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Continuous Improvement Center of Excellence - Kevin Williams
Within the Shore Resource Team is a specialized group called the Centers of Excellence (COE). COEs came from operating careers to provide subject matter expertise and support to portfolio companies. COEs directly support companies on projects, share best practices between companies, and promote connectivity between companies so that 40+ companies create a competitive advantage through collaboration.
In this episode we discuss Shore’s COE focused on Continuous Improvement. Kevin Williams, Chief Improvement Officer for Shore, talks about the strategies he and his team employ to help our portfolio companies continuously improve. He discusses examples from our Healthcare, Food and Beverage, and Business Services verticals.
Transcript
Introduction
Anderson Williams: Welcome to Bigger. Stronger. Faster., the podcast exploring how Shore Capital Partners brings billion-dollar resources to the microcap space. Centers of Excellence at Shore Capital are subject matter experts who provide their functional expertise to support our portfolio companies. COEs, as they are known, share best practices and engage with our portfolio companies to address real business challenges and to create opportunities far beyond what a traditional microcap company would be able to do on its own.
In this episode, we highlight Shore Capital Center of Excellence focused on Continuous Improvement.
Kevin Williams: My name is Kevin Williams. I'm the Chief Improvement Officer for Shore Capital Partners. I've been here for about two and a half years now. Came directly out of a heavy operations background. Started out in the automotive industry.
Spent about 12 years there and then transitioned into food and beverage. Out of food and beverage, spent some time in the chemical industry where I then got into contract manufacturing and packaging in the private equity space.
Continuous Improvement
Anderson Williams: So, tell us what Chief Improvement Officer mean. It sounds great, but what does improvement mean?
Kevin Williams: All things continuous improvement. So, it's more about the relentless pursuit of identifying and eliminating waste in different types of processes, in business services, healthcare clinical settings, and manufacturing, especially.
Anderson Williams: Kevin, most of the people listening to this have probably heard the term Lean, and whether they associate it with manufacturing or otherwise, or startups, the book Lean Startup, whatever.
Can you just define in your terms what Lean means?
Kevin Williams: It's pretty simple. In general, it's the relentless pursuit of waste elimination in any process.
Anderson Williams: That's pretty simple. Now, how do you do it?
Kevin Williams: Right? Right? So, it starts with strategy deployment. First, you need to understand where you're going before you can truly build a roadmap.
We start with measurements and a data driven approach. We then look at the process. We do complete process mapping, current state, and then future state. Eliminate the value added from the non-value-added activities and then measure that performance. Create a system of daily interaction. and accountability, and that's the process in general.
One Misconception
Anderson Williams: And give a little bit of a sense of, in those different settings, what it means. I think if we think about waste, we're often thinking about production or product development, not so much services. How does that work across different verticals in the portfolio?
Kevin Williams: I think one of the greatest misconceptions is that Lean is only relevant to production or manufacturing companies.
It's also very relevant in the healthcare space and we have multiple engagements and examples where a healthcare company has come to us and said we have problems with door-to-door time or the patient journey through the process within the clinic. Can you help us become more efficient? And my partner and I, Sean McDonald, have recently engaged with a portfolio in the healthcare space where we have done multiple time studies at the front office position to drive efficiency through processes that they have in a day in and a day out.
We've gone into the back office and worked with the clinical technicians and the practice supervisors to improve process efficiency. And we normally don't interact with the provider at a clinic because once they close the door, that's their interaction with the patient. But after they leave, we then look at that process of how they exit the clinic.
How they pay their bill, how they're checked out, how they're assigned their long-term care instructions, and then we can drive efficiency through that part of the process. A great example is door to door times on average were about an hour at one of the clinics that we visited, and after we had completed our activities and the process mapping of the entire clinic, we were able to drive efficiency gains of about 50 percent on that door-to-door time.
So, it's very relevant throughout all process, in my opinion.
Listening and Learning
Anderson Williams: And it seems like you have to go into an environment like that and really watch and learn and understand what each phase of that particular process means for that particular clinic or company and start there. It's not that you're coming in necessarily with the right benchmark or the right answer, but you really do have to understand what's the objective of each of those different phases for different companies and different verticals and so forth.
