Industrial Talk Podcast: Live from FABTECH 2022

Scott MacKenzie and Sunny Han talk about ERP and the future of manufacturing

In this live podcast conversation, Scott and Sunny get into some of the most pressing questions for manufacturers thinking through their future and technology:

  • How Sunny got started in manufacturing
  • How "mom and pop" manufacturers can better use technology to manage operations
  • How long run and job shop manufacturers differ in scheduling and planning
  • Fulcrum's vision for the future of a networked system of manufacturers
  • How Fulcrum is growing through its product getting better and more valuable for customers

Listen on Spotify, Apple Music, Google Play and more


Welcome to the industrial talk podcast with Scott Mackenzie. Scott is a passionate industry professional dedicated to transferring cutting edge industry focused innovations and trends while highlighting the men and women who keep the world moving. So put on your hard hat, grab your work boots. And let's go

Oh, once again, thank you very much for joining industrial talk the number one industrial related podcast in the universe Sunny, backed up by data. So don't even go there. I'm not going to argue with you. It is all data being driven right here and we are broadcasting on site. And this is FABTECH. This is gonna go I was at another conference last week or a couple weeks ago. Oh my god, are we gonna blow that one? All right, this is FABTECH, Atlanta, Georgia. And it's it's three huge halls or whatever you want to call it, of just technology solutions provider. And you know what, they all have a common passion, passion to solve your problem in the best way possible. Sunny is in the hot seat. Fulcrum is the company. Let's again, correct? Yeah. Sunny, hang on. Let's look closer to the mic there,

Will do.

He's the CEO. I am big thinker. So if you're if you're at the show, which I don't know, doesn't matter. If you were at the show, you would say, hey, Scott's booth is right there on the corner. And right to his right, is fulcrum. And you have a team of people who are

there working the heck out of that booth. Oh, yeah. They're great. They are very lucky.

Yeah. I was trying to, I was trying to coax a couple come over here. No, I wouldn't dare do that. Anyway. So you flew in today? I did. And we had a chance to sort of look around.

I have talked to a couple of people already. Other CEOs of other startups and some tech leaders at more established companies. And just good to connect and meet in person. And just to chitchat a little bit. So I've gone around or made my rounds already.

Did you go did you go all the way to see I did go all the way to see did you change your time?

Yeah, I generally try to stay within one time zone. But stuff, I have to move. It's definitely tough in this, this venue, because you realize how, how important manufacturing, how important technology, how important innovation is needed for just the economy. Just just business, it's so important to see it here. And, and, and what's really fascinating is just seeing the diversity of of stuff. There's a bench there that apparently is good to see it there. And it's got to be good. And anyway, it's just it's been a, it's been a real joy to be able to do that. All right. For the listeners before we get into talking about fulcrum, which is a great name, by the way. Fulcrum, sunny, give us a little background on who you are.

I'm just a nerd that stumbled into manufacturing. As a kid, I emigrated to the United States when I was really four years old. My mom was studying computer science in University Minnesota and move there and just hung out at her computer lab learn to code at a really young age.

I'm sorry for laughing. That is a that's an interesting so I learned to code at a very young age. I did and just lucked into everything. Really. The Universe Minnesota had a program where elementary school kids would start taking math at the University of Minnesota and I was part of that I led the math team at my high school, which is through that I met one of our board members, Yishan Wong. He was the CEO of Reddit and one of the first engineers at PayPal and Facebook. Well, wow. And he's been an incredible mentor of mine and a great friend. A great person to have as a resource. Basically, my life is just a collection of random luck. That's led to what I do.

Right here right now, right here right now, Georgia in November, finally started cooling down a little bit. All right, tell us just a little bit about fulcrum, there's still a start there. Because people talk about ERPs. But it's out there, you could talk about the need to be able to, to track the business in a very effective way and data and all that because it gives us a little background is the fulcrum is an operational platform, it's, it's what you would probably consider an ERP, we handle every piece of information that our customers need to operate their business. We help them do some cool stuff with some Algorithms and Heuristics about when to build self-scheduling, when to buy stuff from which vendor how much when you know what to build, when how much is an inventory, how much demand is coming. So the core products is a very automated cloud based connected ERP that's really well designed so that your end users can have a really, really good time for machinists or operators, your estimators or sales engineers, we want them to love using the products. And there's a few things that informed that one, I think, this extremely random, but potent realization that manufacturing in the US and a Europe and in Japan and a lot of other countries, is decentralized and distributed. It's a bunch of small manufacturers all working together. Oftentimes not even knowing who each other are, that roll up into a caterpillar, or roll up into a Polaris ATV, or whatever it is, it's being made in a rocket or a shuttlecraft. That is incredible. In other countries, manufacturing is very centralized. We've seen some of the dangers of that with COVID and COVID, shutdowns in China. But I think it's so so so delicate, and valuable, that I'm motivated to create an entire company to try to support this network ventures, the future that I want to vote for is one where there are still hundreds of 1000s of small manufacturers working together to make stuff instead of one giant on the factory or something. And that coordination requires technology, we have the internet, we just haven't brought the Internet to manufacturers. And what we envision is that really, is that a gap? I mean, when you say the internet not to manufacture I know there's a lot of mom and pop businesses out there. What do you mean by that?

