How we brought lean-startup practices to traditional manufacturing

History of MATRIX 4

MATRIX IV was founded in 1976 by my grandfather, who was a was a tooling engineer, entrepreneur and inventor, developing his own proprietary products as well as working with others to bring their products to market.

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After almost 40 years in business, my grandpa was at end of his successful career but the business was not - the expanding global economy and recession left the business in a position losing money without a strategy. I asked myself - could this 40-year-old business be brought back to life with the customer and metric driven approach I’d been a part of at a Fortune 500 company or the lean startup practices I helped execute at an emerging biotech tech company?

I left San Diego and a growing business and industry segment with big hopes for the future for this failing business and struggling industry segment.

Old ways of thinking

When I first arrived on the scene at MATRIX IV, the factory felt outdated. It was exactly what you would expect from a traditional manufacturing company. The front of the house was closed off by walls and separate offices with closed doors. There was no art, or light, or team culture, or exciting new technologies. Envision scenes from the movie "Tommy Boy" with wood paneling, big old desks and leather chairs, dark walls that had been smoked in for 40 years, computers with backs on them and an old TV in the corner. Not only did it look aged and tired physically, it was energetically also, which may be just as bad.

The name also included the outdated practice of Roman numerals. Many confused “IV” with the technique used in hospitals, creating a challenge for an already struggling business to make a name for itself. Age-old manufacturing practices and outdated techniques were in place. It was a tired old factory that couldn’t sustain itself in 21st century U.S. manufacturing.

Time for a refresh

This 40-year-old company needed a reboot. We went into startup mode and till this day we still refer to it as a startup because that’s how we operate. From the get-go, we abandoned the Roman numerals, got rid of the traditional hierarchy and introduced an open workplace focused on collaboration and innovation. We also invested in building renovations, new processes and updated technologies.

Fast forward four years later, MATRIX 4 made the Inc 5000 list for the second year in a row, reaching just shy of the top 1,000, and has grown to 50 employees running three shifts five days a week.

Here’s how we disrupted the manufacturing space and brought lean startup practices to an old school industry.

1. Bring a fresh perspective

I didn't want this to be my grandpa's company anymore and fortunately, I had experiences outside of the industry that provided a larger view of the world and insight into how other businesses operated. Having a fresh perspective and entrepreneurial heart helped me become the type of entrepreneur defined in The Lean Startup—a human institution designed to create new products and services under conditions of extreme uncertainty.

My lack of experience in running a manufacturing business created an environment of uncertainty, but my experience in customer focused marketing, culture building and technology was the fresh perspective that I thought this business needed.

A fresh perspective doesn't have to be from working in another industry for years.

Always think outside the box, think about experiences you can create to help you gain a fresh perspective, learn from others inside and outside your industry, and never stop learning and trying new things. 

2. Create an environment for all people to thrive

Our culture can be easily explained by our core values: people first, make meaningfully and communicate purposefully. We have an open floor plan and an open door policy to encourage communication between teammates and members of leadership like myself and have implemented Cocktails + Coworkers where team members get to engage each other in an informal setting for idea generation and feedback. We believe in equal voices and seats at the table.

I strongly believe in having the best person for the job, whether that be a male or female, as long as they're embracing our shared core values. MATRIX 4 is a business comprised of around 60% women, which is rare in the industry. I think driving the business from our core values has fostered an environment where we all feel empowered to succeed.

By allowing for open communication and transparency, we are always looking to build, measure and learn, taking feedback from our team to heart and deciding where to pivot or preserve to improve efficiency and create happy teammates.

3. Focus on design

Design thinking, process design, product design, organizational design—they all matter. When walking into a 100-year-old factory building, I found a lack of creative inspiration. It was very functional, using trusted techniques and standard office layouts. I think design is about taking in to consideration elements beyond functionality that are also important. Why not have something beautiful and interesting while also being functional. MATRIX 4 embraces design to improve its products and processes to fit the needs of today’s consumer and workforce.

When focusing on design, it impacts all areas of the business. How do we design processes to improve the team's functionality? How do we design new products and improve existing designs? How do we design our core values to drive change and build a culture around #makemeaningfully?

Outside of improving our internal company design, I also wanted to make the space we all worked in more conducive to open minds, new ideas and creative thinking. We broke down walls, creating an open office space, painted all the walls in the factory white and added plastic chandeliers and other design elements to both the front and the back of the house. Refreshing the space with design in mind was a visual representation of the evolution taking place. Now we can see how we’ve morphed, not just culturally, but physically.

4. Update technology

I knew in order to be successful we had to change things from the bottom up and I wanted to bring in world class business practices and technologies that would help us get there. We were also very thoughtful to make sure we were using validated learning, testing new technologies with small groups of individuals before rolling out to the team.

We implemented Trello and Slack for our team to operate in a way that allows us to stay on the cutting edge with open communication and accountability throughout the process.

IQMS launched earlier this month and we’ll be rolling out MAPP benchmarking standards for our production.

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MATRIX 4 operates under EOS, the Entrepreneurial Operating System, which looks at the six core elements of a business. One of the activities includes quarterly retreats to look at where are, what we prioritizing, and where does it fit in the bigger picture. We also have scorecards to track the metrics that are important to us and regularly reflect on performance.

The implementation of new technology has also allowed us to enhance transparency throughout the manufacturing process using barcode scanning and benchmarking practices.

Holding yourself and your organization accountable is the only way to drive sustained growth.

I am always looking to learn from other leaders. I would love to hear about the steps are you are taking to bring entrepreneurial thinking to your business! Drop me a line.