Latest / Zero Friction / The Role of Management Control with Larry Mager || Zero Friction Podcast
Transcript
- Terry Coutsolioutsos/RevRx AI: Well, welcome folks to the Zero Friction podcast. My name is Terry Cotsolioutsos and I have the great opportunity today to be with Larry Mager. And Larry is the founder of a company called Management Control. Larry has been involved in the medical technology space for a couple of decades Larry: you Terry Coutsolioutsos/RevRx AI: now and has had his footprints on the quality and the quality of the products that come into the marketplace. So. So Larry, if you could just kind of give us a couple minutes about yourself, number one, and then a little bit about your experience and a little bit about what you do today. Larry: Sure, thank first of all, thank you. I very appreciative for this opportunity was a young engineer working for a Fortune 500 business where I learned engineering and I learned it from multiple facets, quality engineering, manufacturing engineering primarily, but of course we always touch on design engineering. Most importantly in that business I learned, before they really called it Six Sigma, I learned Six Sigma and Lean methodology. That company, was lured to Silicon Valley. It was in a couple of different startups, one of which I was the fourth person in. I have some patents from that position where I had to do design work. I had to do manufacturing work. I had to build the quality system. So I was able to learn quite a lot about the holistic approach to business. Went back to the Midwest. as a head of quality for another Fortune 500 company. And we had some significant FDA activity across the corporate landscape. And I was the head of quality at one of the 22 manufacturing sites. And the FDA wanted us to have a corporate quality solution, not all the fragmented and disparate solutions that were within the business. So we created one corporate quality solution, and we had to roll that out, and we were able to lift the warning letter in record time. But I also learned there that there was a whole other aspect to being a leader in the quality space at the time, and that was I didn't want to just sit in any quality system. I wanted to make it work or try to make it work with all its shortcomings. I wanted to help businesses make their systems better. And so from that point in my career, every role I had was really in some way or another associated with FDA remediation activity. Although some of the roles I was asked to take internal positions and I did at executive levels, which was also insightful because at the executive level I could see some of the back room and it helped me to grow quite a bit. Terry Coutsolioutsos/RevRx AI: It's great story career and it's built around quality and those of us that have been in the medical device space for any number of years know that the world is not perfect and there's certainly always opportunities for improvement. Some of the Six Sigma processes that you've brought to the industry, it really kind of helped to shape how quality and not as... not just fixing a problem, creating a foundational solution for organizations in general, correct? Larry: Yes. Terry Coutsolioutsos/RevRx AI: So give us a little bit of history like how you move from like fixing a situation, right, how do you move from the situation to like a broader guideline or corporate stance on how to manage quality, perceive or, preserve quality moving forward. Larry: Yes. First of all, a lot of organizations, they typically have quality groups that are big Q. I call that big Q and they're more compliance focused. And sometimes I think the business, the people in the company and the business leaders will say, quality is problem. And that's not thinking quality little Q. And so the first thing is to get people to understand that the quality of business is dependent upon how well that business functions. So the quality of the work process, typically which is embedded in procedural systems, needs to be transformed into the concept of a process flow where the work is well defined, including compliance. But if compliance is built in, then what we're looking for is quality execution, I'm sorry, compliant execution from the workforce. you're, from an engineering perspective, you're locking down one degree of freedom, in essence, the variation associated with what the work is, and you're managing the variation associated with the workforce. So good work process, and then work with people, and people are the variation, and it's, much more complicated on the people side than the process side because we're more complicated people. We have variation between us. We have variation within us. One day we're better than another. And our lives are constantly in flux. And so being able to get an engaged workforce that is skilled, trained, and competent to execute work as it's defined in a compliant manner me that's the ultimate in getting an organization refocused in the way that they have to. Terry Coutsolioutsos/RevRx AI: We had an exciting beginning too, and I think in your career you talk about the impossible balloon, right? You want to tell us a little bit about that story and you know kind of how that probably led you into a new direction as well? Larry: Sure, without a doubt. In that case, there was a minimally invasive product that was going to be used for what was still an emerging market that eventually created the DaVinci robot. But there were a couple companies back then. the concept is the robots would do a cardiovascular surgery through a rib cage. And this was when I was in the four-person company. That device was to be inserted in the femoral artery and go all the way up your iliac tree and transcend the aortic arc into the ascending aorta, where a balloon would occlude the aorta, deliver cardioplegia, and then it would also perfuse the patient. So they were stable without cracking open the chest. What was interesting. was of all the changes for manufacturability, design, things like that, the biggest was the balloon. So we need a balloon that was a beer can-shaped balloon. And that was very important for the stability of the catheter in the patient. What we found was there were balloons that were created that are called plastic where they had the primary shape you can get that kind of barrel shape But they couldn't flex too much versus a so those are non-compliant plastic versus balloons that were created from Compliant material and we needed something in between and there was a wide gap so what we did is we didn't actually Ignore the limits of the other two, but we were trying to explore what was