Continuous Improvement in Venture Capital
CI isn’t just for Manufacturing
The term “Continuous Improvement” (CI) encompasses so many tools and philosophies, all with the end goal in mind: how to create better value for the customer. My structured journey for continuous improvement started when I was at university, doing my degree in Industrial and Operations Engineering at the University of Michigan. Included in the course work at that time were classes in Value Stream Mapping, Statistical Process Control, Six Sigma Tools, and quite a few more. I was even fortunate enough to study under the likes of Jeffery Liker, who would go on to author The Toyota Way and to be a Graduate Student Instructor for Richard Coffey, teaching senior design in the Hospital System using the Total Quality Management principles.
My informal journey into continuous improvement and customer-focused values started much earlier than college. When I was growing up, I worked with my dad in his residential construction business. He was always preaching the need to find a faster, better way to help achieve a better solution for the customer. Whether it was a new way to build structural floor trusses for longer spans or early adoption of new tools like gas actuated nailing to speed up the build, we were regularly trying to provide a better, cheaper solution.
So when I joined the manufacturing industry nearly 20 years ago, I was already passionate about continuous improvement and making the working environment a better place. In my early years, I used tools like process mapping with Kaizen bursts to improve the turnaround time for contract change proposals. Also, I used value stream mapping to identify where to place “milk run” locations in the carbon fiber wing structure value stream. As my career progressed, I learned more about the cultural development and leadership of continuous improvement through training like GKN’s Management Continuous Improvement Leadership course. I started building leadership standard work to help ensure I was engaging on Gemba walks and making time to step back with my team to ensure we were adding value and solving real problems.
Having had the opportunity to use continuous improvement tools in both production and non-production environments, I was excited when I joined Prime Movers Lab, to bring my experience and passion to the venture capital business. As I onboarded, I was extremely impressed to find the existing culture and tools around the continuous improvement mindset were already well established. When I discussed Continuous Improvement with two of our General Partners, Dakin Sloss, and Brandon Simmons, both instantly thought that it was an intrinsic part of the way we operate. Dakin pointed out, “work is changing at an increasingly exponential rate, so you have to grow and improve along with it.”
As I talked further with each of them, we discussed the need to be intentional about continuous improvement, creating the rituals and cadences (standard work, tier meetings, and regular kanban meetings for those of us from the shop floor) that drive the business forward through consistency and communication, highlighting where we are and where we need to be heading.
When I talked with our General Partner Suzanne Fletcher about CI, she reinforced our customer-focused approach. From her perspective, the Prime Movers Lab culture helps us live up to our reputation for both of our customers — the LPs and the Founders: source and select phenomenal investments for our LPs and add value to our founders to support their businesses. It takes tools to help systematize our processes’ efficiency, limiting cost and increasing speed. It also takes a great culture, as Suzanne said, “we won’t get 1:1 results, it takes a team working together to optimize and build off each other’s capabilities.” Christie Iacomini, our VP of Engineering, added “we like our processes to be guidelines, to follow them then flex them and adjust them.”
A few weeks back, we had our Scaling Production Webinar with 4 of our portfolio companies. A key takeaway was the need for both a continuous improvement (tools and culture) and a customer-first mentality. These two go hand in hand, and though looked through a different lens for each industry, it is key to empower your people to develop your processes and to create raving fans of your customers, whether they are buying your product, providing you capital, or the next person downstream in the production process.
The team over at Lean Enterprise Academy (who are industry leaders, and provided much of my early training) have a great summary for what continuous improvement needs to be: “Rooted in purpose, process and, respect for people, lean (continuous improvement) is about providing the most value for the customer while minimizing resources, time, energy and effort.”
For me, regardless of what industry you’re in, a CI mindset separates the good from the great companies. There are many tools and techniques, and the key to applying them: fail forward fast and build the culture of Continuous Improvement every day.
Additional Resources on Continuous Improvement
Books (there are so many so here are a few of my favorites):
The Toyota Way by Jeffery Liker
Podcast:
Training:
Prime Movers Lab invests in breakthrough scientific startups founded by Prime Movers, the inventors who transform billions of lives. We invest in companies reinventing energy, transportation, infrastructure, manufacturing, human augmentation, and agriculture.
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