Americans can build good cars; they're doing it in Marysville, Ohio.
On the edge of an old woodlot in the middle of the flat farmland of Ohio sits America's fourth largest auto manufacturer. Not American Motors. Honda of America. The first Honda Accord built in the U.S. pulled off the assembly line in November 1982; only three years later, Honda's production had moved ahead of Volkswagen's, now number six, and then American Motors's. This year, Honda plans to double production. Each year, the Accord has been named by Car and Driver one of the ten best cars in the world. In 1985, the magazine stretched its superlatives to the limit and said, "There's nothing wrong with a Honda Accord. Nothing.' With that kind of reputation for quality and design, Honda has barely been able to keep up with the demand. In February, when GM dealers had a 70-day supply of cars on hand and AMC dealers had an embarrassing 117, Honda dealers averaged a nine-day supply. In the first quarter of this year, Honda was the only American manufacturer to increase sales.
In 1980, when American companies were shifting pieces of their production to cheaper labor markets in Japan, Korea, and Mexico, Honda came to America to build its third auto plant. Its dealers groaned that American workers wouldn't be able to produce the same quality as the Japanese, and its financial analysts said it couldn't make a profit. Both fears proved wrong. Although Honda won't disclose the portion of its worldwide consolidated profit that comes from Honda of America, industry analysts say it's significant. The fall of the dollar, which has made Japanese imports more expensive, and continued quotas on imports can only make the American division more profitable.
Honda's quiet success in the backyard of American car manufacturers--and with American workers--seems to prove that there is a way to resurrect this country's heavy industries. Its success comes from its designs and engineering, from its efficiently laid-out plant, from its fanatical insistence on high-quality parts, but most of all from the productivity of its workers. That productivity comes not only because workers know that Honda's existence and their jobs depend on increasing productivity, but because workers are trusted to build that productivity themselves. That egalitarianism is reflected even in such simple things as everyone parking where he pleases in the lot, everyone wearing the same uniform, everyone eating in the same cafeteria, everyone going by his first name.
The virtue of this style of management is simple: workers who feel they have a real stake in a business work harder and more carefully, and are willing to work wherever they're needed. Intangibles, perhaps, but the cumulative potential--especially in an increasingly competitive industry--is enormous. Yet the trust that results from an honestly shared effort is easily undercut, particularly in a huge factory where the work is inherently tedious and pressured. Honda's effort is hardly perfect, but its struggle to create a humane workplace has so far given it much of its jump in the American market.
No collar capitalism
I had been invited to visit the Marysville, Ohio, plant in late April. I arrived at 7:30 a.m., a full hour after the first shift started, and parked where I pleased in the lot. My guide for the day, Roger Lambert, took me first into the office, which is one huge, unpartitioned room full of desks, file cabinets, and computer terminals. The president's desk, he pointed out, simply sits in one corner, next to a number of others. Everyone was in the same white uniform with his or her first name embroidered on it. No suits and no ties. There are no personal secretaries for the managers. If they are at their desks, they answer their own phones; if not, whoever is nearby takes a message. Parked at one end of the room were the two car models built at the plant, a knot of people standing beside them, and a sign that read "Washington Square' above. Lambert clearly was pleased to have such a whimsy to explain. This, he said, is the spot where no one may tell a lie, where any concern workers or engineers have about the cars being built must be stated.
As we strode off to the morning managers meeting, Lambert asked me how many companies I knew that would let me sit in on a meeting of top executives and managers. The meeting started at exactly eight o'clock. Short reports from the assembly line managers were given on accidents, rejection rates, downtime, and "countermeasures' for problems. Some managers asked for help solving problems, and Shin Ohkubo, an executive vice-president, reminded them to be sure to ask production workers for their suggestions. When the meeting broke up, most headed for the assembly line, not their desks. Lambert and I followed them into the plant.
The 1.7 million square feet of the plant is an awesome confusion of bright lights and moving machinery. Fifteen miles of conveyors cross and recross each other around and above the two half-mile main lines, cradling windshields, seats, and steering wheels that are directed by computer to arrive at each work station just as they're needed. Forklifts and trains of carts snake back and forth, ferrying the parts the conveyors don't. Two robot carts run alongside the line, following their magnetic tracks and playing their own synthesizer tunes to warn you they're coming. Their Japanese melodies fade quickly in the din of buzzing air guns, clanking presses, and sputtering welding robots. At one end of the plant, rolls of steel are pressed into doors and hoods; at the other, sleek Accords speed off the conveyor.