between Because we knew we had to have something in between Terry Coutsolioutsos/RevRx AI: is this safe to say that this is the first semi-compliant balloon product in the marketplace, then? Larry: it wasn't labeled. People said it was the first, we called it a beer can shape, but when we showed it to physicians, they were floored. I don't know if it's been done since it probably has, but it was the first beer can, first balloon that could be blown up and retain a beer, beer can shape. so that, it would do what we wanted to do. So at the time it was novel. We have patent. I had about 140 design changes and my name went to the front of that patent because of Terry Coutsolioutsos/RevRx AI: My goodness. Larry: that. So yeah. Terry Coutsolioutsos/RevRx AI: That's pretty exciting. So where did that leave you next? And so I know you've had some great careers around working for Boston Scientific, you worked for Baxter, some really major, what I would consider front edge, leading edge companies that in a lot of ways changed the way healthcare is delivered in a lot of marketplaces. Larry: Yeah, and not only that but those are some of the fortune 500 level companies but going to a startup with where I was the fourth person in I didn't think about it at the time, but I had a wide array of experience And I spent a lot of time working with contract manufacturers. I was able to see a lot of manufacturing operations. And I really came to an understanding that business is varied and complex. But every business entity can be, in terms of its manufacturing and scale and everything, can really be summed up. by the technologies that they use. They're all different. But one thing every business has in common is this arena that I call biz ops or business operations. And biz ops is shortened for that. So it's not related specifically to the manufacturing environments, which are often far ahead in terms of how they're managed in the biz ops environment for any company. And I blame some of that again. Now this is med device heavy because I spent a lot of my time in med device businesses, but I blame some of that on the environment of compliance. The quality group, and I had a quality for various companies, the quality group is charged with compliance. They're not charged with little q quality. So that's typically a handful, a small subset of processes within the larger subset or the ecosystem of biz ops processes. And so unfortunately, one of the things that was maybe the biggest learning was that while the manufacturing environment is well taken care of, I won't say the compliance environment is always well taken care of. That's why there's a lot of recidivism. But what was lacking was the concept of building quality into all of the processes within the ecosystem. And then the other big aha moment I had really more later, I was really focused from an engineering mindset on the mechanistic stuff, the processes and how do you rebuild a system. And that's great. But I alluded to the other part, which is the people. There's levels of engagement. There's engaged, disengaged, and actively disengaged. And that's at a high level. They said the level, and you want your employees to be engaged, fully engaged. And that's at 20 % right now, which I think is an all-time low in industry. So what businesses need to do to focus on the quality of the business is to focus on the quality of the processes and the quality of the people. And one last note, this links to the market because the other area that I didn't speak to is RevOps. I break a business down into those three areas. RevOps is Terry Coutsolioutsos/RevRx AI: Yeah. Larry: the marketing, the sales, the customer support that is external facing. But often, and I've seen this way too often, you have RevOps initiatives funded by the business to grow revenue. But because the business isn't managing the biz ops area as they would a manufacturing area, they often have disconnect between scalability. Some companies don't even have their own manufacturing. So biz ops is all it is. You have contracted manufacturing ops. So businesses that have not built a well-oiled machine in terms of process workflow in people can struggle to meet the demand in the market. And that's when you see a lot of the problems occur, and the worst of which is you failed to meet a market demand and you lose that market. So that's Terry Coutsolioutsos/RevRx AI: Right. Larry: my view of business, what I've learned from the different businesses I've been in. Terry Coutsolioutsos/RevRx AI: I think you brought up a really good point is that many times when you talk about control and quality control, everything reverts into the cap environment or the manufacturing environment and they don't always look at the business environment. And I think you're bringing up a great point that business operations needs its own quality control mechanism as well, which leads us into management control, which is your company. And so, give us a little background on, what your purpose is as a company from a management control perspective. And then I know that you and I spoke a little bit around the five phases and what that means and, and how, not only can you help benefit companies from a quality control manufacturing perspective, but also from an operations side. Larry: Absolutely. So I talked about some of the things I learned. And as I was working at executive levels, and I mean at the executive corporate SVP level, but I've worked for organizations with SVPs as well, and it was able to interact with the SVP groups. One of the things I recognized is that the reason these organizations don't run themselves end to end in the way I just previously described is because the executive team is not necessarily aligned by, and this was the biggest. gap I had when I went from and every leader goes from being really good in in whatever domain and that's why they get promoted up they had success at one level but when you go to that executive level and you're still and oftentimes a VP will sit on the executive team and still have their domain to run it's very hard to take off the domain expert hat and put on a business hat that is cross across the board so that the marketing and R &D and quality and operations people are all working together. And the analogy I use is instead of you being in different boats that are rowing in somewhat the same direction, you get your executive team in one boat rowing in one direction and at the same cadence. And it sounds easy, but it's not. Executive alignment is very significant. So the intent of management control is to be able to provide a solution for businesses to