Secrets of GM's Quality Comeback

Many a General Motors heart was gladdened by the news that the latest J.D. Power survey of initial quality awarded GM's Lansing Grand River operation its highest Gold award for 2004 models produced by North American assembly plants.

Lansing Grand River's Cadillac models registered only 74 problems per 100 vehicles among owners/lessees after 90 days. This was second only to the vaunted Lexus top-end models made in the Toyota Tahara plant inJapan.

It was also a significant improvement for LGR products over the year before, despite the fact new variants had been added to the product mix. Production of the Cadillac SRX "station wagon" was added last August and the CTS-V "luxury hot rod" in January. The new STS assembly officially starts June 1.

In addition, LGR's 74 rating was considerably better than the number two and three highest quality North American assembly plants, GM Hamtramck at 91 and Ford Wixom, a hair behind at 92. (The industry average for light vehicles sold in the U.S. was 119.)

Out of the dumps

Five years ago, GM was still pretty much in the dumps in both quality and plant efficiency, even though it had been working hard to upgrade. A generation and more ago, GM was the envy of the world in quality - especially Cadillac - and in efficient production - especially Chevrolet.

But then in those days there were no outside reporting services like J.D. Power, Harbour, and AutoPacific. Together these services are something like a Daily Racing Form for the auto industry today. Power checks complaints about the vehicle, Harbour examines plant efficiencies and AutoPacific combines owner ratings of vehicles and dealer experience.

With that as background, let's take a look at how GM has made such great strides at LGR.

In the first place, LGR is a "greenfield plant in a brownfield site," as one GM exec termed it. Translated, this means an all-new plant erected where an old facility had previously existed. Lansing Grand River was built, beginning in 1999, where previously Oldsmobile Division offices and engineering facilities had rested for decades.

Ford's new Rouge Truck Plant is another example of greenfield/brownfield siting. Later, we'll point out some comparisons and contrasts.

Second, LGR represents the first in North America of the new "General Motors System" (GMS) of manufacturing. Amazingly, it is based on GM's conversion of the former East German Wartburg plant at Eisenach after the two Germanys reunited following the collapse of the Soviet Union.

East German cars like the Wartburg must be the sorriest excuses for cars ever produced. They made the Yugo and Lada look like winners. Only in Hungary, where tiny pockets of Communist glory hang on, can you readily find any of these motoring disgraces still smoking up the roadways. It is hard to imagine mighty GM building on the base of a Soviet plant to achieve top quality and productivity.

But the workers at Eisenach were highly skilled and professional with a good work ethic, despite their former Red masters, according to Klaus Blacke, LGR's manufacturing engineering manager, a 35-year GM veteran and German native who graduated from the General Motors Institute (now Kettering University) in Flint.

And the timing was right, as GM used Eisenach as a first step in reinventing itself in the 1990s. Today the Eisenach plant has the highest quality of any GM plant worldwide, becoming the beacon for the New Way.

In addition to LGR, the GMS approach has now been applied to new plants in Poland, China, India, and Thailand. The next plant to get the treatment will be the Delta Township assembly plant now under construction on Lansing's far west side, a true greenfield plant.

Culture shock

There are several elements in the GMS. Insofar as traditional American autoworkers are concerned, foremost is changing the culture of the workplace. Lansing, home of now-history Oldsmobile, was the logical place for GM to start, because home-built Oldsmobiles had a long-standing quality tradition and the local union was deemed willing to work with management to change the old culture.

The new culture involves unprecedented teamwork, training and empowerment of the assembly worker.

At LGR, there is a three-level hierarchy of assembly teams. On the line, workstations are designed around a team of five members including the team leader. Each is trained to do the tasks of one another, and these tasks are rotated every two hours during the shift. The leader fills a utility role, stepping in to replace workers during breaks or absences or to help out if there is a kink. The next tier is groups of five teams, and the group leader is trained to step in as a replacement for any of the team leaders.

The top layer is the shift, wherein the shift leader oversees the group leaders, and can replace any one of them. The teamwork crosses shift lines. It is hard to imagine in an American plant, but the first shift doesn't go home until members shake hands with the incoming second shift.

Before Lansing Grand River got under way - start-up was mid-2001, with the first new CTS officially produced November 12 - training was extensive. Two to three hundred employees were sent to Eisenach for two weeks. Each of the roughly 1500 employees received from 300 to 800 hours' instruction before starting at the new plant. Yet all had been high seniority Oldsmobile employees facing a dim future as GM's market share eroded and Olds wound down.

Worker empowerment is yet another aspect of LGR's quality story. And it has various aspects. Perhaps major is the ability of any one worker to shut the line down when a problem arises that can't be handled readily. At each workstation, there's a yellow cord which when pulled sets off a unique musical chime and stops the line. It is amusing to hear in Lansing - home of both the state capitol and Michigan State University - an electronic chime of "Hail to the Victors," fight song for rival University of Michigan.

Other chimed songs, which sound fairly continuously during the shift, are nursery-rhyme melodies or just pops. (Okay, I know, State's in EAST Lansing.)

All employees in the plant wear uniforms supplied by GM in the earth tones of Cadillac cars. And these uniforms are not the coveralls you might expect, but rather attractive outfits of trousers, shirts, sweaters, and windbreakers. Each uniform has the worker's name - whether hourly union member or salaried staff - on the right breast, like U. S. armed services personnel. Metal belt buckles and other items like exposed wristwatches, which might scratch new car surfaces, are banned. Even finger rings have to be removed or wrapped.

Safety precautions are rigidly taught and enforced. The plant is spic-and-span clean.

On the floor, the new bodies move steadily along atop wooden-floored "skillets" with team workers able to perform their tasks "in place" without having to rush back and forth between parts bin and station. Instrument panels are inserted through door openings via powered fixtures and fastened smoothly by team members on either side; windshields likewise are robotically placed. The skillet fixtures rise or fall automatically to ease tasks with minimal body strain or heavy lifting.

At a production rate currently of 30 to 34 an hour, the LGR pace seems relatively leisurely but is typical of luxury vehicle assembly. Ford's new Rouge Truck plant reportedly will turn out nearly twice as many per hour, 60 to 66, but the F-150s and its derivatives are very different from the small Cadillacs of LGR.

Both plants brag of their Flexible Assembly capability, which promises greater stability of production and employment and, no doubt, speed and lower costs of switching models to meet customer demand.

Ford clearly has copied much from the GM system, not surprising given the three-year time lag. The new Rouge plant features nearly identical-looking line skillets with easier-on-the-feet wooden floors and lifts for ease of assembly. The bodies moved backwards, the opposite of LGR. The Ford assembly teams consist of seven members, larger than GM's.

The success of both these plants, and the new manufacturing concepts they stand for, depends to a high extent on union-management cooperation. Significantly, in its nearly three years of operations, LGR has experienced zero grievances - the usual sign of worker unrest - filed.

LGR plant manager Ken Knight praises UAW Local 652 president Art Baker for his leadership and partnership. Both men ascribe to LGR "core values," which they list as creating customer enthusiasm, continuous improvement, people involvement, short lead times, standardization, and built-in quality.

The late Dr. Deming, apostle of statistical control and constant improvement, no doubt is smiling. And let's give oft-criticized former GM Chairman Roger Smith some credit, too. It was on his watch that GM began learning from Toyota in the NUMMI joint venture at GM's old Fremont, California, assembly plant some 20 years ago.