The plant's efficient layout is one reason Honda can produce a hundred more cars each day than AMC's Jeep plant does--with less than half the number of workers. Another is that where it has automated, it has designed its systems well. But it is not highly automated. It is, in fact, automating along its assembly line very slowly, only when it's sure a machine can consistently maintain the quality that line workers can. Generally, the only jobs that are now automated --such as welding and painting--are those that are heavy, dangerous, or that need to be done precisely. In last couple of years, many American companies jumped at the chance to replace workers with machines, but they have often been disappointed. The Ford plant in St. Louis, for example, put in equipment so sophisticated that workers couldn't use it, including a laser underbody inspection system that has never been used. "You try to tell the Americans that they can't buy themselves out of trouble with their super-high technology plants, but they don't listen,' James Harbor, president of an auto research firm, told The Washington Post last year. "And this little company is beating them in quality simply in the way it uses people.'
Unlike most car manufacturers, Honda has only two job classifications for line workers: production associate and maintenance associate (everyone is referred to as an associate). That gives management the flexibility to assign workers where they're needed, but it also allows workers to rotate jobs. Managers try to let people change jobs every six months.
The associates work in teams, usually of three to five people. In some teams everyone knows how to do all the jobs, and can switch around every two hours and break up the assembly line tedium. In other teams, each individual assembles an entire part, such as an instrument panel. Management plans to do more such "subassembling,' having found that one worker can build an entire door, for instance, faster than several individuals can put in each piece. Workers who build such parts must initial papers for each, so that problems can be traced and corrected.
Separate teams inspect car bodies and parts at various points along the line, but workers are also responsible for checking their own work and that of those behind them. Quality can't be inspected in afterwards, said Lambert. Gordon Kunkler, who has been with Honda for three years, said later, "You're not penalized for mistakes. They want to make sure you look for them--they encourage you to.'
Workers, instead of managers or engineers, often visit suppliers to work out problems or test new products. They also visit car dealers to hear their problems and their suggestions. Seventy workers flew to Japan last year to learn to build the 1986 Accord. They then taught their co-workers, including the engineers, how it was done. This year, the workers will train their Canadian counterparts to operate Honda's new Ontario line.
The production coordinators and team leaders, those in the first two (of only four) supervisory positions, spend most of their time coordinating, but unlike many line foremen, they also help train employees, stock inventory, catch up those who are behind, and fill in when people are absent. Every one of them has been hired off the line.
Honda's success has paid off for the workers--wages have risen about 5 percent each year, and benefits have also increased. Large attendance bonuses help explain why the average worker misses less than two days per year. Their compensation is now close to that of other workers in the industry. But the usual disparities between management and worker benefits are missing. Pension plans and bonuses for management and workers are calculated by the same formula. A single formula is also used to divide the 10 percent of Handa's pre-tax profits that it shares with its employees. (Only 4 percent goes to shareholders.) The average worker made $26,000 last year, not including overtime. Top corporate executives made an estimated $200,000--a lot, but nowhere near Lee Iacocca's $1.6 million base salary.
Participation in practice
I toured the plant on the day of two biannual events that showcase Honda's worker participation efforts. First was the biannual suggestion awards review tour. Scott Whitlock, senior vice president and plant manager, led Lambert and me around the plant, and listened to each of 72 production workers on the morning shift describe the suggestion he or she made for improving productivity, quality, or safety. Each worker whose suggestion is implemented receives a $50-$200 award. In the first quarter of this year, 450 such suggestions were made; almost half have already been implemented.
As we moved from work station to work station, hands were shaken, backs slapped, smiles exchanged, pictures taken. The suggestions were for things as simple as a plexiglass scraper to remove excess body sealer, to ones as complicated as a totally redesigned unloading bracket for pulling stamped car panels out of the dies. One worker designed a simple device to set glove compartments in straight. Until that jig was made, 100 dashboards every week had to be sent back for repair, a job that took three hours per dash. Now only two or three dashes come back each week. One woman who had trouble getting her immediate supervisors to fix grommet-setting equipment designed a suggestion form that requires a response from whomever it is directed to. The forms, and the big boxes with painted bulls on the sides that hold them, are now all over the plant.
