GA 136 | How to Create Value with Michael Mindes

You're listening to episode 136 with Michael Mendez. Welcome to the Gemba Academy Podcast, the show that's focused on helping individuals and.

Companies achieve breakthrough results using the same continuous improvement principles leveraged by companies such.

As Toyota Del Monte and the U.S. department of Defense. And now, here's your host, Ron Pereira. Hey there. This is Ron Pereira with Gemba Academy, and I'd like to welcome you to another edition of the Gemba Academy podcast. As always, thank you so much for taking time out of your day and your week to listen to the show and for watching our lean and six sacred training videos over@gembaacademy.com we definitely appreciate each and every one of you. Now today, I'm excited to welcome Michael Mendez to the show. Now, Michael is founder and CEO of a company called Tasty Minstrel Games and tmg, as he the short version of that name. And Michael reached out to me on LinkedIn, said he's been listening to the podcast for a while, and he was really enjoyed the Don Scott episode, which was episode 132. Don is the runs a company called Buffalo Games. Jigsaw Puzzle Game. If you heard that episode, it was a pretty good one. And so Michael has been practicing lean for a few years and wanted to come on and share his story. And what we kind of really talked about was talked a little bit about their journey and how he first came to learn about it and so forth. But then we got into the topics of value and waste, and it was really interesting. Michael practices something called self organization, which maybe in lean speak, we would speak about autonomous teams and, you know, giving people autonomy to do their work. But Michael has a little bit different spin on it, and it was really fun to talk to. Super interesting guy says he doesn't like to be told what to do, and even telling himself what to do, he doesn't like that. So it was kind of interesting to. To have a conversation, but I think you're going to enjoy it. It's a little bit different than our other episodes, but I think you're going to like it. So show notes for this episode can be found over@gembapodcast.com just look for episode 136. Again, gembapodcast.com look for episode 136. All right, enough from me. Let's get to the show. All right, Michael, thanks for coming onto the show. Where are you calling in from?

Mountain Green, Utah Rural. Yeah.

Now where is that? Like, I used to spend a lot of time out in, like, Springville area and all that.

Okay, so Springville we are. Springville's right over by Provo.

Yeah.

So we're an hour north over by Ogden. We're just on the other side of the mountain.

I got it. I got it. All right, Miss Beautiful out there, though. I remember we used to. We used to fly into. Well, what was it? What was the airport by Springville that we'd fly into?

No clue.

Yeah, yeah. You flying down, all of a sudden you see these mountains and then like the airplanes, like, just swooping down by the mountains. My gosh, I'm gonna die.

Not a John Denver moment.

Yeah, right, exactly.

Yeah.

So anyhow, well, hey, thanks for coming onto the show. So let's kind of get started with you kind of telling us a little bit about your background and your company, which has a very, very cool name. So tell us about that.

Sure. Yeah. I'm a gamer. I've always been a gamer. I love games ever since I was five or so. Basically, as soon as I can remember and I went to college, I got a degree in philosophy. My wife and I, we were having our first child and I had the opportunity to go to work with my father, who worked as a financial advisor doing retirement planning, things like that. Having a child, I said, okay, this is a good job. I will be good at it, I will enjoy it, it'll be interesting, and I can be a responsible adult. Which took me a long time to come to that conclusion. I'll tell you what. So I went to work as a financial advisor. And throughout that time period, I just always wanted to do something with games. Despite my success and making more money than any 20 whatever year old, 24 year old can reasonably expect to make. And my wife said one of these times, she said, okay, enough of that. How about you do something about it? And I started publishing games. And in 2009, March of 2009 is when tasty Minstrel Games became a company.

So we're like Entrepreneur Brothers because March 2009 is when Gemba Academy launched.

Awesome.

So I couldn't imagine a worse time in our country's history to start a company. So it's like we were at the bottom, right? So it was only one way to go.

And I was. And I continued working as a financial advisor. But I had just gone through the experience of 2008 as someone trying to protect and help protect my. The people who depended on our advice. And it was. That was exhausting. Ultimately dealt with a lot of people who were aging. And at a young age, I Didn't like having everyone or a large percentage of the people that I liked dying or getting dementia and all of that. So that helped push me out too.