Kevin Williams: You're absolutely right. Normally, we do not have the answer coming in. It's all about listening and learning and we spend a lot of time on site initially with the entire team living a day in their life and it builds trust. They're very open and normally if we can get it documented and do time studies, we can start to identify the waste in each of those processes.
In another example, there were a lot of issues associated with staffing and in a manufacturing environment, it's pretty easy. You know how many people work in a plant, you know what their role is specifically for that day, and you're able to assign time to that role. Well, it's very similar in a clinic.
You have X number of associates that are supposed to perform tasks, and we build production modeling and staffing modeling also in the health care space for clinics and Sean and I have been very successful there and trying to optimize labor to manage in labor shortages, able to reassign labor in networks of clinics and create pods that drive efficiency also in that labor modeling.
And labor is one of the biggest commodities in that entire network.
Anderson Williams: It's fascinating because what you're describing feels really manual.
Kevin Williams: It's very manual, but it’s very people oriented, which is the piece that I love about it. It's the interaction. And these teams of people come in every day, and they do this job in and out.
They forget more about that process than what I'm probably going to learn in that week of time that I'm there assisting them. But they also have the issue that They've done it this way and they haven't seen it another way. So, us driving process improvement and identifying the inefficiencies that occur in that process and then going back creates these aha moments for them.
And then they start to identify the opportunities to improve it and then we become their voice for vocalizing the efficiency gains.
How Lean Works
Anderson Williams: That's amazing. Can you just give us an example of an engagement in the food and beverage space or in the business services space? Just so that we have a sense of how this notion of Lean plays in different areas.
Kevin Williams: A CEO from a portfolio company in the food and beverage space reached out. As you know, Shore's story is a story of growth, and the commercial growth was accelerated past the productivity that the plant could keep up with. Their current state was about 350,000 pounds process per week, and they brought my team and I in.
We did some process mapping. We did some line balancing activities and waste elimination, and we improved that productivity to about 550,000 pounds per week. This was a four-week exercise, but through very little investment in capital and primarily process improvement, we were able to really drive that productivity gain for them.
We also focused on yield performance and scrap and waste elimination. In that example, specifically. So, when you're able to partner and drive that type of productivity gain, it's really exciting, not only for the local teams, because they see they're able to do more with actually less makes their jobs a lot easier on the day in and the day out.
Anderson Williams: And what about in the business services space? Have you done any work in that space?
Kevin Williams: Yeah, so that's been a really neat example. My colleague, Sean McDonald, worked on a great project with one of our health care processing centers. And they had a lot of issues associated with moving customers billing through their entire process.
And the approach really was not scaling with the growth. And Sean was able to come in, implement visual management systems, put in dashboards, understand waste elimination, and drive a process mapping event that drove a lot of efficiency through their network. Allowed them to speed up the processing of claims, eliminate billing errors throughout that process, and then create a visual management system that was able to communicate where the status of those claims were throughout the process.
Hands-On Approach
Anderson Williams: Can you just say a little bit more about what that engagement looks like?
Kevin Williams: We go in with a very hands-on approach. So, those that have been involved in a traditional consulting operation, they may come in, do a base level assessment, leave a bunch of actions in place, and then do weekly calls and checkups to say, hey, have you made progress toward all these things that I identified while I was there doing the base level assessment?
We also conduct a base level assessment, but after that assessment and creating those corrective actions, we live on that shop floor with that team, and we help them implement the visual management tools, the hour-by-hour boards. So, not only are we the expertise that they're looking for to help accelerate that growth, We also provide the bandwidth to where we can help them get the work done.
And I think that's the big difference between what the Center of Excellence has brought to Shore Capital specifically, is bandwidth and expertise.
Anderson Williams: It sounds like, Kevin, that the hands-on approach, working with multiple levels of the team, the operations team, there's a side that could go, oh, wait a second, why are you getting all into my business now?
I've run this business so well for these number of years, why are you all in my business? Can you just say more about what you have to do, perhaps it's trust, to build that relationship, so that that becomes a process that's not happening to them, that they're a part of?
