Ownership/Operations
Blue Oval Processes and Thoughts
By Gene White
I have heard many comments on the Ford Blue Oval processes. I will not get into the monetary considerations, but will address the processes required by Ford. From an industrial engineering standpoint, any and all attempts at process improvements are positive. This process will yield positive results if implemented with a positive "can do" attitude. If we take a "what is the minimum requirement" approach to the process, we will achieve minimum results. I have personally worked in industry with process improvements and the results have always been constructive. This is nothing more than an extension of Zero Defects Programs, Quality Circle Programs, Management by Objective, Total Quality Management, Continuous Process Improvement, etc.
The suddenness and extensive nature of the required processes are a burden to small entrepreneurial businesses working on 1.5% to 2.0% retained net profit on sales. Small companies do not have the resources or the corporate culture needed to design and record the full implication of these changes. Hiring outside help can be effective.
Ford's Blue Oval seems to be an automotive application of ISO 9000, the International Organization for Standardization established in 1947, and apparently an extension of Ford's QS 9000 program. Simply put, the QS 9000 standard is a single, industry-wide standard for quality for suppliers that provides the framework for continuous improvement efforts. The concept is to design processes that enhance production and customer satisfaction. It must be noted that this type of process improvement will require a different mindset than is normally found at dealerships. Do not become overwhelmed by the documentation, since it is, in concept, nothing more than an extension of your policy manual, dedicated to processes affecting customers and their interface at the dealership. The process does require that you analyze, formalize, and then document your own processes.
In analyzing the processes required by Blue Oval, it appears that you need most of the following processes. The first 18 and the E-business process, depending on your VOC and FIRTFT scores, appear to be the minimum required. You also need two months of documented follow-up and record retention, in addition to the facilities requirements, your required staff registered in STARS, plus a designated customer relations manager. The following is a list of processes that may be required:
- · Employee satisfaction survey process
- · Continuous improvement process
- · Customer concern resolution process
- · Blue Oval drivers employee notification and improvement process
- · Vehicle sales process
- · Vehicle sales customer bill of rights process
- · Vehicle sales training process
- · Vehicle sales follow-up process
- · Service lane write-up process
- · Service follow-up process
- · Service appointment process
- · Quick service process
- · Competitive pricing/standard pricing process
- · Service customer bill of rights process
- · Quality repair process
- · Service repeat repairs process
- · No problem found process
- · Quality check process
- · Parts customer handling process
- · Special order parts process
- · Parts customer concern resolution process
- · Successful telephone communication process
- · E-Business process
- · New owner clinic process
- · Employee complaint resolution process
- · Warranty administration process
Blue Oval and ISO 9000 Rely on Teamwork, Not Adversarial Positions
The improvements needed today mean giving up the conventional wisdom, (we have always done it that way here attitude), a willingness to step outside our comfort zone and adopt more advanced management systems (flat organization structures with less overhead) with a willingness to embrace change.
"My way or the highway" attitudes disappeared years ago. If you "highway" someone, who will replace them with 4% unemployment?
The service departments at dealerships are an extension of the factory's production line as far as warranty work is concerned and an extension of the factory's advertising effort as far as CSI is concerned. These departments are the production people standing at the end of the virtual production line correcting the defects and design deficiencies that have been introduced or not corrected during the design and assembly process.
An adversarial position with the extended production workers does not help customer satisfaction. ISO requires an impartial outside auditor. The ultimate ISO 9000 auditor and "certifier" is the customer.
I have been in management consulting since 1961 and none of the world famous consultants that I have read or heard recommend that you belittle the people who can correct these problems at the point of consumer interface. It is very easy to sit back at a corporate table and demand cost cutting, while pointing a finger at the people who are trying to correct a problem, rather than building a team effort to correct the problems and give customers satisfaction. A look at the list of vehicle satisfaction indices indicates many products with lesser quality but higher customer satisfaction, why? It just may be that a team effort has been forged between the factory, dealership personnel, and the consumer.
IEE Solutions published an article "Measuring Performance Against World Class Standards" in December 1996. It was written by Ron Basu and Nevan Wright and states, "The achievement of manufacturing excellence just at the factory level will result only in gaining a fraction of the competitive advantage that is available. The argument is that there needs to be a marriage of marketing, manufacturing, and marketplace. Focusing increasingly more on establishing closer links between production and other functions in the company, as well as suppliers, customers, and others outside the company."
Demoralize the Production Line and Expect Better Products–Is This Good Business?
Something must fail for the customer to initiate the warranty process except for pure fraud. When that happens, the factory must rely on its field production people–the dealership staff, to diagnose and make the correct repair. A team effort is a must to gain satisfied consumers. Listed below are methods that destroy good will on the part of the extended production lines:
A. Lower the producers' pay. Reduce the flat rate hours paid to do a job, especially those jobs that are getting harder to diagnose and accomplish without offering a recommended labor saving process.
B. Openly criticize the producers. Use audits and words like fraud, especially when the producers are trying to fix design, engineering, and supplier problems that brought the consumer to the service department in the first place. They did not design nor build the product only, repair it.
C. Ask the extended factory workers to give up their profit, for AWA adjustments to factory problems and then rate them on how well they satisfy customers on things not covered under warranty.
D. Have them spend dollars on new equipment because the old equipment won't connect. Even old computer systems will run new programs since they were designed with flexibility, scalability, and upgradeability in the original systems using software and universal ports with inexpensive specialized connectors. This eases the learning curve for technicians.
Build Teams and a Team Effort
Ford's Blue Oval, ISO 9000 and Ford's QS 9000, by their basic design concept, dictate that team efforts be utilized. Team members from all departments, factory and dealerships included, must work to solve the basic problems so the problems per unit diminish. Without this field input and offering only criticism does not enhance the ISO 9000 effort. This requires dealership personnel become part of the team to solve problems, not be perceived as a major part of the problem.
Keys to improvement are:
- · Teamwork at ALL levels
- · A Continuous Process Improvement Process that includes suppliers, factory, dealership management, customers, and technicians.
- · Forward thinking, not rear view/ historical thinking
Gene White is president of Gene White Management, Inc. He is a recognized Fixed Operations expert and has conducted in-dealership evaluations and training (automotive, heavy-duty trucks, recreational vehicles, and marine) for the past 22 years. He has conducted workshops for NADA, ATD, FADA, NACE, WD&S, accounting CPAs, and multiple State Associations and 20 Groups. He is a member of SAE, IIE, and is a Charter Member of the National Bureau of Management Consultants. He is knowledgeable in the Blue Oval Processes. gwhite@dealeronline.com
