MAR 16, 2017 @ 11:00 AM
Krisztina “Z” Holly Guest Contributor
THE ART OF MANUFACTURING: ENTREPRENEURSHIP | BUSINESS | INNOVATION
The Art of Manufacturing
It’s one thing to work for the family business, but back in 1989 when Kellie Johnson stepped into her father’s shoes as President, it was a man’s world. And manufacturing was pretty old-fashioned.
But she wasn’t afraid to turn it up two notches and show everyone how it’s done. Through true grit and teamwork, she overcame intimidation and discrimination and tons of entrepreneurial challenges to turn what was once her grandfather’s little corner welding shop into the high-tech aerospace powerhouse it is today.
I had a chance to sit down with her for The Art of Manufacturing podcast. I learned how she has driven the frontiers of her field and evolved her company into an enterprise with clients like NASA and Boeing. We also learn how Industry 4.0 trends are impacting her workforce, and how she decides where and when to invest in new technologies as a smaller company.
And we hear about her early years, as a psychology masters drop-out trying to follow in her father’s footsteps, struggling to build credibility with her team and with their global aerospace clients, one step at a time.
Through the process, we get some pointers how even the smallest manufacturer can really push the cutting edge in today’s rapidly changing landscape and make their services indispensable.
- Dip a toe in
Manufacturing is moving fast. Whereas Industry 1.0 was the basic mechanization of tasks, Industry 2.0 was the specialization of tasks, like Ford’s assembly line. Industry 3.0 is the moniker for the time tasks started getting automated. And now, Industry 4.0 combines cyber-physical systems, cloud computing, and the industrial internet into a smart factory that can be fully optimized along its entire manufacturing process and supply chain.
Small companies might be intimidated by this concept, and think they aren’t sophisticated enough to take advantage of these technologies. But Kellie says, “Put your toe in the water and see how it goes.”
She started first with a small industrial 3D printer and encouraged her team to experiment and suggest uses for it. Now they have a sophisticated printer with which they create models, trim templates, and weld fixtures. It has become essential to their business.
Not all of the experiments will work, and that’s fine. On one hand, a new project around high speed computing with a local university didn’t even get off the ground because of a language barrier. But now they are instrumenting all their TIG welding procedures so they can optimize the highly variable process.
“Don’t be intimidated by all the options. Experiment a little and then do what makes sense for your company.
- Use technology to develop talent
Technology isn’t just for manufacturing. It’s for communication and marketing as well.
Kellie was an early adopter of the Web in hte early 90’s. But ACE Clearwater wasn’t consumer facing, so why did they bother if they weren’t selling anything on the Internet? “The purpose was to attract people to come work here. For people to see our Web site and go, ‘That’s a really cool place.’”
Kellie was well aware that manufacturing had been missing the “cool factor” among the general public for a long time. Her company still acutely feels a shortage of skilled workers, and her company isn’t alone. According to a report by Deloitte, “80 percent of manufacturers report a moderate or serious shortage of qualified applicants for skilled and highly-skilled production positions.” So by highlighting the great people and projects at the company, she could attract the best and brightest to go work there.
Z Holly with Kellie Johnson at ACE Clearwater
They also developed a production company named Dash 9, hiring animators from USC’s film school, to create instructional videos to share knowledge across the company.
“As companies struggle to find welders or machinists and programmers, imagine how difficult it would be to find a drop hammer operator,” she explains. It’s an art that goes back to the 1920’s. One of their operators, Lucky, has been with the company for 25 years. Their Dash 9 Productions enables them to capture some of that art and share it with others across the company.
- Embrace the tough times as a team
In Kellie’s earliest years at ACE Clearwater, she entered a world surrounded by girlie posters, with only one other woman at the company affectionately called “Dragon Lady.” The employees expected Kellie to be married off soon enough and didn’t pay too much attention to her at first—but they had sized her up wrong. And it wasn’t long before her hard work, authenticity, and open door policy won them all over.
