The executives at General Motors had had enough.
It was 1982. General Motors’ Fremont auto assembly plant was in crisis. The plant ranked at the bottom of the GM’s quality and productivity metrics. Absenteeism was high. Costs were 30 percent higher than GM’s Japanese competitors. Sales and overall customer satisfaction with the Chevy Nova which was manufactured in Fremont were poor and getting worse.
But that wasn’t the worst of it.
Some employees were bent on sabotage. After leaving his sandwich inside the door panel, a line worker chuckled: “A month later, the customer would be driving down the road and wouldn’t be able to figure out where the terrible smell was coming from.”
Management attempted a variety of improvement programs. Nothing worked. A decision was made.
The plant was shut down.
“Then GM did something interesting,” Robert E. Quinn recounts in his excellent book, The Deep Change Field Guide: A Personal Course to Discovering the Leader Within: “The company approached a competitor, Toyota, with an offer to collaborate on designing and building a car. Toyota jumped at the chance.
“GM offered the use of the Fremont facility, but the plant was not to be remodeled. Toyota said, ‘Fine.’ UAW workers had to be hired back first, on the basis of seniority. The oldest and most recalcitrant employees, those who had complained about management the longest, were given the first crack at jobs. Toyota said, ‘Fine.’
“Toyota had just one request: to allow Toyota managers to run the place. GM said, ‘Fine.'”
18 months after being shut down, the Fremont plant reopened. Robert tells us: “Everything improved – employee satisfaction, sales trends, quality, productivity, and customer satisfaction.”
The turnaround at the Fremont plant is one of my favorite business stories because it speaks to the power of workplace culture.
“There is one point that towers over all others,” Robert writes: “The GM plant at Fremont was a human system teeming with potential. The GM executives were so firm in their conclusion about the lack of potential that they, in essence, gave the plant away.
“The people from Toyota, by contrast, could see the potential. They built their efforts on two pillars: commitment to continuous improvement and respect for people. They recognized the problem lay in the plant’s culture. They therefore set about making a deep change, working to change the culture by giving each employee a personal stake in the product he or she produced.”
And the line worker who left his sandwich in the door panel?
“I feel personally responsible for those cars,” he shared following the plant’s reopening. “When I see a Toyota Corolla in a parking lot, I leave a business card under the windshield wiper with a note: “I made your car. Any problems, call me.'”
Reflection: What explains the change in attitude and behavior of the line worker?