Going Places & Getting Things Done: Think Operating Systems

Gary S. Vasilash

There are plenty of ways to get jobs done. One underlying method is to establish a systematic approach. Sometimes the system is carefully organized and articulated (e.g., at Chrysler). Sometimes it is more tacit and shape-shifting (e.g., at Honda). Regardless, for manufacturing, an operating or production system is The Way.

As the old saw has it, "If you don't know where you're going, any map will get you there."

Which isn't an ideal way to travel, and which is certainly not a good way to run a business.

For the past few years, companies have been in the process of paying attention to their maps—or the lack thereof. And this organizational cartography has taken the form of "operating systems," or "production systems."

Chrysler wants to be known not only as a company that can design gorgeous cars like this, the 1999 300M, but as the premier car and truck manufacturer on the plant. The Chrysler Operating System is part of its on-going initiative to realize this goal.

To be sure, the most famous of all production systems is that ofToyota. The Toyota Production System, which had been initially established in the late 1940s, was launched into the consciousness of the North American auto industry in 1990 with the publication of The Machine That Changed the World, a text that became a fixture on the desktops of managers throughout the industry. As Mitchell Fleischer and Jeffrey K. Liker write in Concurrent Engineering Effectiveness: Integrating Product Development Across Organizations (Hanser Gardner Publications), "Lean Manufacturing is an approach to manufacturing in which you attempt to minimize everything, from work in process, to part count, to labor hours. `Less of everything' not only inherently reduces cost, it increases pressure to get things done more quickly as well as correctly (no slack means you can't waste anything). Invented by Toyota...Lean Manufacturing is currently the dominant paradigm in manufacturing—guiding many of the improvements now taking place around the world."

Said another way, the Toyota Production System has become a model that many manufacturers—OEMs and suppliers alike—are modifying for their own purposes. Of course, Toyota is not the only company that has devised a production system. Other companies in other industries (e.g., Canon, the office equipment and camera supplier) have developed their own operating systems; companies in automotive have created their own ways of getting things done (e.g., the Donnelly Production System).

Getting There—with Management

Getting things done is, at the fundamental level, what an operating system is all about. But it is a methodical approach to doing so, one that's often codified and then practiced. But it just may be that in some cases, the production system is something that's actually part of the fabric of the organization to the extent that the people, in effect, "just do it."

The primary essential for an operating system—regardless of the type—is that it have top management's support. Without this, it is too convenient for people to fall back on what they've always done. After all, what's always been done has, presumably, had at least tacit support from top management, so why would people be inclined to do something else? Without this support, a production system will be nothing more than a collection of seminar notes, a few copies of books on shelves, and good intentions. (How many copies of The Machine That Changed the World started a change that fizzled out because management became otherwise distracted?)

Working Toward Being Premier

Chrysler has been making an aggressive effort to improve its operations with what is called the "Chrysler Operating System" (COS). Chrysler's program was developed during an August-to-December 1994 timeframe. Thirty management people constructed a system, based on the Toyota Production System, but tailored for Chrysler's needs. In fact, a goal that has been set is to become the "premier" car and truck company "worldwide by 2000," which means that they are aiming to pass Toyota.

At the workable level, Frank Ewasyshyn, vice president of Advanced Manufacturing Engineering for Chrysler, says that COS "is a way of doing our business." It's the means to the end.

The system is arranged so that there are core beliefs and values (Inspired People; Customer Focus; Continuous Improvement) that are made possible by enablers (H.R. Systems; Management Behavior; Communication; Training). There are four key subsystems (Human Infrastructure; Leveled & Balanced Schedules; Value Added Activities; Robust, Capable & In-Control Processes) that have a systemic relationship (i.e., one affects the other). There are support processes for each of the four subsys-tems (e.g., Recruiting & Hiring; Capacity & Process Planning; Identify & Eliminate Waste; Robust Product & Process Design) and assurance systems backing those up. Then there is a whole kit of tools (e.g., Five S's; Standard Operating Practices; Preventive Maintenance) that is used. These, too, have measures. The outcome of all of these translate into the reputation of the organization and financial success as they directly affect Safety, Quality, Delivery, Cost, and Morale.

Looking at Things


 

While all of this may sound rather complex, Ewasyshyn explains that it is really a means by which people in the organization focus on what's going on and then begin to ask questions about whether (a) those functions are what need to be performed and (b) the necessary functions are being performed in the best-possible manner. "You start to look at things in an entirely different way," he says. And the focus is primarily on process and practice, not technology and equipment. "In the past, when we'd visit other companies' plants, we used to look for the latest technology that they were using. We weren't looking at the right things. The hardware you can buy. The trick is how the business operates. How is the technology applied? What is the people side of the business?"

