GA 639 | Putting the Customer First with Slaytor Baldwin

we reduced our changeover time in the cell from 3.5 hours to 9 minutes, all while increasing our throughput by 42%. And what I didn't expect to come of that was it worked so well for us that our plan to implement everything into a cellular format over the next year got truncated to 3 months because there was just a conviction that we have to do it this way now.

Today I am excited to welcome Slater Baldwin to the show. Now, today's a great episode, folks, I mean, I'm biased, it's, you know, Gemba Academy podcast, so I think they're all great, but man, this one really is good. So, Slater works for a company called SilencerCo, and so they make silencers for firearms. And they're on their lean journey, so they're pretty new, really, as you'll hear. They've been at it for a little over a year now. Slater's got some prior experience, and so he sort of led the charge here for them on this journey. But what we do is we sort of just walk through what it's like for a company to to begin and where they are now. And man, and as you'll hear, they've made some staggering improvements with respect to things like inventory turns and even just as you'll hear, just like employee morale and just the pride that they have in the work that they're doing. But it wasn't easy, you know, there was some resistance at the beginning, like many of us experienced. So anyhow, it's a fantastic episode. Listen to this one all the way through and show notes are going to be found over at Gemba .com. This is episode 639. Again, gembapodcast.com, look for episode 639. Okay, enough for me, let's get to the show. Slater, welcome to the show. How's it going?

Great, Ron, thank you for having me this morning.

Yeah, man, my pleasure. Where are you calling in from?

Calling in from Salem, Utah.

Salem, Utah. All right, beautiful part of the country. So, all right. Well, hey, man, I'm excited for today's episode. And Slater, as you know, we like to begin all of our episodes with our guest sharing a quote. So, what do you got?

So, right now, the quote that's most relevant in my life that stands out, and I'd be shocked if you haven't heard it before, is, "The impediment to action advances action. What stands in the way becomes the way." Marcus Aurelius.

Yep. Yep. That's a life-changing quote and book and everything else in between, man. So yeah, Mr. Aurelius had it way ahead of his time, wouldn't he?

Yeah, absolutely.

Yeah. Yeah. Yeah. Good stuff. Good stuff. All right. Well, hey, man, again, I'm excited to have you on the show. We had— listeners don't know, but we had some technical issues earlier on. So thank you for sticking with us there, Slater, and being patient. So we're recording this on a Monday, actually. Episodes come out later in the week. But, but, but yeah, typical Monday morning, right?

Yes, sir.

All right. Well, hey, Slater, tell us a little bit about yourself. Tell us about your background and, and all that good stuff.

Yeah. So my name again, Slater Baldwin. I grew up in Payson, Utah, a small town in Utah County. I started my career in manufacturing straight out of high school. My first role was with U.S. Synthetic, a remarkable company in Orem, Utah, that was already very deep into their lean journey when I walked through the door. Looking back, I couldn't have asked for a better foundation. I just didn't know it at the time. But as a young kid fresh off the high school graduation stage, I was handed lean training and dropped into a cellularized production environment on day one. And my reaction was like, well, why are they selling this? This just kind of makes sense. And so starting my career that way, that, you know, that instinct that lean isn't a complicated overlay on top of work, but the intelligent way work should be designed, has kind of stuck with me. So during my time at US Synthetic, I had the privilege of participating in multiple Kaizen events, which gave me the thing that no classroom can fully replicate, right, which is, you know, applying the principle in real time on real problems with real stakes. In 2019, I began kind of pursuing the Six Sigma world and found a deep passion for that discipline, particularly the way it uses quality science and statistical thinking to shift from a reactive quality policy to predicting and preventing defects. And then in 2020, I joined with SilencerCo and I've had the incredible opportunity to grow into my current role as Director of Operations. And it's been a position that's put everything I've learned over the years as far as, you know, Lean, Six Sigma, culture change, supply chain, leadership into practice every single day. And having the opportunity to lead this lean journey for SilencerCo is, you know, it's not just a responsibility given my position, but it's a genuine calling and I'm super excited about what we're doing.

Yeah. Yeah. So tell us a little bit about SilencerCo. What do you guys do?

So SilencerCo is a suppressor manufacturer for firearms here in West Valley, Utah. Currently the biggest in the market. And been around since 2008, seen a lot of highs and lows, seen a lot of change, and we're just really trying to cement ourselves as the strongest brand in this industry.

So talk a little bit about the, I guess, the lean journey there. Maybe I'm curious, like, how was it when you first stepped in day one?

