Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, August 29, 1993 TAG: 9308270014
SECTION: BUSINESS PAGE: F1 EDITION: METRO
SOURCE: John Levin
DATELINE: LENGTH: Medium
But at General Electric Co.'s industrial drive systems factory in Salem, now about five years into a quality management program, there's some hard evidence that makes even a cynic take notice.
Some of it is symbolic: Managers no longer wear ties (or dress pumps if they're women), and plant walls are papered with charts measuring progress toward admittedly outlandish production goals.
More tangible is that there have been no layoffs among the 2,100-employee work force in five years despite the recession. Also, GE Drive Systems' marketing division has been moved to Singapore to compete in the global marketplace while waiting for domestic customers to recover from the slow economy.
GE Drive Systems lost 25 percent of its sales during the recession as U.S. steel and paper mills, electric utilities and crane companies ordered fewer of its automated controls.
Indeed, from late 1990 until this spring, the company's goal was holding the course. Every time a cost saving was uncovered, it was measured in terms of how many jobs it protected. As the economy has recovered, the push has shifted toward increasing sales and production.
"In the recession, our objective was to survive, to keep people on the payroll," said Michael W. Allee, the Salem plant's spokesman. "In the past year, growth in volume has replaced survival as a goal."
It may seem surprising to hear such talk from a company the size of GE. Salem is but a unit of a division of 13 major lines of business. This is a corporation that did $62.2 billion worth of business last year and has nearly 300,000 employees worldwide.
It's a company that for much of its 114-year history has functioned with a traditional top-down management style. When, in 1982, GE Chairman Jack Welch dictated that the company would be no lower than No. 2 in each of its markets, his decree was taken as all that was necessary to make it happen.
The message is very different now, although Welch and GE still are considered among the most competitive in American business.
"I didn't know General Electic in its downside," said Donna Chapman. But after just seven weeks working in Salem, she knows "employees are instilled with a sense of power of getting problems solved."
"People aren't afraid to approach a new person and tell them about a problem, in a professional manner," she said.
"I remember when we did more fighting than anything," said Lou Jane Basham, a 29-year employee. "Now we work together to get problems solved."
"We're not really doing anything different; it's just that we've fine-tuned, and it's showing up," said Boyd Price, with GE since 1980.
These are people who make circuit boards, plastic plates embedded with wire, sockets, diodes and capacitors: high-tech gadgets that when completed are the brains in automated control devices. This is precision manufacturing where the final product is either precisely correct or completely wrong.
It takes 11 days to make each board, but that's down from 23 days. The plant makes about 1,500 boards a week.
In 1990, the 15-member team that included Chapman, Basham and Price decided to cut the work group's waste, estimated as $640,000 worth of unusable product a year. Their goal was to cut the waste in half.
They met it and as a "reward" were given the challenge of cutting it by half again in 1992 and again, to $117,000, this year.
"We saved seven jobs," Price said of the first-year achievement. Some of that money now goes to employee training.
Another measure, said 25-year veteran Marge Crowder, is that often the group's work is caught up so they can work in other parts of the plant, helping to solve other problems.
"Our frustration level has dropped tremendously," Price said. "If I have a problem, I have the empowerment to take care of it."
\ John Levin is business editor of the Roanoke Times & World-News.
by CNB