https://youtu.be/tU0kHdf7oXo

Drew Allen, CEO of Grace Technologies, is driven by a mission to lead a life of adventure and impact. At Grace Technologies, that impact is tangible: the company develops electrical safety and predictive maintenance solutions that help industrial teams prevent downtime, improve productivity, and, most importantly, send workers home safely at the end of the day.

We explore Drew’s Product Engineering Framework — Clarify the Problem You’re Solving, Understand the Constraints, Think from First Principles, Build a Prototype, and Iterate within a Time Limit — a practical approach to innovation in technical product development. Drew explains why rapid iteration beats overbuilding, how constraints can unlock better engineering decisions, and why time-boxing product development prevents teams from getting stuck in endless perfectionism. He also shares how Grace Technologies is expanding into the data center market, where rising power density is creating new safety challenges and new opportunities for growth.

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5 Steps to Engineering Breakthroughs with Drew Allen

Good day, dear listeners. Steve Preda here with the Management Blueprint Podcast, and today’s guest is Drew Allen, the CEO of Grace Technologies—the leading innovator of electrical safety products and predictive maintenance solutions that help companies maximize productivity and foster a safety culture. Drew, welcome to the show.

Hey, thanks for having me, Steve. I’m excited. I’ve really enjoyed your books, and they’ve had a big impact on our business. So it’s great to have this conversation today.

Yeah, glad to have you here. So if you enjoyed the book or read Pinnacle and Summit OS perhaps, then you’re going to be familiar with this question. What is your personal “Why,” and how are you manifesting it Grace Technologies?

So my personal “Why” is to lead a life of adventure and impact. And I think that manifests in our company. We try to be as innovative as possible. Typically, around 30% of our annual sales come from products released within the last two to three years. We try to take risks, not in kind of a willy-nilly way, but we try to be smart about our risk-taking, but still make sure that we’re taking risks and we’re on the forefront of the technology edges. In our business, it’s really easy to see the impact that we have. Not many businesses get to say that we literally send people home at the end of the day.

We literally save lives, and we don’t take that responsibility very lightly. And so it’s a little way that we can kind of make a dramatic impact in the world. We get a lot of stories of people who have been going to go to work on an electrical system. They were just moving throughout their day, trying to do their work, and all of a sudden they saw that our unit was indicating and they were about to put their hand on that bus bar or that cable, and they stop and realize, “Oh, there’s still power there.” And they could have been either severely injured or dead. And so

we get those stories quite frequently, and so it's really impactful to hear that, to know that we're doing that kind of good in the world.
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Yeah, I love that. And yes, I mean, it’s dangerous. My son actually worked for an electrical contractor last year, and they told him the story that they were in big industrial facilities and one of their workers was trying to fix a light and he got shocked. And the only way to save him was to kick the ladder out from under him. He ended up breaking his leg. So it was kind of funny story afterward, but also a very dramatic one at the same time. So yeah, you definitely want to avoid situations like that.

100%.

And I think what you do is really great, and focusing on the safety aspect is very important as well. What I’m wondering—because I’m a framework guy and I’m always looking for new frameworks people have developed—and obviously within the Pinnacle system there are a lot of frameworks. But you’ve been doing this for a few years, and I’m sure that you have come up with your own. So what is your favorite framework—something simple enough for listeners to understand in maybe three to five steps—that could help them improve their business?

My favorite framework really comes from Jim Collins’ work on the Flywheel. And I think you reference it in your book as well, Steve. I think if people can see their business—or even their life—through the lens of a flywheel, it becomes really useful. So in our business, our flywheel is relatively simple. And I think there are probably only a limited number of flywheel models companies really operate under. Our version of a product flywheel works like this:

We start with amazing new products and services. If we do that well, we naturally excite our channel partners. When our channel gets excited, they can’t help but get us specified by customers.

