Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, March 24, 1991 TAG: 9103230027
SECTION: BUSINESS PAGE: E1 EDITION: METRO
SOURCE: GEORGE KEGLEY BUSINESS EDITOR
DATELINE: LENGTH: Long
Coming off what he calls the best year in the drive systems plant's history, Brock says 1991 shapes up as the toughest "this business has faced in a long time. But we've probably got the best chance of making it."
Brock, an electrical engineer who manages with evangelistic vigor, says he believes that despite the recession the plant will continue as a front-runner against stiff international manufacturing competition. Success, he said, is "100 percent because of what the employees are doing."
Followng his lead, hourly union workers and salaried employees alike are tackling problems and working together to raise productivity and cut costs. It's described as a new era of cooperation.
By reducing work cycles, the time it takes to manufacture a system, as well as cutting expenses and overtime, the employees "are building a war chest to weather the storm," he said.
Brock expects employment will be stable but "the biggest risk is recession." In the weak economy,"we see signs of effort by all of the people in the business. It's going to be a real horse race."
On March 1, Brock completed his first full year as the plant's general manager. He's running hard and his hallmark is a contagious enthusiasm about the plant's new employee involvement. That program won the backing of union members and skeptics who often have seen management as an adversary.
Brock says he urges employees "to find ways to cut overtime so that we're not forced into laying people off." If that should happen, he said, the number laid off will be fewer if "we've done the right things in the beginning of the year."
Under a similar situation 10 years ago, "we would be facing a monstrous layoff in July or August" because of lengthy work cycles, said Bob Semones, president of Local 161, International Union of Electronic Workers.
It once took a year or two for the plant to design and manufacture the computer software and microprocessor controls that GE sells to paper and steel mills and other industries, Semones said. Under Brock's leadership, the plant is cutting these cycles from years to months. The result is the plant can handle more orders in less time.
"If the cycle time is three months, we can take lots of orders between now and the end of the year and still get them loaded into the shop and produced," Brock said. That's the result of a new attitude evident in the work of 200 employee teams that produce labor-saving ideas. These GE workers address and solve complex technological problems daily, and their solutions often produce dramatic increases in productivity and sharp cost reductions.
Indeed, the plant's engineering section has made a deep cut, reducing its cycle time from 200 to four man-weeks by organizing the work, structuring the effort and by greater use of computers, he said.
If the plant reduces overtime pay from 10 percent to 8 percent, Brock said those two points are worth 60 jobs for six months.
That's the point where the plant is looking at a decline in orders later this year, he said.
\ A major part of the turnaround has been in a new style of relationship between the plant's workers and their managers.
Semones said managers "are much more responsive to the needs of the people and the business than the management we had before."
The union president sees "a different attitude throughout the plant. Our common goal is job security. Every time you pick up a paper, you read about another business closing. You've got to be concerned about it. It's a whole lot easier to sit down and talk [with management] than to throw rocks at each other," said Semones, a 35-year veteran at GE who tests finished products in the plant's final assembly section.
Yet, conditions are not ideal. "This is not to say that we don't have problems, difficulties," Semones said. "We're not naive enough to think we won't. The difference is that we sit down and try to work them out. Before, we had grievances and strikes."
And Brock admits that employee participation is not unanimous.
He estimates that 30 to 40 percent of the employees "are signed up and involved, another 60 percent say it looks good but they're not sure, while we may never have an impact on 5 to 10 percent."
But Brock said he's never seen a more creative work force than he oversees currently in Salem.
"In the shop," he said, "they tell me, `We find a new Einstein here every week."' Employees have different levels of education "but there's no difference in their desire to make things better. You can see it in every area of the plant," he said.
Higher productivity and reduced costs come in many forms at the Salem plant. One of the new teams has tackled the plant's $88-million inventory of parts and components, a level that's too high, according to Larry Beard, materials manager. He leads a team that has set a target of a $10 million reduction this year. Money that is unnecessarily tied up in inventory could be used for better purposes, Beard said.
Inventory has got to keep turning, Brock said. "If it doesn't turn, we won't make any money."
Scott Ernst, team development and training manager at the plant, was recruited from a similar job at GE's Fort Wayne, Ind. plant. When he came to Salem a year ago, "I saw a real feeling for change," he said.
Brock supported and expanded the new "bottoms up" philosophy of employee participation that George Joeckel, manager of production, was working on in Salem, Ernst said.
Ernst sees a new attitude at the plant. "People say, `I want to come to work and see what's happening."'
A significant change is in how the company rewards workers for their creativity.
Mike Smith, a production expediter and former union steward, serves on an awards committee which is paying employees $82,000 for ideas that will save the company an estimated $1 million. The self-funding program will pay out $300,000 next year, he said. Formerly, Smith said, the plant was paying managers bonuses of $2,000 and giving hourly employees a pen and pencil set. "This was not fair and we thrashed it out," he said.
Teams set their own goals and some productivity is up 30 percent in six months, Smith said. "The thing that amazes me is that the union is sitting down and talking with the company about productivity," he added.
Brock and Semones said a GE Drive Systems plant at Erie, Pa. made a product in one-fourth or one-fifth of the time for a similar product in Salem, a challenge for factory teams. "They looked at it and put a finger on what they could do. They worked in teams to see how they can take time out of it and work smarter," Semones said.
