A Manufacturing Parable.....

[ND66]

Here's something to think about: Ford has spent the last thirty years moving all its factories out of the US, claiming they can't make money paying American wages.

Toyota has spent the last thirty years building more than a dozen plants inside the US .

The last quarter's results:

Toyota makes 4 billion in profits while Ford racked up 9 billion in losses.

Ford folks are still scratching their heads.

A Japanese company (Toyota) and an American company (General Motors) decided
to have a canoe race on the Missouri River . Both teams practiced long and
hard to reach their peak performance before the race.

On the big day, the Japanese won by a mile.

&nbs p; The Americans, very discouraged and depressed, decided to
investigate the reason for the crushing defeat. A management team made up of
senior management was formed to investigate and recommend appropriate
action. Their conclusion was the Japanese had 8 people rowing and 1 person
steering, while the American team had 8 people steering and 1 person rowing.

Feeling a deeper study was in order, American management hired a consulting
company and paid them a large amount of money for a second opinion. They
advised, of course, that too many people were steering the boat, while not
enough people were rowing.

Not sure of how to utilize that information, but w anting to prevent another
loss to the Japanese, the rowing team's management structure was totally
reorganized to 4 steering supervisors, 3 area steering superintendents and 1
assistant superintendent steering manager. They also implemented a new
performance system that would give the 1 person rowing the boat greater
incentive to work harder. It was called the 'Rowing Team Quality First
Program,' with meetings, dinners and free pens and a certificate of
completion for the rower. There was discussion of getting new paddles,
canoes and other equipment, extra vacation days for practices and bonuses.

The next year the Japanese won by two miles.

Humiliated, the American management laid off the rower (a reduction in
workforce) for poor performance, halted development of a new canoe, sold the
paddles, and canceled all capital investments for new equipment. The money
saved was distributed to the Senior Executives as bonuses and the next
year's racing team was "outsourced" to India ..

Sadly, the End.

[cjolley]

Another reason for the loss--

Toyota:
"The Judges have said they want us to go as fast as we can.
That seems to be 4 minutes and 15 seconds. We hope that that meets with the judge's approval."

Ford:
"We have decided that an optimal time for our purposes is 5 minutes exactly. It is a nice round number and easy to meet. We will market that time to the Judges so they will buy it."

[Brian Ellis]

It should perhaps also be mentioned that the Japanese canoe was designed to not ship water and to have less draught to slip through the water more easily, using modern materials and automated manufacturing techniques.

I visited a Nissan factory in Japan, about 16 years ago. I was impressed in two areas. The body assembly area, where the shell was assembled and spot-welded together. There was one man whose job was to make sure that there was no hitch in the manufacture: in reality, he was just looking, to make sure that there was an adequate supply of the component parts and that the spot-welding electrodes were OK. Obviously, this production line was for a single model at a time. and it would take several hours to change models. What was interesting was that there were QC robots: they measured essential chassis parameters, e.g., the overall length within a tolerance of ±1 mm. Each spot welding electrode was computer controlled and if the current/time was incorrect, the machine stopped for manual intervention. When this was done, the machine went back and redid the faulty weld. The weld defect rate was ~1 in 50,000.

Even more impressive was the final vehicle assembly line, where they had mixed models, specifications, colours etc. At each station, the robots were automatically fed with the correct parts for the spec of that particular car and assembled it. Guess how many humans were assisting with the assembly, from the bare shell to the drive off at the end of the line? Exactly 19, not counting the drivers. Compare that with a US or European car maker.

To be fair, we were told that this factory was unique and was used experimentally to maximise robotisation but, even so, a car was being driven off the line every minute. But remember also that this was in 1991 and I've little doubt they have improved on this since then.

During the same trip, we also visited the Seiko-Epson watch factory at Suwa, where they were doing the same thing for wristwatches with one experimental line for ladies' and one for men's watches, each with 50-60 robots. This was more difficult and they had 4 or 5 people on each line to take care of stoppages. The watches were not only assembled, but they were regulated automatically and, at the end, they were automatically placed in their presentation case which was then automatically placed in a despatch carton, at the rate of one watch every ten seconds. Coming from a country with the greatest watch-making tradition (among my clients were Omega, Ebauches, ETA, Swatch, Tissot, Longines, Rolex etc.) and very familiar with how watches were assembled, I can only say that the wind was taken out of my sails when I saw it. The nearest we had was the Swatch factory, but that was a different low-cost concept, whereas the Seiko lines were producing middle-of-the-range (~$200) timepeces.

If we extended the analogy of the parable, the Japanese had only a couple of paddlers in each canoe, but the latter was so well designed that it went faster than one with 8 paddlers!

[ND66]

In the "Top 10 American-Made Cars" are Toyota Camry (#2) & Sienna (#8) and are making money.

So, we could build cars for profit here.

IMO, what's killing US automakers are Unions, just don't hang me for that. It's just my own opinion.


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[ND66]

While little OFF the topic, check this out:

Cars Future Innovations


I like this one:

Self-Repairing, Self-Cleaning Paint

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[Tjalfe]

IMO, what's killing US automakers are Unions, just don't hang me for that. It's just my own opinion.


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[Jammrock]

In the "Top 10 American-Made Cars" are Toyota Camry (#2) & Sienna (#8) and are making money.

So, we could build cars for profit here.

IMO, what's killing US automakers are Unions, just don't hang me for that. It's just my own opinion.


.

Unions are a big part of it. They are so entrenched in the big 3 and corrupt beyond repair that it definately hurts. It forces the big 3 to pay people way more then they should because they get union dues taken from their pay. The other part is quality control. The big 3 are getting better, but having a hard time convincing the public that their quality has gone up.

[ND66]

Unions were good for 1920's ~ 1930's, when workers were loosing hands and were kicked out on the street in reward for that.

Now's it's just a legal Mafia. I have a neighbor, he was paying union dues for 23 years, after that he had a stroke, his heart stopped for few minutes before they were able to bring him back.
Only because he couldn’t work in his trade anymore, he can kiss his union benefits and those union premiums he paid goodbye.


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[cjolley]

...he was paying union dues for 23 years... he can kiss his union benefits and those union premiums he paid goodbye.

There is something wrong with this story.
Where did his retirement contributions go?
What union was he in?

[ND66]

Don't know all the details. I know he had a layer looking into it, couldn’t do anything.

While he had the stroke, later he was cleared to return to work (???), and union did provide him with a job 45 miles away (one way), not in the safest neighborhood in the world, working 3rd shift.
On top of that, he couldn’t keep up in the metal factory (after 19 pills a day I bet you couldn’t work on your feet whole day long, not to mention to do some heavy lifting), so he left on his own & quit that job.

They got him on some kind of technicality that they did provide him with a job (something they were obligated to do) and he did quit on his own, didn’t pay union dues for few (or several) months. So in Union books is like he did quit the Union too. The only thing, he did try to pay his Union dues by himself, while not working, but they didn’t allow him to do that.

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PS. Needed 25 years of paid union dues in order to collect before the retirement age, he had 23+.