The Revolution of Efficiency in Manufacturing with Andrea Dallan

Contact Andrea Dallan

Email: Andrea.Dallan@dallan.com

Website: www.dallan.com

LinkedIn: https://www.linkedin.com/in/andreadallan/

Get "The Revolution of Efficiency" book here

Lisa Ryan: Hey, it's Lisa Ryan. Welcome to the Manufacturers' Network Podcast. I'm excited to introduce you to our guest today Andrea Dallan. Andrea is an engineer entrepreneur and CEO of Dallan Spa, an Italian family business producing systems for the processing sheet metal since 1978.

With 160 employees, including engineers, technicians, and operations, he is the author of the books "The Revolution of Efficiency," which came out in 2020, and "Think Thin," which is coming this summer. With a bachelor's degree in industrial engineering at the University of Padua. During more than 20 years spent in sales, Andrea Dallan has visited hundreds of companies analyzing production processes and helping entrepreneurs and managers to make their operations more efficient. He's also the father of Mateo Vittorio and Beatrice. Andrea, welcome to the show.

Andrea Dallan: Thank you, Lisa, for inviting me. I'm excited to be here. Thank you for the introduction.

Lisa Ryan: You're very welcome! Andrea, please share with us a bit about your background. What led you to what you're doing now?

Andrea Dallan: I started to work in our family company back in 2000. My father established the company in 1978. He was an engineer, which led me to choose my studies at the University. I was starting to work during high school here in the company. I went through many jobs in the company and eventually found out that working around sales and speaking foreign languages was my favorite. It was in line with my attitude, which gave me the possibility to meet many engineers. That's the beauty of my job - meeting people and getting to know their problems. I also enjoy helping them find solutions to their challenges, challenges in production.

Lisa Ryan: Now, we talked about a lot of different topics. We landed on the fact that digitalization changes the conversation in manufacturing from that dark, dirty, and dangerous to something cool as we move into industry 4.0.

So when it comes to recruiting people into manufacturing, what are some of the things you've done? What are some of the companies you've worked doing?

Andrea Dallan: This is a hot topic right now. We are based in Italy, but 90% of our customers are in Europe and the US. We see the challenges in recruiting. It is a real challenge for many of our customers. Companies used to support their lines for their manufacturing in the high schools. Without professional schools, there are a lot fewer students to choose this professional career.

It's a problem for companies in Italy, but this is a general trend in Europe. I see that it's becoming a problem in the United States as well. So the problem is that working in a factory in manufacturing in sheet metal fabrication. It seems not to be sexy anymore. Students tend to look for other types of jobs that are more into office jobs. They are looking into marketing and all this kind of stuff. The significant point about digitalization is that it is an effort that we are also making as a company with the high school in our hometown.

There are opportunities in manufacturing and choosing a professional school because the environment inside companies has changed completely. Going into manufacturing means we look for people who assemble our automatic systems. Then we deliver to our customers for doing their manufacturing. They can go to one company and become responsible for a whole line with a high level of automation. The kind of skill that will require from these guys is a lot more towards digital. The knowledge they need is to know how to operate the line and connect with HMI with a human-machine interface.

The environment and the level of safety have increased dramatically in the past 20 years or so. Getting to explain this to students is helping to build that. How can we say to let them know that there is a career and the possibility of growing professionally in the manufacturing and the operation area? It's not about being in the office. These manufacturing jobs are going to pay more office jobs. That's what we need to explain to young people right now.

Lisa Ryan: Well, you also mentioned that you look for these kids, these 16 and 17-year-olds and younger, who have the right attitude for working in the company. What does that right attitude look like? And when you find somebody with that attitude, how do you continue the conversation and get them excited about working for you?

Andrea Dallan: Our human resources has an excellent connection with the professors in the technical high schools here in our town. We offer students the possibility to spend time in our production during the summer and the school year. They can spend one week here in the company and then three weeks at school. So we start to observe these kids when they are 17, 18, 19-years old - right before they finish high school. We try to find people who have the right attitude are curious. They are brilliant in what they do. They want to learn more. Once we spot this, it is very encouraging for us. We tend to call them again for the following summer for another period until they graduate. 

We end up adding two or three of them every year to our workforce. The students train on the assembly or the automatic lines. First, they will make one installation for one of our customers. Then, they will arrive to do service to our lines at the customers' facility. This is the kind of path which starts from the high school and then, once we have found that people persons with the right attitude we train them to give good value to our customers.

