Lessons Learned in a CPO's Transition from Auto to Life Sciences

[Transcript]

[00:00:00] Jan Griffiths: This is the Auto Supply Chain Profits 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.

[00:00:23] Jan Griffiths: Hello and welcome to another episode of the Auto Supply Chain Profits Podcast. Let's check in with my co-host, Terry Onica. Terry, how are you?

[00:00:30] Terry Onica: I'm doing great. How about you?

[00:00:32] Jan Griffiths: Good. What have you been up to?

[00:00:33] Terry Onica: Well, last night, I got invited to speak to Wayne State University's ERP class hosted by our industry colleague, Lori Sisk.

So, that was a lot of fun. I am so glad that they're teaching ERP in college now. I mean, it couldn't be more critical to you once you get into your first job. So, that was really fun. And then she also had me bring my colleague Sylvia with me to talk about QAD Redzone. So, the students were really fascinated with our connected workforce solution. I've talked about it before. It connects the factory floor; it allows the workers to have a voice in production. They communicate via iPads. It's just awesome, and it's so good for employee engagement. Actually, when we get done with implementation, they actually have parties. They're so happy with it. So, it's a really fun solution, and the students enjoyed hearing about it.

[00:01:19] Jan Griffiths: That's good. And tonight, I believe that you are joining the Wayne State Supply Chain Advisory Board as its newest member. Is that right?

[00:01:27] Terry Onica: That is correct. It's my first night joining the group.

[00:01:30] Jan Griffiths: And our guest has a little something to do with that board, but hold on a second before we introduce her. So, I will tell you that I've been working on the book and continue to work on the book because just when you publish a book and you think it's done, oh no, it's not. Because then there's the Kindle version that you got to get out. And then, there's the audiobook that you have to get out. So, the Kindle version is out, and the audio version is on its way, and having to read my own book. Oh, it's like, 'Oh, really? I got to read it again?' But I did. I read it. And I actually recorded it in a podcast studio because the specifications on an audiobook are really strict and stringent.

[00:02:14] Terry Onica: Really?

[00:02:15] Jan Griffiths: Yes, I was surprised. Yeah. I'm learning a lot. I'm learning a lot. Anyway, let's get to our guest because talking about learning different things, one of the things that I actually enjoyed many years ago, I jumped out of the automotive space and worked in the appliance industry for a year. And I think there's so many different things, different perspectives that you can bring to the table. And in automotive, we have a tendency to stay in our lane. And we have a tendency to say, 'Oh, but they don't understand. If you're not an automotive, you couldn't possibly understand.' Well, I got news for you guys. Every single person in every industry thinks that way. And I know Terry, even though you and I are focused a lot on automotive, we'd actually cross those boundaries and work in other industries. But our guest today is no stranger at the mic. She has joined me at the mic previously and is well known in automotive, is well known in the healthcare field, and also life sciences. And today we welcome back to the microphone, Carrie Uhl. Carrie, welcome to the show.

[00:03:17] Carrie Uhl: Thank you so much. I'm just absolutely excited to have another conversation with you, Jan, and now with you, Terry. And I'll see hopefully both of you later tonight at Wayne State.

[00:03:28] Jan Griffiths: Yeah, that's right. That's right. It's a party. It's a party.

[00:03:30] Carrie Uhl: Yep. It's a party.

[00:03:32] Jan Griffiths: So, tell us, Carrie, what have you been doing since your days at Magna? And tell us a little bit about that transition.

[00:03:39] Carrie Uhl: I always thought I would always be on automotive Jan, but as you said, sometimes a door opens, and you choose to walk through it. And so, back in 2019, about six months before COVID, I chose to join GE Healthcare and spent four years there. And then, most recently, I've just transferred over to Danaher, continuing in the healthcare field. So, it's been a really interesting last five years transitioning from automotive. And I would say, all in all, a pretty easy transition. Look, at the end of the day, the supply chain is the supply chain, and the issues that face any industry are pretty similar.

So, when you think of things that are top of mind for everybody, it's things like security of supply, how to take costs out, how you're going to be a customer of choice. Making sure you've got the best talent and what your digital roadmap is going to look like; all of those things have been the same, really, from automotive over to healthcare.

So, for me, the biggest difference personally was really just getting comfortable with the products being different. You know, I grew up in the auto industry career-wise, so I've been in hundreds of plants, stamping plants, injection molding plants, and machining plants, and it's just been comfortable, right? So, for me, switching over to healthcare and med tech can be kind of different in terms of the manufacturing processes, sometimes even a little overwhelming because it's just such high-tech science. But again, the supply chain is the supply chain, so it's been a great transition.