So when I first stepped in, all I saw coming from a lean company was opportunity everywhere. Okay. To give you an idea of kind of our methodology is we ran based off of resources being active meant the company was healthy, right? So we didn't care if we were making the right parts per se at the right time. It was if the spindles are on, we're doing good. And in doing so, we really failed our customers in a lot of ways for a long time by not building what they actually wanted, chasing kind of, you know, arbitrary dollar targets and just making sure that equipment and people were staying utilized, kind of put us in a predicament as far as understanding what our true demand is, putting us into an even bloated inventory position and many other things. That, uh, were a little bit dysfunctional. Um, but the, the overall problem— this is, this is how I see the world, um— is that we just viewed the— we viewed the business as dollars first, not customers first. And the biggest change that I think we've made that's allowed us to start going down this path is we speak in terms of units because that's what the customer wants.

Yeah, it's been my experience, and I'm sure maybe you agree that the irony of it is, is when you do put the customer first, the money actually comes in buckets, right? You know? Yep.

100%. And, you know, and that's what I was kind of alluding to is we didn't understand our demand because we'd throw out, we want X million dollars. And it's like, okay, well, We'll go chase that. You know, the ironic thing about metrics that I've learned over the years is they will drive action. So you've got to make sure they're right.

Yeah. Yeah, for sure. For sure. All right. So I'm curious, so when they hired you, did they hire you as a sort of lean expert, change agent, or was it— were you hired for something else?

No. So when I first started there, I was actually hired as the quality assurance engineer. Okay. But it was quickly recognized at the time that I had a little bit more skill, and I started overseeing the continuous improvement group while overseeing quality.

But they did have a continuous improvement group?

Well, I created it. Yeah.

Yeah.

It was to help spread the knowledge, and we did some Kaizen events, and it was great. But one thing I found really fast was You know, if you don't have alignment at the highest level, you can only go so far. And that was, that was my biggest challenge with a lot of these initiatives in the early days of my time with SilencerCo.

So I guess that was going to be my next question then, is like, how was the top-level support, you know, um, when you were in those early days trying to get things going from a continuous improvement perspective?

Um, there was just no true commitment. So, the genuine feeling that I have is we would talk about it and it was like, yeah, this sounds like a great idea. And here are some of the obstacles and challenges given our industry or given our processes or whatever. But everyone was just too afraid to feel the pain. I think, you know, there was too much at risk as far as how the leadership at the as SilencerCo at that time saw the world. And so we never, we never had the opportunity to really bite off on it until about a year ago, which is, which was quite a fun transition.

So what changed? Was it like literally people changed, or— yep, so hearts open, minds open, combination?

Yeah, so that's what was fun. So when I started there 5 years ago, we started doing training. We, you know, we did Lean fundamentals training. I led a Six Sigma training, um, and we're always talking about how, how do we get to this next step and how does this apply to us. And, uh, we just could— again, we could never really get through that top layer where we really needed that help. And, and last year they, they appointed, uh, Scott Klinger as president of SilencerCo, who was, um, the director of sales before being promoted to president. And, you know, me and him go a few years back as far as, you know, reading The Goal by Elijah Goldratt, and we're like, man, why don't we just do it this way? And so he came in and he was like, I want to do this and I want your help. I want to do it for real, man. I was like, okay, it's, it's going to be a big change. And he was like, let's do it, you know, and And he kind of formally kicked off that we are going to do this, and this is going to be the way that we operate with a customer-first mentality. And we need to get our value creators as connected to, uh, the customers as possible, and this is how we do it. And it's been off to the races ever since.

So what were those first— I don't know, what was the first month after that point of, all right, you and your top leadership are committed to this? Like, what did you do?

So the first steps for us was really two things. One, we implemented an executive S&OP process to start again talking about the customer demand and units, but understanding the financial impact, right?

Money is to sales and operation planning, right? To make sure everybody's on the same page.

Yes.

Yeah.

Okay.

Yeah, yeah. So money is obviously the economic engine that keeps any business running. We're not naive about that, but what we change is how we talk about demand. We basically convert our demand targets into dollarized figures and then planned around the customer need in units. The conversation starts with the customer, not the P&L like it used to. So that was okay. That was really step one. And step two, which was happening in tandem, was designing cells, right? The whole operations format before this was departmental. Right? Everything was running at max utilization, um, big inventory, and it was how do we create value streams, how do we create cells. So those were the first two major steps as far as, yeah, we're going to commit to make this change.

When was this again? Sorry, I know you said, but no, you're good.