Once we’re specified by customers, it grows our revenues, unit sales, and customer base.
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And as that happens, it expands the power of the brand, which allows us to set high prices and deliver higher gross margins to be able to reinvest into R&D for amazing new products and services. And I think while maybe there’s a couple of pieces in ours channel-specific or whatever, we found that most of my focus as CEO is just constantly figuring out how do I push those pieces of the flywheel, and where is the current bottleneck in the flywheel?

Is the bottleneck getting the specifications? Is the bottleneck the wrong product? One of the challenges in our business is that we have a 12-month product development cycle plus an 8-to-12-month sales cycle for products. So if I miss, I’m basically down for two years. And I don’t really know it early enough unless I’m paying close attention to the leading indicators—which we’ve become much smarter about over the last few years. A lot of business people tend to focus only on lagging indicators, and they’re not always clear on what the leading indicators are in their business—or how correlated those leading indicators are to the lagging results.

I’ll say this: the most recent releases of Claude have made it incredibly easy to input a bunch of variables and figure out how strongly your leading indicators correlate with your lagging success. I probably haven’t done that kind of work since college and deep regression analysis or logarithmic modeling. And now Claude makes it so easy. So if you can identify the leading indicators tied to your future success, and you know there’s an 80% or 85% correlation,

then that leading indicator is almost as valuable as the lagging indicator itself. And if your lagging indicator is revenue, that gives you a pretty strong signal about what you should actually be focusing on.
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Yeah. That’s a great way to reverse-engineer those leading indicators from the outcomes you’re targeting. I love that. So when you say that one of the flywheel cogs is for people to specify your product, what do you mean by that exactly?

We come out with a product, and then we get meetings with large end-user customers. Okay? Our products are really sold into two major markets. One is the industrial market—everything from where things come out of the ground, like oil and gas, pulp and paper, and mining—to all the downstream processing industries, including automotive, tire and rubber, consumer packaged goods, food and beverage, all those kinds of industries like shipbuilding, naval yards, and all those kinds of environments. All of these places have complex electrical and control systems. And when a factory or facility is being designed or upgraded, someone is writing a specification document.

That specification literally defines how everything should be built—including the machinery and the electrical systems.

So we want to make sure our products, from an electrical safety perspective, are included in those specification documents. We’ve been really fortunate to get into some of the world’s largest companies’ control specifications
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companies like Amazon, Procter & Gamble, GM, and Ford. These large organizations really see the value in our products from both a productivity and a safety standpoint. And that’s really the key to our success: driving specifications with large end-user customers.

Yeah. So it sounds like when you get specified, then essentially you’re baked in to their product, and then you kind of have, at least for the time being, you have a monopoly of supplying them. Is that the case?

Yeah. And some specifications are a little more open. They may specify our type of device, or they may even list competitors as alternatives. And then it becomes a little more of a street brawl when we’re competing. But either way, we want to grow the overall market for products like ours—not just our own products—because we’re in the safety business. And I think it’s really shortsighted to be selfish about that. I think we have much more opportunity if the overall pie grows than if we focus only on increasing our individual slice of the pie. Of course, I’m going to do the best I can to grow our share. But ultimately, electrical safety and electrical reliability in factories are still major problems. And the number of deaths, injuries, and life-changing accidents we hear about—it continues. We hear those stories all the time, and we don’t want those things to happen.

Yeah. Love it. So your business is innovation-driven, and you are designing these electrical appliances that increase productivity, reduce risk. What is the major success factor in being able to come up with new products along these lines?

Yeah, so I guess I’ll tell you my biggest failure. Okay? I’ll use the failure to illustrate the point. That’s good. I think I was about 25 or 26 years old, and I was working with a customer—a very large publicly traded company. They liked our product, but they needed it in a different form factor, which meant we had to re-engineer the product, retool it, and go through all the certification processes again. And I just took it hook, line, and sinker. I thought we were really onto something. I probably had delusions of grandeur and thought I was some Steve Jobs-like figure who could just wave a magic wand. And by the way, I don’t think that’s actually what Steve Jobs did, so I want to put that out there for a minute. I think what we see from the outside as consumers is often not the reality inside the company. So I just want to say that.

