The 244 workers at the Chrysler group's transmission plant in Kokomo, Ind., are busy assembling rear-wheel-drive gearboxes for the hot-selling Chrysler 300 series and Dodge Magnum.
The $455 million plant, built in 2003, is nearly an exact copy of a Mercedes-Benz plant in Hedelfingen, Germany, which builds the same transmission for use in Mercedes C-, E-, S- and M-class vehicles.
Workers in both plants use the same processes to build the transmissions. Doing so makes it easier for DaimlerChrysler AG manufacturing executives to measure quality at the plants. A problem at one plant can be an early warning to its counterpart.
The Kokomo-Hedelfingen connection is one example of the move by automakers and suppliers to make their manufacturing processes operate on a common standard. The goals: cut costs, improve quality and make manufacturing systems more flexible.
The Big 3 have spent more than two decades studying how Toyota Motor Corp. and Honda Motor Co. build vehicles. But just copying them didn't guarantee success.
"They all looked at Toyota and Honda, saw things like the andon cords and said, 'We can do the same thing,'" says consultant Ron Harbour, president of Harbour Consulting Inc. in Troy, Mich. "But they missed the core of what makes it work. It's like they were building a house with windows and walls but had no foundation."
That core, Harbour says, is having a plan for what to do when things go wrong and a system for improving the process.
Take the andon cord, Harbor says. When the worker pulls the cord, it signals the team leader to come help and may stop the assembly line.
"But then what?" Harbour says. "Who fixes the problem? How do you keep it from happening again? Can it be fixed in a couple of minutes, or does someone else have to be called?"
It is important that a culture be in place first before workers begin using lean production tools, Harbour says.
"The strength of Toyota is that it has one way of doing things. It's not only a production system; it pervades the entire business," he says.
That way of doing things is called the Toyota Production System.
Over the years, all the U.S. automakers have developed their own manufacturing plans. They all have different names - General Motors Global Manufacturing System, Ford Production System, DaimlerChrysler Manufacturing Strategy - and company officials say they all are different from the Toyota Production System.
But they all have elements in common with the Toyota and Honda systems, namely:
The efforts at standardizing assembly plant operations are beginning to pay off.
In the 2004 Harbour Report of manufacturing efficiency, General Motors reduced its labor hours per vehicle by 5.2 percent from a year earlier to 23.61 hours; the Chrysler group cut its hours per vehicle by 7.2 percent to 26.01 hours; and Ford Motor Co. cut its hours per vehicle by 2.7 percent to 25.44 hours.
In comparison, Nissan North America's labor hours per vehicle averaged 17.26; Honda's averaged 20.65; and Toyota's averaged 20.69, according to Harbour Consulting.
But the Harbour Report doesn't rank the Japanese automakers against the Big 3 because Nissan, Honda and Toyota don't allow the consulting firm to include all their plants in the study.
In late 1997, Harbour rated GM's hours per vehicle at 31.59 hours, the Chrysler group at 34.72 hours and Ford at 24.85 hours.
Ford's Hinrichs: Reward workers for boosting productivity.
But the challenge of implementing a production system in an existing plant is twofold, says Joe Hinrichs, 37, a director of manufacturing for Ford who oversees one-third of the automaker's assembly plants.
One goal is getting the process working right on a daily basis. The other is a change in plant culture, he says.
"The cultural aspect is more challenging because you can run into a bit of not-invented-here syndrome," he says. "Manufacturing plants tend to take on a life of their own, with a lot of pride and history at each site."
Hinrichs' background is well-rounded. Before joining Ford in 2000, he worked in manufacturing at GM for 10 years. Before that he worked at a U.S.-Japanese joint venture that made brake parts.
While not every Ford plant around the world looks or runs the same, they now all use the same set of metrics to measure progress, Hinrichs says, as part of the Ford Production System.
Workers at Ford's truck assembly plant in Louisville, Ky., for example, have been organized into teams, similar to a Japanese assembly plant. The plant has the fastest assembly line rate at Ford: 77 jobs per hour.
Each team tracks its progress on a chart that resemble a football field. When enough progress has been made to score a "touchdown," the team gets a reward, Hinrichs says. By tracking work and making changes, Hinrichs says, the plant has cut time lost to accidents by 50 percent from a year ago.
And while the automaker's flexible manufacturing system is not installed in every site, Hinrichs says, every plant is making gains by following the standard procedures and measurements of the production plan.
Standardization is the foundation for eliminating waste.
That is a key element of the New Manufacturing System that Honda Motor Co. began implementing in its assembly plants three years ago. It's now paying dividends for the automaker at its factories in central Ohio.
Next year, the factory in East Liberty, Ohio, that builds the Honda Civic and Element and Acura CL will add the Honda Accord to its line. That plant has been running below maximum capacity.
The move will free up room at the plant in nearby Marysville, Ohio, to build more of the hot-selling Acura TL without taking away from total Accord output.
The switch is possible because in 2000, with the change to a new generation of Civic, Honda installed a welding system with reprogrammable robots that can change quickly between body styles. It also lengthened the assembly line and broke it up into five zones to commonize the assembly process for all models. It made the same changes at the 12 plants around the world that build the Civic.
When the Marysville plant was overhauled for the next-generation Accord in 2003, Honda made the same changes there and has changed each of its plants worldwide to conform to the strategy.
Now, Honda engineers can develop new vehicles without having to worry about differences among the various assembly plants, spokesman Ron Lietzke says. Any of Honda's plants can build any vehicle within the same size class.
"What this does is significantly reduce the cost and time needed to prepare a new model to be put into a plant," Lietzke says.
For an automaker that wants to be as efficient as Toyota or Honda, it takes more than just copying the way they build cars.
It's also important to understand the difference between standardization and commonization, says John Shook. Shook is a former Toyota employee who advises companies on lean manufacturing and the Toyota Production System as president of the TWI Network Inc. in Ann Arbor, Mich.
"At Toyota they have a standardized work process. You do the process the same way every time. That gives you a baseline for the kaizen, or continuous improvement," Shook says. "But you have to have both; they are two sides of a coin. That's a critical piece."
The main value of a common production system it that it makes problems stand out, according to Shook.
"And something is always going to go wrong," Shook says. "A part is late or defective. A worker is late. That serves as an opportunity to make improvements. That's why a Toyota worker in the plant looks to make changes in the standardized work every week."
Common production systems also make it easier for senior management to visit multiple locations and identify how well things are going, Shook says. If the performance at one plant doesn't match another, it becomes easier to focus on why if they are following the same system.
For a company to get the full benefit of a standardized work system, it has to move beyond the factory floor.
"Eliminating waste is a race that never ends," Harbour says. "The biggest opportunity still out there is to wring waste out of the entire company process. If you focus just on the end of the assembly line, it's harder to make it more effective."
For the traditional American automakers, a prime area of the business that could benefit from a more standardized system is purchasing, Harbour says.
The process is rife with conflict and last minute changes that add costs. Automakers push suppliers to cut prices as low as possible to win contracts. Then they are prone to change specifications or demand modifications up until almost the start of production, which adds cost to the project that the supplier is hard-pressed to cover. Once production begins, automakers expect suppliers to cut prices each year.
By contrast, Harbour notes, Toyota works with a supplier for two to three years in advance on a component to reduce costs, then seeks a price quote. He says, "So they achieve their price reduction by working on cost reduction."