An important comment listed on www.autoextremist.com that is worth sharing:

“AE Quote of the Week, II. “Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes - the ones who see things differently. They’re not fond of rules and they have no respect for the status quo. You can praise them, disagree with them, quote them, disbelieve them, glorify or vilify them. About the only thing that you can’t do is ignore them. Because they change things.” From a famous Apple Computer ad (1997), reprinted in last Sunday’s New York Times.”

I have admired these guys for quite a while. Check out their web site sometime.

Cheers!

I posted some comments to GM’s “FastLane Blog” and have an additional post script I debated about including directly on the GM site. So I’m putting it here where serious people may find it through the links I left there.

Some feedback comments by concerned posters included requesting a big PR stunt.

For something completely different.. Lutz & crew could go through the GM employee lease program to prove the quality mission and will save some cash in the process. This will be unpopular internally while instructive externally and invaluable to the consumer needing a reason to believe in GM again.

New “old” Program: Every middle manager gets a 5 year old GM vehicle, every executive gets a couple of 10 year old GM vehicles, while a couple at the top might be provided some 15 year old vehicles (in quantities equivalent to their current allocations). Sure, you could put mileage numbers around those profiles too. Do this until GM is profitable and has increasing market share (a new incentive program). No one shows up at work with any new cars!

These vehicles would be purchased at used auto auctions or from classifieds, and need to be a representative random population of vehicles with no “prep work” allowed (readers might be surprised, or not, to learn executives often get new vehicles that were tweaked so the big boys don’t get any initial quality surprises and the plants etc don’t get more work and headaches from their bosses), and no classic cars either. This will also soak up the secondary used car market (increasing sales value of new vehicles) - which is a major contributor to poor resale values/lease rates/etc.

Any problems must be fixed in person at a GM dealer (everyone feels the same pain). No one can pass off quality problems - quality teams need to make sure the trends seen there are fixed for the new vehicles (prove that the latest spark plug wires don’t soak up salt and moisture to strand someone’s wife late at night). Track and comment on the results (what problems, how long to fix, can they find repair parts, how many missed meetings, number of break-downs on the road to Aspen, etc).

Then GM will be able to convince Consumers Reports to re-evaluate their used car rankings. GM would have a fleet of thousands to refute CR’s data (which is survey response driven and so has some natural statistical quirks). GM managers will see how engineering and purchasing decisions can improve or worsen extended vehicle life expectancies. They will have walked the mile in an average consumers’ shoes and only then will the consumers believe them.

Certainly, lots of risk, and lots of details that need to be fleshed out too (I can hear the crackle of flames now). But maybe it could work.

Will anyone be so bold to try it?

For my first weblog post I thought a broad scoping opinion piece would be most appropriate and more interesting. I’ll also casually introduce a bit of myself.

I have been bridging the gap, professionally, between the mechanical automotive business (yeah, I know there is more electrical content today, but bear with me) and the electrical/software computing business for most of a year now. There are many parallels between the two that one industry needs to be aware of and can perhaps learn from each other including the tenants of Lean Manufacturing and Agile product design (thought you’d like some buzz words). Sorry if I use your favorite company or product as an example, but that’s the way it goes.

Growing up in the shadow of the automotive Big Three, it was nearly foreordained that I spend some time in their hallowed halls. That destiny spanned the end of the 1980’s, all of the 1990’s and past the early quarter of the 2000’s. Before and after helping the nation build some cars I was involved with the electronics and computing industry, from hobbies, necessity, and business. I’ve pulled and repaired automotive engines as well as built computer systems at the hardware and operating system levels (did you guess I have a background in Engineering? And got an MBA degree along the way?). I’ve advised CEO’s and startups and run manufacturing operations. After some interesting times in these capacities I set up a consulting business. But, carry on…

The Automotive and Computer businesses are subject to declining pricing, but traditionally from two completely unrelated pressures. These pressures are becoming more similar now – with the computer industry finding itself more like the rust-belt industries than the other way around.

