By December 13, 2006 1 Comments Read More →

Searching the Shopfloor Investment Value

Wilbur Ross moves into the auto-parts industry – December 11, 2006

I referenced this article from FORTUNE a few days ago, but here’s an individual post. Wilbur Ross and his team walk shop floors looking for opportunities. Does anyone know if they use lean methods or just traditional slash and burn layoff/cost cutting? I’d vote for lean as a better long-term approach for auto supplier turnaround, obviously, and I’d hope they recognize that.

Ross describes himself as a big-picture guy who doesn’t get wrapped up in operational details. Yet the clash and clangor of the plant floor hold little fear for him when it comes to analysis. “A lot of it is simple: material wastage, reject rate, cleanliness, safety. I never saw an efficiently run factory with a bad safety record.”

That last line is very indicative of the relationship between lean and a focus on safety.

Most of the feet-on-the-ground work falls to Ross’s point man on autos, Stephen Toy, 33, a graduate of the State University of New York at Albany, who has worked with Ross for ten years. Toy has walked through dozens of auto plants. He scrutinizes the condition of the tools and machinery, analyzes the use of floor space and talks to plant managers to see if they focus strongly enough on improving efficiency.

One thing they consider in selecting companies:

Barriers to global competition Ross picked plastic parts because they can’t be shipped long distances.

That’s another reason to consider lean… they can’t just rely on cheap labor from far-off countries.

Other than me trying to do some google research, does anyone from the auto industry have more of a perspective on Wilbur Ross? Do they just focus on financials or real operational and lean improvements?

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an book titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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1 Comment on "Searching the Shopfloor Investment Value"

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  1. Jamie Flinchbaugh says:

    Ross isn’t an auto guy, he’s a turnaround guy. He goes into industries that most people think are hopeless and creates a success – textiles, steel. He doesn’t do “lean” but at US Steel he slashed management ranks and worked with the union to uncover the issues and take action.

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