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Why Smart Manufacturing Is a Dumb Idea

Smart manufacturing has been all the rage in the last few years. And then it was “Smart Manufacturing 2.0,” even though 1.0 was never explained or implemented. These days we are into 4.0. So maybe you ran out and bought a bunch of smart machines. But then you had to buy a bunch of smart interfaces. And don’t forget IOT (the internet of things).

Before long, you may have had a bunch of smart machines talking to each other with all those smart interfaces. At what cost? Probably millions.

Congratulations. You wasted millions putting the roof on the house before you built the foundation. What can all these smart machines talking to each other all day accomplish? Sure, productivity improves. But you could have improved productivity by asking employees on the line for suggested improvements. Sure, you gain all kinds of intelligence about processes that you didn’t have before: information you might have obtained from your employees if only you had asked them.

It always astounds me when leaders think the silver bullet to improving can be found everywhere but in their own employees. Buy this, buy that and then things will get better. Why is that? Well, in a nutshell, the perception is that machines are easy to manage; people are hard. Many managers don’t want to get involved in the messy business of leadership, reasoning: It is easier to program a machine than to motivate an employee. It is easier to replace a machine than to replace an employee. It is easier to find out why a machine is underperforming than an employee.

And do these smart machines find new ways to improve processes? I doubt that. Do these smart machines innovate new ways to do things? I doubt that. And how do your employees feel about all these smart machines? Do they view them as threats? Probably.

Smart manufacturing cannot be very smart if you have “dumb” employees. As long as you treat employees as dumb, I guarantee they will act that way. So help them be the smart people they are. Most employees want to be smart and contribute. If they don’t, you probably have the wrong people.

Build the foundation for your house before you put the roof on. The foundation of any business is its people. Invest in your people before you invest in smart machines and the so-called factory of the future. Here are some ways you can do that:

Years ago, I decided my company needed to be more inventive to meet the challenges of the future. One thing I did not do was decree innovation from on high and expect it to suddenly materialize. What I did do was hire an innovation expert—someone with real-world experience and a demonstrated track record of results—to teach every single employee the principles of innovation. (It’s ideal if the innovation expert is in an entirely different field than yours, so you can spark innovation not normally found in your environment. And they should be able to teach the basics, starting with brainstorming, which is the root of all innovation.)

The training was spread over about three years. Team members learned brainstorming to arrive at new ways to improve processes, and to develop new product ideas that wouldn’t normally appear. After the training was complete, I made innovation a job requirement and part of everyone’s job description. In performance reviews, everyone is evaluated, incentivized and promoted in part on their contributions to new ideas and processes.

I also made sure people had the time, the permission, and the place to innovate. These days, my employees can go off and innovate any time they want, without a boss telling them to or giving them permission. I also built what I call a “Google-like campus in the middle of the factory,” a dedicated space for innovation.

And what was the result of all this? A few really big new products, and a million little process improvements. Improvements, by the way, that would have never happened from a bunch of smart machines.

Never forget this. If you treat your employees like an afterthought, they will act like one. Build your foundation first. Put your people first. That is the way to build a smart factory. Not with dumb machines. Steven L. Blue, president & CEO of Miller Ingenuity, has published five books that teach senior leaders and CEOs how to increase profit, take market share and destroy competition. He serves as CEO-in-residence at Winona State University.


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