The problem of declining pricing shows up most strongly in inventory - killing value in both of these industries – bad for the traditional Big Three automotive companies that park vast lots of unsold cars from time to time, or some of the computer manufacturers trying to unload last fall’s unsold products (maybe Google or the WayBackMachine will take them for a server farm?..). Lean Manufacturing mavens understand. Toyota gets it - generally and consistently less than 30 days inventory while peers have upwards of 60 days to “feel comfortable” and only get worried when it hits 90 or 120 days. Dell gets it - generally less than a week of inventory while peers may have several months. The problem companies justify high inventory with being able to satisfy impulse buyers – so there must be lots of customers waiting 90 days to be impulsive! These companies forget they are in the fashion industry where the risks of inventories range from simply dangerous to nearly fatal.

Automotive spends its time trying to shift buying fashions through new design and marketing efforts. Like a clothier, Automotive companies are forced to offer deep discounts on last year’s model when the new models debut. “That scarf is sooo last season, dharling”. Some technical achievements are certainly made for more mileage/horsepower, folding seat storage, air-bags; but not exponential increases like computer manufacturers have contended with. With slowly evolving technical achievements a mature business must resort to fashion changes to energize excitement for purchases. Clothiers must change fashions several times a year because of the even lower speed of technological improvement than cars.

Broad fashion changes: the cars of the 1950’s were tall and narrow with fluid lines, the 1960’s brought fenders and grills with hard edges, the 1970’s cars went low and wide and returned fluid lines, 1980’s cars again got sharp folds ironed in (yeah, there was the Taurus) , the 1990’s saw the tall cars (aka SUVs) with fluid lines return, and the 2000’s are showing up with more edge-work (Cadillac most notable). Clothing and cars have been useful for movie makers to define period films – fashions of the times.

The computer industry has historically spent its time squashed between software coding (ever more lines to compute) and Moore’s law (resulting in declining prices for yesterday’s technology). However, recent events indicate Moore’s law may be coming to an end:

1> Intel put up a reverse auction on Ebay last spring to search out an original copy of the magazine Moore was originally quoted in that became “the law”. Intel paid $10,000 for the one, and libraries across the nation started noticing archival copies of this publication missing. When you’ve got time to collect you know your glory days are behind you.

2> The second action is that the chip companies have more or less given up on attaining single chip speed increases by announcing pairing or quadrupling the number of base chips in the cpu core (they must have been shaving with Gillette’s five bladed razors one morning). They have to, they fear Mr Microsoft over there daily pitch-forking more code on top of an already overloaded cart – Mr Microsoft does it because he knows the Intel/AMD/Motorola/IBM/etc hardware teams have been able to breed stronger horses to pull it up the hill. Soon either the Budweiser Clydesdales or the Boraxo 20 Mule Team will be required.

Demand is slowing. Maybe saturation. Most likely, in the world of web browsers, the computing needs for many consumers are lower (marketing does convince them otherwise sometimes) – true there are high end requirements causing real need in the games and video editing/recording/etc genres. General surfing, blogging, and the occasional letter writing to your favorite uncle don’t need much, cutting demand for the newer Moore’s Law driven machines. For example, I am writing this text in a full-featured document word-processor while Internet radio is playing in the background and a browser is open with several tabs to grab links and check some facts, all on a vintage 1998 Pentium II 450Mhz computer. Stop over at my web site to see what equipment was used to create the site (hint: PII-266Mhz).

Apple understands, for a long time now, that the computer business is getting older and Moore’s law is eroding. They learned from or accidentally arrived at the automotive model – mature businesses must market fashion to keep excitement and sales up. Apple is by far the most fashion obsessed company in the industry; and changes their proprietary designs, whimsically burning bridges, every few years (Apple II, Mac, PowerPC, iPod, “Mac-Intels”) just like the Automotive manufacturers. With Apple entering the mainstream computer hardware market they will need to be cautious to understand Lean Manufacturing inventory laws since now their hardware can be directly comparison shopped, or keep Dell from understanding fashion marketing. For these two I’m betting on fashion for now.

So, fashion becomes the end-game for all industries after the technological engine slows down. Just make sure you don’t have a lot of inventory when spring rolls around or you’ll have to unload everything with an “Up to 70% off Sale”.

Cheers!