But anyway, instead of taking small iterative steps and quickly prototyping and getting feedback, I did a full design based only on feedback from that one customer before cutting tooling and paying all the certification costs. It ended up being about a $400,000 project. And I think we still have inventory from that project—and this was probably 12 years ago or something.

Oh my gosh.

So what have I learned now? The best innovation happens through rapid iteration. A lot of your listeners have probably seen the Elon Musk SpaceX Raptor engine images, right? You have this incredibly complex engine that goes up into space, and then the next version looks much simpler, and the third one looks like it came out of a sci-fi movie. It’s almost like the Picasso bull sketches.

There are nine different bulls until Picasso eventually gets it down to two lines, and you still understand it’s a bull. Okay? And I think that’s what iteration looks like. What you see as a final product from Apple is actually the result of thousands of prototypes, iterations, and constant testing behind the curtain. For me, I want to test with customers directly, because you get much better feedback that way. I think the more rapidly you can prototype, the more rapidly you can iterate and get real customer feedback, the more innovative your product is going to be. I really think that when you try to make too big of a leap all once, you usually can’t get there. And I think 10% compounded over time is a much better strategy than trying to go 10X in a single shot.

Yeah. It’s kind of the Kaizen principle of continuous improvement through small steps. But actually, I was listening to an interview with Jensen Huang, and he said he hated Kaizen because he wanted more first-principles thinking—completely rethinking things from the ground up. And I think Elon Musk does that too. Although honestly, I think he does both, which is really interesting. But I love Kaizen. I think it’s a wonderful concept to continually improve things.

We do work with SpaceX. We don’t do much with NVIDIA—a little bit, but not much. And while you can think from first principles, you still have to iterate on the prototypes, right? Yeah. You have to constantly try things. So you may have a first-principles vision of where you want to go, but you’re not going to get there by designing the perfect thing 100% upfront. You get there through iteration.

Yeah. So you really need both. That’s a really good point. So Drew, what is it that you are trying to figure out in your business right now?

So over the last 12 to 18 months, our largest orders have started coming through the data center sector. Back in 2015 or 2016, I tried to push into data centers, and we just had no product-market fit. None. Everybody kept talking about the data center business, and I was like, “Well, they’re just not using our products. We tried…” But what suddenly changed was the increase in power density inside data centers. And what I mean by that is this: You can now have a hundred megawatts in a traditional data center hall. That’s basically the equivalent of multiple oil and gas refineries worth of electrical load inside a single data center hall.

A hundred megawatts—yeah.

And so the electrical risk profile has really changed. And because of that, now there is product-market fit. So now I’m trying to figure out: How do I set up the right distribution channels? How do I build the right sales network? Because data centers definitely buy differently than our traditional industrial customers. And then, as CEO, you always have to decide where you’re going to focus your time. I’ve been very intentional about not losing the core identity of Grace through our industrial business. So I’ve had to build a separate group that really focuses on the data center market. That also means bringing in a board member who really understands the data center space. Right now, though, it’s a huge growth area for us, so figuring that out has been super important.

The other thing is that over the last few years, we’ve launched an incredible number of new products. But a lot of those were what I’d call necessary innovations—things we had to execute on quickly. So now we’re finally getting to a point with the engineering team where we can start from a clean sheet of paper again. We can think more deeply about where we really want to go—maybe even from first principles. Because honestly, I feel like we’ve been operating in a reactive mode for the last few years. So it’s going to be really exciting to finally have some white space again and be able to innovate more intentionally for the future.

Yeah. So you want to have that sci-fi engine for Grace Technologies that SpaceX has for the rockets, right?

Yeah. That’s the goal. And our mission is to accelerate the industrial world to zero downtime and zero harm. Until we get there, it’s a pretty lofty goal. And I think it’s going to require a lot of innovation to achieve it.