Okay, well, interesting. So tell us about Tasty Minstrel. Like, we just had Don Scott, as you know, on episode 132, Buffalo Games, making puzzles and whatnot. How do you relate to that kind of industry?

Okay, so they make puzzles. To me, mainly they're a puzzle company. They also make games that are more mass market. On the end. The games that we make are for gamer, really, really gamer geeks like myself. They are board games. They're not video games. But, you know, it's the kind of thing that if you're the type of person that says, hey, I really want to. I enjoy looking at spreadsheets and crunchy numbers because whatever the analysis gives me, whatever I need. And I like that. Yeah, we make games that are for people like that.

Got it.

So it's a relatively small audience, although small is still several hundred thousand people easily.

Yeah, yeah. Cool, cool, cool. All right, well, we're going to get into kind of your Lean journey here in a bit, but as you know, we like to start all of our shows with our guests giving a quote or two of something that possibly inspires mc. Do you have one?

I actually have two that I'd like to mention and they relate to my core belief that human dignity is important and that we gain human dignity through our work. You know, that the labor that we do connected to the value that it is connected to the result and understanding how those connect enable human dignity. And so these quotes relate to that. The first one is Albert Einstein. Everybody is a genius, but if you judge a fish by its ability to climb a tree, it'll live its life. It'll live its whole life believing that it is stupid. And then the second, also related, which is a paraphrase of Taiichi Ono, because I don't remember exactly what it said, only that which the customer pays for is value. All else is waste.

Yeah, well, hold on to that thought because I want to kind of get into the topic of value and waste here in a little bit, but great quotes, by the way. So let's get into your journey with Lean. And, you know, we've talked a little bit over email and whatnot, so I'm genuinely interested because I don't know the answers to these. Sometimes I already know, but I really don't know. So tell me, tell me about, I guess, your journey with your business and how Lean has, you know, played a part sure.

The pre Lean journey is my whole life and I have always thought differently. I even learning, I learn really well with ideas, I don't learn well with facts. And I implement those ideas from one area to a totally seemingly unrelated area. And the ideas that go into Lean have sort of always been a core part of me. And it wasn't until just about a year ago that I discovered that, hey, there have been people who've been struggling with trying to implement the ideas that I have in the core of me, and they have successfully done this and they've already done the thinking. And discovering this has brought my thinking in this area decades further along than it would have on its own. And so the reason I discovered it is because a podcast I was listening to about productivity, they mentioned that they use a Kanban board internally to help track where things are. And I hear this several times like, oh, okay, what? And eventually I just do my quick Wikipedia research and say, oh, what's a Kanban board? And I read about it and I discovered Taiichi Ono. And I look for a book. And so I go on Amazon, I'm looking at all the books in particular, it ended up being Toyota Production System. And because of the way this book was published or whatever, it's rather expensive to buy a new copy. It was like $40 or $50. I said, Whoa, I don't know if I want to spend 40 or $50 on a book. Let me make sure this is going to be valuable. So I start reading the reviews on Amazon and most of the reviews say, oh, this is pretty good. It's a lot of ideas and philosophy, but not a lot of reason or ways that you actually implement this. And I said, perfect. This is perfect for me.

Yeah.

Everybody's complaints. I said, oh, wonderful. And I bought a copy. And it turns out it's probably the second most important book I've ever read. Okay.

And the first being?

The first being the Book of Mormon.

Oh, got it. Okay, okay, got it, got it, got it. All right.

That's a whole nother story.

Yeah, exactly, exactly.

And then we moved on. I like the concept of a Kanban board because at tmg, I've had this concept that I don't want managers ever. And so having a method that we could track our entire production process and every item in it at any given time and everybody could know, could look in and see, oh, well, that's where that game is, would be important. We had identified our production process from the beginning where we receive a design and see if it's Something that we want to pursue publishing all the way through, developing that design to make it better, getting the artwork made, getting the manufacturing done, verifying that it's a game that we want to do because other people like it. If we sell out, it'll actually be financially viable. All these things, we had already identified these, but we were doing them piecemeal. And oh, hey, what about that game? Oh yeah, the thing that we forgot about for six weeks. Let's figure out where we are on that. Waste the time figuring out where we are and then move it several steps ahead really quick. And the Kanban just leveled all of that out. That's been the most impactful thing. That is different about TMG since we started as far as quantifiable, I suppose.