Second were several quality circle presentations. One quarter of the workers participate in the circles--all of whom get paid overtime. They may choose any topic they like, and no one from management has to approve their choice. One group had figured out how to correct frequent bubbling of the padding that is applied to the dashboard. If there are bubbles, the whole dash has to be scrapped. The circle members all stood very straight and stiff at the front of the room, their hands behind their backs, as one member after another flipped through their carefully drawn and colored charts. They described how they had discovered and corrected one problem after another, yet without reaching the target they had set for themselves: a rejection rate of less than 1 percent per month. One member finally flew to Japan to work with the supplier of the padding, who, he found, had had trouble with the adhesive. The supplier agreed to be more careful, and the problem has nearly been eliminated.
The tour and presentations over, we walked back to the office where Al Kinzer, vice president and senior manager of administration, explained Honda's personnel policies. Some of them are strict. There are no sick days; vacation days must be used if workers are to avoid unexcused absences and the loss of their attendance bonuses. Only seven unexcused absences can put a worker on the Attendance Improvement Program, under which workers sign a contract, agreeing to quit if they are absent more than an agreed-upon number of days in the next few months.
Even in personnel matters management shares responsibility. Workers who have been fired can appeal to either a management review panel or an associates' review panel (ARP). If they choose to appeal to an ARP, they randomly pick six workers from a different shift to sit on the panel. One manager is chosen at the managers' meeting. The worker presents his case; a manager presents the case against him. Questions may be asked and then the panel takes a secret-ballot vote. The votes are counted only until there is a majority one way or the other. Thirteen cases have come before the ARP; three employees have been reinstated with back pay.
Lambert and I made one last stop for the day. We walked with Susan Insley, vice president of corporate planning, across the parking lot to the sports center. Heaven knows why, after working all day, there were people swimming in the pool, playing basketball, and doing aerobics. But there they were.
Insley described how, as the plant has grown larger--there will be nearly 4,000 employees by the end of the year--communication between workers and management has gotten more difficult. "We're still learning to work together,' she said. "It's not a utopia.'
"All the running you can do . . .'
And it's not. For starters, there are complaints about favoritism in promotions to management. Such complaints are common in any workplace and perhaps what favoritism there is at Honda is simply more apparent because so many people have been promoted so fast to keep up with the expansion. But almost every worker I spoke to thinks it is a serious problem. "They're looking for "yes' people, not hard workers,' says Ted,* who has worked in assembly for three years. "The vast majority of the time its who you know, who you play golf with.' With dozens of new openings for team leaders, Ray Johns, who works in welding, says, "You have a lot of people right now stabbing each other in the back trying to get ahead.'
Nearly everyone I spoke to also said that there's
* Some of the people who were interviewed for this story did not want their names used. First-name-only pseudonyms have been used for them. favoritism in job assignments. "A lot of people have put in time, worked hard, and they're still on the line,' says Jim, who worked three years on the line before he was given a better job. "They commonly just hire people in . . .. There's no job posting and they never let you know on shift about openings,' says Randy Neighbarger, who has been with Honda since the line started.
Yet it is the workload that seems to frustrate the workers the most. Somewhere along the plant tour, I stopped and watched the workers on the line. They move with remarkable swiftness. Their hands spin wrenches, connect wires, and set windshields with the perfect dexterity that comes only with repeating a motion thousands of times. There's no pause between the last motion of a task and the first motion when it's repeated. Having bagged flour in a mill for two years, I remember the tedium of doing the same thing over and over, day after day. But this is different. I could get ahead of the mill and stop if I wanted, but on the assembly line, the workers are under the constant pressure of a new door to weatherstrip or a new engine to mount coming at them every 72 seconds. The line is rarely down for long, and there are only two 10-minute breaks and a half-hour lunch per shift. "If it doesn't get you physically, it will mentally sooner or later,' says Ted.
