Manufacturing Quality is driven by Cultural Transformation: a lesson from history for General Motors.

"Considered the worst workforce in the automobile industry in the United States," was the way a leader of the workers' own union described the employees at the General Motors (GM) Fremont plant in 1982. 

Toxic labour relations, wildcat strikes, extreme absenteeism (so severe that managers sometimes couldn't start the line) and poor vehicle quality eventually lead to GM shuttering the Fremont assembly plant in California. Then a historic 1984 venture was formed between GM and Toyota resulting in the New United Motor Manufacturing Incorporation (NUMMI) 

Toyota wanted to begin manufacturing in the U.S. to avoid looming import restrictions and agreed to manage the Fremont plant. Toyota also wanted to learn how to manage American workers using Toyota’s own production methods, as set out in their manifesto. The Toyota Way is a foundational, guiding document establishing the company's organisational culture and core values that serves as a compass for how every Toyota employee everywhere in the world should approach their work, solve problems, and interact with society.

Operating until 2010, NUMMI famously transformed the worst-performing GM workforce into one of the most productive auto plants in North America by implementing the famous Toyota Production System. 

After only 3 months, cars coming off the NUMMI line had near-perfect quality ratings. The cars made were more reliable and cheaper. Grievances and absenteeism dropped. By late 1986, NUMMI was more productive than any other GM plant. The NUMMI plant produced 8,000,000 quality vehicles; 6,000 vehicles per week, two shifts a day, until 2009 when GM filed for bankruptcy. Toyota took over running the plant alone until 2010, when it closed. Unfortunately, lack of a strategic plan or vision meant the lessons of culture change in management were never spread throughout the mother company and ultimately General Motors became the largest industrial bankruptcy in US history. (Like they say: “Change before you are forced to.”) Its bailout cost US taxpayers more than $50 billion, eventually re-emerging as a new corporate entity backed by a majority stake from the U.S. government.

NUMMI remains a classic business and operations case study (often explored in Harvard Business School classes) detailing how to change corporate culture and implement lean manufacturing practices.

The core problem they solved was: empowering the workers. 

The Toyota Way is an emphasis on teamwork. Toyota didn't try to change workers' mindsets initially. Instead, they changed daily behaviours by teaching the "Andon" cord system, giving any worker on the assembly line the authority to stop production to fix a defect. They also restructured labour, reduced job classifications, implemented flexible work teams, and implemented kaizen (continuous improvement.) 

The turnaround came from the management/cultural system, not from new workers or new machines.

A venture that proved to General Motors that cultural transformation, worker empowerment, and Lean production systems—not just advanced machinery—were the keys to manufacturing quality. It demonstrated that troubled union workforces could thrive when trusted. 

The key lessons for GM from this joint venture include:

• People Over Technology: Toyota upholds that investing in employee training, problem-solving capabilities, and teamwork is a company’s most vital asset.
• Real-time Problem Solving: Systems like the Andon cord ensured quality was built into the process rather than inspected afterward. 
• Mutual Respect and Trust: By treating workers as partners rather than adversaries, NUMMI eliminated historic issues like high absenteeism and sabotage that plagued the old plant. 
• Behavior Drives Culture: Changing daily routines yielded overwhelming rapid culture shifts. 
• The Struggle of Transferring Knowledge: Despite the success at Fremont, GM struggled to transfer these systemic cultural changes to its other plants due to a lack of strategic planning and not deploying the trained NUMMI managers throughout the company.

Flōware Relevance: 

Flōware systems support the philosophy of management-by-exception— Flōware’s core differentiator. Software that aligns with your company's natural workflow. Employees don't have to waste time trying to navigate complex systems or figure out workarounds, producing superior efficiency and productivity. 

The Flōware platform continuously surfaces exceptions instead of expecting managers to search through reports. In essence it is Monitoring for Variance—where managers only intervene in routine operations when results significantly deviate from the plan (the "exceptions"). 

How it gets done with Flōware: 

Businesses often react to problems after they have already caused damage. Flōware's management-by-exception approach introduces the concept of operational early-warning systems—acts as an operational radar system, continuously surfacing actionable exceptions requiring attention. It is done by systems that flag surface stock as well as purchasing, sales and production issues before they become costly problems. Teams focus on the exceptions that need attention, thereby preventing problems that are discovered too late. Flōware's flags engine monitors these conditions and brings them to management's attention automatically.

Conclusion

The General Motors Fremont turnaround was brought about by NUMMI’s principles of:

• early intervention, 
• operational visibility,
• red flags (the Andon cord) that linked to business consequences.

Flōware systems software supports you with these principles. The result: employee empowerment, faster problem solving, time efficiency.