Article Summary
This article demonstrates how various decision-making tools can be used to increase production and growth in any given company. General Motors (GM) applied different tools and mechanisms in its efforts to salvage the company from extinction that was to be caused by stiff competition and poor management. To begin with, all the challenges that were facing this organization were listed and a team instituted to handle the identified challenges using the necessary tools (Alden et al. 7). The team came up with efficient models for use in project management. The first model to be adopted by GM was C-MORE, which was fast and highly efficient. Various assumptions were made in adopting this model, such as the assumption about the unreliability of workstations and the assumption that all buffers always had everlasting capacity (7).
The C-MORE model had a tradeoff in its capability to give an analysis that was between the system’s complexity in modeling and the speed at which the analysis was executed. Various easy to use equations were employed using a predetermined paradigm. One of the notable assumptions that were made by the research team was the fact that all variables were independent, thus not equal. It meant that if one working center failed, then the other centers would not fail; instead, they would continue to function at a reduced rate to compensate the rate at which the closed center would have been operating (8). The C – MORE was largely used to identify those centers that were more likely to have problems in data collection, as well as using historical results for comparison purposes. It is worth noting that results on performance estimates were obtained within a few seconds through the use of a computer.
There was the introduction of other methods that used discrete simulation to increase the degree of accuracy. Specific software, the discrete-event-simulation (DES), was developed to analyze the vast system that GM used. Data structures that were efficient were used alongside a representation flow of jobs to efficiently cater to the machines and the interaction of jobs movement within the system. More efficient software was developed to aid in the analysis of the data that was collected through the use of the C-MORE model (9). In a move to automate the collection of data, GM adopted the use of programmable data controllers (PLC) that relayed information collected from the production lines to a database that was centrally placed. Validation of data was done, followed by filtering data at several stages. Normally, the data collected was compared with the projected data from the C-MORE mode. Deliberations were always made among the team members before any decision was made on how to improve the throughput. Various case studies were reviewed and better training materials were prepared. The adopted C-MORE tool was put to test through a case study about an assembly center located in Detroit-Hamtramck (10).
However, the introduction of new technology that the workers had little knowledge about hindered the expected growth. On the contrary, it led to losses exceeding $100,000 per shift. To effectively change this worrying trend, all floor managers were organized to attend training conducted in GM’s labs. Continual data collection and improvement in the way work was carried out was critical for the company to appear in The Harbour Report among the plants that had the most improved performance. The success recorded brought with it a change in the job operation. The C-MORE technology brought with it improved data collection methods and enhanced teamwork. Later on, a central organization was formed to oversee the operations of all other plants in terms of training, development, and improvement of the C-MORE technology, as well as the introduction of a web system that interlinked all plants to enable them to send data to the central database at the shortest time possible. By the time of publication of this paper, C-MORE was in use in all the plants that GM owned. It helped different managers, engineers, as well as analysts to advocate for good manufacturing practices. GM developed good relationships with the suppliers, where engineers directly engaged with the suppliers to design what would fit in the production. This, in turn, reduced losses that were previously recorded as a result of poor engineer-supplier relationship (17).
Improved project management using various decision-making tools has enhanced the performance of GM. The use of the C-MORE approach has, in the long run, changed the behavior of both managers and engineers, resulting in increased revenue and growth of the organization. The model, which has undergone several modifications, has resulted in over $2.1 billion in savings, as well as increased revenue. The number of overtimes has reduced gradually. GM is now able to meet its production targets, thanks to the C-MORE tool. The tool enables the organization to compete favorably with other players in the automobile industry. Remarkable occasions are when the organization appears in The Harbour Report, which is the widely recognized paper that ranks different automotive manufacturers (19).
How the Article Relates to the Business Community
With good decision making, any company facing challenges can thrive and make profits again. Like the article’s example, success is not a one-off affair; instead, it is gradual. Success requires excellent project management, involving the use of the Program Evaluation Review Technique (PERT) and the Critical Path Method (CPM) in scheduling and controlling the processes. Any manufacturing company ought to maintain its production data. The personnel involved should be engaged in project management to make sure they forecast their production for the organization to meet its target. To register good results, an organization should use modern and relevant decision-making tools to reduce the amount of time that old and inadequate decision-making tools take to give results. Entrepreneurs in the business community can borrow from this article because increasing labor and investing heavily in equipment alone do not contribute much to an increase in throughput. Continued pressure on managers also fails to necessarily correlate to increased throughput. Rather, good project management is the key to a successful business.
This article vividly highlights the need to have a research and development department in any organization that wishes to see itself as a top brand in the future (8). An important lesson learned by personnel in the research and development is that they should adopt better data collection methods, alongside workable models. Another lesson for entrepreneurs is that different stations that are under one business should be interlinked, as a failure in one station would eventually lead to failure in other stations as well, thereby affecting the whole business. The speed at which station A manufactures its products should not differ much with the speed at which Station B and all other stations are producing. This prevents blocking and ensures smooth forecasting of throughput. Models that any business may wish to use in its pursuit of improved performance and growth of an organization should be efficient, easy to use, as well as fast in delivering results. As learned from the article, models that businesses intend to adopt ought to give outputs that are expected at the end of the project.