Here and there I saw people actually running to catch up. "If they're running a 350 [cars-per-shift] pace, you run,' says Ray Johns. "It's a quick pace, but you can keep up.' Management says it doesn't run the line any faster than GM; but the measure of hardship is not necessarily the speed of the line, but how much each individual is expected to do. There are, of course, easier jobs, such as driving a forklift, and harder ones, such as hoisting one end of a 60-pound driveshaft into place over your head. Still, every worker I talked to said that there are plenty of areas where the workload is unreasonable. "They give you whatever you can handle,' says Gordon Kunkler. "If you can handle it, they give you more. You don't have any free time . . .. The pressure's there. You keep up so no one gets mad at you.' Sam says that at one point his area was seven people short, but no one was hired to replace them until those who were left started calling in sick. "It was really nothing more than everybody being worn to a thread,' he says. Ray Johns says he worked a job which a time study showed required two and a half people, but he worked with only one other. "We were running 99 percent of the time,' he says. "I've always tried to do my best, so I'd try to keep up with the line. But we'd get behind. I feel guilty when I do something like that.'
Management sometimes pays a price for such pressure. "They break things in welding regularly doing things too fast,' says Mike, who works in maintenance. "It would be better to slow the line down and do it right the first time.'
The speed can also be dangerous. Sam describes how a man nearly got crushed on the rear-door welding line that normally runs one door every 56 seconds but is now running one every 42 to meet production demands in Canada. He says even his team leader says that someone will have to get killed before the pace is slowed.
Although management is proud of never having laid anyone off--and the expansion will ensure that for a while--a number of workers wondered what kind of job security they really will have if they can't keep up when they're 40 or 50. Or if they are permanently injured. Back and wrist injuries are common in some areas, as is nerve damage in the hands of those who use the constantly pounding air guns. I was told stories of people who were injured, then put back on the same job where they reinjured themselves. Sam says that when he hurt his knee, the company doctor told him to take the rest of the week off and then come back and do light duty for a while. He came back after only two days and was sent straight back to his old job. "They are productive,' says Ted. "They just don't know when to stop about how much they can ask of their employees. But jobs are scarce. People are willing to put up with a lot of things just to maintain a job.'
Honda's management has to know that favoritism, dangerous working conditions, and unequal workloads demoralize workers. And that demoralized workers are not productive workers. In fact, President Shoichiro Irimajiri said among other things in his New Year's speech to the workers that he was "very greatly concerned' that the workload be balanced. Because of that kind of concern, workers and management may well be able to work through the complaints, particularly if some of the solutions come from workers themselves. Ed Buker, senior manager in assembly, says that some of the team leaders had complained to him that they didn't get much chance to change jobs and wanted him to come up with a plan. "I said, "You tell me!'' he says. So now they're working on a better way to rotate their jobs.
Yet enlightened procedures or decision-making participation don't change the inherent tedium and pressure of assembly line work, or make it anything more than endurable for many. Promotions off the line and better assignments are limited. Certainly, the more people are able to switch jobs, and the more opportunity they have to do subassemblies, the more bearable the work. More automation may lighten some of the physical load, but it won't necessarily give a worker time to rest, and there are limits to how much can be automated.
Moreover, competition in the auto industry is intense and getting more so. Two more Japanese auto manufacturers, Fuji (makers of Subaru) and Isuzu, announced in late May that they plan to build their own U.S. plants in 1989. According to a Washington Post report, some analysts say that if every company builds what it says it is going to build, there will be such a glut of cars by 1990 that some companies may get knocked out of the market. "On our assembly line we measure downtime in seconds,' says Irimajiri. "When you have more than a thousand associates working together to build a car, it is the attention to seconds, not just the minutes, that determines your production efficiency.'
With that kind of pressure on them, auto manufacturers are not likely to slow down their assembly lines or hire more workers just to be nice. And Honda's managers are going to be under just as much pressure to squeeze their workers as anybody. Continually rising wages just increase the pressure to demand more of workers. Wouldn't workers be better off asking for a little more help in return for giving up a bit of their wages? Or by giving up a little of their wages in return for a shorter week? And wouldn't Honda get an even more efficient, more productive workforce while maintaining the same production rate and cost?
An imperfect union
For all the anger and frustration workers expressed about problems in the plant, they are not yet bitter. Most seem to want to try to work out their problems with management by themselves, and have so far rejected the solutions offered by the United Auto Workers (U.A.W.), which has been trying to organize the plant since it opened.