[00:04:59] Terry Onica: What role does technology play in the life sciences or medical devices? How is it different, or how is it the same?

[00:05:07] Carrie Uhl: Yeah, technology for me and supporting business excellence; it's a key thing, right? When I think about the auto industry, technology's always been pretty good. Enabling communications with suppliers, for example, EDI, has been around and adopted seemingly forever—a lot of digital tools. And I think organizations like AIAG have been really helpful here, encouraging the adoption of standard processes that are enabled by common technology. I don't see as much of that yet in Med. Tech. and Life Sciences, but the conversation is happening. Both industries really emphasize lean manufacturing in processes; learning from the Toyota Way, right? Focused on continuous improvement. And a lot of times, that is supported by digital tools and technologies. But you know what? Other times, it's just good old-fashioned whiteboards and dry-erase markers. And that's common in both spaces.

[00:05:55] Jan Griffiths: I have a question for you. I'm thinking about the technology, and I'm thinking about the difference, but how the supply chain operates in different industries. But there was a point in time when both of those industries came together in your life when you were at GE. Tell us about that.

[00:06:12] Carrie Uhl: That was really fascinating because peaking back to building ventilators and the world needing us to just do that so quickly. GE is very strong in that technology but has lower volumes than the healthcare industry typically is. And then, now you have these automotive suppliers kind of idled with incredible manufacturing and high volume. It was just an awesome way to see companies come together all throughout the supply chain, and it was just amazing to be a part of. And one of the things that it highlights is the similarities between the industries, right? Very focused on quality, very focused on bringing products to market quickly. It was just incredible. I don't know how to describe it other than that.

[00:06:53] Jan Griffiths: You were the perfect person to be handling that from the GE side of it because you knew the automotive so well. So, you've got automotive companies coming together with GE. Your background had to put you in a very strong position to be able to move quickly because it was all about speed.

[00:07:10] Carrie Uhl: It was, and it was good timing, and it really helped to have the network that I had in the automotive industry to know who to call, and I knew I might not get the right person the first call but they're going to keep connecting us and allow us to move quickly, so it was just terrific, and a wonderful example, and not just ventilators, I mean, you saw it collaborating on personal protective equipment and just some really incredible things that were big contributors to global health care.

[00:07:36] Terry Onica: What are some of the key capabilities of supply chain technology that you find most helpful?

[00:07:41] Carrie Uhl: I think those of us in procurement, one of the things that is super important now and always is visibility into your supply chain. For example, as of this recording, there was an earthquake last night in Taiwan. And when I woke up to that news, the first thing I wanted to know at the touch of a button was how might my supply chain be affected. So, there's been a lot of progress over the last decade in maturing kind of those third-party feeds for risk. So, maybe it could be financial risk feeds, or it might be geographical events like this weather event. Those things are really helpful to companies to be able to connect them to your own internal technology. Last week, it was a cargo ship in Baltimore striking a bridge, right? So, you really want to know quickly what your impacts might be, and I think technology has a big role to play there.

[00:08:29] Terry Onica: In the life sciences and medical device industry, do you find the importance of your suppliers as critical and automotive as it is in life sciences?

[00:08:39] Carrie Uhl: Absolutely. I think they're both the same, and I think both industries kind of struggle with visibility into sub-tier supply chains, and that's common in automotive, medical, and anything else. I don't think a lot of companies have that right yet, and that's an area where technology really can help us all.

[00:08:57] Terry Onica: Speaking of tsunamis and what happened with the bridge last week, talk to us about supply chain resiliency. What do you do in that area?

[00:09:06] Carrie Uhl: Yeah, it's such a tough topic, Terry. I have yet to see a company that really thinks that they have it right. Listen, you have to start with some kind of scoping. You can't de-risk everything. It's just not possible. So, you've got to define what's most important as your place to start. Have a really good method for quantifying revenue impact, for example. If you don't get certain components, you need to know what's common across platforms. So, you've probably heard the term the industry uses about the golden screw, knowing what that one part is that is on everything you make, and it might be low revenue, but it's very high impact. So, I think you've really got to be intentional about scoping. That's kind of the first thing. And then, especially in med tech and life sciences, it's also about the impact on global health, like we were just talking about. So, it might not be your highest revenue products, but it's the ones that have the most impact on global health. So, you might want to start there. Then I think once you've kind of scoped your de-risking and resiliency, then it comes down to what mitigating risk actually even means. And it's going to vary by part. It can't be a one-size-fits-all. So, sometimes, it might just be having a certain level of inventory that solves your problem. Other times, you really are going to have to ramp up a second source or a dual source. So, knowing your techniques is pretty important.

