Page 2: Changes in the car industry
The car industry has changed dramatically. At the start of the twentieth century, the industry was dominated by the achievements of Henry Ford who created a manufacturing system that was known as Fordism. In Fordist organisations, the manufacturing system was geared towards creating standardised products such as the Model T Ford.
The needs of the production line determined the life of the production line worker. Workers knew exactly what was expected of them and were given set periods of time to carry out particular operations. This system was very successful, lowered production costs and brought the motor car within the budget of the ordinary family in the west. However, during the 1980s the car industry was transformed by new manufacturing approaches from Japan. Japanese success was based partly on the competitive prices they were able to ask for their products and services, but mainly on their quality.
The concept of Total Quality Management (TQM) was developed in the US after the end of World War Two but was implemented first in Japan. It changed the balance of world trade and led many companies in the west to rethink their attitudes, policies and structure. TQM can only operate when responsibility and power are delegated downwards through all levels of the organisation.
Responding to changing demands
As the world became more competitive, organisations had to respond quickly to rapidly changing demands. They could no longer rely on producing standardised products but had to manage a wider portfolio of associated products. This demanded increased flexibility, and the active co-operation of a versatile and increasingly skilled workforce. In the 1980s and the 1990s, many American and European companies adopted more flexible Japanese ways of working so they could respond quickly to changing market conditions.
In recent years the world car industry has been rationalised. Instead of hundreds of car companies world-wide, there are ten major global players. Part of this rationalisation has seen the development of a new Ford group of companies. In the 1990s Ford took control of Jaguar. It recently overhauled the Halewood plant to produce the new X400 Jaguar and created a new way of working. Many of the employees at Halewood had previously produced Ford Escorts using traditional manufacturing techniques, in which they were not encouraged to show initiative. They now needed to learn new approaches to work which involved empowerment and flexibility; more responsibility was given to the operative at the sharp end of production. What better place to introduce a culture change than by starting with a prestige marque like Jaguar?