Chrysler improves plant efficiency by adopting Fiat system

Posted in Chrysler, Fiat

Chrysler Group adopted Fiat S.p.A.’s production system just one year ago, but it has already generated a measurable improvement in manufacturing efficiency.

Compared with 2009, productivity in Chrysler’s assembly plants this year is expected to improve 10 percent, operating costs will decline 8 percent and injuries will decrease 30 percent, Scott Garberding, Chrysler’s senior vice president of manufacturing, said Monday at the CAR Management Briefing Seminars here.

With the UAW’s cooperation, all plant workers have participated in the program, he said.

Fiat’s manufacturing system is similar to the Toyota Production System. Workers form teams to analyze the assembly process and identify waste. The teams quantify the waste caused by a particular problem via “cost deployment,” a painstaking process to identify the biggest sources of waste.

This process sometimes leads the teams to put aside easier, quicker “fixes” if they generate smaller savings. The cost data also serves to persuade plant managers that these more difficult problems are worth fixing.

The teams then search for the root cause of the problems so that they can find a permanent solution.

An example: Chrysler’s Belvidere, Ill., plant had an inefficient stage on its assembly line that forced workers standing beside the car to reach blindly just inside the vehicle to above the door opening along the vehicle’s ceiling, to assemble components. So the plant devised a “happy chair” — a seat attached to an overhead rail that allowed the workers to slide in and out of the car, facing the spot their hands had to reach.

The result: fewer assembly errors and fewer lost-time injuries.

Another example: To reduce lost-time injuries, each plant examines less serious safety problems — not just the conditions that cause serious injuries. By studying the “near misses” that could have caused injuries, the employees were able to improve safety and reduce serious injuries as well.

Chrysler reduced its work days lost to injuries 35 percent in 2009 from 2008, following reductions of 7 percent in 2008 from 2007, 15 percent in 2007 from 2006 and 17 percent in 2006 from 2005, Garberding said. He did not give absolute numbers for any year.

About 30 employees in each plant focus on fit-and-fitness issues, and 14 Fiat coaches circulate through Chrysler plants each week. Garberding noted that Fiat’s production system requires “lots of rigor and logic,” adding, “There is no silver bullet.”