Building the System Before the Crisis — How Jason Few Is Reinventing The Way FuelCell Energy Works

Damon, thank you. It's a great question. When I joined the company, we had a number of different critical challenges that we were facing — financial execution and productwise. We had so much to accomplish. We needed a better way to organize work so we wouldn't try to boil the ocean because then nothing gets done. We needed to execute faster. We needed to be more nimble. So, we needed to find a way to get that done.

It meant being less commercially focused. I mean, we were a company that had been around for over five decades. We were a research-minded organization. So, the definition of success was very different. The definition of success was solving problems even if those were only solving problems that we found interesting but weren't solving customer problems, and that needed to change. So continuing in the status quo was simply not an option if we were going to be successful.

The clock was running financially. We had significant debt that we needed to satisfy. We had a lot of cost both in the operations of our business and we were spending money on R&D. We needed to move quickly because time, you know, it really felt like in our company the old saying is, you know, time costs money and that was very much the case for our company.

I think it was two things. I think everybody's really passionate about the business. Everyone's really passionate about our technology. Everyone believes in the purpose that we have as a company, which is to enable a world powered by clean energy. And we believe we can do that. The question was how are we going to do it? So we needed tools. We needed a methodology. We needed a repeatable way to approach our work. We needed a way to know that we were being successful. We needed to know what the current status was, what we were trying to get to, what it was going to take to get there, and then measure along the way that we were actually progressing toward our north star. And that was what was going to be critical to us being able to be successful on our journey.

I think it was the collective observation of the company. However, the one challenge for the company was that the company had faced financial challenges in the past and has always found a way through grit and determination to work its way out of it. So getting people to really believe that this time was going to be different was part of the leadership challenge, and I had to find ways to communicate that message and get buy-in throughout the organization. The board was clearly aligned. The senior leadership team was aligned. Now we had to get everyone in the same boat rowing in the same direction.

Well, I think in the void of clear direction, people create what's important in their own mind because no one wants to come to work — or at least most people don't want to come to work — and feel like they're not accomplishing anything. So, they make the task that they've decided to work on become the really important task. And unless you can really make clear for people what exactly is required, what exactly is needed, what exactly are the priorities for the business, then people do what they think are the right things to do. And it's incumbent on leaders to make it clear to people what their priorities are and how their role plays into the broader success opportunity for the company. So for us, what we tried to do was develop a methodology or utilize a methodology to do that. We initially started doing that with OKRs, and the goal around using OKRs was to really break the work into small chunks — daily, weekly, monthly, quarterly — so people could really be clear about what they needed to do, track it on a daily basis, weekly basis, monthly basis, and then we built an operating system around that. Unfortunately, it never really became part of our total DNA. But for me, I know that the best operating companies have a clear way of working and they simplify work. They make tools and processes available for what people need to do to get their work done, and we needed to find the same way of working at our company.

You know, it was an interesting dynamic because inside our organization — and I think this is true in most organizations — people say we have too many priorities.

So with OKRs, you know, you start by trying to really make the priorities clear — four priorities, five priorities, six corporate priorities — and then you try to cascade those priorities throughout the organization. And then what you realize is that five priorities or six priorities become hundreds of priorities as you cascade them throughout the organization. And you find yourself right back at the point where people are saying we have way too many priorities. And it became really hard to distinguish between things that just need to get done inside of a company — we need to offer an insurance plan, we need to pay people. Those are important, but those are not our priorities for the business. And people begin to cascade these things throughout the OKRs and they become rather lengthy. And then the process to try to really simplify that to manage them on a daily basis, a weekly basis, a monthly basis, a quarterly basis becomes very complex, takes a lot of time and energy. And you're spending more time managing and reading out on OKRs in many cases than you are in doing the work. And so we knew we needed to do something different as a company in order to drive transformation because what we needed people to be able to do is do two things at the same time. We needed them to perform against the set of priorities while we were also trying to transform this company, and that's what we were trying to get done.

