May 31, 2007
Lee, Buttermore Transcript
NOTE: The following is a transcript of a podcast with Tim Lee, GM North America Vice President of Manufacturing, and John Buttermore, GM Powertrain Vice President of Global Manufacturing
Tom Wickham:
(Communications Manager, Global Manufacturing and Labor Relations):
Welcome to GM Manufacturing’s podcast about the annual Harbour Report on productivity. I am Tom Wickham, Manager of Communications for GM Global Manufacturing and Labor Relations. With me today are Tim Lee, GM North American Vice-President of Manufacturing, and John Buttermore, GM PT Vice-President of Global Manufacturing. Thanks for taking the time out of your busy schedules, gentlemen.
During the next 10 minutes or 15 minutes, we’re going to talk about the Harbour Report and the results for assembly, stamping, engine, and transmissions operations.
Tim, why don’t we start with you? What is your assessment of the 2007 Harbour Report and our performance?
Tim Lee:
Well, we’ll certainly get into the details as we go through the interview and it’s really, I think, a validation of everything John and I and the entire extended manufacturing team has been working on, in terms of the global manufacturing system at General Motors. We have taken three of the four categories as the most productive operations in North America, and we’re very proud of that.
Tom Wickham:
One of the key things that came up in the last year or so is the launch of the GMT 900, the full size utilities and the pickups. Can you elaborate a little bit more about what a monumental task that was and also what the played in to, in terms of our productivity?
Tim Lee:
Here was a product program that included seven plants in Canada, the United States, and Mexico. The product programs were pulled ahead about 13 weeks to get to the market sooner than later. And I think it is a real testimony of running common and running lean and institutional learning as we move from plant to plant to plant. It was a like a tsunami of knowledge moving from Silao in the south up through the United States into Canada and back as we launched all the products.
Tom Wickham:
Didn’t that require a great deal of coordination between assembly and stamping and obviously with Powertrain?
Tim Lee:
A terrific amount of collaboration. The stamping very, very closely aligned with the assembly operations getting all the die sets done. Of course, the Powertrain operations being there and supplying everything just in time in a very lean system. Everything worked remarkably well. We (increased) the acceleration plan in every plant. We [indiscernible] up achieved of full time rate in every plant, and got faster and better. The safety of our people was never compromised, the quality of the product was outstanding, and throughput was excellent.
Tom Wickham:
It all came down to protecting the customer.
Tim Lee:
Absolutely.
Tom Wickham:
John, Powertrain, what are your takeaways from the Harbour Report? And obviously, tying in with the 900 launch, there were a lot of synergies in play.
John Buttermore:
Yeah, thanks, Tom. I’d like to congratulate Tim for best assembly plant in North America and to win the best engine and transmissions also; very good for the GM team. So, a lot of people working very hard on this and every proud of their accomplishments. Working with our partners in the union. This just shows that doing the right thing, working together, we can accomplish greater things.
Tom Wickham:
Is there anything in particular, when we look at the results, obviously, John, you point out that we have three segment winners, two of them are in Powertrain. I mean, Toledo Transmissions, Spring Hill Engine, and then we have Oshawa 2 on the assembly side. But focusing on the Powertrain, what can we say about those two segment winners?
John Buttermore:
Well, Tom, I think when you look at the Powertrain segment winners that we’re using the same process, whether it’s a stamping plant, Powertrain plant, and also anywhere in the world. It’s GMS; it’s the system that we use everywhere. So the numbers happen to come out the way they did. We’re very pleased with it. We worked very hard on it. But I got to give credit to our common systems, and we work as a global manufacturing team. A lot of people working very hard on this every day.
Tom Wickham:
Tim, on the assembly side, Oshawa 2, you must be really proud of the operations in Canada, but also what people are doing elsewhere in North America.
Tim Lee:
Exactly, and it’s not just Oshawa 2. The entire Oshawa complex, the local union team there, the local management extremely, extremely focused on all of the elements of what makes it a great plant. The GMS attributes there beginning to flourish and really paying off. And if you take a step back, Oshawa has traditionally been a very productive assembly center. And if you take a step back and look at this data for the General Motors Corporation over the last 10 years, we are the only full-line manufacturer across those 10 years who has improved year after year after year after year. There have been no bumps alone the way. Every year has been better than the prior year. And I think that is exactly, as John said, it is a testimony to the implementation of a global manufacturing system, common methods and systems throughout the plants, and a total dedication and a focus at the operator level to get it done right the first time in-station.
Tom Wickham:
I’m going to shift gears a little bit and talk about stamping. And obviously, a lot of people, the consumer, even the media, don’t pay much attention to the stamping operations, and they are so critical to the success to the vehicle assembly process. What can you tell me about our performance in ’07 with Harbour and what are we doing to raise the bar for the years to come?