Initially, the employees saw it as an impossible goal "but they solved hundreds of little problems and they got help from engineering and other areas," ending up with more than a 600 percent improvement in productivity. "That's phenomenal," Brock said.
The plant was making four electronic module assembly units a day for use in paper and steel mills or electricity generation. Problem-solving teams boosted that production more than seven-fold to 30 units a day.
Brock tells of a $20-million order for a metals plant drive system that he credits to a team effort. "We took the order at break-even," he said, and a team found a saving of $1.5 million without compromising quality in the project. "We've got to make money on these jobs," he said.
Other GE plants are working on employee participation as well. But the dedication at the Salem plant to quality products and serving customers "is unsurpassed in our business," said David Genever-Watling, senior vice president of GE Industrial and Power Systems. Genever-Watling, based at Schenectady, N.Y., visited the Salem plant in February. He said he found the operation "empowering people to participate more fully in addressing key business challenges."
Will the new employee spirit have an effect on the union's contract renewal this spring? "I haven't spent 30 seconds thinking about the union contract," Brock said. "I'm sure the company and the union will get together and absolutely try to work out a contract. It's not an issue. That's not what we're focusing on here . . . I'm going to worry about things we can do something about."
Pat Howell, a wire assembler and an IUE member, said the new plant management has "kind of a turnaround . . . better communication with employees. They're opening up a lot of doors . . . It's different. I like it."
Productivity in her area is up 25 percent, she said.
Now, "everybody is working together and it makes a big difference," said Wiley Foutz, a tester and former union steward. "It used to be that we would beat on a desk and fight. Somebody would win and somebody would lose. Now, we work together and we're all winners."
Beverly Campbell, a 22-year software specialist, said employees are feeling more responsibility. "Everybody feels that they're more a part of the company. Morale is up. . . In the past, we were held back and not encouraged to see things through. Now, if you have an idea, let it go."
Brock said he is working to replace a we-they confrontation with the company and the union standing on the same side, both facing competition from other corporations. Both sides, he said, "are trying to do the same thing - to grow the business and create opportunities."
Semones, looking across the table at Brock in an unusual joint interview, told the general manager, "Your goal is to make money. Our goal is for you to make money so we'll have jobs."
\ As greater employee involvement increases productivity, Brock said the plant is able to invest in modernization and improvements.
The most significant will be a multimillion-dollar technology development center to be completed by May.
The 30,000-square-foot center, the first of three phases, will house "the brains of the product." People will work in design and development, engineering automation, product structure and software simulation testing. These fragmented operations will be brought together.
More visible will be a modern front of the building, the first major change in the plant's 36 years. It is to be constructed this summer. The reception area will be extended in a modern design, replacing the building's flat front facade.
Also in the works is a computerized audiovisual center for customers. Two second-story conference rooms will have big television screens "so we can show off what we're doing here," Brock said.
The present engineering development laboratory will be converted to a customer training center, now operated at the Holiday Inn opposite Roanoke's civic center. This means customers from all over the world will be able to talk with GE employees about their projects, Brock said.
An out-of-date building in a high-tech business is "totally incongruous with what we're doing. We haven't spent money representative of what we do."
These plant expansions will not bring additional employment, Brock said. But employees understand, he added, and they're trying to improve productivity "so we can free up funds to do the kinds of things we need to do to stay ahead of competitors."
\ Competition has been a driving force for General Electric for the past decade. John Welch, GE chairman, has an industry reputation as a tough competitor who expects all segments of his company to be first or second in their fields.
Brock however, is quick to note that Welch's influence is not the driving factor in Salem.
"The employees are driving it. They want to do better. There are a lot more employees in business than there are managers," Brock said.
Semones said no one knows more about the product and how it works than the people who built it. They can tell you what needs to be done, he said.
Added Brock, the people who design, build, sell and use it also know, Brock said. "We look for ideas from sales, marketing, engineering, customers, installers, service people, vendors and competitors."
Brock said he wants every employee "to have an opportunity for a career, not a job, with GE." People have looked at jobs as jobs "and that's not a very good system," he said.
Saving time and money allows employees to cross-train, learning new skills so they can replace workers who are on vacation or off for another reason, Brock said. The plant has an overload of work in final assembly so volunteers from other sections were asked to reduce overtime.
"Every hour of overtime steals money at a rate of 1 1/2 times away from expenses we use to cover people on the payroll," Brock said.
Semones said the union promotes a "Pay for Skill" program that enables employees by seniority to work up to a higher skilled job that pays more. This gives the company flexibility to move workers around the shop, he said.
Another popular form of employee participation is an exercise period of 5 to 6 minutes before work and after lunch, at company expense. Semones said close to three-fourths of the employees stretch and do wrist rolls and shoulder rolls.
Where will employee participation lead the Salem plant?
"Productivity gives you the ability to invest in business, people and the process," Brock said. "It also sets you up to take advantage of an upturn in business. As you become more productive, you can take on more opportunities you didn't have the capacity to take on before."
This will allow a plant to grow faster than its competition, he said, and that leads to more opportunities for employees.
With better productivity, Brock said, a plant sheds lower levels of work. "Typically, that tends to raise the level of work in this place."
Keywords:
PROFILE
by CNB