TVR Quality Control
Discussion
By all accounts the TVR factory is now running differently, I'm not sure of all the details but was told (by a nice bloke at a dealer who is also a mate) that the TVR workers are targeted on quality. Therefore they get a bonus if the cars they build are good! Take it with a pinch of salt but if there is any truth in it then great, maybe I will confirm that Tuscan order. Has anyone had a new car recently? Is there a marked improvement ( I suppose the best thing would be to as the people who do the PDI).
D.
quote:Bunch of arse, mate... Quality based remuneration can work very well if it is properly implemented - especially in manufacturing. As for measurements - it is difficult to implement leading measures (i.e. data that indicates whether the product will not fail in the future) but easy to get good lagging measures that would indicate the product quality (number of PDI items requiring rework, number of dealer returns in 1st month etc.) The difficulty with lagging measures is that you are indicating problems with what happened at the factory last week or last month - its difficult to learn from that and depending on how transient the workforce is, it can be hard to rectify.
Bonus schemes never lead to improved quality and a bonus scheme on quality is difficult to police.
I'm with James. A bonus scheme to improve quality implies that quality is purely dependent on the manufacturing workers. Not so. It's more to do with the culture of the factory as a whole. W Edwards Deming (the evangelist of quality) states that 85% of quality problems are the result of management errors. He specifically opposed performance ratings and individual bonuses as "inherently unfair and detrimental to quality".
Funnily enough, Deming's most ardent fans are Japanese car companies so there might be something in it.
quote:I agree to a certain extent - Deming's points are valid, but with any situation you can't simply apply the "it works for the Japanese" ethos - you have to take a look at the organization you are dealing with in its own right: TVR is a firm run by an autocratic enthusiast largely for his own pleasure/ benefit. It designs cars in a somewhat antiquated fashion around "tried & tested" principles (with little regard for design-for-manufacture / design-for-quality). Its facilities are not state-of-the-art and many of its methods luddite. I suspect that changing any of this would be very difficult in the context of any "Holistic quality drive". More realistically (and supported by some of Kaplan & Norton's more recent HBR work on implementing the balanced scorecard as well as some personal experience) is the formation of a micro vs. macro approach to quality. Given that the shop floor is most able to physically influence quality - my original point was that it should be feasible to setup measurements that would reward workers for producing a quality product. My assumption is that staff turnover is sufficiently low to allow the measures to work (and the learning to be institutionalised) and that the identified measures can be implemented. As to James' further education, I suggest he reads up on some of the basics first: Maslow's Heirarchy of needs, perhaps?
I'm with James. A bonus scheme to improve quality implies that quality is purely dependent on the manufacturing workers. Not so. It's more to do with the culture of the factory as a whole. W Edwards Deming (the evangelist of quality) states that 85% of quality problems are the result of management errors. He specifically opposed performance ratings and individual bonuses as "inherently unfair and detrimental to quality". Funnily enough, Deming's most ardent fans are Japanese car companies so there might be something in it.
quote:Actually I thought the staff turnover had been rather high recently... Your proposals assume that the quality issues are directly related to the care being taken by the assembly staff. Try again. Not.
My assumption is that staff turnover is sufficiently low to allow the measures to work ....
Hoping that paying shopfloor workers a bonus will result in better quality is very optimistic. Research by Kearney in 1980 showed that 80% of quality initiatives fail and it is probably unrealistic to expect this one to succeed. It is a simplistic response to what is likely to be a systemic problem operating on a number of different levels. As you rightly point out, there are corporate governance issues and few stakeholders in TVR to balance PW's narrow self-interest. In my view the reason the bonus scheme will fail is that it turns on the premise that quality is in the gift of the shopfloor worker and ignores the extent to which workers are empowered to change upstream practices affecting quality. For example the failure of Griffith / Chim starter motors is attributed to a design fault (heat soak from the exhaust). Not much that the production line chap can do about that. I suspect that 'they all do that Sir' is engrained in the corporate mindset (evidenced by the PR chap' response to the JD power criticism) and challenging a mindset requires more than a worker incentive scheme.
I agree that my suggestion is optimistic - its original intent was to counter James' rather blunt assertion that bonus based quality systems cannot work. A point I disagree with (we are all entitled to our own opinion after all).
I completely agree with your argument, but like you I can't see the senior management changing in a way to facillitate proper, cultural shift within the organisation. My suggestion is not simply "give 50 quid to Dave if he screws the car together properly" - there would have to be further analysis to understand what measures could be implemented and how workers could be best incentivised (not always money).
Don't get me wrong - if it were possible to start from the top down - that would be the right approach. I'm just making a suggestion in the one area where there may be scope for change.
(sorry if this is boring anyone, but it is interesting to me...)
quote:Don't get turn-over confused with lay-offs. The remaining staff may have been there for 5-10 years for all we know (that would be considered low turn-over). My proposals are probably over-simplistic, but given the apparent myopic approach to quality at the senior level and significant power-distance between shop-floor and management - I thought I'd offer it up for discussion. Edited by paul on Thursday 19th April 15:07
Actually I thought the staff turnover had been rather high recently... Your proposals assume that the quality issues are directly related to the care being taken by the assembly staff. Try again. Not.
Edited by Don on Thursday 19th April 16:04 
Paul, I didn't mean to be overly critical of your idea; just having a larff with an mba textbook.
Actually, I am not sure how many theoretical concepts apply to a firm like TVR: theory is based on logic and who buys a TVR based on logic? There is an element of magic about them that defies rational analysis and perhaps stems from the intuition / vision of a dominant personality like PW (or Ferrari, Morgan, etc). ****, I have lapsed into Bollocks mode again...
quote:1. No offense - good to have some debate 2. Yup TVR defies logic alright...(all mine have) 3. I rarely ever get out of Bollocks mode, me
Paul, I didn't mean to be overly critical of your idea; just having a larff with an mba textbook. <snip>****, I have lapsed into Bollocks mode again...
Well this thread has been enlightening. It somewhat backs up the research we've just had done which pointed at our readers not only being educated, but also having jobs. In fact it seems you're quite a wealthy bunch.
No surprise that 95% of the readership is male though. Apparently 52% of you intend to buy a car in the next 12 months. And did you know that 41% of you own an electronic organiser... Interesting huh? No... oh ok...
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