So how would you go about finding a new CNC shop to do you know, five axis work with a specific grade of aluminum at a specific procedure, you might go to Thomasnet, you might go to Bucha stuff, but there's 10s of 1000s of them that are out. And the discovery of those folks is difficult. And then now I'm working with you and your let's say your CNC shop, and maybe I'm a powder coater I'm gonna give you some wheat times and have some buffer, and you're gonna give your customers something tangible, for and now all of a sudden, something that actually only takes three or four weeks to complete. The end person that's buying, it thinks it's a 12 weekly fundraiser. And without some sort of automated coordination. It's just never going to be better than that. But imagine if we could actually tie all these things together, coordinate them together with the same number of people in the same amount of machines, we could then just produce so much more stuff on

See, this is interesting, because this is sort of this is not like a typical what I see as a typical ERP.

Yeah, I think we're in ERP by looking at your your display, and it said, ERP, so that is that is what, but it's much more. Yeah, I think you need to build, I think we slowly realized as we tried to build AI schedulers first. And we realized we needed to plug into the ERP to get the data out. And then we realized the data in the ERP is trash. So we built a job tracker that allows the shop floor employee to have a really beautiful interface that has the drawings on there that it can enter all the all the checkpoints of measurements of the part on there that they can start and stop on there. And then we got better data. And then we realize, Oh, we got to understand when the materials coming from ERP Well, that's slow, because people are like, sending purchase orders are not entering that information back into the system. Well, that we built that and we never intended to build a full suite ERP. It was just each and every time we built something, we realized there was something else that we needed to make it better for our customers. And over time, we realized that there was a nonlinear exponential growth and value we deliver to the customers. Every time we built something else. When we knew what the purchase orders were. Our purchasing planning got that much better. We knew what the sales orders were our demand planning better. We knew The work centers were in what what, what the humans could do and and how many there were, the scheduling got better. And so, as we've continued to evolve, we've just, I wouldn't say reluctantly. But it certainly wasn't the grandiose plan to be an ERP system. We just wanted to help improve throughput for manufacturers, and it's grown into this thing.

That's interesting. If I was if, if I, if I was on the fulcrum platform, I'm a manufacturer, how does the how does the platform help facilitate my vendors, like I have ABCD, whatever the vendor name, and I want information about where they're at on there, I want to tighten things up. That means I've got to be able to have a line of communication. How does that how does that work and fulcrum

there, it's there's no publicly published features that do that we do have technology, that for some of our customers, we can tie their information together a purchase order, and is a sales order in another company's full. Now, the real blunt truth is that we're just not large enough, we have hundreds of customers, now we're tripling every single time we raise funding, which is either a year or year and a half, we've grown over 9x Over the last couple of years, three years. But we're not even anywhere near the size we need to be to create a real network. So for us, the strategy right now is, let's work with a broad set of manufacturers, let's work with rubber extruders, and let's work with aluminum, CNC shops, with sheet metal fabricators, with plastic injection, molders, let's make sure we can even service all of them really well. And then let's make the product increasingly awesome. So that everyone, it's just a no brainer that they're gonna switch to that I think are the those are the two ingredients that we need to make sure that we're compatible. And so we're experimenting selfishly behind the scenes writing software to connect these businesses together. And so if if you want it, you will opt in for it and you wanted to connect, we can make it so that when you placed a purchase order became a sales order in your vendor, we could we can pull from them if they wanted to share what their capacity is. And maybe the lead time for this quantity is is three weeks. But if you want 10 times the amount? Well, you're gonna have to wait 15 weeks, well, maybe I'm going to place five smaller orders for 1/10 the amount, get them exactly what I need them instead of buying a huge amount. And that way everybody's capacity starts to loosen, and we just get way more yield out of the situation.

I don't see how you can avoid that. I think that that's where it's going. Yeah, I know, if I was a just a manufacturer, I would I want to, I want to have as much visibility into my business into my vendors so that I'm as efficient as I possibly can be. I mean, just that would be the ideal situation. And then having that conversation, I want to buy my materials from you. Let's have this conversation about how we connect and how you send that information. I just don't see any other way of getting around.