Lisa Ryan: Introducing them to your company while they're still in high school and getting them to come in for those couple of weeks over the summer, and meeting the people and seeing the processes and starting to build those relationships, particularly if you have them back through their high school career where maybe they're spending two or three summers with you. By the time they graduate high school, it seems like a no-brainer that they would go to work for you because they've already seen the culture. They know it so that investing in time and building those relationships with these kids coming out of high school seems to set you apart.

Many people are looking to hire the same people. From what you're doing, it sounds like for a lot of your competitors and maybe a little bit too late, because you already have them.

Andrea Dallan: You have to find the people that will do very well in our company as an environment, that will be good team members. We have 12 students that are doing this stage inside our company, but we will not hire all of them. We also have to be because they may choose something different, but we have to choose one another, so we want to start a long-lasting relationship when it goes on.

They start to work, or we need to train them for two or three years before they are ready to do one installation alone. So there is a lot of investment of time for us. We try to retain them as much as possible. It means investing in teaching them a lot and then doing our best to retain them. So they can be productive and entirely onboard with our company.

Lisa Ryan: It sounds like making that extra effort to establish those relationships with the professors and working with the schools and talking to the parents and getting all of those other people involved in the process to change that conversation that manufacturing is a great career. You're working with automation and cool technologies, and you're getting involved in making things that have never been made before. You're conveying that excitement and passion that you have.

Andrea Dallan: We hear a lot of the IoT industrial Internet of Things and the advanced sensors. There are many changes in our industry, from the electrical point of view on the automation and on the mechanical side. All of these elements interact with one another in our machines, and so if someone has the right attitude, if they are curious, if they are willing to learn. They keep that humble attitude of learning from the older and more skilled technicians.

Over time, we understand that we can also learn a lot from them because younger people were born in the digital age. They can give us a lot of added value, and they can keep our minds fresh and open for for for novelties.

Lisa Ryan: Whenever I talk to my manufacturing clients, the people problem is always number one. How do you find workers? Then, how do you retain those workers? Coming in at number two or number three are the supply chain issues we're all experiencing today. After the pandemic, we've seen prices of raw materials go through the roof.

I know you've just written a book on being more efficient. In what ways do you see that manufacturing companies can stay healthy and profitable amid all these raw material costs and supply chain issues?

Andrea Dallan: The rise in raw materials prices puts the spotlight on every company's number one problem. We have to figure out how to keep the cost of their production under control. Today, the influence of the cost of raw material on the price of the final product has grown exponentially. So a lot more people are contacting us to understand how they can make the same amount of production using, for example, less raw material or thinner gauge material. This is one of the reasons why I started to collect my articles in this new book in the first book I wrote. The central theme was efficiency because, in one company, efficiency means producing using fewer resources. For example, one of those sources of raw material, so if we can do the same amount of production using less raw material to reduce the scrap or use a thinner gauge, that is huge savings. 

That turns out to be a considerable saving at the end of the year. We have customers who are through the redesign of one product or the redesign of the one process, they have gone from saving hundreds of thousands of US dollars to millions of US dollars, so that's what changes from market to market. 

What was a big advantage before the rising prices of raw materials, and right now, it's an even more enormous advantage? Companies that have started this process are rethinking their production lines. Their operation in the direction of efficiency has the benefit right now in this condition of price increases.

Lisa Ryan: The people factor and the production factors still go hand in hand because you're looking at efficiency and the opportunity to use fewer raw materials or thinner gauge materials. But still keeping connected with the employees, ensuring that they're engaged, that they like what they do, you're investing in them. So it's going to be the employees and seeing things differently.

If they feel valued, if they feel appreciated, they're more likely to come up to you and say, hey, I think that we can save a little bit over here we can save a little bit of time we can save a little bit of money. If the employees don't feel that they're a part of the team, it will not happen, so it sounds like those to go hand in hand together.

Andrea Dallan: We have this mindset throughout the team. Look for inefficiencies because inefficiencies can be a problem. It starts from the raw material or the lack of flexibility or one process or the lack of automation in one process. So if the whole team comes together and analyzes this one process, maybe even together with external experts, sometimes it's essential to have external eyes to help us find the solution to become one. That creates a considerable value for our support for each company. I see in our customers' companies all the time.

Lisa Ryan: When I think about what happened in the future, employees were afraid of automation because they believed that that was a way for companies to eliminate their jobs. Employees are such a massive part of automation because somebody's got to know how to run it. Somebody's got to know how to program it. So now you're allowing those employees, instead of doing, I don't want to call them menial tasks, but basic labor - they can use their skills, knowledge, expertise, and machines, do they, don't have to do the "grunt work." What do you think will be the role of automation in the production process in the future?

