Archive for January 29th, 2008

Making cars safely, efficiently, and high-quality — a look into organizational culture

January 29, 2008

Along with a group of MIT alums, one week ago (1/22/2008) I was fortunate to visit the automotive manufacturing plant in Fremont, CA that turns out the Toyota Corrolla, Pontiac Vibe, and Toyota Tacoma pickup truck. The NUMMI auto plant is a joint venture of GM and Toyota. In North America, for Toyota it is the most efficient plant taking 19 hours of human effort per vehicle produced and seventh overall (GM and Honda have more efficient plants) — see the article “Most efficient assembly plants” in Automotive News. In 2007 NUMMI produced 407,881 vehicles — see “There’s a new No. 1 plant: Georgetown.” I have blogged about NUMMI’s high-trust workplace, and here are some notes that another MIT alum put together in 2003.

The first thing I noticed at the entrance to the plant was a rug on the ground titled “Safety Absolutes”

Safety is the overriding priority

All accidents can and must be prevented

At NUMMI, safety is a shared responsibility

Their mission statement posted on the wall is

“Through teamwork, safely build the highest quality vehicles at the lowest possible cost to benefit our customers, team members, community, and shareholders.”

What struck me was message of social accountability and interdependence being conveyed in both the rug and mission statement.

The plant is 5.5 million square feet (118 football fields or 122 Costcos), and workplace for 5,000 “team members” (they didn’t say employees). There are also 300 temporary workers who come in to help for seasonal variations in production.

The emphasis on relationship with team members and “community” comes out at every turn in the plant. The plant has had no layoffs in its 23 year history of operation. Wages start at $20/hr and go up to $35/hr in three years. The plant has 160 “team rooms” with refrigerators, lunchrooms, and lockers. Phrases I heard included “quality, pride, teamwork, job security, benefits, pay, family, successful year, looking out for my family, winning team, all about the family.”

There are five stages (divisions) to auto manufacturing at NUMMI.

  1. Stamping steel into body sheets — 1 million lbs of steel / day
  2. Body / welding
  3. Paint
  4. Plastics
  5. Assembly — the assembly line is 1.5 miles long producing 650 trucks / day and 900 cars / day. There hours per truck, one produced every 85 seconds.

Quality control involves random test drives and audits at the end of the production line. The quality philosophy really starts with the team members who are trusted with the authority to push a button that will raise an alert to stop the assembly line if they find a problem — an innovation from Japanese lean manufacturing. There was a time when auto plants did not allow their employees to do this. Once they raise the alert, the a red light goes on and they have 81 seconds to decide to clear the alert the before the line actually stops. Sometimes it gets cleared up within that time, and other times the line has to stop to fix the problem. After reading about it before coming to the plant, I was really curious and I actually saw it stop a few times. The line statistics are prominently displayed for team members to view on a scoreboard. They were reporting 2% downtime and the target is to remain less than 4%.

The NUMMI team members work in teams of 4-6 people, and they rotate their jobs throughout the day whenever they want to — this eliminates most of the repetitiveness and boredom usually associated with manufacturing. They usually spend 1 year in a division (like plastics) before moving onto other types of jobs in the plant, so that way employees learn about all aspects of manufacturing/production. Team members are encouraged to find ways to improve the process and implement these ideas. Using a “frame rotator,” the truck chassis were flipped upside down to aid team member ergonomics during assembly of the drivetrain. We saw several robots by Kawasaki, and automatically routed (guided) vehicles to transport auto parts.

If an auto plant can do this, what would it look like if we incorporated this philosophy into software development? Software programmers and test engineers would have the authority to raise alerts and hold up software releases instead of a manger having the final say in triage of bug reviews. People would rotate between software and test. What if the space shuttle launch could be delayed by any engineer on the team instead of being determined by launch managers? To make this work all engineers have to have sufficient system level knowledge and be “trusted” with the authority to make these decisions.

There is a hierarchy,

  1. skilled worker — several of whom are organized into quality circles
  2. team leader of 4-5 workers (tends to be nurturing)
  3. group leader of several teams (tends to be more disciplined)

Only the teams are evaluated for performance, not individuals. People can get fired, but they can’t get layed off. The plant operates in two 7.5 hour shifts for a total of 15 hours per day, five days a week so people have weekends off. According to the tour guide, job rotation was the big thing that drew employees to the plant, not work or guaranteed employment.

The big difference that comes out here is the relationship with team members and that trust turns into better results.