and What Should Leaders Learn
from Them
SECOND EDITION
By William “Red” Davidson
Texas, USA
From time to time, we hear of a story of an organization that transforms from the worst in their field to the best. These stories provide leadership with insights that can help them design a workplace where their organizations become highly successful. This article reviews to different worst to first stories:
- New United Motor Manufacturing Inc. or NUMMI
- USS Santa Fe under the command of Captain L. David Marquet
New United Motor Manufacturing Inc.
Our first story starts at the General Motors Fremont assembly plant. The Fremont plant opened in 1962 to replace the Oakland assembly plant some short distance away. It would produce more than one thousand cars and trucks per day for the Chevrolet, Pontiac, Buick, Oldsmobile, and GMC brands. Over time, this assembly plant would gain the reputation as being the worst plant in the GM system. The workforce was considered the most difficult in the automobile industry. There were tales of sabotage, such as placing Coke bottles or loose bolts in door panels of vehicles. Wildcat strikes were not uncommon. As a result, both General Motors and the UAW gave up on this plant. Consequently, the plant was closed March 1, 1982.
In the early 1980s, Toyota did not have an assembly plant in North America. They started looking for a partner who would entertain a joint venture. Toyota wanted to learn the nuances of building cars in North American given the local suppliers as well as working with a unionized workforce under the UAW. The Ford Motor Company passed, while General Motors accepted the offer. GM wanted the learn how Toyota produced high quality small cars at a profit.
In February 1983, Toyota and General Motors signed an agreement to produce small cars at the former Fremont assembly plant. Cars would be produced under a 50/50 joint venture between General Motors and Toyota, the venture would be named the New United Motor Manufacturing Inc. or NUMMI. NUMMI was officially recognized as an independent corporation in February 1984. By June, the first group of NUMMI trainees arrived in Japan at a Toyota assembly plant.
Toyota would install their production and management systems at NUMMI while General Motors would market the plants main products, the Chevrolet Nova and later the Geo Prizm. Production started in December 1984. Within two years NUMMI was rated the best plant in terms of quality and productivity in the General Motors system.
Some of the key metrics:
- Productivity at NUMMI: 36.4% less hours per unit compared to a comparable GM Plant. GM-Fremont would take 57.5% more hours per unit compared to the same comparable plant.
- Quality: JD Power and Associates data indicated that cars produced at NUMMI were significantly better than the average car, 117 problems per 100 united vs. 151 for all cars produced.
- Absenteeism was significantly reduced, from 20%-25% under GM-Fremont to 3%-4% under NUMMI.
- Union grievances also significantly improved, from 700+ at the time the GM-Fremont plant closure to roughly 30, only three grievances going to arbitration.
With these productivity, quality, and workforce relationship improvements, one might assume an entirely new workforce was hired to fill all positions. On the contrary, 85% of NUMMI‘s workforce were former GM Fremont UAW workers — including all the union hierarchy. It should be noted that none of the former managers from GM Fremont were rehired for NUMMI.
USS Santa Fe under the command of Captain L. David Marquet
The second worst to first story involves the US Navy nuclear fast attack submarine USS Santa Fe (SSN-763) and their new captain L. David Marquet.
More…
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Editor’s note: Second Editions are previously published papers that have continued relevance in today’s project management world, or which were originally published in conference proceedings or in a language other than English. Original publication acknowledged; authors retain copyright. This paper was originally presented at the 14th UT Dallas PM Symposium in May 2022. It is republished here with the permission of the author and conference organizers.
How to cite this paper: Davidson, W. (2022). Two Worst to First Stories and What Should Leaders Learn from Them; presented at the 14th University of Texas at Dallas Project Management Symposium in Richardson, TX, USA in May 2022; republished in the PM World Journal, Vol. XI, Issue IX, September. Available online at https://pmworldlibrary.net/wp-content/uploads/2022/09/pmwj121-Sep2022-Davidson-two-worst-to-first-stories-2.pdf
About the Author
William “Red” Davidson
Texas, USA
William Davidson, known to many as Red, is an Agile Coach from Plano, Texas. He’s coached at large enterprises including Frontier Communication, Citigroup, Toyota and Chase. He’s been writing software for money since 1983 (whoa, that’s a long time). He’s held many positions (Development Manager, Project/Program Manager, PMO Lead and Scrum Master), receiving awards (Business Development Quality Award for Excellence), written papers & articles, and presented at more than 100 conferences and user group meetings. As an Agile Coach, Red helps teams (and their organizations) achieve the benefits of Agile software delivery. He can be contacted at reddavidson@yahoo.com or www.linkedin.com/in/reddavidson