All right, so you recently published an article on LinkedIn. We'll link to it here in the show notes for this episode. But in the article you touched on several things, but you kind of opened with a little discussion on value. And so maybe, you know, most of the listeners here have a deep, lean, thinking background, so they kind of understand a little bit about value. But give us an example of what you mean by value, perhaps from your TMG's perspective. Like, how does TMG create value?

Yeah, the value that people get, that people pay for in relation to our games is the experience that they enjoy. And now that experience that they enjoy requires it, factually requires three things. It requires the materials, so the manufacturing, we pay to have it manufactured, that costs us X. That is not waste. There's the game design, how everything actually interlates and works together. And then there's the artwork which lets you visualize and interact with the materials per the game design. I was hard pressed to think of anything else that really the end consumer needs that we provide. It doesn't much matter. As long as they want the product, it doesn't much matter to them. Everything else, they get the same. They get the game, it's the highest quality that we can manage to produce and then they're happy. Or maybe they don't like it and they figure out something on secondary market. That's not up to me. But that's the value. And taking that way of looking at it is. It's like. It's like scary and makes you a little sick to the stomach maybe. Because think about everything else that we're doing to make that happen and be available.

So what about. No, I understand. We talked before the show started. You guys primarily outsource your manufacturing, right? So you guys don't do it internally. So what's your thoughts on just manufacturing? Let's say you had a puzzle making machine right there that stamped out puzzles or whatever it might be. How would you feel about that in a value perspective?

Right, I would. Well, that is, yeah, we would be able to improve the value and then we could turn that improved value into either reduced price.

Right.

Or we could turn that into more profits. I'm of the opinion that there's basically a price that any of these games that we make are worth and that's set by the marketplace. Because of our experience, we can say, oh, we understand that this game, the retail cost should be $60 or the retail cost of this game should be $40. We identify that and say, okay, that's okay. Anything that we can reduce, all of the other things that just goes to profit, the price is basically set by the marketplace. I know it kind of didn't answer the question.

No, you did. The reason I like kind of the Traditional Lean Training 101. What we from like a manufacturing perspective that for something to be value added, three things must exist. Number one, customer must be willing to pay for it. Number two, the thing must change. And then number three must be done right the first time. Not always in that order. But that's a gist of it from like a manufacturing. Because, oh, obviously in a manufacturing environment you could have lots of things that aren't value added. Right. Moving it around the factory or, you know, tons of motion or whatever. So. But I like where you went. You know, materials, game design, artwork, you know, those are what you, you yourself impact. And so I think that's a great way. And yeah, I can't think of anything else. Right. Like I'm imagining like I make games for gamers, you know, like what else could you be doing besides those things?

So with that and on the, on the manufacturing side, part of what I think your question was getting at maybe a little bit is if we had these things, would we go about manufacturing them ourselves? And at this point in time, I don't think that we would because of our relationship with the manufacturer. They make super high quality stuff. If we say, hey, we think that this would be a better way to do this, sure. Then they will look at that and say, yeah, thanks for that. And at this point in time, eight or nine years into doing this, learning manufacturing is not a good idea. I think.

No, I think that's really cool that you've identified kind of your core competency. Right. Like what it is that you're good at, what you're passionate about and you're sticking to it and if it's working, you know, good on you. Right. So yeah, there's, you know, Apple, you know, does a little outsourcing, right. And they're doing okay, you know, so. But yeah, okay, well, so we talked a little bit about value, right? So how you guys create it, but let's flip it around. So, like, is everything else waste, including, I don't know, managers running around or whatever? Like, talk about that?