It was, uh, May of last year.

May of last year.

Okay, so you're about 12 months in.

Okay. So about 12 months in. Talk a little bit about the, I don't know, how many people work in there, if you're allowed to say?

Yes. Currently on the operations side, we have 253 people.

Okay. And what was the, I don't know, the reaction of the folks out there on the Gemba doing the work? Were they excited? Were they resistant? Combination?

Yeah, given our past, it was, it was an interesting, uh, headspace for a lot of those folks because we had, like I mentioned earlier, we've talked about this before but never really did it for real. And so for a lot of the old-timers, because there's a lot of folks that have been there for 10 years plus that are on the floor still that just love what we do, they were kind of just waiting to see, is this real this time? And, and then there was also, you know, some skepticism on if we could pull it off. So a lot of folks kind of found themselves in this, well, we're going to wait and see what happens, which is why we were very, we were very deliberate about what product family we chose to cellularize first, which was our heart, which was our most challenging. To not to nerd out too much, I apologize, I get, I can get rolling. Yeah, we decided to start with our titanium suppressors. Titanium is notoriously difficult to machine, tight tolerances, and our particular components are thin wall condition that does not forgive any mistakes. And, uh, so there was a lot of skepticism that we couldn't pull it off. And, you know, in those beginning phases of designing cells, you know, we started by balancing resources to the actual customer demand, identified part families to enable SMED. And, uh, the results were dramatic. We reduced our changeover time in the cell from 3.5 hours to 9 minutes.

Wow.

All while increasing our throughput by 42%. And what I didn't expect to come of that was it worked so well for us that our plan to implement everything into a cellular format over the next year got truncated to 3 months because there was just a conviction that we have to do it this way now. Which was a huge win, but a huge undertaking at the same time.

What was it like seeing— or let me ask you this. What did it feel like when you got that, those early wins? What did that feel like?

For me, it felt just like I could finally breathe fully. Like I finally took a full exhale when it came to how I saw the world and knowing that it was working and seeing that You know, these machinists who were connected to a component, they were given a build this many components in a day to this many suppressors are leaving my factory, and I know that that's what my customer wants. I just felt super proud. I'm like, the people that do the work are connected to what the customer wants. This is all we've ever wanted, and this, this is a huge step in the right direction. Um, the other thing that made me super happy is part of creating the cell. So forgive me, I'm going to give you a little more detail. Was we had to eliminate some batch processes. So before it was the machine shop made components, they all got funneled in, they got prepped for welding, and they all got injected at a welder. And so when we designed this cell, we got rid of our giant Ransohoff batch washing machine. We got inline ultrasonics, moved the welder into the cell with the CNC machines, and so that we can produce all out of the same team, out of the same shift, and we're looking at suppressors, not components. The fun thing for me personally was just in implementing a cell over in our titanium suppressor line, we reduced our scrap by 60%, um, overall throughout the value stream. That's not the impressive part. The impressive part is now scrap hurts worse, even though we're that much better because they scrap one component and they can't make a suppressor. Everybody feels it. And so what I love is because they're that connected and we've lowered the water that much, they feel the pain and they react to it and they, they take it personal. And I, and I love that, right? My customer needs this and I just made a bad one. So I'm going to stagger my break and. They're making decisions in the best interest of the customer, which is awesome. Meanwhile, you know, on the finance side, we're like, wow, our scrap looks amazing. But they, it hurts them more than ever because they can't hide behind inventory.

Mm-hmm.

Mm-hmm.

Yeah. So I don't know how much you can get into your numbers and all that, but I'm curious, like talking about like inventory turns, like what was it like 3 years ago, what's it like now kind of thing?

Yeah, I'd love to share. Um, now, so we're 6 months in, fully cellularized now across the entire factory. Our target for inventory turns when I first stepped into this role was 3, and we thought it was aggressive going to 4. And as of today, year to date, we're at 6.2.

Oh my God.

Yeah.

Wow.

Yeah, it's pretty incredible.

So if someone's listening and they're not quite sure what we're talking about with 6.2 inventory turns, talk a little bit more, like explain it. What does that really mean?

Yeah, let me just talk in terms of dollars because I've got the go-ahead to do that. So a year ago, SilencerCo, in order to generate $8 million of revenue, in a month, we had to carry $20 to $23 million of total inventory. Okay, for context, today we're carrying $12 to do $14, and that's— that's been flat all year. So there's a lot less tied up cash, um, our flow velocity has improved dramatically. And so We just have a lot more freedom with our dollars to expand and further help serve our customers.