Yeah, I think the industry is trending in that way. The it used to be that there were job shops that didn't only customer stuff. And there were long run manufacturers, well, the long run manufacturers, they're hearing from the auto companies, we're going to change this program every year now instead of every three years. And instead of having one lump sum in our warehouse, we want blanket orders where you deliver stuff to us every other week. Well now imagine how difficult it is to go from scheduling. I'm going to build this for three weeks. So I'm gonna build this four times over the course of three weeks, and schedule that all together, it went from a three by three Sudoku board to a 100 by 100 Sudoku board. And it's just getting almost impossible for these businesses to solve. And because these businesses are so richly diversified and distributed and decentralized, they're not hugely powerful. They're not 100 billion dollar companies that can afford to write software for themselves, they need somebody else to build this technology for them. So I think that's where the need comes from, for what our vision is for the market. So with that said, as we venture into the future, I would imagine course poker wants to be bigger, stronger, faster, you want to apply the Steve Austin approach to your business. And where do you see fulcrum growing? Because you guys are growing rapidly, guys. Clearly, it's it's that way. Is it? What do you see yourself going? What do you want to go?

So I think we talked internally a lot about not comparing ourselves to competitors, we really want to continue to just service our customers as best as possible. So from a growth standpoint, we try as best as possible to see the sales growth and customer count growth as a natural byproduct of the product getting better, and really just invest as much of our energy into making the product better as possible. And it's hard. It's hard because you have a very volatile stock market environment. We have have really great venture capitalists that are backing Yes. But the value of your company is largely based on how much revenue you have. So it's really easy to fall into that trap of, well, I need to be at, you know, X number of million dollars in revenue, we really try to force that as the revenue is an outcome that's driven by better products by a better marketing plan, not the other way around. Because I think you can get into this really toxic mindset, it's like, well, we have to hit this thing, I'm going to say yes, to a customer that doesn't actually fit, we're going to build some stuff just to close them. And then your product gets muddy and cluttered and whatever it may be. So I think keeping the long term sanctity of this vision of a network of manufacturing alive is we want, we want the luxury to make that as the power to be in our hands as much as possible, so that we can continue to stick to that. So insofar as growth, we want to grow enough to be self-sustainable.

So one last question, before we wrap it up. Do you have sort of groups out there that you take suggestions like I, we have these working groups, and we we all use your your, your, your solution. And we think that it would be great to have this and this and then provide those insights into your organization? Yeah, we have a we use a piece of software called tribe. And it's like a community platform and all of our customers, if they want to, can sign up and put ideas in there. And sometimes it's negative, and sometimes it's positive. And then actually, just before this, we did a live stream from FABTECH for our customers, and they asked a bunch of questions about is this feature coming? How do you think about this, so we, we try to have an incredibly open dialogue with our customers about it, some customers are just happy as is, they don't want to mess with that they want a stable of a product as possible. But a large portion of them want to tell us what their thoughts are, and have been really, really fun to work with. Because they understand that we can see so many manufacturers, we can deliver really great ideas that maybe they can't see, but they still want to share that. So I think for now, we're managing that feedback really well, we're getting a lot of ideas from them in in the in time, we're probably gonna have to formalize that and make some sort of customer Counsel of non-customers as well to try to collect the information in a balanced way.

So with that said, one last short last question. I'm sorry about that.

So this particular this, this particular event is you are focused primarily if I was a manufacturer, and I'd say gosh, I like hearing what Sony has to say, I want to knock on the door, I want to be able to sort of begin that dialogue. What is your typical approach to a manufacturer saying I hear it? I want? How do you approach that manufacturing?

So if you just want to learn more, anyone can email me, Sunny, like the weather, my inbox blows up all the time, I might not answer as fast as I used to. But I always answer everybody's emails. If you actually think that you could be a good fit our processes may be a little antithetical, we do as much as we can to push you out, we asked a bunch of questions to make sure that you fit. And once we believe you fit, we'll give you a price. We'll show you the software right away. There's no need to set up a demo. The product is cloud based. It's it's super intuitive. We don't need to do anything, you can see a demo right away. And then you can ask us questions be like, Okay, we handle things this way. How would we handle as a fulcrum? And either we have no answers for you. And then we would say you don't fit or all of our answers make sense. And then we would see what we need to do to implement as soon as painless. Well, there's a little bit of pain, but

I've been upgraded software. It can be painful. Sounds like you guys got it under control. Yeah, we already given me your contact information.

This is fulcrum. She's just Pro.

I'm looking at your card right now. Both from You are great. Sony.

Thank you. Thank you for doing all this. This is, this is a lot of fun. All right, we're gonna have all the contact information for sunny out on industrial as well as fulcrum. I highly recommend just like, like I keep on saying you need to reach out you need to find individuals, you need to find those Sherpas that'll help you become a better business. I did Sunny and tiempo from fit that bill, reach out to them go out to industrial Alright, once again, we are broadcasting from fact. It is in Atlanta, Georgia. And it is a great, great event. Put this on your calendar for next year. So if you find yourself you gotta get out here. It could happen, Captain.

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