind it as to when you have good communication, when you have trust, and how that impacts the bottom line. But the WRI study, the old Henke study that's now run by Plante Moran by Dave Andrea.

[00:17:46] Terry Onica: New one's coming out soon.

[00:17:48] Jan Griffiths: New one's coming out soon. But that one, that gives us data and it gives us history, and I love to look at that. And I can't wait to see those results this year. Let's see who's making progress and who isn't.

[00:18:01] Terry Onica: Yes. And last year was all about the more collaborative OEMs there were, the higher they scored. So, we'll see how they all fared again this year when it comes out. I think it's just in a few weeks. I just saw an email come out on it, so that's great. So, another thing I want to talk about in your book, you state, 'In the automotive industry, neither is failure accepted or rewarded,' and I find this particularly in the supply chain where there are stiff penalties if you don't deliver on time. Now, I understand the importance of delivering on time, but how can we change that culture? Can we lighten it at all? So that it's not so penalizing or more collaborative and working together.

[00:18:47] Jan Griffiths: Yes. If you look at Toyota, the way that Toyota approaches supply chain management and works with their supply base. Yes, of course, there are some penalties if you miss a delivery or there's a quality issue; those are contractual terms that you need to both agree upfront. But there's a much better understanding, and it's this view: that the OEM Toyota is there to nurture and coach the supplier.

[00:19:16] Terry Onica: True.

[00:19:16] Jan Griffiths: It's much more a coaching kind of mindset than it is, 'You're the supplier, you screwed up. I hate you. I'm going to throw every single possible debit at you that I can. I'm going to make up a bunch of charges and debit you, and that's just the way it's going to be.' You know, that's not a collaborative relationship. A collaborative relationship, a coaching relationship, is where you sit down together, you understand both sides of the argument, and you work together to find a resolution. If supply chain management was easy, anybody could do it. It's not easy. The situations we experience in delivery and quality are never straightforward. They are never black and white. There's always a customer position and a supplier position, and each one will have a whole slew of data on why they're right. It's not about being right or wrong. It's not. It's about getting to the right business outcome, and that's a huge mindset shift in leadership and culture.

[00:20:17] Terry Onica: Yeah. And lessons learned in it. What can we learn from it going forward instead of penalizing or being in these debates, like you say? What can we learn from it moving forward and make the industry better? So, lastly, I wanted to mention to you that it really tugged my personal heart in your opening of your book when you talked about being with your dad. Like you, my dad was an amazing man, and he was so supportive of his three girls. I will always remember that about my father. He was such an amazing mentor, and my mom absolutely was, too, so supportive of my career. I just wanted to let you know that it really, really got to me, and I really enjoyed that in your book, hearing about your dad and his impact on your life.

[00:21:06] Jan Griffiths: Yeah. You know, my dad was a farmer in Wales, and he didn't know anything about the auto industry. He never traveled anywhere. He never went on a vacation in his life ever because he had livestock to take care of, but he used to take me into the pub when I was a kid. And in those days, when you walked into the pub, the families went to the right to what they called the lounge, and then the men went to the bar, and there was no carpet on the floor; it was stone floor. And women typically weren't allowed in there, but I was because when you're a farmer's daughter, they think of you as a guy. They don't see you as a woman, as weird as that sounds. They just don't, well, at least when I grew up. And they never called me Jan; I was always Em's daughter. My father's name was Emlyn. So, I was Em's daughter. So, Em's daughter would dutifully sit next to her dad and drink, unfortunately, but that's the pub culture, and I would listen to them talking about selling tractor parts and the price of hay, and they were negotiating. My father didn't realize that he was actually exposing me to some of the best negotiation tactics on the planet without even knowing it. I talked about that in my Automotive News interview many years ago for the Top 100 Leading Women. I said that's where I learned my negotiation skills. Forget going to some Harvard business school or caress negotiating training, whatever that is. I learned my negotiation skills in the pub, Terry.

[00:22:35] Terry Onica: What a great way to learn. My dad always told me to be the first in line when somebody asked for help and always to give an honest day's pay. Those were two things that he always taught me about, and he exemplified them. Both my parents really did show me that in action, and so I grew up with that. And so, one of the things I want to tell the listeners today, especially the men out there, is don't underestimate the impact that you can make on your daughters. You can teach them to be very successful women, and it's just amazing what they can do in your life. So, with that, we get to wrap up the episode here. And so, what is that one action, Jan, besides getting your book, which I highly recommend too, that our listeners can take away from today and do tomorrow to make a change in this world?

[00:23:31] Jan Griffiths: Ask yourself this question: who are you as a leader? So often, Terry, we can't answer that question, and if you don't know who you are as a leader, how do you expect other people to support you and follow you? You've got to know who you are as a leader. What do you stand for? What are your values? What is the culture that you want with your team and in your company? Answer that question. Take some time after listening to this podcast, go for a walk, sit in a dark room, whatever works for you, but ask yourself that question. And it may be something that you work on over time, but get really clear and intentional about who you are as a leader, and making sure that you walk the talk with the values and the answers that come back to you.

[00:24:27] Terry Onica: What a great piece of advice. I think that's really good because, as we talked about today, people are watching you. So, what kind of leader are you? And are you the type of leader that you want people to really do and be the type of leader that you are as well, too? So, that's a great piece of advice. Thank you so much, Jan, for today. I'm super excited about your book, and don't forget to go out there and order it on Amazon.

[00:24:54] Jan Griffiths: Thank you, Terry. Are you ready to find the money in your supply chain? Visit www.autosupplychainprophets.com to learn how, or click the link in the show notes below.