Marcy Alstott is a seasoned operations and supply chain executive who is currently a Managing Director at On Tap Consulting. Having worked with blue-chip companies and startups through two natural disasters, which caused significant supply chain disruptions, Marcy approaches manufacturing and quality with a resume like few others—and shares some insights from her storied career.
Resilient Processes Insulate Against Black Swan Events
2011 may feel like it occurred a lifetime ago, but to Marcy, it’s still fresh in her mind. It was the year of the Tōhoku Earthquake off the coast of Japan, measuring 9.0 and triggering a tsunami. Marcy was VP of Operations at Hewlett-Packard, which had a partnership with Canon and relied on them for toner cartridges and other components for laserjet printers. After the tsunami, Canon and other key suppliers’ factories were shut down, and Marcy was forced to turn to 2nd sources for critical parts that HP needed. “There’s no such thing as drop-in equivalents,” she recalled. “These were mechanical components, these were electronic components going onto boards and systems. You can’t simply drop in another supplier or even a factory change without some rigor.” The rigor that Marcy references was the key factor that allowed Canon and HP’s CM partner, Jabil, to continue pushing forward. HP strictly adhered to the 6 Sigma approach and followed internal guidelines laid down by W. Edwards Deming that emphasized a strict Total Quality Approach. Every failure was traced back to a course-corrective action, tight guidelines and incoming inspection processes ensured the product and the assembly process remained the same. Quality was emphasized early in the process. “If you’ve got a resilient process that’s clear with its KPIs, and you’ve pushed your quality processes to exclude things that aren’t validated, you’re going to be more resilient to anything buffeting that process.”
If you’ve got a resilient process that’s clear with its KPIs, and you’ve pushed your quality processes to exclude things that aren’t validated, you’re going to be more resilient to anything buffeting that process.
Marcy AlstottManaging Director for On Tap Consulting
The Problem with Drop-In Components
If there’s one concept that was hot on everyone’s lips during Covid, it was “supply chain”, and Marcy, who was working at the time with a startup developing farming tech, found herself staring down supply chain issues while helping the company ramp production. The problem? The components called for in the product design were scarce, and acquiring enough from a single supplier could require a year in lead time. They instead chose to utilize components from 2nd sources to help the ramp stay on schedule - and learned some hard lessons as a result.
The startup needed to minimize the time-to-market consequences that came with post-Covid supply chain disruptions, so they opted for a fast-moving strategy: tweak the original design to accommodate the available components and perform simple, functional turn-on tests. “For a startup, time is critical,” Marcy recalled. “Who has the time to test?”
The team tried to get away with skimping on additional tests and sent the new designs to the factory floor. They were soon met with line stoppages and their engineers quickly learned a lesson Marcy carries with her to this day: new components need to be treated as a new design. Seeing that the functional tests were insufficient, the team put the new designs through highly accelerated life tests (HALT) and only then released the design to the factory. Highly Accelerated Stress Audit (HASA) was added in the factory process as an extra quality check. “Sometimes you need to slow down in order to speed up,” Marcy says. And the result? A successful, if not slightly delayed, ramp to volume — and hundreds of averted field failures.
A Lesson in Manufacturing Quality for $5,000 a Minute
Field failures have obvious costs, from sending out an engineer to perform a repair to the cost of swapping out malfunctioning units for ones fresh from the factory. But those costs can pale in comparison to those faced by the client. Marcy discovered this firsthand while working for Chipcom—whose systems were core to the Bloomberg financial information company. When Chipcom’s networking products failed, they brought down Bloomberg’s entire network and cost their client five thousand dollars per minute. “We had 24 hours to come up with a plan, and that focused my attention on quality at that point in my career.” Chipcom scrambled to provide redundant systems to prevent Bloomberg’s network from failing again, and had to wait to perform their retrospective analysis. “If we didn’t get it right, it would affect the future of the company.” Stress screening and data analysis became a critical part of their review process. The team’s renewed commitment to quality would result in their sale to 3Com, which itself was eventually acquired by Hewlett-Packard.
Quality endures.
Overcoming Field Failures with Quality as a Safeguard
Each failure, each near-tragedy Marcy overcame, taught her to prioritize quality. Quality ensures a good customer experience free from failure (saving the company on costly repairs), forcing engineers to fully comprehend the changes necessary to accommodate 2nd suppliers, and creating rigorous controls that safeguard processes from unprecedented disasters and supply chain issues. As Marcy succinctly put it, “The secret is to make sure your process for qualifying new sources is robust and streamlined.” In other words, do sweat the small stuff, because that’s where it matters most.