Fixing manufacturing
An exclusive Q&A (and healing) session with Disney Institute director Larry Lynch

by Paul V. Arnold

What’s ailing manufacturing?

The industry tries to claw itself out of recession, and everyone wonders when recovery will truly occur.

But the downturn didn’t happen overnight. Some analysts believe the deep, steep hole was dug a long time ago. Some also believe recovery efforts began in the 1980s and ’90s.

Has there been progress? The first step to recovery is knowing and admitting that a problem exists. To that end, many manufacturing firms deserve praise. They admit perceived problems and, like anyone out to kick a bad habit, seek a cure. That’s healthy progress.

These companies devote money and man-hours to dig up inefficiencies, waste, things that have a negative impact on productivity and profitability. Some are successful in their efforts. They heal themselves and make it on the cover of MRO Today magazine. A large percentage of companies, however, fail to turn the corner. Some fail miserably. Why? They spent money and set aside employees like the victorious ones, but they are no better off.

Why is success, change and recovery so hard to come by?

To answer these and other questions, MRO Today turned to Larry Lynch, the director of the Disney Institute.

Arnold: "As the leader of an organization that educates companies, you keep close tabs on the manufacturing industry. In your research and observations, why is it so difficult to turn the corner and realize success, change and a recovery?"

Lynch: "(At the individual level), I think it has to do with the ‘essence’ of an organization . . . its culture. All too often, organizations will do what you described — use money and manpower to dig up inefficiencies, waste and ‘things.’ They’ll create programs and slogans, have people rally around the new slogan, and that’s it. Sometimes that approach works, but too often it doesn’t. For a variety of reasons, energy isn’t sustained and the effort is all but forgotten. This approach might best be compared to treating symptoms vs. curing the illness. Sometimes you get well, but the likelihood is that you’ll suffer a relapse.

"We think corporate culture is the best barometer of your success potential. At Disney, we created a culture of raising the bar, of creativity and innovation, and of employee involvement. Does that mean every new initiative we try works? Hardly. But I can guarantee it helps us hit more home runs than a lot of other organizations. More importantly, it helps us focus the right resources on recovery, which allows us to turn the corner faster than others."

Arnold: You believe that people management is one of the most important issues facing the manufacturing industry today. Why don’t most inside the industry see it the same way? A manager’s list will likely include issues like reducing internal costs and getting a 10 percent price concession from suppliers, but people management is missed. Do you see that?

Lynch: "I’d like to think this is happening less and less. I find manufacturing to be very process-driven. More than in the service industry, you can predict with incredible accuracy what will happen in your plant — when deliveries will arrive, the output of your machines, etc. American business spent decades refining those processes, and for much of that time, labor was just another cost.

"You have the completely opposite scenario in the service sector. Hospitals, retail, food and beverage, lodging, and certainly theme parks rely more heavily on people. I think the service sector realized it needed manufacturing-type processes several years before the manufacturing side realized it could use people processes from service industries.

"It’s the savvy manufacturer that realized a long time ago that people — unlike machines — are, first, a critical component to the business and, second, the most variable part of your operation, meaning that on a day-to-day basis they can make your business run better or worse."

Arnold: It’s almost as if you have to bang somebody over the head to make the light go on that, "The answer lies in the way I hire people, or treat people, or develop people, or in the environment I’ve created."

Lynch: "Change of this magnitude never comes easily. Few organizations are willing to totally reinvent how something is done. But that’s something Walt Disney did probably better than anyone. Whether it was movies, television or theme parks, he always tried to find a way to do it differently and better. More than once, he risked his entire company on an innovative idea. That innovative streak is still the wellspring of his company.

"What we’ve learned is that successful innovation breeds imitation. Once you’re successful, people want to imitate that success, so they’ll study you and follow your examples. I think that’s where manufacturing is today. Many organizations ARE getting it and having success. And many others are studying those examples. It takes time to change an industry. But I’m confident that those successes, combined with more industry focus on people, will help the process to snowball."

Arnold: The Disney Institute aims to bring the topic out in the open. Is that why you agreed to write a column on people management in MRO Today?

Lynch: "No question about it. For more than 15 years, people have come to Walt Disney World to learn the people side of our business. We’ve been honing our people management strategies for a long time, and we know they are very applicable to manufacturing. So the column seemed a good way to share those best practices."

Arnold: Using the people skills approaches you wrote about in the MRO Coach columns, wouldn't that help address some of the concerns managers may have originally put on their "top issues" list?

Lynch: "Absolutely. Walt once said, ‘You can dream, create, design and build the most wonderful place in the world, but it requires people to make the dream a reality.’ I don’t care what business you’re in, your people are the key to your success. We’ve yet to find a machine that can think, reason, inspire and innovate. And if it existed, it would be invented by a person!"

Arnold: The Disney Institute has offered best practices in people management and other areas to clients since 1996. Why is it so forthcoming in offering success formulas?

Lynch: "Because we’re asked to . . . constantly. Disney Institute grew out of the enormous number of requests received from organizations wanting to benchmark against us. It was impossible for us to accommodate those requests without disrupting the very operations we were trying to showcase. So we asked ourselves, ‘How could we make this work?’ Working with leadership teams throughout the organization, we were able to not only identify what people wanted to learn from Disney, but also the best way to share those learnings."

Arnold: Disney Institute teachings come in a couple of formats. There are programs held on-site in Florida. And, on Sept. 13 in Kenosha, Wis., there is "The Disney Keys to Excellence" in Manufacturing program. How do the formats differ and how they are the same?

Lynch: "We have a number of different programs available to groups holding meetings at Walt Disney World. Disney can be the meeting’s focus, or an important part of a larger agenda. All of our business programs focus on management practices Disney is known for. In addition to people management, we have programs on service, leadership, loyalty, value chain management and organizational creativity. Each can be explored in 90-minute presentations, three-hour workshops or one-day seminars. You can also mix and match topics and formats to create a tailored learning experience."

Arnold: What can a person expect when he or she attends a program like "The Disney Keys to Excellence" in Manufacturing?

Lynch: "They can expect to learn the Disney success formula and business strategies that are easily adaptable to their organizations. They can expect to see their businesses in an entirely different light. And, they can expect to have some fun. After all, we are Disney."

Arnold: How does this program differ from traditional one-day seminars, conferences and workshops?

Lynch: "What you’ll learn from us is proven to work. Most seminars do a pretty fair job of talking theory and examining some case studies. In our programs, you’re learning proven ways to impact your business, and you’re learning them from the very people who are responsible for our success. I’m extremely confident when I tell you there is no other learning experience like those offered through Disney Institute."

Arnold: Who teaches the program?

Lynch: "Our facilitators are members of the Disney management team who come to us from different operations throughout the company. And, of course, they’re all outstanding presenters. We started this discussion talking about people, and the Disney Institute facilitation team truly represents the best of the best."

Arnold: Why is it important to attend "The Disney Keys to Excellence" in Manufacturing?

Lynch: "Competition in manufacturing has never been tougher. We’re in what is arguably one of the most uncertain economic times in recent history. As a manager, do I stick with what’s worked in the past or do I take a risk and try the untried? The Sept. 13 Disney Keys program sponsored by MRO Today and tailored for the manufacturing industry can help you navigate that sea change. We’ll introduce you to some creative new approaches — that don’t, by the way, have to cost a fortune — and help you to translate Disney principles into your operation. And, just as important, we think you’ll walk away from the program inspired by what you’ve seen."

And, he believes, poised to lead your company into a new era of growth and prosperity.

This article appears in the June/July 2002 issue of MRO Today magazine. Copyright 2002.

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