Rebirth of American Industry
Rebirth of American Industry, A Study of Lean Management, with Foreword by Dr H. Thomas Johnson, by William H Waddell and Norman Bodek, PCS Press, 2005
Although this book is a bit odd and biased in its presentation, published in 2005 it offers readers:
1. A Foreword by one of my favorite West Coast professors, Tom Johnson, giving us some insight into the Sloan System in contrast to later Japanese methods.
2. Delphi Corporation, despite its bankruptcy and later re-organization and recovery, was awarded, as Bill Waddell notes, 24 Shingo Prizes. Was this because of excellent performance in its various plants, was it because of good PR, or a connection into the Shingo decision-makers, or did Delphi, like other fallen giants like a few covered in Tom Peters’ In Search of Excellence, for example, just get lucky?
3. Seven years after this book’s publication, what can we say about the limits of lean or of any other manufacturing methodology? Seven years later both GM and Ford have rebooted, and GM, with the help of very smart and very demanding outside venture capital, continues to show great growth and profitability – otherwise the VC guys would have disappeared by now. So there is life after death in the manufacturing world.
The question becomes therefore, for the companies that restructure and morph into a more “age-appropriate” operation, what does it take to reinvent a healthy and profitable – and growing – new corporate body? There are all sorts of vitamins and supplements that an aging corporate model might consume. There’s kaizen to pep up the operation and discover quick opportunities for improvement. There are great quantities of lean philosophy seminars and books to carry corporate leaders along a twisty path. Executives can buy into certifications and interest groups very quickly over the Internet.
But what would Alfred E. Sloan or Henry Ford say were they alive today to give us a new diagnosis, a new prescription, to fix it, or at least make us feel pretty good? I’m guessing that each of these geniuses would in his own way design a regimen of assorted healthy, but difficult, remedies. I have no doubt that Mr. Sloan would find great use for the Internet, including leveraging it to reduce supply chain risk while increasing variety and production responsiveness – no level-loading restrictions there! And I think each of these leaders would take a very different approach to the human aspect of the whole problem. I’m not sure that we would enjoy Mr. Ford’s approach to the people part – on the other hand, he might surprise us and build a new workplace that even Google would envy
The point to the Mill Girl is that Waddell and Bodek and especially Tom Johnson asked the same questions seven years back that we in industry can ask today – is what we are doing working? Can we sustain it? Are we miserable and tired and breaking down, or are we happy and energized and winning?
Read Tom Johnson’s Foreword and Chapter 7 “The Collapse of Ford”; Chapter 10, “The Illusion of MRP” is an intriguing misstatement of the history and design of MRP, an illusion that has, to our detriment, contributed to a fanatical obsession with unplugging the computers. It’s only a machine guys, and you can make it do batch or flow or even a mix, but it’s only a machine. Don’t expect complex global supply networks to run without IT power – not even Toyota would attempt that.
Chapter 15 asks “How is Toyota able to continue to grow successfully without ever having to lay off a single person?” and some seven years later, we wonder. Has Toyota, or have other excellence models continued to maintain that original working philosophy?
Chapter 18, “Spoon Feeding Lean to America” is insulting to my Mill Girl up-bringing – I bristle at the term spoon-feeding, but nevertheless it contains some memorable factoids –
· First Bodek study mission to Japan 1981. See Ken McGuire comments on his pioneering Japanese Study Missions in Blue Heron Journal https://sites.google.com/site/blueheronjournal/the-made-in-the-americas-sm-series/made-in-the-americas-sm-the-invasion-of-the-kaizen-blitzers
· :,,, Japan has 410,000 of the world’s 720,0000 ‘working robots’
· “… the unfortunate result of this piecemeal revelation of the ship-floor workings of the Toyota Production System has been to convey the notion that it is only a shop floor concern.”
Chapter 20, “Brass Tacks” begins with a bullet that some seven years later does not apply:
“No publicly held American manufacturer has become lean, except the 1 -2 percent with unusual circumstances. Lean means lean at the bottom line – many large American companies have a showcase lean plant or corer of a plant for public relations purposes. Virtually every one of them has tried, and failed.”
Goodness, we’ve come a long way baby from that sad conclusion. Fortunately for us, the numbers tell a better story of net profit margins that prove how well companies are managing their production systems, whatever they are called:
Toyota 8.99%
Ford 3.24
GM 3.62
Honda 4.32
VW 5.43
Nissan 3.67
So we are naturally left with the question, what happened in the magical seven years since Rebirth of American Industry appeared, and the happy, growing and pushed-to-the limit Income Statements from the majors? Could it be – might it be? – that some smart companies have created the New New Production Model, the one single mix of healthy vitamins and daily exercise, combined with a robust IT architecture, that carries them forward? The Mill Girl, being an optimist with a deep love of manufacturing, likes to think so. And I’ve given it a name, The Third Industrial Revolution.