It was harder to win over the clients, however. One day early on, five men in suits from Boeing sat her down and said “You’ll never make it happen. You’re never going to succeed. This is a complete failure.”
What was going through her head at that time? “Oh, I was determined to succeed,” she says defiantly. “Determined to succeed. I just remember thinking to myself, ‘I’ll show you.’ And so a really proud moment for me and our entire team was a couple of years later when we won the Boeing Supplier of the Year award.”
That wasn’t the last time she had an uphill battle. Once, baseball-bat wielding thugs came in to smash all of the parts they had made. Another time a client asked, “Why is it every time you open your mouth it sounds like birds are chirping?” That made her work extra hard to get their ISO 9100 certification—in less than three months, no less—and eventually won that same client’s business.
ACE Clearwater’s custom parts have been on the International Space Station
The rough patches made her even more determined. She embraced those crazy moments in a way that brought the team closer together.
- Contribute to the community
Kellie’s journey into manufacturing started when she realized the potential impact of running a successful manufacturing company. One day when she was in graduate school studying for a psychology degree—her goal was to “help people”—she looked around at the nice cars in the lot of her father’s company. She then realized how ACE Clearwater was creating good jobs for hard-working people. What better way to make an impact?
So, motivated by that experience, she jumped into the family business and hasn’t looked back. And that desire for impact has driven her since. She’s on the board of the National Association of Manufacturers. She was part of the recent small delegation of manufacturers that met with the Vice President Pence to advise on policy issues. She works closely with local colleges to help develop curricula to create a pipeline of talent into her company and the industry.
Kellie Johnson at a White House meeting with the NAM
And although it might mean more competition for her, she’s been working with aerospace companies to try to expand their supply chain to include newer companies and make the industry more resilient.
Why would a busy CEO waste time with helping other companies? Well, she’s creating an ecosystem that supports her industry and her company. It’s grown her network and has been paying back in connections, talent, and reputation in the long run.
- Consider legacy
Kellie’s employees tend to stay with the company for decades. Several have even been working there for more than 40 years. One drop hammer operator is 80 years old. Kellie says that half of her workforce is aged 45-65. What will happen when they retire?
Kellie Johnson with the Next Generation at MFGDAY
The Manufacturing Institute estimates that in the next decade, 3 1/2 million manufacturing jobs will open up and two million of those will go unfilled due to the skills gap.
This is the direct result of the meme that “manufacturing dying.” Most parents wouldn’t want their kids to become manufacturers. Yet meanwhile some of the most exciting and well-paying jobs out there are on the factory floor. (In 2015, according to data from the Bureau of Economic Analysis and the Bureau of Labor Statistics, the average manufacturing worker in the United States earned $81,289 annually.)
Kellie and her team take this very seriously. In their spare time, have been developing a nascent platform to encourage manufacturing workers to find a safe space to connect and learn from each other. She also works closely with local colleges to help develop curricula to create a pipeline of talent into her company and the industry. Kelli is focusing on succession planning now; it’s her next big milestone.
Kellie’s struggle resonates with me. My biggest concern for manufacturing in this country is that so many manufacturing businesses are run by owners close to retirement, and most aren’t lucky enough to have a son or daughter to take over the company business. In our MAKE IT IN LA study, unveiled last year, we found that most manufacturing businesses had fewer than 20 employees, and the average age of the business itself was 25 years old. What will happen when the owners of these businesses want to retire?
Fortunately for Kellie’s father—and for us—he had a daughter that not only took over the reins, but took the company to the next level. I might be hard for her to find a fitting replacement. But in the meantime, it’ll be great to see how they continue to advance and succeed.
Krisztina “Z” Holly is the host of The Art of Manufacturing podcast and Chief Instigator of LA Mayor Garcetti’s MAKE IT IN LA initiative. Listen to more episodes at http://makeitinla.org/listen.