Nissan Motor Manufacturing Corp. U.S.A. wowed the auto industry when it became the first North American plant to apply waterborne paint electrostatically in 1992.
But one of the most revolutionary pieces of technology introduced by the transplant automakers since the 1980s was also one of the simplest: the andon cord.
Toyota Motor Corp. used the cords in Japan to allow any worker to stop an assembly line with a yank in the event of a manufacturing glitch. The device - or some mechanical version of it - now exists on factory lines across the world. But it demonstrates two technological phenomena of the U.S. transplant industry.
1. Because foreign-based automakers were investing in greenfield factories here at a time when the traditional automakers weren't, they enjoyed a full decade of being able to introduce clean-slate factory innovations.
2. The new plants' most influential new technologies were human based, not engineering based.
Now, in fact, many in the industry agree that the material differences among North America's automakers are few when it comes to cutting-edge manufacturing technology. In some areas, such as new software systems that control manufacturing processes, the Big 3 have taken the industry lead. The greater differences now lie in how human capital is being used.
THE PRODUCTION SYSTEM
Toyota's American factories are now regarded as industry benchmarks for their sheer auto-manufacturing elegance, consistency and sophistication. But it is not because of any tools or equipment they produce. It is because of what the company calls the Toyota Production System, or TPS.
TPS is essentially a rule book of steps and philosophies that are followed by factory managers and employees. It governs how parts are delivered to the assembly line, how employees move about their jobs, and how quality is maintained.
Variations of the system also exist at other Japanese-owned auto plants in the country, including Honda of America Manufacturing Inc., Mitsubishi Motor Manufacturing of America Inc., Nissan and Subaru-Isuzu Automotive Inc. They now also exist at BMW Manufacturing Corp. in South Carolina and Mercedes-Benz U.S. International Inc. in Alabama.
Each of the Big 3 is also establishing its own proprietary 'production system' philosophy now.
'I literally don't know of anyone with a major technology program that sets them way ahead of anyone else anymore - and I've been around to all of them,' says James Harbour, chairman of Harbour & Associates, an auto-manufacturing consultancy in Troy, Mich. 'The biggest thing going on in manufacturing now is to make sure you're running all the time and make sure you're in control of the process.'
The transplants had a decided advantage in rolling out such production systems because they built mostly greenfield factories and hired new work forces. That opportunity also allowed them to begin with more efficient tools, such as flexible, automated metal-stamping presses that permitted them to change back and forth between models in a matter of minutes instead of hours.
But early on, the transplants maintained that the secret wasn't in the hardware. When Toyota began partnering with General Motors in 1984 to overhaul what would become the New United Motor Manufacturing Inc. plant in Fremont, Calif., it actually stunned GM executives with a lack of bells-and-whistles advances in factory automation.
'With NUMMI, the big shock was, 'We're not going to automate this place, guys.' And to this day, it remains one of the least-automated plants in this country,' Harbour says. 'The focus of the Japanese, which finally dawned on GM, is to learn how to run the automotive system first and then talk about the rest.'
What mattered, many U.S. manufacturing executives came to believe, was rooted in common sense: the elimination of waste, continuous improvement and the flow of materials.
Honda says its approach is conservative about the level of automation in its Ohio operations and to fully utilize the experience of employees in making improvements.
'I've got 5,000 engineers here, really,' says Neil Vining, Honda's chief engineer.
In Smyrna, Tenn., Nissan still attacks ergonomic challenges and spends a lot of time continuously foolproofing its factory lines, says Guy Wilson, vice president of engineering.
'And there's still a spirit among our people that wants continuous improvement,' he says.
At Toyota's Georgetown, Ky., assembly operation, its American managers have learned how to optimize their work force with continuous training, a strong dose of democracy and a systematic solicitation of their ideas. Last year, Toyota employees submitted more than 94,000 suggestions, 99 percent of which were implemented, according to Peggy Ferriss, assistant manager of assembly.
'Our philosophy is that small, incremental changes build up car-by-car,' Ferriss says. 'They don't all have to save $10,000 in scrap.'
The enhancements can be as minor as putting padding on the dollies that bring windshields to the assembly line, saving workers one or two seconds with each car because they don't have to be as cautious. Collectively, last year employee suggestions saved Toyota $74 million, and the company awarded $3 million in bonuses.
NO SECRETS HERE
The competitive gap in manufacturing today has also narrowed because the Japanese never tried to conceal their philosophies from their Big 3 competitors. Allowing Big 3 engineers to see the new factories in action would not have led to large-scale replication, the transplants reasoned. Therefore, they allowed - and still allow - American auto executives and managers to visit by the hundreds. Similarly, some executives from Japanese plants have gone to work in Big 3 plants. Dennis Pawley, executive vice president of manufacturing at Chrysler Corp., was an executive at Mazda Motor Corp.'s plant in Flat Rock, Mich. So was James Solberg, manager of Ford Motor Co.'s powertrain operations.
'GM has learned a lot of lessons since the early '80s,' Harbour says. 'In fact, when it comes to lean manufacturing, it is way, way up the learning curve.'
Ford has been pushing ahead with implementation of its Ford Production System. Among other things, the program benchmarks its own best practices worldwide and then tries to integrate them companywide. For example, borrowing a technique perfected at Ford's plant in Valencia, Spain, the automaker can now double up production of door stampings by fitting two different dies - such as for a front door and a back door - on the press at the same time.
Another major component of Ford's new approach is embodied in 'in-line vehicle sequencing,' a practice that takes just-in-time manufacturing to the next level. It pushes the task of part sequencing onto a supplier in order to reduce cost and increase assembly speed. Suppliers deliver parts right to the assembly line in a sequence that matches the order of the vehicles moving down the line.
The practice should help Ford in its goal of reducing the lag between vehicle order and vehicle delivery to 15 days, down from about 60 currently.
Ford's approach also is slashing inventory of manufacturing components. 'We have taken 30 percent out of our inventory in the last 18 months alone, at a savings of $1.5 billion to $2 billion,' says David Thursfield, vice president of vehicle operations.
'You have to remember that TPS used Henry Ford's original production system as a benchmark,' he adds. 'We've reinvented the wheel. We'll be the people to watch over the next two or three years.'
BACK ON TOP?
The Big 3 continue to put resources into such newer technologies that merge information tools with 'people-friendly' philosophies. Chry- sler believes it has a leg up on the transplants now - as well as on GM and Ford - with its advances in virtual manufacturing. Chrysler can move and shape data seamlessly from the very front end of a vehicle-design project right through final inspection at the factory.
Frank Ewasyshyn, Chrysler's vice president of advanced manufacturing, says the tool 'gives you speed and the ability to make more improvements, because you can do more than just work in the physical world.'
Die-making time, for example, used to account for months of a vehicle development schedule. It is now dropping to days.
Working more closely with suppliers, as it learned from watching Honda in particular, Chrysler is also now executing projects through 'extended enterprises' that blend engineers from Chrysler and its suppliers as though they worked for the same company.
Ewasyshyn says that these advances are only part of the 'major strategic initiative' called the Chrysler Operating System. Among many other advantages, it is allowing the company to cut costs by reducing space requirements at its plants.