Kevin Williams: Yeah, I think again, it goes back to listening and learning.
Our approach is to come on site, perform an assessment, congratulate them on the wins that they have, but also identify the quick wins that drive value and increase productivity, efficiency, make their sites in some cases safer for operation or improve the customer satisfaction through delivery or improving cost structure.
So I think once you've done that, and you've proven that you're able to add value, I think the trust starts to be built. And the trust is what allows us to go deeper and to drive faster gains within the environment.
The Network Effect
Anderson Williams: So, Kevin, can you describe a little bit about how your work and perhaps your role and your partnership with portfolio companies changes across the sort of phases from planting to growing to harvesting?
How does the project or how does the relationship or the work change over the hold period with Shore?
Kevin Williams: In the beginning, it's more based on minimum operating standards. Like they have certain systems and processes in place and the areas that we see that they might have inefficiencies, we come in and we're propping those up.
And we're trying to get a great foundation to support the scalability and the growth. And a lot of that happens with every COE in that planting phase. In the growing phase, it's more about accommodating the accelerated growth. The add on acquisitional side. It's working with the deal teams to understand pain points that the management teams are experiencing.
Those management teams have built trust in us in that growing phase because we've come in and established baselines. We've helped them improve productivity. We've driven out waste in different areas of the organization. So now they're reengaging to take on that accelerated growth. Then in that harvesting phase, we are looking at what future buyers see and what they believe is going to add value for them on that acquisition of our portfolio network.
So, then we're able to go in from a larger scale and provide value to them on what's important to a large-scale buyer. Our cohorts play a huge role in these different phases. And in that, I would elaborate to just say, in every phase, the planting, the growing and the harvesting, we have Chief Operating Officers and VPs of operations that are in each of those phases.
So, the network effect that gets created in those meetings and we meet quarterly, all these groups come together to provide value for each other. So that network effect creates a lot of synergies. We share best practices throughout that network, and then it creates value in every phase along that path.
Anderson Williams: Are those stories and as that network effect happen, even across verticals and different industries?
Kevin Williams: Absolutely. I think regardless, if you're in a healthcare space, you're in business services, the industrials fund or food and beverage, there are similarities in each of those phases of growth. And everybody understands the accelerated piece of that.
We're the platform, and we're growing, and we're building a team. Now they're adding on, and they're bringing more companies into their network. And it's about culture, and it's about sharing best practices, and it's about process discipline to create that fundamental base that we're able to leverage and build this machine of growth.
And then in that harvesting phase, it's about how do we drive out waste, create efficiencies, and really drive the performance that we need to show that productivity that the buyer wants to see at exit.
Anderson Williams: So, Kevin, if I'm an early platform company that's new to the Shore portfolio, how do I find you to ask for help?
Or how do you find me? How does that process work early in the game?
Kevin Williams: So early on, there's two ways. The CEO or the deal team can reach out to us specifically and say, hey, we believe there's opportunity here because they're very in tune with what's going on in the day-to-day operations of the portfolio network.
But another method is during the hundred day plan we have our SRT organization in there with a very robust playbook. And they sometimes will call me in to do customer journey mapping or value stream mapping, which identifies opportunities in portfolio companies. In this specific example, there were some inefficiencies associated with the supply chain.
In managing the supply chain and just having risk associated with the supply chain. There weren't vendor scorecards, they didn't have redundant suppliers to basically account for raw materials components that there could be shortages in, or if there were disruptions in operations, so more about risk mitigation.
They brought me in, I was able to help them develop a supplier scorecard, identify and introduce them to other vendor networks that created a more robust supply chain. And drive efficiency gains and even drive a little productivity savings throughout their supply chain specifically.
Anderson Williams: This podcast was produced by Shore Capital Partners with story and narration by Anderson Williams. Recording and editing by Andrew Malone. Editing by Reel Audiobooks. Sound design, mixing, and mastering by Mark Galup of Reel Audiobooks.
Special thanks to Kevin Williams.
This podcast is the property of Shore Capital Partners, LLC. None of the content herein is investment advice, an offer of investment advisory services, nor a recommendation or offer relating to any security. See the terms of use page on the Shore Capital website for other important information.