Yeah. If we want to really hold on to the idea that only what the customer is willing to pay for is value and then all else is waste, if we really want to hold on to that, we have to hold on to it and it makes sense. Right. If we can get the product delivered to the customer and they still want it, and it didn't require Sally the manager who is telling people what to do and holding them accountable to their specific metrics, then the customer doesn't have. It doesn't affect them at all. And so as long as we're going to hold on to that, then, yeah, all that is waste. And I think one of the conceptions associated with Lean is that we want to get to know waste. And I think getting to know waste is like trying to become perfect. It's not going to happen. It's the journey towards that and you can make steps towards that. But yeah, all the other stuff I think is waste. And so I try really hard to not bring it in or look at things as a net. Net sort of situation. Yes. Sally the manager, everything that she does might be waste. But if we didn't have Sally the manager, would we have more waste instead? And that is a difficult question to answer. And in trying to answer it, I'm sure I've made. Well, I know I've made tons of mistakes. Yeah.

Yeah. So. All right, well, in that same article, then you kind of, after you talked about value and you talked about waste, you then kind of introduced a phrase, a self organization. And so.

Or.

Or, you know, or self organizing, if you will. So talk to me about that. What does it mean to be self organized or self organization?

Yeah, and that, that self organization comes from a. A deep something with me where I don't like being told what to do. I want to do what I want, I don't want to, and how I want to do it. I don't like being told what to do. And on some level I think everybody has that, but I have it so much that I don't even like it. When I previous Me told today me right now, me what to do.

Okay.

Oh hey Michael. Yeah, by the way, tomorrow you need to do this. I look at that and I go, yesterday me is a jerk sort of situation. And so I try to keep management out. And to me, the way that looks or I described it is self organization. So enabling, empowering everybody and building the total process, the total system such that as opposed to having one manager per X number of employees per 10 employees or something like that, you distribute that same sort of management responsibility among all the others, among everybody. And so in our example, we have somebody who wants to sell the games to the distributor who is then going to sell to retailers. But once we sell to the distributor, it's mostly out of our hands. And if that person is doing their work, they're making their sales calls, they have the relationships with distributors so they can sell all of a sudden or not all of a sudden, he looks and he sees, okay, this is what's coming along. I can talk to him about selling this. And it's right there on the KAN mod board. Oh, there's nothing coming along. What's going on here? And he'll go to the person doing the manufacturing or directly to the person doing the product development and say, why don't we have games for me to sell? The interrelated nature of that helps to self organize. Having people who are passionate about what they're doing, they understand that it's the responsibility of everybody working to make sure that we have enough profitable revenues to pay everybody. Right. And they're not just passionate about being able to eat. And it's what I say in here. It's hard, it's hard to do. And I made tons of mistakes throughout. We're much better about it. But the first person I hired other than myself to help with like business process was in January of 2014. He came in for his first day, January 1, and he said, okay, what do I do? And I said, I don't know. I've never had someone doing stuff here. Here's something, go and figure it out. That's what I said. And I basically said that for the next week or. And then one time I said, okay, here is access to my email. Just go through, see if there's anything you feel like you can answer. If you have any questions, ask me. And it was just always that it was here. I've thrown you in the water. Swim. If you feel like you're drowning, let me know, I'll help you. Now I understand there are better ways to go about that, but that's how it started.

So I mean, in lean speak, what you're describing is very similar to the concept of what we'd say, autonomous teams, right. Where team members are given full authority, full power to perhaps profit and loss responsibility even for their particular value stream. So a group of people might come together and they used to have a supervisor or manager who now really more acts as a coach. It's not that they disappear, but you know, the, the day to day responsibilities are up to the team members. So it sounds similar to what you're describing there.

Absolutely.

So I guess the challenge that I've always seen and we even experience it here at Gitma Academy was as we work really hard to, you know, give, give everyone autonomy and freedom to kind of do their work. But you know, Elaine has been with us Gambia Academy for, gosh, I don't know, five, almost six years now. And she tells a story how early on she would come to me and she'd say, Ron, I'm struggling with such and such and what should I do? And then my answer was always, well, I don't know, what do you think? You know, And I would put it back on her and she would tell me, you know, it really, sometimes it just ticked her off. She just wanted to be told what to do. Right?

Yeah.

And I've seen how hard it is to, to give autonomy, but also sometimes it's hard to just receive autonomy. So I'm curious, have you struggled with that?