So what’s the process when you’re trying to get to that kind of innovation—when you’re rethinking something from first principles? Is there a process you can follow or work through? Or is it more about letting your imagination wander? Like when Albert Einstein came up with the theory of relativity—he was daydreaming in the patent office and suddenly had these insights. What’s your process for getting there?

So first, we want to be really clear on the problem statement. Getting absolute clarity on what problem we’re solving is the first step, right? If you don’t know what problem you’re solving, there’s no amount of engineering you can throw at it that’s going to make sense. Second is understanding the constraints. For one of our new product development efforts, we decided to move away from a digital platform and go to a fully analog electrical platform because we realized one of the main constraints was size. And size is really determined by the power supply.

When you run a digital circuit, you’re operating at something like 100 to 300 milliamps. If you go to an analog circuit, you’re operating at the microamp level. So you’re literally at around 10% of the power requirement. And if you’re at 10%, you can make the power supply about 90% smaller. Now, it’s much easier to do things digitally because you just program the microcontroller. You’re not dealing with the art of analog circuitry. So I think that’s a good example of thinking from first principles. Okay—we’re solving this problem. One of the major problems inside that problem is the size of the unit. How do we reduce the size? Well, we have to reduce the power supply. How do we reduce the power supply? Reduce the power draw from the circuit. How do we reduce the power draw? Go analog. And that’s how we got there.

But even then, the amount of prototyping and iteration we’ve done on that over the last 12 months has probably involved 75 major iterations of the circuit, tons of prototypes, tons of testing, and countless tweaks that probably never even hit my radar. I know I’m getting a little nerdy for the podcast, but I think it’s a really good example. And if you take it out of engineering for a minute and look at our sales engine, it works similarly. Ultimately, what drives sales? You have to have unique selling conversations with customers. So everything I focus on becomes: How do I maximize those conversations?

Getting people interested in the product and actually getting to the point where we can sit down and fully tell our story—that’s kind of my North Star.
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I know that if we increase the number of those conversations, sales will increase. And of course, there’s optimization on both sides of the meeting—follow-through, follow-up, competitiveness, lead quality, all of that. But the big North Star in our sales function is: How many unique selling conversations are we having with customers?

Okay. I love it. So this is a framework that I’m more excited about than the flywheel because we are almost 400 episodes in. Here is what I heard. So be clear on the problem, step number one. Understand the constraints, step number two. Think from first principles, that’s step number three. Build the prototype, step number four, and perform iterations. Step number five, essentially the optimization. And with the sales engine, it’s kind of a similar process that you described, but less technical perhaps.

Yeah. And one other piece too is that all of this has to be time-constrained.

What do you mean by that?

I think people miss that point. If you don’t have a time constraint, it will literally take forever. So inside of your framework, you need a time box, and I think that’s really critical. I like what Elon says about timelines. He assigns timelines that he believes have about a 50% probability of being achieved. I think that’s actually a really smart way to think about it. And that means that about 50% of the time, you’re going to miss the target. But that’s okay, because you want that level of tension and flexibility in the system. You still have to be aiming at something. If you don’t put a time box around iteration, if you don’t set launch dates, product development can drag on forever. For example, we have a major trade show every fall, and we always try to have products ready for that event. That creates a really effective natural time box for us. And if your business doesn’t already have natural time boxes, then as CEO, you need to create them.

Yeah.

Otherwise, iteration, product development, and even sales initiatives can lose momentum. Sales naturally has monthly, quarterly, and annual cycles. But in engineering especially, having that time box is really important.

Yeah. And what I read about Jensen Huang is that one of the innovations he introduced was creating two overlapping time boxes. So instead of having just a single one-year cycle, he created two teams working on separate one-year cycles that were staggered by six months. That way, they could effectively iterate on the product twice as fast. I thought that was amazing. And I also had a client—an engineering software company—whose challenge was that they couldn’t launch a product for three years because they were such perfectionists. So we talked about putting a stake in the ground and committing to a release every year. Maybe the scope would have to change, maybe they’d have to narrow it or simplify it, but the release date itself would become a forcing function. And once they did that, their product suddenly started gaining much more traction. That’s a fantastic point.