And then, I think the other thing that you can get right now, no matter what the current state of your supply chain is, is making sure your product development process is aligned with building resiliency from the start. So you don't have to revalidate anything. You don't have to change an existing supply chain because you're starting fresh. So, really thinking about designing for resiliency is important.

[00:10:46] Jan Griffiths: Tell us more about that new program development and new program launch. In automotive, we've got, as you well know, APQP, and we've got very robust, detailed, and structured launch processes. Do those processes translate over into your world now in health sciences or not?

[00:11:08] Carrie Uhl: No, they do. They do very much, Jan. And I've seen them throughout the healthcare industry; very robust NPI process. But I think what's missed in automotive, as well, is what many people call design for X, right? And that X can be resiliency like we were just talking about; it might be designed for manufacturability; that one's a little more common. People have got that one covered, but the newer ones now are designed for sustainability, for example. So, you may have the toll gates, the checklists, the APQP, and all of that there. But really, thinking about some of these new topics is still not embedded in those processes across most industries.

[00:11:46] Jan Griffiths: Yeah, well, actually, Terry fixed that. Did you know that? She fixed that. She's got an eBook coming out in a few weeks that really builds sustainability into the 24 supply chain processes. And it's there—it's all done. It's done for you, Carrie. You're going to love it.

[00:12:04] Carrie Uhl: Fabulous. I can't wait to get my hands on it then in a few weeks.

[00:12:07] Terry Onica: Absolutely. I'd be happy to share it with you. We're really excited about it.

[00:12:11] Carrie Uhl: No, that's fantastic. One other thing I would mention on this topic is early supplier involvement; whether it's a new product introduction or its end of life, you really need to be engaged with your most critical suppliers, especially if you're doing platforming because it's a risk of designing in something that's going to be a very big and expensive problem later. If you don't understand their technology roadmaps, and you choose something that's going to be obsolete. You put it on all of your products, or you pick a material on a sustainability watch list that can be a problem later. So, working with your suppliers as part of that NPI process is really important.

[00:12:48] Jan Griffiths: Who's better at that automotive or healthcare?

[00:12:51] Carrie Uhl: Oh, that's a good question. I haven't seen major differences. I think for both, that's just something with room to improve for sure.

[00:12:59] Jan Griffiths: Yeah. I think it's this idea that we learned many years ago in automotive that at least 70 percent of the design of the product or the cost of the product rather is hooked in at the design stage that we only spend typically about 5 percent of our resources during that stage. And Carrie, I worked in a system that talked about that in the 80s in the mid-80s on a concurrent engineering team that had an early supplier involvement element to it. And honestly, I don't think we've moved too far.

[00:13:31] Carrie Uhl: I don't either.

[00:13:32] Jan Griffiths: Since the 80s.

[00:13:34] Carrie Uhl: I know. And that's why I say I don't think either industry is really good at it. And you know what? It always comes down to the intention being there, but what my experience is is it's snagged with timing. Oops, we don't have time for that. It's too late. We'll miss our deadline. We've got to build that time into the process somehow.

[00:13:52] Jan Griffiths: Yeah, it's timing, it's resources, and it's having a process. And that's one of the things I like about Terry's 24 Supply Chain Processes is it really gives you a bit of a structure to follow. But I know as I had a supply chain for an auto supplier that, I didn't want to put my resources on it because all our metrics are so focused on cost reduction that I had to put most of my resources on cost reduction or managing supplier issues. The reality is if you put more resources upfront during the design and the development, you wouldn't have all those variances later on when you're launching the product. Still, it seems like in auto, we'd rather just fight with it later after it's all launched, and we got a problem. And then, there's an unplanned variance to the financials that nobody likes to hear. But that's a huge mindset switch. So, what I'm hearing is that you've got that in healthcare as well.

[00:14:52] Carrie Uhl: We do. The latest catalyst, of course, is COVID, right? There's always something, but first, in the automotive industry, it's the tsunami. Now, we have COVID. There's always something that gets people to say, 'Okay, this time, we're really going to do it.' Instead of, we really are going to do it. And then, a year or two later.

[00:15:11] Jan Griffiths: Slips back.

[00:15:11] Carrie Uhl: Flips back. So, I really think we're going to have to find a way to break through this. Otherwise, we'll always be fighting fires.