Oh, absolutely, of course. I don't know if it's something within us or it's training from being in the more traditional system, but yeah, that is difficult. In my experience, one thing that works and you have to also, in my experience, it's like repeating it all the time. And it takes about, at this point in time, I think it takes maybe three months, three to six months for it really to sink in. And that's the concept of, well, what you do is important. 99.9% of anything you choose to do will not break this company. If it's wrong, I count on you to understand that it was wrong and to fix it. If you have questions, you talk to me, you talk to someone else. You know, other people have been here for a while and just that understand that safety, that it's okay. The best way you're going to learn in some ways is for you to figure it out and you're not going to lose your job for this. I'm not going to be upset. I think in a lot of ways it Takes very particular kind of special person to both be on the receiving end of that and the giving end of that. Yeah, but it's. Yeah, it's tough. It's absolutely one of the hardest things. The other difficult thing in my experience is hire a new person and say, okay, you're in charge of customer service. Now what that means is if you look at it, want to look at it this way, you have the most authority in this company to change things. More so than me. I have political authority because I'm the CEO, I am the largest shareholder. Right. People will listen to me if I say something. But you as the customer service representative are interacting with the customer on a regular basis. You are the person who knows what we need to do to provide more value. And therefore you have the power. You're the last process. Right. The last process gets, you know, the later process gets to dictate to the previous process. Hey, this isn't working for me.

Right.

How are we going to fix this?

Right, right. Good. Got it. So when we talk about self organization, in your article, you kind of pointed out a few specific items or things, if you will, that organization should consider talk through those.

Oh, you mean like the clarity and inspiration authority. So clarity, that's one of the biggest problems that we have getting. Every individual will need to have a deep understanding of why the company operates, why we're doing what we're doing and who we're doing it for. And then their authority, you know, where their responsibility is. And then also understanding who the best people are to potentially go to for assistance, inspiration. It's easy for me because we make board games. I go out and I hire the same gamer geeks who buy the games that we have. So at some level, it's super easy for me to inspire. Maybe a manufacturing plant that's making packaging materials in a lot of ways is super hard. It's not that inspiring. I mean, maybe someone deep down in them is a germaphobe. And so packaging materials are like, oh, this is, this is what I'm really inspired about. But it's a smaller group of people, I think.

Whereas like me, I'm not a gamer. I have never gotten into it. So yeah, if I got hired at your company, I'd probably be like, hey, what's the point here? You know, like, so to your point, you got to find the right mix, right? So you got to. Yeah, so I think that makes a lot of sense.

The authority to act autonomously. We talked about that. If someone doesn't actually have the authority to act in their space and they have to go to someone else to get permission, then that other person might as well be a manager. And that's what I'm trying to avoid. So autonomy and authority to act is super important. Those three are the most key I think based on my experience doing this thus far. Additionally, I think.

Oh yeah, so it's clarity, inspiration and autonomy is that those are the three.

The authority to act autonomously.

Okay. The authority to act autonomously. Yeah.

But yeah, autonomy combined with the authority.

Yeah, got it.

Additionally, I think these items are important, but if you don't have those first three, it's. You might as well not even bother to try. I think these items caring community inside of the organization here at tmg. Thankfully we all happen to like each other. We care about what happens to each other and that makes that easy. I haven't tried this in an organization that doesn't have that, but I think that's pretty important. It makes it a lot easier to come to somebody else and say, you know, I just, maybe I'm an idiot, but I'm having trouble with this. And they'll say, well yeah, you kind of are an idiot, but I like you anyways. I mean that's, that's the way it works here.

Yeah.

The interrelated work. So someone upstream already identified that someone downstream has been slacking off for a couple of weeks. That's where. Yeah, that's a problem with self organization which is why you, you need the inspiration. But still having that dispersal, distribution of management type responsibilities, coaching. If you're going to count on everyone to do what they think is best, probably good to help them figure out how to be better at doing that. Hand in hand. People development the flexibility of workers to work on multiple things. One of the things I liked most reading Toyota production system was the idea of taking these machines which are all operating at their capacity at different rates and instead of doing that and having a worker to work each machine and then a worker to work the warehouse where all the surplus parts go to. You train all of those workers such that they know how to operate each machine and then you have them work in unison to make the one thing that you need in enough time for you to utilize it. I like that idea. And in a way that I, every time I do it, I think of myself. I try to be careful about how I think about this. But if I think as people, as machines, that's a bad idea because they're valuable, they're people, they're not machines, they're very different. But if you think about people in that way and the flexibility to work since again I'm not dealing with machines. It's super helpful if the person who's doing sales here at TMG also knows how to handle all the customer service, also knows how to help with product development, also knows how to do these different things. So that way if we're looking at a leveling of workload, it's not going to be level because we have enough sales activity every single day for you to do sales activities every single day for the rest of your life. It's yeah, no, we need sales activities now, but here we need some product development. I think that flexibility is, is critical to a self organization. One of the things that I think is important here is that we don't say oh that's not my job. Yeah, that's the quickest way to get into trouble, maybe one of the only ways. And then the safety from judgment or termination if you do something wrong. Right, right, right.

