Saturn Rethinks Car Manufacturing

Saturn, a division of GM founded in the 1980s, had its own dedicated car factory from the beginning. A prime reason for locating in Tennessee was to distance Saturn from other GM facilities, thus allowing a unique "corporate culture" to flower more easily.

Just as important, tiny Spring Hill (pop­ulation 1400 at the time) was about 35 miles south of Nashville and 30 miles from Smyrna, Tennessee, home of Nissan's North American factory, so vital railroad lines, interstate highways and suppliers were all conveniently close. Groundbreaking took place in April 1986, by which time fledgling Saturn, barely a year old, had its third president: Richard G. "Skip" LeFauve, transferred from GM's Buick-Olds-Cadillac Group after Bill Hoglund, LeFauve's predecessor at Saturn, was named to head that unit.

Saturn's self-proclaimed mission was to "market vehicles developed and manufactured in the United States that are world leaders in quality, cost, and customer enthusiasm through the integration of people, technology, and business systems and to exchange knowledge, technology, and experience throughout General Motors."

That was a tall order for an established car company, but Saturn was starting from scratch. The job was monumental, and ensuing months witnessed delays, cost overruns, and difficulties in signing up dealers that forced pushing back the production start date to summer 1990, shortly before GM Chairman Roger Smith's scheduled retirement. Yearly volume was first set at a half-million units, then reduced to a more manageable 240,000, and GM's total investment was trimmed to about $3.5 billion.

Smith envisioned the Saturn plant as the last word in automated manufacturing, with computer-guided vehicles delivering parts to robots that did most assembly chores. But like so many GM leaders before him, Smith was a financial manager, not an engineer or manufacturing expert, and he didn't really understand "high tech" or its limits.

Spring Hill would use robots for welding, applying adhesives and painting the cars, but the plant wasn't nearly as futuristic as Smith envisioned. The real innovation came in labor/management relations. As LeFauve noted: "People are going to make the difference for Saturn."

The first employees were recruited from other GM operations. There were just 3800 jobs but more than 16,000 applicants, all evidently intrigued by the Saturn experiment and wanting to be part of it. Candidates were invited to Spring Hill for a two-day screening session, and 90 percent of those who came were hired.

The eventual employee roster showed migrants from 46 states with an average of 13 years GM experience. Being so accustomed to GM's old ways, "associates" were required to undergo comprehensive training in the new Saturn way of thinking and working.

UAW members received 350 hours of training on average, though some high-skill positions got twice as much. Base pay for all workers was 80 percent of GM's national average, but there were bonuses for meeting productivity targets and a ­profit-sharing plan -- if Saturn turned a profit.

Saturn's labor agreement had few traditional industry "shop rules" and gave employees more say in how they did their jobs. Workers were organized into teams responsible for monitoring the quality of parts and their own work, and any worker could stop the assembly line to fix safety or quality problems on the spot, a common practice in Japan but unknown in U.S. auto plants.

That allowed doing away with separate quality-control inspection areas. In addition, workers sat alongside managers in meetings, helping to make decisions as "team members," and everyone ate in the same dining room. LeFauve even shared the executive office suite with the UAW's Saturn coordinator.

The team approach also figured in Saturn product development. Designers, factory workers, engineers, and outside suppliers came together for what was called "simultaneous engineering." This was in sharp contrast to the old way of having designers, once finished with their part of the car, "throw it over the wall" to engineers, who did their jobs before tossing the project to manufacturing, and so on down the line.

Just as important, Saturn planners, some of whom already drove imports, put aside personal preferences to focus on what buyers wanted. Said engineering vice-president Jay Wetzel: "Most great cars in history reflect the personality of one person. In our case, that person just happens to be the consumer."

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