Now I know you're real early on the journey, so am I correct in assuming that your, maybe like your financial systems still are kind of more on the traditional side and haven't quite gotten to what we would call sort of like a lean finance kind of approach?

Yes, 100%.

Okay, not to knock on your cash, I'm not trying to, you know.

No, no, I know I have to play that game very carefully myself. As far as choosing my words carefully when we talk about those things. Yeah. Yeah. And that was actually one thing I was—

Yeah, less assets right now, you know what I mean?

Yeah.

Yeah.

And that was one thing I wanted to talk about is that I've learned is as I've grown from operator to where I'm at now, I've always kind of looked through the lens of Lean as an operations game. And what I've learned is it's not. These initiatives have deep ripple effects across supply chain, finance, sales, and even marketing. And when operations makes changes without buy-in from the broader organization, you create friction. Ask me how I know. And that tension, like you're suggesting, is most acute with finance and supply chain, from traditional cost accounting metrics to forecast-driven purchasing models, and that can undermine the flow you're trying to create.

So, so what's your strategy? I mean, I'm sure you're not all the way there yet or whatever, like, what's the plan? Like, how are we working to, to get everybody singing from the same hymnal, so to speak?

Yeah, so right now, um, it's, it's pretty great as far as the executive leadership group goes, we've kind of got a book club. So, we're trying to read because a lot of us are new. I'm a sample size of 1 as far as my exposure to a lean transformation in my past life. And a lot of the other team members haven't done it yet. And so, we have a book club and we constantly ask ourselves, how do we apply this? And, you know, going back to the accounting one, we read Who's Counting? The Lean Accounting Business Novel, and I think that one was, was huge for the supply chain and finance team to start aligning those metrics with what we're actually trying to do. So, I guess, pivot onto that, that's really our next step. So, we want to extend what we're doing outside of our walls. Is kind of where we're at. The beauty of, uh, where we're at as far as the executive team goes is the operations drum is beating. We've got the cells in place, we've got systems in place to, you know, monitor, react, and improve as needed. And so we're trying to look into out months and apply this to, um, you know, supply chain. How do we get consumption-based purchasing so I don't blow inventory, gap on something else, or do both at the same time because my products are wrong. And we— and, and then the, uh, conversely is how do I extend that to distribution? Because I don't— you know, we don't sell directly to an end user, and so we're right in the middle of this giant, you know, value chain.

Yeah.

And so understanding the true customer demand is challenging and there's noise in that signal. And so we want to get as close to that as possible on both ends, help our distribution partners be more successful and help our suppliers be more successful and go away from transactional, you know, relationships to a partnership.

Mm-hmm. Have you guys worked through the book All I Need to Know About Manufacturing I Learned in Joe's Garage?

No, we have not.

Yeah, you should check that one out. It's a classic. Yeah, all that was— all I need to know about manufacturing I learned in Joe's Garage. It's, uh, it's a short read, but it's, uh, it's fantastic, man. Um, it was one of the first books that I ever read, uh, many, many, many years ago. So yeah, really good. Um, man, um, this is such a cool story. Um, I'm gonna have you back on, uh, Monday. We're gonna just book it, man, like 6 months from now. I want to, I want follow your journey, man, if you're open to it, man, just to see what you guys have been learning along the way. And it's super exciting just to hear stories like this. I'm wondering, maybe if someone's listening right now and they are, they are also maybe right at the beginning or haven't even started, they're worried, they're nervous. Like, what advice do you have for those types of folks who are just at the cusp of getting going with this?

So, this is my opinion and preference.

Okay.

But it's, Lean is not a template. It is a culture. And I know that that sounds cheesy and you've heard that in every PowerPoint presentation you've ever seen, but it is the reality. You can't just hand someone a toolkit and expect transformation. You have to create an experience that shifts beliefs at the value creation level. And without that buy-in, the gains just won't stick. Yeah. And so my recommendation is to be very deliberate, very strategic about where you start, and pick a product family or area that is genuinely challenging, not an easy win. When people see Lean principles succeed in your hardest environment, creates a conviction that no training ever could. So my recommendation is be very careful about your first project and execution of that first project is everything. Yeah.

So speaking of the next 6 months, what's next for you guys? Like what's on the docket for your transformation?