Last fall, the U.A.W. said it had the support of the majority of the plant, and asked Honda's management to recognize it without an election. Management was skeptical and took a secret-ballot poll it claimed showed only a quarter of the plant wanted the U.A.W. The U.A.W., nevertheless, had signed union cards from a third of the employees, enough to force the election that was set for December. Then the U.A.W. filed three unfair labor practice suits against Honda with the National Labor Relations Board (NLRB), accusing management of holding its own election, of granting increased benefits during the drive, and of assisting an anti-union group within the plant. The charges were thrown out by the NLRB, though the U.A.W. is appealing. The December election was postponed, and then a few hundred new workers were hired. In March, the U.A.W. withdrew its petition. In a press release, it stated that "misinformation about the union' and "a rapid influx of new hires' had created a "poor climate' for an election.
Still, Jim Turner, the national organizing coordinator for the U.A.W., says that pressure from the union has had an effect. "If the U.A.W. wasn't here, they wouldn't be getting the benefits they're getting now.'
Those who support the U.A.W. tend to be older and usually have been with Honda for a while. But much of the workforce is new, young (average age, 28), and from the surrounding rural area. Honda has hired most of its employees from within a 30-mile radius of the plant, a circle which includes farmland and small towns but just misses metropolitan Columbus. Unemployment in the area in 1983 was 12.5 percent. Honda is the best job many of its employees have ever had or are ever likely to have.
In addition to not wanting outsiders telling them how to solve their problems, many of the workers simply don't trust unions. Some who have farmed say that unions helped push their production costs up--more expensive tractors, for instance--until they couldn't make a living farming. Some fear the U.A.W. might cost them their jobs by pushing Honda out. Others fear they'll lose the open relationship they have with management, or that U.A.W. work rules will make it hard for them to rotate jobs.
Management says it has always been and will remain neutral on unionizing the plant. The Honda plants in Japan are all unionized, though the union is only for the company, not industry-wide. Takanori Sonoda, assistant to the senior vice president, says the difference between Japanese and American unions is one of "sentiment.' "Japanese unions,' he says, "think first of what is good for the company, then of what is good for the union.' There seems to be an unspoken fear among those in management that if the employees choose the U.A.W., with its history of often bitter management-labor relations, that same kind of adversarial relationship will follow and kill their productivity.
While most workers agree the U.A.W. drive is dead for now, they say the need for some representation remains. "I'm the first to admit there's been a lot of union abuse in the past,' says Ted. "But I get a little wary of nothing but praise and good press about Honda. . . . Within a year or two, unless they get more help, you'll see a resurgence of union support.' Even Steve Barker, the main organizer of the anti-U.A.W. group, says, "I think there's room for something. I'm not sure what.'
Yet even the strongest unionizers appreciate Honda's approach. "It's good that you can talk to the vice president and call him by his first name,' says Randy Neighbarger, who calls himself the top union organizer in the plant. "And the productivity concepts are good if they're actually carried out. The teamwork philosophy is good. . . . It's not a bad place to work. I'm planning on staying. I just plan on changing them a little bit.'
In the long run, whether workers and managers can work out their differences may determine Honda's ability to hold or expand its market. For now, Honda has the advantage of people who work hard and give a little more when it's needed. Scott Whitlock tells the story of how nasty snow storms last spring had set the plant behind in production. Demand for the cars was strong and the number of new dealers Honda could franchise depended on whether it could meet that demand. Everyone was already working heavy overtime. Management considered cutting production, but decided to first ask the workers. "We gathered the associates and offered them two plans. Continue with heavy overtime, or with very heavy overtime until Easter,' says Whitlock. The reasons for the choices were explained and a long discussion followed. "The sentiment was about 90 percent to build. It was the hardest six weeks we've ever had. . . . But everybody pulled together.'
Honda has shown that it is possible to build high-quality cars in this country--and do it efficiently. If it seems near stumbling right now in its worker relations, perhaps that is because it has not yet learned its own lesson well enough. Thinking of his American--and foreign-- competition, Al Kinzer said, "In 10 years, those that survive will be those who have a way of pulling their people together as a team, who are enlightened enough to know there's competition out there. . . . We know it's coming. Somebody's going to be right. Somebody's going to be wrong. I have no fears.' He smiled. "They're going to have to get more like us than we like they.'
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|Date:||Jul 1, 1986|
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