Process Capability: Toyota, Lean and Quality Systems

In December 1984 the first Chevrolet Nova, a car derived from Toyota's Corolla, came off the line at New United Motor Manufacturing, Inc. (NUMMI), in Fremont, California. The building was the General Motors assembly plant that had closed in 1982 after years of absenteeism, defects and grievances, and most of the people on the line were the same United Auto Workers members who had worked there under GM (reported). Chapter 2 told how GM and Toyota came to reopen it as a 50/50 joint venture, and how, within a few years and with largely the same workforce, it reached quality and productivity comparable with Toyota's plants in Japan (MIT's International Motor Vehicle Program, reported).

The details of the start show what Toyota was actually installing. It could have hired new people. It chose to rehire the old workforce, including union activists, and to send hundreds of them to Toyota City to work alongside Japanese teams (reported). It negotiated a local contract with the UAW that cut the old plant's job classifications to a few, organised work in small teams and accepted flexible assignments in exchange for commitments on employment security, terms unlike the UAW's national agreements with GM (reported). It strung andon cords along the line so that any worker could stop it. And because its suppliers were in Aichi, not California, it shipped many parts from Japan by sea and held inventory buffers to match, the opposite of the just-in-time it practised at home (reported). The system was the only new thing in the building, and it arrived before the supplier base, the local engineering and the low inventory that it normally relied on.

GM sold the Nova through Chevrolet dealers, where it sold more weakly than near-identical Toyota-branded models (reported); it rotated managers through Fremont for twenty-five years and could not spread the system through its own plants at scale for many of them, partly because its national UAW agreements, incentive systems and plant hierarchies were unchanged. Toyota took the opposite lesson. In December 1985 it announced a wholly owned plant at Georgetown, Kentucky, with a non-union workforce, and began building Camrys there in 1988 (reported): proof that the system could be built from scratch in the United States without a Japanese partner plant or a union. When NUMMI closed on 1 April 2010, its roughly 4,700 UAW-represented workers dispersed and its tooling was shipped to Toyota plants in Kentucky, Texas and Mississippi (reported). The machines could be moved. The capability had always been in the system that used them.