go from where they are today to where they need to be tomorrow. And most importantly, within this digital age of technology, we've had, you can go back and look at all the way from Henry Ford and the industrial age and what was prior to that. And then you can look at what these huge shifts that came after that. The internet of things, for example, was another type of segmentation of the ages. And then finally around the 2010s, there was this digital age of technology and it really got done well in manufacturing environments. A lot of money was poured into AI enabled technology and how that could be used in ERP systems. But it really wasn't done well across the business as it was intended. And so that's where there's still work to do that can really make businesses run themselves, help the businesses run themselves better, align the executive team and make big shifts. For example, instead of everybody doing their own thing, more like a John Wayne character, They're working together as an executive team to understand what the theory of constraints is, which is anything that inhibits your business the most is the fastest your business can go. And so if they were in line, would not only know what is the operational capability, capacity, and cost that consistently satisfies the current market demand and every business needs that, that's their mission. But they would also know based upon new and upgraded technology, what is the systemic operational constraint? And in that way, they can go target that constraint to open it up and create more capability, capacity and costs that can be sold by the rev ops organization into the market. Terry Coutsolioutsos/RevRx AI: And again, I think you and I were having a pre-chat just around this topic a couple days ago. And, let's talk about something that's maybe closer to the business. you know, think manufacturing is always important, too. But for my listeners, a lot of them are commercial leaders. And let's talk about how we can bring quality control mechanisms into the revenue side of the business where, there are leaks and there is friction and there are There are opportunities for better processes, better ways to manage things on a consistent basis. Any thoughts there? Larry: I would say first of all that I am a believer that revenue ops, rev ops, or operations are, they're less mechanistic. I usually don't like to place a lot of rigid control on the creative side of marketing and things like that. Sales obviously gets to be, can be very mechanistic. putting the right level of process flow and working with those groups, you have to be a little more sensitive than an operational group. But where I would focus in the rev ops environment is the ability to really translate forecasted demand into actual demand that operations can engage with. And I'm amazed how many times operations is really running off. Forecast boundaries and things of that nature and then you run into these problems of with a manufacturing operation for example You don't want too much Built that you have to store in a warehouse and then I see companies throw product away And it's a financial thing it has nothing to do with the product So I would say the continuity between or coherence between what rev ops is doing in the market and what The operations business is doing needs to be strengthened. the two have to work hand in hand. A lot of people jump right over the biz ops and they think of the product, if it's going, if it's product, sometimes it's not even a product, it's service. But if it's product, they just send a signal to manufacturing. there was a lot of logistics involved and sequence and interaction between the business, the people in the business and the work that they did. And I just think while that was a very complex environment, I still don't see that kind of sequence and interaction mainly because it's the old, when I said the John Wayne, Instead what I meant and I should have followed on versus see a Jimmy Stewart who would have more of a conversation I know I'm dating myself But it's if if you have a leader that says this is my functional group my silo my domain I'll run it the way I want You typically have several things going on so there's while there is communication because people do it's not Set out in terms of the concept of sequence and interaction What I like to see is process flow with defined roles at each process step. And that gives you a couple of things. It gives you continuity between different functional groups. Because everybody works in one process within an ecosystem, one process at a time. And then it gives you the ability to look for business outcomes. People need three things, and this is tied to that people part, right? They need careers, and they get a job, and they make money, and that's great. They need to work within a community. The community gives them one of the things people need, but people, if they're working on their own in a business, it's also very difficult. So even remote workers can fit in a process community, process level community, within the ecosystem community. And then the final thing is cause. And so now, instead of being focused on my job that I do because I'm satisfying my boss, I'm focused on a process workflow that I can see where it is at in terms of its sequence. And when it comes to my step, there's an interaction where I accept work that was verified to be where the requirements were satisfied. And then I can take that work and I do my part. And I'm understanding that There's timing to it, tack time in manufacturing parlance, but there's timing to it. And so I'm invested in working within the boundaries of what that process needs to satisfy my community, to satisfy the outcome the process provides, and to be a part of the larger sequence and interaction of the ecosystem. So linking rev ops and the signal from the external market to the internal BizOps is really important. Terry Coutsolioutsos/RevRx AI: You said a couple of things that resonated with me. Number one, we talked about teamwork and having teams work together. And I think that's one element. The other would be, and how do you do that? even though there's a subjectivity component with sales and marketing that you brought up where it's more individualistic and less process oriented, but Having been involved in the sales and the marketing and the commercial operations aspect for Fortune 500 companies over the last 30 years is that what I've learned is that when you create guidelines and consistent patterns of workflow that it allows for more fractional intake, you can have people step in and do certain things because there is