Detroit's Just In Time Manufacturing: "A Lose – Lose Relationship"
Industry Week's David Blanchard offers an analysis of Just In Time (JIT) manufacturing's dangers, from Boeing's delayed Dreamliner to Motown's supplier woes ("woes" as in torpedoes aimed straight the mothership's hull). Blanchard says JIT is fine in theory. "Some Japanese automakers have done quite well with that type of win-win relationship, often symbolized by the idea of the keiretsu, or joint partnership. The Detroit Three automakers, on the other hand, apparently see greater promise in pursuing lose-lose relationships… Look at the relationship (if you want to call it that) between Chrysler and one of its Tier One suppliers, Plastech, who had fallen on hard times. Rather than offering assistance to a key supplier, Chrysler canceled its contract with Plastech, which not only led Chrysler to temporarily shut down production at four assembly plants, but also caused Plastech to file for bankruptcy protection." While that's not the way it went down– Chrysler bailed and bailed until it bailed– Blanchard's wider point is valid. "The key word in supply chain management is management, and when relationships aren't managed properly (or at all), then there really isn't much of a supply chain. What you've got instead is a mad free-for-all, and ultimately, a lot of unhappy customers." And, we might add, employees, shareholders and dealers.
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Paul N. & Sherman L.: Couldn't agree more about the reasons for doing the right thing.
Unless someone had ever worked in Automotive for the Big 3 you wouldn't understand how little value is placed on doing the right thing as oppossed to making it look like you did the right thing. Lying, cheating coniving and back stabbing are rewarded. I knew I had know future with Ford when my annual appraisal said I had a good future with Ford if I could do something about my honesty problem. There was no room for that in Quality at Ford.
I have worked for Suzuki motorcycles and had the opportunity to see what real teamwork is between the manufactures and suppliers. They both realize the value of the relationship. Suzuki designs it, the supplier gives their imput for improvements and the final part design is produced. The supplier knows if they supply quality parts on time, they will make their buyer sucessful. The manufacure knows if they use quality parts their products will be better and they have a good chance of selling more of those products. They realize both entities must be sucessful to work. Win, win.