Yeah. I was advising one of the companies we’re invested in. I was actually on a call with them yesterday, and they’re starting to run out of time a little bit, right? And that was literally the conversation we had. “Okay, we had this wish list. We had this dream product-development idea. Now what can we realistically get done in three months?” So we started stripping out everything that couldn’t be completed in that timeframe, and those items will move into the next iteration cycle. But I think it’s super critical. You’ve got to put a stake in the ground and force things through.

Yeah. Constraints create creativity. Yeah. that’s fantastic. So, penultimate question—I have one more just to wrap things up. If you had a magic wand, what would be the one thing you’d want to fix inside your company over the next 12 months?

I think we have a lot of relatively new and young salespeople. We operate in a very technical field, and trying to get them to really understand the application space from a technical perspective is difficult. And when you’re selling to engineers, they can immediately tell if you don’t know what you’re talking about. So the challenge becomes: How do you compress 20 years of experience into a brand-new sales or business development person in just a few months? Trying to accelerate that learning curve is probably one of our biggest challenges. We’re trying to use AI to help visualize the kinds of equipment our products go on.

And frankly, even after doing this for years, I still run into things I don’t fully understand. But I have enough experience that I can have a relatively technical conversation, understand the constraints, and work through the problem set. But compressing that knowledge into a faster training process—that’s definitely been hard. I’m also opening a sales and engineering office down in Austin, so I’ll be moving there in June. The plan is to build out another R&D facility there. That’s one of my major time boxes over the next 12 months—getting that operation fully up and running. But from a more holistic perspective, I think really solving that sales knowledge-transfer problem is critical. And on one of our product lines, honestly, I’d love ideas from listeners.

We have an IoT condition-monitoring product, and we’ve been very successful at selling pilot programs. What we’ve found, though, is that it’s been much harder than expected to convert those pilots into broader expansion deployments. So we’re asking ourselves: Are we making the barrier to entry for the pilots too low? Are we attracting the wrong type of customer—people who don’t actually have the authority to make a larger purchase decision? Or are we missing something in the sales process that would better position the expansion after the pilot succeeds? Those are a few of the areas we’re really trying to figure out right now.

Yeah. Love it. That’s fascinating. So if the listeners would like to learn more about Grace Technologies—or maybe you spark something in their mind and they want to reach out and communicate to you, or have access to someone in your company to answer the questions about the products. Maybe they want to have more safety and more productivity with their electrical safety equipment. Where should they go, and where can they find you?

Yeah. You can reach me at drewa@gracetechnologies.com or find me on LinkedIn. I think it’s Allen-Drew is my handle, but Drew Allen on LinkedIn. I love hearing from people. I really enjoy advising startups, especially in the industrial electrical space. If you have a product idea or you’ve got a startup, I do a lot of advisory work, and we’ve invested in a number of startups as well. We’re really passionate about having more innovation in the industrial world. I believe that the reindustrialization of America is super important, and I’m a big proponent, and so love to support companies that are doing cool things in our space.

Oh, that’s fantastic. So if you’re listening to this and you have a startup in the engineering space, then definitely this is your opportunity to get mentored by Drew, and maybe to get opportunities that you don’t have yourself. So reach out to him. And if you just enjoyed this conversation with an entrepreneur who’s innovating fast and who is working from first principles and time boxes and and leveraging constraints, then definitely stay tuned on this channel because I have more wonderful guests coming on every week.

So thank you Drew for coming, CEO of Grace Technologies, the leading innovator of electrical safety products and predictive maintenance solutions. So thanks for sharing your wisdom and thanks for listening.

Important Links:

Drew’s LinkedIn
Drew’s website
Drew’s email: drewa@gracetechnologies.com

332: 5 Steps to Engineering Breakthroughs with Drew Allen

Management Blueprint | Steve Preda

332: 5 Steps to Engineering Breakthroughs with Drew Allen