Absolutely. I think, you know, as a company whose roots, whose DNA is innovation — and that's one thing that we've always been, is an innovation company — but there is a transition that we needed to go through that wasn't just innovation for innovation's sake, as people sometimes say, but it was innovation for customers, solving customer problems. I like to say, you know, innovate, need to sell. That's what we were there to do. And so that meant you needed to really understand customer problems and opportunities, and then how the application of our technology would address those customer problems and opportunities and do that better than the competition or alternative choices that a customer may have. And so in that mindset of innovation and in the belief that what we do is very complicated, one of the transitions we had to drive or beliefs was that speed and quality can coexist, and we needed to do both in order to win in the marketplace. And that required changing the mindset of some incredibly talented, innovative scientists and engineers across our organization.

That's right.

I think other things that we had to change was, you know, when you think about an organization who's rooted in innovation and we do something that is fairly unique and differentiated — we take fuels and we don't combust them, we reform them, and we make electricity, and we do that cleaner and more efficiently than traditional technologies, and that's an incredible innovation and it's chemistry at its best. But when you think about that, one of the other things that needed to change was that we didn't need to be the company that did everything on our own. There were certain things that we could go outside to other companies who wake up every day trying to solve a specific problem that we're trying to sometimes solve that they do all the time and they do it better than us. And we could integrate those things into our technology. So getting people to accept that we can look for integration of other technologies and engineering solutions as we integrate into complex solutions for customers was another way that we needed to change in the way we work as a company. And then from a management team perspective and how we allocated capital, we needed to have more of a mindset that you had to earn the right to spend the capital, which meant you had to have clear milestones and markers. You had to hit those milestones and markers in order to get that next tranche of capital. Almost similar to a VC model, if you will. You get your A round of funding and you've got certain targets you need to hit and you need to hit those and show that it actually accomplishes what you projected, and then there's a B round of funding. And that really changes the mindset and pace at which work gets done.

Damon, I'll tell you, when I sat down with the executive leadership team and I had made the decision that I was going to tell them that we were going to embark on a lean system and we were going to build the FuelCell Business System. I joked a little bit about it being called FBS because everyone knows I'm a big college football fan. So, I'm like, we're going to be in the FBS. And I knew it would be a bit of a challenge because I'm the one that also introduced OKRs. And so I felt as though the risk was that the team was going to have 'here we go again, flavor of the month.' But I did a lot of work upfront in reading and trying to understand and making sure that I could really articulate my why as to the reason we were going to move to lean and have lean be the foundation for our business operating system. And I knew it would be harder because we'd already tried OKRs. We wanted to make sure that lean wasn't perceived as the flavor of the month. And creating the lean business system became really the focal point to say we need a repeatable way to work. We need to make our work visible. We need to make sure that everybody understands what they need to do, what they need to do every day when they come to work. And we need to give them the tools and the methodologies to do that. But we also need to give them the tools and the processes that if they think we can do things better, that we have the ways in which we can receive that information, we can validate those changes, and then implement those changes as opposed to people just deciding to do work the way they wanted to do it. And I think that really resonated with the leadership team and I made it very clear that I too was going to operate from a lean perspective and the way in which I was going to engage with each of the leaders was going to be around lean and when we met in our one-on-ones we were going to talk about A3s and we were going to talk about bowlers and we were going to go through all these things to really change the way in which we ran our business. We then probably made our smartest move in our lean journey. And I'm not just saying this just because I'm talking to you. We hired you guys to help us figure it out. And you were incredible.

You have to do the work to ensure understanding. You have to get to a common language. And in order for people to attack a problem, to work their way through a problem, to get to a root cause on a problem, the communication between those team members needs to be clear. So when one team member says X, every other team member needs to understand what X means. And so getting to that clarity and doing the work to do the training and the education is really important. And I have a board member who recently just retired from GE Aviation or Aerospace now. And she led the lean work at GE Aerospace. And to hear her talk about the common language across the organization, the amount of training they go through up through and including the CEO, I knew it would be a challenge, but I knew the reward would be well worth it. And as we started to do this, because we weren't in a position to roll out lean across the entire organization at once, so what we tried to really do is pick some high-profile things that we could go attack, show success with lean, and get that buy-in, and get people to start saying, 'I want to be a part of that.' And that's the way we approached it.