Our Community Mission - Helping the Automotive Industry

DOING IT RIGHT! This blog is a community work focused on improving the automotive industry, specifically, but it is a "melting pot" of ideas that will help ANY enterprise. The "founding" authors have a combined total of 152 years of experience in improving quality, productivity, costs, and the Quality of Work Life on the plant floor for General Motors, Ford Motor Company, DaimlerChrysler, Honda, Toyota, and many others. Collectively, we have seen "Best Practices" at individual plants and headquarters around the world. And it amazes us how little these Best Practices have been taken up by other plants and other companies. The very things that would have averted the current crisis in the American automotive companies are already in their possession; in one form or another and in one plant or another, they have what it takes to win. Dysfunction in their cultures appear to prevent the deployment of the best. There are still "chimneys" in these companies that have endured all the "chimney breaking" programs of the last two decades. There are still "buzzword societies" flourishing within the companies. And we still see punishment meted out for unpopular successes and failure rewarded. This blog is NOT an indictment of the industry. This IS a collecting place for the Best Ideas for fixing what ails these companies! It is our hope that the best thinkers in industry will contribute their Best Ideas in one or more of our categories here and that the whole will be much greater than the sum of the parts. ......................................................................................................................................... This blog is copyrighted. All rights reserved. Small segments may be copied for either news articles or scholarly papers.

Monday, June 11, 2007

BIG Questions "At The Crossroads"

If I were in the top management of any of the U.S. auto makers I would be asking myself some fundamental questions:

1. Divesting "Hard-Core" Manufacturing? With the erosion of market share we have expeienced over the last 15+ years, do I really have the economies of scale needed to stay in "hard core" manufacturing? Do I really need to be good at machining parts and building axles? If I sold off those "hard core" machining-intensive operations would it allow me to focus on the new manufacturing processes required for hybrids and on creating eye-popping skin designs and assembling them in flexible processes?

2. Outsourcing More? Why do I own and manage tens of thousands of racks for part freight? Do I need my own truck fleet? Do I really need computer programmers maintaining and extending legacy applications and building new information systems? Could I outsource all of vendor quality auditing and could I get rid of the cost of sort labor by eliminating quality spills?

3. Lean Tools? It has been my experience that the savings possible from Lean Manufacturing never happen unless "Built For Lean" information systems and communication are not put in the hands of the operators. Yes training the operators and teaching them to "see" waste are utterly required. But the operators need Lean Information Tools to obtain the inventory reduction "gold" that's out there.

4. Redundancies In Material Planning? In most companies Material Handling Engineering (MHE) use simulation and other tools to develop an MHE Plan for each new launch and this should occur before the plant even exists. Then this plan is sent over to Advanced Manufacturing Engineering (AME) for actual development of the process that the MHE Plan anticipates. But time has passed so AME will often do their own plan which could be very different from the MHE Plan and is typically NOT done with simulation and Knowledge / Math Based tools. Finally, during launch, even a third plan may be put into place, at least de facto, due to expedience and personnel preferences. Can we not capture huge savings by eliminating the redundancies and outsourcing this work?

5. Shares For Concessions? Is it possible to win concessions from the Unions by offering shares in the company as partial "risk sharing" between worker and management? Would not making the "rank and file" Union worker an owner of the company?

6. Outlawing Freight Expediting? What if I took the money I spend on expediting and used part of it to build systems and processes which are predictive and proactive such that the expediting is never (rarely??) required? HUNDREDS of millions of dollars are spent annually by the plants on expediting and that is a huge source of potential savings.

There are many, many more questions along these lines that we must ask ourselves, but these six, alone, could swing the bottom line by at least a billion dollars per year - possibly even more.

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