an SOP So this is where I really think from a quality management control perspective. There is a place in the revenue side of the business where this can definitely enhance consistency. It can enhance the volume that you can push through. You talked about having fractional support from different areas of the company where people can step in. Well, they can only step Larry: Thank Terry Coutsolioutsos/RevRx AI: in effectively if they actually know what they're doing and when they should do it. And so this Larry: That's right. Terry Coutsolioutsos/RevRx AI: is where these processes really lend itself very well. Larry: Yeah, Terry, I like what you said. See, the rev ops arena to me is more fuzzy in terms of the type of work they do. But you said something where revenue goes out the door or revenue leaks because of that. And it makes sense. So operationally revenue can leak from any aspect of the organization. So I just think that goes back to that screwing down the degree of freedom of saying, this is the work that we do, and this is how we want it done. Terry Coutsolioutsos/RevRx AI: when you talk about teams and silos and working together, there are two things that I really seen kind of fall apart in Fortune 500 companies is number one, very few, like if they're all speaking the same language, and I mean like definitions, like everybody, when you say the word blue, everybody sees the same shade of blue, right? And you know, when you use a word like operation that everybody understands what that word operation means inside of that company. So Again, common language is number one. And most big organizations, by the way, use acronyms and they try to confuse everybody. where I see things fall apart is where communication and not having common knowledge of what definitions are really is where things fall apart. And so, again, it goes back to quality control processes, guidelines. you know, building a glossary of framework of vocabulary that everybody should understand what every word means so that when you're talking and communicating together that everybody actually understands the same thing. And so I think those are wonderful things. I think that, you brought a lot from a quality control on the manufacturing side that we definitely can bring into our revenue, revenue ops, marketing and sales processes that can make us all. perform more effectively. Larry: if I could address that real quick. So as I said earlier, quality big Q is compliance focused. You see great quality control, typically in a manufacturing environment, because it's easier, tangible to the physical product. What we don't see is the quality control across the business operations and including the rev ops organization as well. And I think that's what's missing in the leadership alignment around an infrastructure or a framework that gives you a high performance management system. Executive leaders aren't necessarily the people that want to solve all the problems. And we typically, as people bring them all the problems, They actually need people to bring value in their role. And so what we need to be able to tell executive leaders at a high level is how is it all running? Not necessarily give them all the minutia and allow them to tell us what we should do. And that's a big shift as well that the right kind of high performance management system can can bring modern digital age technology enabled. Terry Coutsolioutsos/RevRx AI: That's a great point and thank you for that. as we close things up for today, number one, thank you for your time. Larry, it's been an honor to have you here. I have a common theme question that I ask every one of my guests on the podcast is that if you could go back and talk to your 22 year old self with the sole purpose of giving yourself advice, what would that advice, what would today's Larry give advice to 22-year-old Larry. Larry: That would be more related to people interaction. As an engineer, we're trained to be very mechanistic and you're looking at process and you're looking at machinery and you're looking at requirements. So it's not flexible. It's rigor and rigid and approach. A lot of things could have gone a lot better for me in earlier roles would have been if I would have spent more time listening to people. And in hindsight, I did spend time, but as I was listening, I don't think I was thinking about how they do their work. I was thinking about what work are they doing focused on that process. And when people talk to you about how they do their work, I'll give one example where it's not very mechanistic. It's putting together anesthesia trays and you have common tray footprints with many components that go in there. And the complaints that I would hear from the people that put together, they would complain about how the information came to them. They would complain about how the feedback was provided to them when a mistake was made. They would complain about things that that could have been readily fixed and and so I would say when people complain and that's how we get to this level of disengaged workforce and nobody listens It's bad. So my younger self, I think I would spend a lot more time trying to focus on voice of the people doing the work as I'm looking at the process and as I and I would interact back and forth more I just thought I'll know a better way to do it now put it together in a better way and they'll just love it well there's a lot of information that you can't unlock from the tribal knowledge right that people have and I think that's what I would counsel everybody from the beginning people are the most important part of anything. Businesses don't run with a workforce that is underappreciated and disengaged. And so that's probably where I would say spend your time really valuing people and their input. Terry Coutsolioutsos/RevRx AI: great and I think you know every leader has a great appreciation for what you just said too so it's a super reinforcement because without people there is nothing you know just like most companies need three things to operate one is you need a product two is you need processes to get those those products put to market and the third would be is you need people to make it all happen and so that's a a great reminder for us all. So Larry, I appreciate the call today and the opportunity to engage you and we look forward to, bigger and better things from you down the road. I know you've got a couple books that you've written and you've got some more that you're getting ready to sort of engage with. So we look forward to that next story. Larry: All righty, thank you so much for the opportunity to speak with you today.