The magnitude of specialization in a manufacturing company should be put into consideration before adopting a specific method for use in the estimation of performance. One can also learn the fact that time series forecasting is a useful tool that businesses in various fields should use during their decision analysis and project management. To avoid errors in predictions, businesses should learn that poor data collection should be avoided at all costs (10). There is a need for organizations to have data records for all the production activities to avoid repeated obstacles in analyzing throughput. This can be done against a set of standards instituted by the organization. In the case of GM, it was able to install an automatic system of data collection in all its centers.
The use of software in conjunction with project models is reported to have many advantages. This is a welcome revelation to business people who wish to engage in any project management shortly. For example, there was a reduction in the time used by analysts in simulating line design by 50 percent at GM (11). Additionally, there was increased communication and efficiency in transferring the models from one person to another within the same facility. This would be an added advantage to those organizations that are challenged by physical and organizational boundaries. The development of advanced software that can analyze data efficiently is vital for organizations that aim to promote consistency throughout the organization. This is supported by the fact GM developed an improved software to enhance data analysis (11).
The research and development (R&D) team performed several trials and validations to determine the minimum amount of data that was required in the production at GM. Different types of data are always collected from time to time. However, to have a positive impact on the improvement of production, the management of every organization ought to install a team tasked with the implementation of the findings obtained from the data collected. This is vividly supported by the way GM collected data from various centers, but it was not until there was a team instituted that positive impact was observed (13). As observed in GM, data obtained from production units have to be deliberated upon by a group of competent team members before any decision is made on the recommendations to improve the throughput (14). Getting the right people to do a specific type of job is crucial for the progress of any company. It ensures that each specific job is done as projected and using the best knowledge available (17). Therefore, it is wise to invest in employees by conducting training and seminars to improve on the way different managers tackle project management. The fact that GM used employee appraisal to boost morale and improve the confidence of all staff should be welcomed by other companies that anticipate performing well (9). Like in GM, poor project management will lead to poor results, with case scenarios being unexpected losses. To make the work done by production managers more effective, their offices should be constructed close to where production is taking place. Moreover, spare parts should not be placed too far from where production is taking place.
Relation of the Article to this Course- Decision Analysis
This article has a lot that relates to this course concerning decision analysis. A good example is the use of the Gantt chart, which assists in artistic representations of when a given project in a given organization should have the earliest and the latest start, as well as the termination point. The use of decision trees is well portrayed in the article, where they define a chronological view of how the decision process was carried out and implemented mainly by the research and development department. One can argue that the analytic–decomposition techniques that were applied in this article were efficient because they were fast and they gave a wide range of alternatives that could be used to improve on the design of the system. One of the major driving forces in project management is continual improvement in an organization. This requires continual data collection and proper bookkeeping, which are in line with this course. GM praised the C-MORE model they adopted in their project management. A remarkable advantage of the C-MORE was achieved when the data for each operation in the production line was collected and analyzed. In one center, for example, one operator had to stop the production line every 5 cycles due to some bottlenecks.
The total time that was lost during those runs was significant to cause more losses. What followed was that the spare parts that caused the operator to stop the line were brought closer to his place of work. The office of the production manager was also brought closer to where production was taking place. This eventually reduced the losses experienced before and the company was able to register profits again (14). GM also had a database where information was kept for use in future predictions (15). It helped in foretelling the future by identifying the trends from the data. In the same manner, managers need to decide regarding various issues that they encounter, despite the uncertainty about the outcomes of their decisions. This article provides an example of cases where models such as C-MORE were adopted without even knowing what the future held in the company’s performance. Depending on the personalities of the person making the decision, the company either reported increasing results or decreasing results in case of optimistic and pessimistic types of managers respectively.
GM distributed free reading materials that emphasized goals in an organization in a move to boost morale and improve the working habits of its employees (15). A commendable program was introduced were centers that performed greater than others were rewarded, thereby boosting the employees’ performance and encouraging them to improve to get rewards during the next awards ceremony.
As expected, failure to register improvements leads to increased frustration in the whole team involved, as well as poor relationships with various labor unions. This shows that at one point GM did not use project controlling as a decision tool well. If a project is controlled well, then adjustments are made in the course of the project, in case of irregularities, to better suit the expected outcomes.
Work Cited
Alden, M. Jeffrey, Lawrence D. Burns, Theodore Costy, Richard D. Hutton, Craig A. Jackson, David S. Kim, Kevin A. Kohls, Jonathan H. Owen, Mark A. Turnquist, and David J. Vander Veen. “General Motors Increases its Production Throughput.” Interfaces 36.1 (2006): 6-25. Print.