Brutal reality of process management for hardware startup

Startup company and process management. These are probably two most conflicting definitions you might think about. Everyone is familiar with famous Zuckerber’s statement – move fast and break things. How process management can survive in such environment? Although Facebook is more careful these days about “breaking things”, startups are still operating on the edge to move as fast as possible. The outcome is questionable for many hardware startups. A large majority of young companies are not delivering on time. The rough statistics said 75-80% of hardware projects on Kickstarter are not shipping products on time. That was a piece of information that made me wrote the following post last year – Why Kickstarter projects need PLM?

The blog post Speed Can Kill: the importance of process for hardware written by Ben Einstein of Bolt put a great perspective on what means process for manufacturing startups companies dealing with atoms (not bits like software companies). Take a look on the article – I found it very interesting. So called “long shadow effect” is brutal if you think about potential impact of decisions made during the lifecycle of product development. The following passage can give you an explanation how it can happen:

Early mistakes often don’t have a measurable impact until first shots are coming off tooling and the manufacturing process grinds to a halt. My partner Scott calls this the “long shadow effect.” An early decision about which microcontroller to use or the shape of a housing can appear correct until months or even years later during the first production run. Sometimes parts can have exceptionally long lead times, require odd financing terms, demand manual rework, or be entirely un-moldable. None of these problems can be uncovered by moving quickly to get to production.

The article speaks about four “trunks” as a the way to organize processes. I found it interesting comparing to more traditional department organization you can in PLM implementations done in larger companies. It reminded me my earlier blog about why PLM companies should revise NPI processes. The waterfall process is complicated and can introduce many artificial breakpoints to prevent company from moving fast. At the same time, running out of process organization will fail you on late stages of product development and manufacturing. My favorite passage from Bolt’s blog is the following conclusion:

This is not to say that hardware startups can’t move quickly; in fact they can move faster than ever before. But the ability to go fast and build good products on time and under budget comes from process, not pure iteration. The fastest companies tend to be exceptionally organized about their product development and manufacturing process. Many people have asked us to cover this in much more detail and we’re working on a 4 part series exploring each of these trunks.

What is my conclusion? I’d change the original “breaking things” statement in order to fit manufacturing companies reality as following – “move fast and respect process”. It is easy to say and hard to implement. The complexity of product and processes is high. Products are combined of mechanical parts, electronics and software. Work and teams are distributed. All things are interconnected and can create “long shadow effects”. Hardware startup companies are struggling to set basic elements of information and process organization. My hunch that those companies that are able to organize four trunks right will survive. This is a note for PLM architects and other people thinking how to apply PLM technologies for agile and dynamic processes. Just my thoughts…

Best, Oleg

Image courtesy of hywards at FreeDigitalPhotos.net