Andrea Dallan: We are taking out through automation many manual tasks, but these are also the tasks that are so uncomfortable for the operators to work on. Whenever we have introduced automation to our customers' facilities, we have seen that the operators were a little bit suspicious. When they understand that the equipment is designed to relieve them from that part of the manual labor is repetitive and tiring, they rise to a different role. The supervisor can dedicate time to quality control. 

The whole structure of our customers benefits from their change of mindset. We have seen so that some customers, for example, move some of the operators to the logistics because it became so productive that it was more important to keep the machine fed with the raw materials and to take out the ready production, or rather than just doing the manual packaging. So we had worked to get automation. 

We also a more significant result of the added productivity and the wellness of the whole workforce. When you don't have labor to do production, everything is taken care of by automation. So you can expect much better productivity over the eight hours over the shift. We are sure that we obtain a lot more effectiveness from the equipment. 

There is also another important point that has come out during this pandemic. We hope are these crazy times are over, but we have heard a lot about social distancing over this time. We have also understood that the more automated the systems or, the more so, social distancing is also guaranteed. We have seen our customers with higher degrees of automation in their processes, producing more continuity and without any stop. People aren't working too much together. Someone has called this pandemic proof processes, but let's keep let's get the pandemic board out much safer procedures. They are more automated than we are making even the production a lot safer, even for these cases.

Lisa Ryan: Your company has opened a branch in the United States. What are some of the perspectives that you've seen - comparing your European operations to the US market for these automated systems.

Andrea Dallan: Yes, so there are some differences between European facilities and US facilities. We opened our facility in 2018. We are working in the US since the 90s. My father always pushed the company to work more outside of Italy rather than in Italy. This is the reason why he pushed me to study foreign languages. For him, that was the future. He turned out to be perfectly correct.

The one thing that we have seen is they said that the need for automation is very similar. There is a lot of room for expansion for us in the United States. Many companies have equipment in the field that is sometimes 30-40 years old. The older style of equipment lacks automation, which is the highlight. The strong point for our equipment is that they also understood that services in the United States are critical for most companies.

This is the main reason for opening a branch and opening one facility that will be specialized. But he specialized in the service of spare parts. We have many of our customers in a driving range of five to eight hours from Dayton, where we have our facility. That is one difference. The level of service requested in the States and the requests from the companies are very similar. The demand for productivity, automation, flexibility, and increasing the efficiency in the use of raw material.

I can also add that we have seen that in the states, so the market dimension for our customers is much larger than it is in Europe. So, therefore, our machines are oriented to very high productivity. It is very much in line with what our customers in the US expect, so it was in the right place at the right time, I think.

Lisa Ryan: It all comes down to efficiency, which you have written the book on. Tell us about your book, the revolution of efficiency, that came out last year. Then, Think Thin, which is coming out. Talk about the books and if somebody would like to get that how they would do it?

Andrea Dallan: Okay, thank you very much. I always liked writing articles. I started very early in the first years were when I was working. These were articles that analyzed how to calculate the cost per hour of one production line or calculate the price of one sheet metal product outside the one line. Over time, I had a lot of articles, and I thought it was time to to to bring them together and to give them the shape of a book, but I didn't know where to start.

At the same time, it was also the age when my children started to ask me about how I began to work in the company. So I brought the two things together and started writing this story for them. Given the problems that our customers are facing, I put all of these elements together. I think the nice thing is that I have asked many of my customers to give me some case studies to make the reading more fun and more practical. 

We are bringing actual case histories or stories. So I was writing these four elements of efficiency. So that was the reason for the title of the book. So and efficiency, so the problems that our customers face and typically are efficient in sustainability are producing with the last raw materials or optimizing the raw materials.

They are increasing the flexibility of their processes to produce smaller batches according to the lean production methodology. Automation is not about reducing the workforce but of improving the quality of the people's work and the quality of the production. The productivity has to be more competitive, so each time we work on that efficiency, we generated the same result. We used fewer resources which tuned into higher profits for the company. 

The first book was a collection of case studies and focused on the processes I have listed. It will be available in kindle unlimited for another two months, so it's just a subscription, and you can get it for free. So if you put the link down, there will be a lot of essential information.

The second book is on a different topic. It is on product design. It means that we can build a lot of efficiencies, looking at the process. If we start earlier on and we designed the product to be manufactured more efficiently, using less raw material. There are some chapters on that. The characteristics of raw materials, how to form the water, what we need to take care of bringing us even more efficiency,...