So the last question I have for you Michael is so we've talked a lot about value, talked a lot about management's role and value or lack thereof in some cases. So what about you, the CEO of your company, how do you add value?

I don't, I absolutely do not. As a, from the, from the. Well, I shouldn't say I absolutely do not because I do participate in some of the game development stuff. Other than that I don't add any value that is associated with our games. Now I gloss over it in the article, but I believe that there are two ways that a customer can pay for something. They can pay for content with their attention so that we gain brand loyalty and awareness and all of that and that attention can later lead to sales. So the only way that I add value potentially is by publishing meaningful content that could grow our total volume of sales over time.

But what about, what about I will push back on you a little bit. Maybe you're being too hard on yourself. What about, you know, do you have a vision for your company? Like where do you want to be in five years? Or do you just think about today and maybe tomorrow?

Absolutely. Well, the, the reason that TMG does what it does is that we want to do what's right for the gamer. And what that means is number one, we hire gamers so they have an inherent understanding of that. But we price things right. We try to make the highest quality games that we can in materials and game design and art work. We don't go about price fixing schemes that restrict Where a gamer can buy something from. I mean, I do that. I communicate internally about those sort of things. But ultimately I'm not adding value that you talked about. I might reduce. We might have more waste if I wasn't here. It's the less waste versus more waste argument. But in some respects, as the person who started it and 100%, well, me and my wife, 100% shareholder, I kind of get to do that.

Yeah, no, I got you politically at least.

And it's definitely something I struggle with internally because I see everyone else, you know, diligently working, which is what, as I mentioned, I don't do well when people tell me what to do, even when it's myself. Yeah. So. But everyone else, they are good at sticking to what needs to be done, whereas I'm all over the place.

Yeah. Yeah, I gotcha.

Very good.

Very good. All right, well, this has been fun. Been very different, but I've really enjoyed it. Michael. So how can people connect with you?

Well, right now the best way is on LinkedIn. It's Michael Mindis M I N D as in David Es. And people can connect with me there.

What's your website? Company website.

Company website is playtmg.com and it is something that is being improved right now because it is horrible. Okay. It goes back to our more. We tried to make it better in a waterfall sort of setting as opposed to iterative. And that waterfall improvement has been going on for a couple of years.

Yeah.

Our website is mostly non functional.

You need to call up our friends, Menlo Innovations, Richard Sheridan, he wrote a great book called Joy Inc. And they're a software house down in Ann Arbor, Michigan. They're pretty awesome, so check them out.

Yeah, I heard the episode. Yeah.

Yeah. Pretty cool. Pretty cool. All right, well, good stuff, Michael. I really enjoyed it. So perhaps we'll meet up face to face one day at a conference or something like that. And if you're ever in the Dallas Fort Worth area, definitely look us up.

Okay, will do.

All right.

Yeah. Amy, in 2018, it's supposed to be in San Diego, so that sounds great to me.

Well, Boston next year. Come on, man. You need to be in Boston 2017. That's where you need to be.

Yeah, well, we'll see how that goes.

I'm not telling you what to do, of course, you know I would never do that.

Right. The issue is if. If we go to Ame, I want to bring is like maybe everybody. And San Diego, I have access to free lodging.

Yeah.

And I gotcha. And that makes it a lot more cost effective, I hear.

Yeah, I hear you. All right. All right, Michael, listen, I appreciate it. And you be well.

Thanks, Ron. Appreciate it. Have a good one.

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