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Nummi Automation

In: Business and Management

Submitted By mitnipa
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In light of Dan Pink's SRA talk about motivation (Drive: The Surprising Truth About What Motivates Us), what should a leader do to help his/her organization achieve progress in its lean journey?

In the cases of Wiremold and NUMMI, what are some of the key factors that are in place when a company "reverts" from lean? How can an organization prevent this? Is it possible to prevent this from happening?
The main lesson of NUMMI is clear: Massive automation without corresponding changes in management and work force organization is not enough. Because GM's executives were too concerned with labor cost, they failed to recognize that other costs are also significant. These costs include inventory, defective parts, and overhead. Although automation can also reduce these costs, NUMMI clearly shown that changes in management practice are more cost-effective than buying new machines. Moreover, GM's corporate culture in the 1980s was resistant to change in management-worker relationship. Many managers of other factories dismissed NUMMI's practices as irrelevant. As a result, GM failed to fully develop its human resources. In contrast, the organizational innovations of Japanese car producers, such as teamwork, short product cycles, JIT , much longer training time for workers, and a more equitable relationship between management and workers allow them to fully exploit the advantages of flexible production.
Besides the issue of management, GM's speed of automation also turned out to be damaging to the company. GM simply wanted to do too much with too little time. As a result, managers and workers did not have enough time to master the latest technologies available. The chaos in Hamtramck during its first year clearly illustrate the danger of GM's "rushing ahead" strategy. In contrast, Ford and Chrysler moved more cautiously towards automation because they were at the edge of...

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