John Buttermore:
Despite the fact we’ve had, again based on our plan to go to market, etc., in terms of reducing some of our sales into the daily rental fleets, we took down our volume year to year by about 200,000 units, about 5%, and the stamping operations, despite that improved their productivity significantly, and you can see the data in the website.
Again, here the legacy of General Motors has been we went from an old Fisher body model to today’s model of more continuous stamping operations, and that march is ongoing as we continue to take press lines out of the system and get more productive on the press lines that remain. Our people in the press plants and in our contiguous stamping shops where we have them snugged up to our assembly centers, know exactly what the benchmarks are from around the world, they’re posted at their press lines, and they march to get those benchmarks every day.
Tom Wickham:
That begs the question, two years ago or thereabouts, Rick Wagoner came out with the turnaround plan. Capacity reduction was a key component of that. You know, we’re going through the cessation of production at a dozen facilities in North America. We’re taking about a million units of capacity. That’s pretty tough for a company like General Motors to do that. But obviously, with the performance, we’re making gains. How are you balancing that? How are you able to balance the reduction of capacity and reduction of production but still make gains?
Tim Lee:
Well, it has been a challenge, clearly, and John has had the same challenge on the Powertrain side as we have had on the stamping and assembly side. But Rick’s plan that was announced back in November of ’05 clearly set out some benchmarks and targets along the way in terms of where we were and where we wanted to get to. We are exactly in line marching to the total that was outlined in that November announcement in ’05. And we will get the plan effected as it was described, no problem at all.
Tom Wickham:
John, you’re take on really the whole capacity utilization of global footprint?
John Buttermore:
It’s like I said before, Tom, we’re trying to work this thing from a global manufacturing standpoint. We’ve clearly had to rationalize capacity in some areas, but we’ve also made a lot of investment in capacity. A lot of our investment in capacity has been made with flexibility in mind, reusability, re-deployability, across the whole global footprint. So from that standpoint, that’s been a great aid for us, but again we have to balance out where we have too much and where we have too little.
Tom Wickham:
John, investments in your operations have really received a lot of attention in the last few weeks. Can you go into a little more detail? What is the significance of the investments? For instance, in Toledo, which is the best plant?
John Buttermore:
Yeah, one of the questions during Toledo was why invest in Toledo? I think today you can see why, the kind of plant it is. But as we invest in more efficient, fuel efficient transmissions and engines, we’re also using that investment to have more efficient engine and transmission plants. You’ll see short mainline; you’ll see the use of Minomi; you’ll see build quality in station, upper utilization. We’re being careful that we invest in the right product, but also make the investment in the plant. And we’ve invested over a billion dollars here in our US manufacturing facilities as we roll this new technology through our organizations.
Tom Wickham:
There’s something I want to conclude this with is the discussion about GMS, Global Manufacturing Systems. Tim, obviously GMS is so important to our success as a company. What has it meant for you as a leader to see the success of GMS implementation in our plants?
Tim Lee:
Tom, as we’ve implemented GMS in our company, I’ve had the benefit of living and working in Asia, living and working Europe, and living and working here in North America, and as I walk through plants in the United States or I walk through Canada or in Mexico, it’s déjà vu all over again. It’s no different than walking through a plant in Poland or in Germany or in China. We’ve executed a very, very sound plan. We call it the Global Manufacturing System, and it in effect turns the organization upside down because it puts all the focus on our operators and our team leaders in our various manufacturing operations, which is where it should be, and we’ve stressed people involvement. We talk a lot about first time quality and lead time reduction, continuous improvement, and standardization. And when that all works together in harmony, the outcomes are just very, very rewarding.
Tom Wickham:
John, we obviously talk one GM in this company and GMS is very important in Powertrain. Can you share some of your thoughts?
John Buttermore:
GMS is a common process. It’s so powerful of an enabler for Powertrain. We run 47 plants worldwide. We have 47 plants worth of teams working on this. We gathered best practices from GMS everywhere in the world. And the fact that we have one common strategy, one common system, we can communicate that immediately and have plants adopting these best practices worldwide very, very quickly. Our ability to get better faster by using one common production system is extremely powerful and a great enabler for us and our results.
Tom Wickham:
One final question, you took three out of four trophies, are you going to go for four out of four next year?
Tim Lee:
Absolutely.
John Buttermore:
Absolutely.
Tim Lee:
We’re in it to win it.
John Buttermore:
Interestingly, as you look at the configuration of our plants after we’ve gone through a huge attrition plan in 2006 and worked through that, maintained our safety record, maintained the quality record, maintained the productively record, we are poised in 2007 to do exactly that.
Tom Wickham:
Gentlemen, I want to thank you for your time. Obviously, this is great news. There are a lot of challenges that we face as a company, but the Harbour Report shows that we’re moving in the right track. Again, thank you very much. This concludes our podcast.