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Mind your business

Don’t neglect the communication and business skills you’ll need to succeed

A metal fabricator or metal former can't run a successful business without have some business skills. The good news is that an MBA is not necessary to make good business decisions.

Engineering and technical schools are in business to teach you the hands-on, specialized skills you will need to practice your manufacturing craft. While this type of training is essential for industrial workers, these schools often fail to explain that your communication, analytical, and business skills also are crucial to your career advancement.

Manufacturing relies heavily on the results of testing and analysis, but they are meaningless if you don’t have the business skills required to prepare a budget or promote an idea, or if you don’t understand how to select a sample, determine a population distribution, and calculate probabilities. And your ability to listen to and communicate with others effectively has a big effect on your ability both to promote and adjust to changes in the industry.

When my sheet metal forming students ask me for advice—and often when they don’t—I always recommend they take a couple accounting courses, learn probability and statistics, and learn how to write persuasively. In today’s dynamic materials and technology environment, your ability to listen and respond to new ideas is critical to your planning and success. Many engineers go back to school to pursue an MBA when faced with crucial business decisions. If you enter your career with a good foundation of business and communication skill, you can probably spare the cost of an MBA because you already have the skills, unless you want the credential.

Accounting

No matter the size of your company, the measure of business success is primarily financial. As a result, you have a better probability of meeting your goals when you express yourself to business managers in their own language. Of course, there are notable exceptions to financial measures, such as employee safety and environmental hazard prevention. But your business measurements are reflected on the balance sheet, income statement, and cash flow statement.

Too often, managers simply take last year’s budget and add a percentage to it. This isn’t budgeting. This practice is convenient, but it fails to adequately support your company’s goals. Formulating an effective budget requires:

  • An understanding of your company’s goals and how you can support them.
  • Knowledge of your business unit’s strengths and how you will capitalize on them to support your company’s results.
  • Knowledge of your business unit’s weaknesses and your plan to improve your results in those areas.
  • Defined production goals for the coming year.

A little financial literacy can go a long way in ensuring that your company’s needs for the coming year are supported. Also, understanding your business unit’s significant lie items on your company’s balance sheet, income statement, and cash flow statement go a long way in convincing financial employees of your goals and their benefits.

Probability and Statistics

We hear often about “big data.” It’s a great marketing term, but it isn’t all that new. The science of analyzing data and determining the probability of an event dates to the 17th and 18th centuries. The difference today is the amount of data available and the processing power available to analyze it.

Large volumes of data allow you to select reasonably accurate representative samples of transactions. Statistical analysis and probability help identify trends and causations for targeted events. With these tools, you can determine probabilities for transaction occurrence and forecast events with a fair amount of accuracy.

Applied to sheet metal forming, statistical and probability analysis helps you anticipate equipment failure, measure sheet metal variability within a grade, predict the probability of failure events occurring based on a mill certification, determine an accurate margin of error for a given grade on a forming limit diagram, and determine the impact of press tonnage variability on product quality.

But even with these valuable tools at our disposal, our greatest obstacle is in the collection and persistence of meaningful event information. Tonnage monitors frequently are ignored, and their data isn’t saved. Little research exists on the variability of properties for grades of material. Coil properties usually are measured at the ends of the coil across the width, but not across the length of the coil. If we do a better job of collecting meaningful information and analyzing the effect of measurements on manufacturing results, we can better anticipate and manage our processes for greater efficiency and better results.

Persuasive Communication

Your technical and business skills provide a solid foundation to support your company’s objectives. Just as with a house, a solid foundation is critical, but the visible presentation sells. Your ability to communicate in concise and understandable language can be the deciding factor in your career and department success.

Anyone in business should understand effective writing and speaking, along with the use of digital media. The ability to influence company and industry decision-makers is one of the best tools you can have in your arsenal. When you can present facts and informed opinions persuasively, you can advance your ideas to improve industry results and make your career more rewarding and productive.

Active Listening

In a dynamic industry, we must accept that some of old assumptions and rules of thumb will become irrelevant. We often reject new ideas because they challenge the comfort zone. Ironically, reliance on habits, rules of thumb, and tradition is what should make us most uncomfortable.

Active listening skills allow you to hear messages of change and respond to them in a positive and constructive way. Questioning and learning are the most important aspects of active listening. When you listen intently and objectively, you will also discover hints to possible future changes in both technologies and practices. Insight and responsiveness to change are the leading contributors to success and security in today’s dynamic metal forming industry.

Successful metal forming management requires many skills. New materials and technologies demand you learn and adapt to provide quality product in an efficient manufacturing environment. Your success as a business manager depends on your knowledge and awareness of the technical aspects of your job, as well as data management, business, and persuasive skills. When you understand your contribution to business measures on the balance sheet, income statement, and cash flow statement, you can speak to your business people in their own language.

About the Author
4M Partners LLC

Bill Frahm

President

P.O. Box 71191

Rochester Hills, MI 48307

248-506-5873