This is what COS looks at. He describes it as "a holistic approach to manufacturing." Although some people might dismiss this as touchy-feely stuff, know that regardless of what it is, it is providing big returns to Chrysler.

Saving Space—& Dollars

For example, Ewasyshyn says that at the company's Mack Engine Plant, more than 50,000-ft2 of space has been opened up as a result of doing things like paying attention to how the lines are laid out, how far operators must walk to do their jobs, what inventory requirements are in place, etc. He says that at the Indiana Transmission Plant, 60,000-ft2 of space was saved. In the case of Mack Engine, that's open area that can be used for productive purposes. In the case of Indiana Transmission, that's space that was never built, which means money not needlessly spent not only on the construction, but also on the heating, lighting, etc.

They are designing equipment with "poka yoke"—fool-proofing—devices that simply (i.e., through the use of notches and pins and the like rather than with sensors and switches) prevent errors from occurring, which helps assure quality. They are documenting procedures that occur in the plant so that operations can be handled even if the normal operator is out. They are looking at whether value is being added—or not in all operations. And they are looking both back up the value stream (e.g., "Is this part designed for production?") and out to the supply base. It is an on-going, thoroughgoing approach.

One of the companies that people at Chrysler have been paying careful attention to is Honda. Honda's capabilities, such as in production launch (see "World Class Vehicle Launch Timing,"AM&P, February 1998) and in building high-quality cars that consumers want, are well known.

When asked about their production system, key people at Honda of America Manufacturing—including John Adams, senior vice president, Ron Shriver, Marysville Plant manager, and Tim Downing, Engineering Project Leader for the '98 Accord—were a bit puzzled.

Without a Steady-State

That is, although what they do on a daily basis in performing their jobs is based on making products with the highest efficiency that are available at reasonable prices, the methodological working out of a structure in the way that Chrysler has done is something that hasn't been done at Honda.

"If you are trying to achieve a standardized methodology or operating system, it assumes a stable state around you. The environment we are working in," Adams points out, "is unstable. Things change. What used to be good may not be now." So how they go about doing things changes, as well.

In fact, Adams goes so far as to say, "One of the things that we do is continually create a dissatisfaction with the way things are. This impacts everything we do and how we do business." He admits that this sometimes "verges on chaos." But the belief is, "If you want to change something, you have to be dissatisfied with it."

Factors

There are some key areas that are emphasized:

  • Flexibility—This encompasses both people who can adapt to changes and equipment that can be quickly converted to build new products.
  • Efficiency—Sometimes this butts head with flexibility, so it is generally a drive to find balance (they are also driving, in this regard, capacity: the Marysville plant was originally thought to have a 300,000-unit capacity—it is now 440,000, and there hasn't been a major expansion used to get it). They are always working to do more with less, as in having the fewest manufacturing processes to get something done and having short lines.
  • Associate involvement—Tim Downing explains, "This is not a system from the top that says, `This is how we are going to manufacture cars.' We ask for the people's ideas for improvement." When work was being initiated on the Accord, each associate was talked with on an individual basis for input.
  • Supplier involvement—not only is this considered to be important, it is actually proven to be so: for the Accord, management from Honda visited suppliers. That's not so unusual. But what is different is that the Honda managers joined the managers from the supplier companies and went out on the respective factory floors to see where the products being manufactured for Honda were being made and to address any issues related to that manufacture. (This is truly management support of the way things are done.)
  • Customer focus—What all of the above are directly related to.

Ron Shriver puts it quite simply: "The key to all of this is that every time we do something, we try to get better."


Learn More First-Hand

Operating systems of the major automakers will be the focus of a special panel discussion Tuesday, May 12, at the SAE International Automotive Manufacturing Conference & Exposition (IAM '98). Thought to be the first event of its kind, the following people are scheduled to participate on the panel:

Michael N. DaPrille, vice president, Manufacturing, Toyota Manufacturing USA
Emil Hassan, senior vice president, Nissan North America
Roman Krygier, vice president, Advance Manufacturing Engineering, Ford Motor
Dennis Pawley, executive vice president, Manufacturing, Chrysler
Ron Shriver, vice president and plant manager, Honda of America Manufacturing
Joseph D. Spielman, vice president and general manager, Metal Fabricating Div., Manufacturing Center and Worldwide Facilities, General Motors Corp.
The panel discussion, which will take place from 7:30 to 9:15 am, will be moderated by Ronald E. Harbour, president, Harbour & Associates.

For more information on lean, check out SAE's www.sae.org.