[00:15:19] Terry Onica: One thing that I'm surprised to see is often organizations still track their suppliers using spreadsheets, and they don't have a tool that keeps all of that information.

From your perspective, how important are supplier relationship management tools to really understand the position of your supply base and understand each one individual and what they bring to you?

[00:15:43] Carrie Uhl: I think it's important for me; you're right; a lot of it is still in spreadsheets. In fact, for many organizations, even having it as a spreadsheet is a step in the right direction because they didn't have it at all. For me, it's more about going back to that segmentation, really, and understanding which suppliers you really need to have those strong relationships with and how they're performing. So, most companies have thousands of suppliers, and you can't focus on all of them. So, I think getting that segmentation is right. And then you can really put the effort into developing the relationships.

[00:16:16] Jan Griffiths: Carrie, you've spent a significant amount of time in automotive and now a decent amount of time in healthcare. As you look back into automotive, is there anything that we need to unlearn? I know when I worked in the appliance industry, what I loved was the ability to take what I thought was really valuable about automotive and put it into the appliance industry. So, I'm sure you've had some of those same thoughts, but as you look back now into automotive, what do we need to unlearn?

[00:16:44] Carrie Uhl: Yeah. Great question, Jan. You know, the number one thing that jumps out to me, and I knew it when I was in the auto industry, but it's just even more enlightening now, seeing it work a different way elsewhere. We've got to stop treating our suppliers like they're adversaries. Nobody wins here in that model for very long. One of the things I love about the auto industry is Plante Moran's WRI Index, right? Or the Working Relations Index. I actually brought it over to one of the healthcare companies to use it there because it's a great insight into how supplier relationships matter. The auto industry knows it, but they haven't moved the needle. Health care is a lot stronger, I think, in terms of overall relationships, really being partners. So, I think the auto industry could take some lessons there. Keeping your word, paying on time. Being tough on problems, not people. Tackling things together and really making sure that there's an emotional connection to your products so that these players really understand how their work fits in and how that's valuable. I think the automotive industry could unlearn some of this my way or the highway and really benefit from some collaboration.

[00:17:52] Terry Onica: On the flip side, what do you feel you brought to your current position from the auto industry that benefits them?

[00:18:01] Carrie Uhl: I think one of the big things there is just sort of relentless focus on cost management and quality as well, but the margins are razor thin in the auto industry. So, you've got to go after everything. And I think bringing some of that discipline to healthcare is why myself and a lot of people have been recruited from the auto industry.

[00:18:22] Jan Griffiths: Carrie, what is the one action that you would recommend that leaders in the automotive supply chain should take right now, given what's going on? You've got vast experience, different perspectives, and a lot of things that you bring to the table. But as you look to your previous colleagues in the automotive industry, one action that they could take right now that you think would make a difference as we go through this massive transformation in the auto industry.

[00:18:49] Carrie Uhl: Yeah. Jan, I feel really strongly about getting supplier segmentation right. Really knowing what your suppliers are most impactful to your business. It's important for a lot of the things we talked about today: risk management, good NPIs, and collaborative cost-out; it all starts with knowing where to focus and being really intentional about that. A lot of companies put their effort where things are going wrong, firefighting we talked about. There's always going to be a degree of that because, after all, we're in a supply chain. There's a book I really like, an older book, it's called First, Break All the Rules: What the World’s Greatest Managers do Differently,' and it's about managing your employees, but I think it's applicable to this situation with suppliers. One of the key takeaways from the book is that managers should be spending more time with their A players, trying to get out what's been left in, instead of working with C and D players, trying to put in what's been left out. I think this is true of supplier relationships and where the automotive industry could really get better. Your best suppliers are almost always underutilized in terms of their expertise and their ideas. So, I would say for my call to action, spend the time with them proactively at their sites, at your sites, not on a team's call. Going to Gemba really matters with the right suppliers.

[00:20:05] Jan Griffiths: What a perfect way to close Carrie Uhl. Going to the Gemba matters. Thank you for joining us today.

[00:20:11] Carrie Uhl: Oh, I’m very grateful to be on the podcast today. Thank you for inviting me. It's always a terrific conversation with you ladies.

[00:20:17] Jan Griffiths: Thank you.

[00:20:18] Terry Onica: Thanks again, Carrie. See you tonight.

[00:20:20] Carrie Uhl: See you tonight.

[00:20:24] Jan Griffiths: Are you ready to find the money in your supply chain? Visit www.autosupplychainprofits.com to learn how or click the link in the show notes below.