I kind of touched on it a little bit already, but our biggest focus right now is supply chain. And getting onto that consumption-based purchasing cadence. There's some other projects that we're working that kind of go hand in hand with supply chains, such as consumables, purchasing consumables. Right now we have, and we've been doing it forever, is we have managers just manage Loctite and rubber bands and what have you, and they do purchase orders, and then our purchasing team goes through that whole process. And so in tandem with consumption-based function-based purchasing on raw materials and purchase components. We want to get a system implemented to autonomously purchase our consumables for every given area so they can do less PO entry and just, I consumed a thing, I scanned it, drafted a PO, onto the next.

You guys, you have any of those vending machines? You know what I'm talking about?

Yeah, and that's actually been my business case to try and implement this at a broader scope is we, yeah, for our CNC machines, we have MSC. It's just vendor-managed inventory. We pull an insert and they stock it. And so it's how do we do that everywhere and eliminate a lot of the waste? 'Cause I don't want my leaders buying product. I want them building their people and sharing their culture.

Right. Oh man, fantastic, man. This has been a great conversation and it's exhilarating really just to see folks that are, kind of getting going and, and, uh, just the, the, the excitement in here. I can feel it. I haven't even been in your facility. So well done, man. Well done.

Yeah, thanks. Yeah, that's a big reason I really wanted to come and share some of our, our story with, with everybody that listens, is it's applicable everywhere. You know, we get a lot of, uh, questions because we're in the firearms industry and we're suppressors, which you're even more regulated. And the reality is Everyone has rules they have to play within, and you find what works for you.

Do you have any sort of like, I don't know, final words of wisdom, um, or some maybe some parting advice that you want to leave for the listeners?

Oh man, there's a lot. I nerd out on this stuff. I'll, I'll keep it, uh, summarized as possible, but the most important thing I can tell anyone standing at the beginning of their journey is just take the next step, not the perfect one, not the next, or just the next one. Analysis paralysis is one of the greatest threats to a transformation. And at some point, the whiteboard has to give way to the shop floor. You've got to go do it. You've got to be out there. You've got to see it. So, run the pilot, pick your hardest problem, put your best people on it, and go. And a well-scoped pilot is your proof of concept, and it's where theory meets reality. And where your culture begins to shift or shows you exactly what still needs to change. And, uh, you know, don't be afraid to fail. Just fail forward. Failure in a lean environment isn't a setback, it's just data.

Yeah.

And every failed experiment narrows the gap between where you are and where you need to be.

Exactly. Learn your way forward, right?

Yep, exactly. And then, and then ensure every gap along the way is filled with knowledge. You know, you're gonna find gaps whether it's going through a transformation or just monitoring your KPIs that are business as normal. Just ensure your gaps are filled with knowledge and then close it with an actual root cause solution and don't create, you know, Band-Aids that make that problem harder for you to solve tomorrow.

Yeah, yeah.

And I guess the last thing I would say is most decisions in an organization are a two-way door. I know Jeff Bezos popularized that, but I think it's super important, especially in, in our world. There's, there's always apprehension because it's, you know, a famous quote in SilencerCo 5 years ago was, "Don't fall on your sword." It was like, "I'm gonna let you try this, but if it fails, you're gone." And the reality is, is no, no business is that vulnerable. And, and if it is, they're not going to make it anyway, in my opinion. Mm-hmm. So don't be afraid to try, and don't be afraid to push that onto your people, to let them try. And, you know, don't give them a one-way door, but anytime there's an opportunity for there to be a two-way door and learn and experiment, give your folks the opportunity to go and do that and to learn from it and support them.

Fantastic. Hey, Slater, if folks folks wanted to connect with you personally, what's the best way? LinkedIn? Some other way?

Yeah, LinkedIn is great. I'm trying to be more active, uh, these days.

So, okay, all right, well, we'll get, we'll get everything linked up in the show notes. But, uh, but again, man, hey, thanks for coming on. This has been fantastic. And, uh, again, I'm gonna tell Greg, put it on the calendar, man, and in 6 months to go check in with, with Slater and see what's up.

Perfect. I look forward to it. Now, thank you, Ron. I appreciate you taking time this morning.

All right, man, take care. Thanks.

You too. We'll see ya.

Thanks for joining us today. We know the path to continuous improvement can be challenging to walk alone. That's why Gemba Academy exists, not just to provide training, but to be your partner in problem solving. Whether you're just taking your first steps or leading a global transformation, our goal is to help you bridge the gap between knowing learning and doing. Beyond our library of Lean and Six Sigma resources, we're here to coach and guide you through your journey, whether that's through personalized support or joining us for a live training to get that immersive, hands-on experience. To learn more, go to gembaacademy.com.