|
The Plant with the $70,000 Petals
by Wesley Gribble
Three workers weld a new BMW X5 model car, and each moves away from the X5-in-progress to switch their weld heads and then resume working. Ordinarily this does not impress a tour group. So what is it that is so captivating at the BMW plant? These three workers are robots.
In early April, ten students from the E-Business Strategies class taught by Jim Utterback took the opportunity to visit the BMW plant in South Carolina. One purpose of the trip, according to Utterback, was to attempt to illustrate the degree to which information technology is integrated." One of these ways is automation.
Like so much of the production at the BMW plant in the Greenville/Spartanburg area, the process just described is automated, with robots doing most of the work. The X5 production is around fifty percent automated while ninety percent of the Z4 production process is automated. Together, about seventy-five percent of the entire plant is automated. Utterback believes that this plant may be slightly more automated than some but that most manufacturing plants would compare favorably.
Of course there are still things that only a human can do, such as fixing a robot or welding a car in such a way that if a robot tried to do it with a laser the car would be cut in two.
Cutting cars in two is frowned upon anywhere, but especially at a BMW plant, where every car that is made is not mass-produced, but has already been custom ordered and its price already paid. Every car that is manufactured is already someone else's property, so the utmost care is taken to make sure no damage, like scratches, comes to it during production.
The plant produces two types of cars: the Z4, which before that was the Z3, and the X5. This BMW plant is the only one in the world where these models are produced. When someone orders one of the models in Britain, the steering wheel has to be put on the right-hand side.
It is possible that a line of cars could each be going to a different country and the process would need to be switched for each car. The way this is done is a computer tells the human and robot workers on which side of the car the steering wheel needs to be put.
Seat installation is another task at which robots are infinitely more superior to humans. The precision with which a robot can put a seat into the side of a car without scratching it is much better than a human's precision.
Tour groups watch as a robot in the shape of a giant arm grabs a seat and begins placing it into a car. It twists, turns, and angles the seat so that it puts it through a hole in the side of the car where a door will be without so much as a mark on the car. Then it moves out of the car and prepares to repeat the process when the next car arrives.
As Melissa Sechrist, senior, and others felt, "it was almost like they were human." Not just the giant arm robots, but many others as well. A video that groups watch before they begin the tour of the facilities shows the paint shop robots at work. Robots that look like the arms of a person begin to spray paint and other chemicals onto new car bodies. When the car doors are opened and closed, the robots that perform these tasks look like an arm bent at the elbow with padding so that no damage is done to the car as they push the doors open or closed.
Damage to the cars, however, is not the only cost that the plant is worried about. Another cost that is sometimes incurred is due to their JIT production system. JIT stands for "Just In Time," which means those parts needed to finish production of the cars arrive just when they are needed.
To save on inventory and warehouse costs, BMW chooses to store only enough parts for two to four hours of production. If after this time production is interrupted and the line is caused to shut down, then an estimated $3,600 a minute is lost.
BMW is not the one to eat this cost, however. Whichever supplier it is that has caused the line shutdown must pay the bill. One real-life example is a truck that was delayed due to an accident, causing the line to shut down for forty-five minutes. This is something that Utterback felt really astonished the students -- to learn that there is a penalty for being late in the real world.
This is also one of the reasons that the Greenville/Spartanburg area was chosen for the location of this plant. It is near Charleston, a port off of the Atlantic, and there are many major suppliers in the area, which cuts down on supply travel time. Another factor is that it is near major East Coast population centers.
Other factors that Utterback felt were probably reasons for this location were availability of a skilled workforce and incentives offered by the local government. This last reason is something that Utterback believes should be illegal, but he admits that it is very common in business today.
He can remember when the plant was being planned and can remember the bidding wars that went on between states and cities. Things like lower infrastructure costs and property tax relief were the kinds of incentives given.
JIT production, a part of their Supply Chain Management (SCM), is just one of the business strategies that BMW uses. The company also carefully manages about 10,000 parts per car very tightly, but another strategy relates to its Enterprise Resource Planning (ERP).
BMW is known not for mass-production, but rather for mass-customization. By this, it is meant that each car produced is custom made for the buyer, but it still goes through the mass-production process. Each car is treated differently at each of the steps along the way, such as the aforementioned steering wheel placement.
This customization is achieved through their ERP system. By communicating each detail of information about a car and its needs, mass-customization can easily be executed. Utterback also suspects that the Human Resources department is also connected with the plant's ERP system.
Customer Resource Management (CRM) is another apparent E-Business strategy implemented by BMW. Customers can access the BMW web site and custom-design their own car. When their car is being built in the plant, they can follow it through the production process.
Internet based CRM methods are not the only ones that BMW uses. BMW also over the past five years or so has hosted the Z3 homecoming, where owners of Z3s from all over the world come to the plant for fun and fellowship. Through methods of this nature BMW works to build strong customer loyalty and pride.
Customer loyalty is something that BMW works hard for, but they also work hard for employee loyalty and pride too. The waiting list to begin working at the BMW plant is between two to four years. This is mostly due to the fact that the turnover rate for the plant is only around three percent.
One explanation for this is the line-worker compensation package. The base wage is fifteen dollars an hour. After the first year or two this shoots up to about twenty-two dollars an hour. It is now obvious why a line shutdown is so expensive.
As for a company car, there is not one. There is however a program that employees can become a part of after their first year which allows them to lease a brand new BMW for 8,000-10,000 miles before trading it in for a brand new one. These cars are then sold at used car dealerships.
The most sought after job at the plant is, of course, the test-driving. Every BMW that is produced is taken out onto a test track to make sure its performance is up to standards. This is just one method of their quality control.
Another method is one that is programmed into the robots. If a robot senses something wrong with a part it is working with, or if something is out of place, it will move back to its "home position" and stop until a human operator fixes it.
A fine example of this happened during the tour of the plant. A robot, which had previously had this same problem earlier in the week, was placing windshields into the fronts and backs of cars. While getting ready to place a windshield into one of the cars at its station, the robot noticed something out of place -- a paper attached to the windshield. It held the windshield and returned to its home position and waited for someone to fix the problem.
All of this has to take less than three minutes, because in that time the line will start moving again. The cycle time for any single production station is three minutes. If a task takes longer than three minutes to complete, then there will be another station to which the car-in-progress will move to complete the process.
Even when plants are mostly automated, humans will still be needed to fix any problems that occur. With so many factories relocating in third-world countries where wage demand is lower, automation could be a good thing. "Automation may be our best salvation in keeping the manufacturing jobs we have," said Utterback. Cutting the costs of factories makes it easier for them to remain within the United States, and although there are fewer jobs at the factories, there are still jobs.
The BMW plant, although extremely clean, not too noisy, and with ergonomically correct working conditions, is not too far from the norm in modern day automobile manufacturing.
This trip has helped many students to see how what they are learning in the classroom applies to the world outside. Brenda Angel, junior, said that she now realizes that "E-Business is a huge part of companies today," and it allows "them to have more efficient and effective processes."
Utterback said that he was satisfied with the trip, although he was a little disappointed that not everyone was able to go. The trip missed five people. His satisfaction came from seeing the students' satisfaction and what they were getting out of it.
One of the disadvantages of a liberal arts institution when teaching business is that there is very little exposure to manufacturing. Utterback says he was trying to do just that -- trying to bring exposure and to get across that which can't be gained from a lecture.
HOME
| 
