So here's a squib on the continuing saga of the ultimate plan by American automotive OEMs to take away worker benefits.GM emerged from weekend talks with the United Auto Workers with an agreement to slash health-care costs for retirees by $15 billion and cut its annual employee health-care expenses by about $3 billion a year.

As a result, GM's stock is soaring today, despite reporting a big loss. Apparently, investors LIKE a company that takes benefits away from workers.

Question in my mind is how much do the employees on the dirty end of this stick like GM? Are those employees going to feel a loyalty to assure GM's reputation is enhanced by higher quality goods and services?

GM's stock would really soar if they announced that all mid-level employees on down in the US will have pay reduced to align with pay scales in China.

Bottom line: GM is moving to China for all intents and purposes. I doubt GM employees will feel any loyalty at all after this - It will be every person for him/herself. Nor do I believe for a second any of this will lead to higher quality goods and services from GM (or Ford or DaimlerChrysler).

Of course, of note is the retirees are also getting screwed.

GM's stock would really soar if they announced that all mid-level employees on down in the US will have pay reduced to align with pay scales in China.

Bottom line: GM is moving to China for all intents and purposes. I doubt GM employees will feel any loyalty at all after this - It will be every person for him/herself. Nor do I believe for a second any of this will lead to higher quality goods and services from GM (or Ford or DaimlerChrysler).

Of course, of note is the retirees are also getting screwed.Retirees are the easiest target - they have no leverage. (What are they going to do? Strike? :frust: ) Sears did it to theirs and the airlines did it to theirs.

Yes, retirees always seem to get Special High Intensity Training from their former employers to prepare them for their golden years. [you supply the acronym!]

The Unions are scrambling to save anything at this point. As mentioned in the WSJ, the Chinese GM folk relate GM-USA as to a sick mother with tumors, with her children worried but confident that the tumors will be removed or reduced in size.

There are more auto workers in the USA that ever before. Almost all new plants and workers are in 'Right to Work' States which do not require joining a union . Why?? Union workers work as hard as non-union. It is the details, like cross training, flexibility in schedules, and working together. I worked at Ford on the main line for a few years, the stories of wasted time and money are endless. "Why are you working so hard?" was a common complaint! Sound familar??

Unfortunately, the lower union wages mean more competition for my small, 20 person, non-union shop. Now, my employees will make more than UAW members if Miller has his way. My costs should be higher than a Union shop. Not to worry though. It will take quite awhile for all those union employees to learn cross training, computer skills, and work hard unsupervised. There is plenty of work out there, work that will stay in the USA just because of distance and complexity. My neighbor who is a great guy and has cleared $87,000 in 6 months belongs to the UAW. He works 7 days a week, 12 hours a day cleaning small parts on an inspection line, helping launch a new program. On a Sunday he makes more than any of my employees do in a week! Others stand around watching him work, they are not in his quality job classification. No wonder our cars cost so much!! Miller, It's about time!

No doubt unions are for all intents and purposes dead. And with them go many benefits such as health insurance and pensions, not to mention decent wages. Soon it will all be WalMart wages. As poverty in the US rises and wages decline, as the 'middle class' continues to shrink, we will all be affected. It will take quite awhile for all those union employees to learn cross training, computer skills, and work hard unsupervised. There is plenty of work out there, work that will stay in the USA just because of distance and complexity. You're dreaming. There isn't 'plenty of work out there' unless you consider WalMart greeting and fast food restaurants 'work'. As to work staying in the US because of distance and complexity, open your eyes. There is very, very little that cannot be outsourced to Mexico or over seas regardless of distance and complexity.

The US is declining into what we used to call a 'third world' country.

GM is asking the hourly (Union) workers to pick up a share of their med benefits similar to the salary (non-Union) workers.

Look at what happened to the NHL and the Players Association. The owners won a big one there. Will the B3 follow suit?

I note several things cropping up in the news aftermath of the GM blitzkrieg against its unions. Here's an example:

Delphi officers and top managers propose to take a 10% cut in pay until the bankruptcy runs its course, then they will get bonuses for having stuck with the company during its "trouble" and resume original pay scale.
Meantime, Delphi asks wage earners to take more than 50% cut, no bonus if and when Delphi comes out of bankruptcy, and the wages will remain low thereafter.There are more auto workers in the USA that ever before. Almost all new plants and workers are in 'Right to Work' States which do not require joining a union . Why?? Union workers work as hard as non-union. It is the details, like cross training, flexibility in schedules, and working together. I worked at Ford on the main line for a few years, the stories of wasted time and money are endless. "Why are you working so hard?" was a common complaint! Sound familar??

Some managers at automotive OEM must have thought there was sufficient money to pay union workers the wages they requested. So, if the money is no longer there, how come the union guys take it in the neck and not the top managers who OK'd the original deal? If they go around and diminish all the union retiree benefits retrocatively, will they also go around and change some of the golden parachutes of the executives to black crepe? Why can they renege on the contract with unions, but not on the contract with retired executives?

In my mind, the argument is not whether unions were greedy (so what?) The argument is about the basic unfairness of the way the employees (blue or white collar) get hammered while the executives pick up millions in bonuses. If the wage earners get dropped 50% in wages, then executives should ALSO get dropped 50%.

Remember, I'm one of the executives, a "suit" who prowled the C-level suite for years. If I made a pension deal for employees, I funded it fully right from the beginning. If I couldn't afford it, I didn't make the deal. I didn't lie to employees that we'd pay and wink at my investors that we'd unwind the deal before we had to pay REAL money.

Somehow, many so-called "entrepreneurs" think it is OK to screw over employees to line their own pockets. Worse, the "wannabes" who work in middle management think they enhance their position by crushing the wage earners below them in the hierarchy. (Think "slaves put in charge of other slaves who were more cruel to the ones under their control than even the masters were.")

These middle level folk are the ones who write in to the Cove saying, "Our employees are worthless." It's as if W. E. Deming never existed. I get a wave of nausea each time I read some post where the writer wants to know how to discipline low level staff because they can't follow instructions.

For everyone who thinks unions took advantage of corporate America, let me remind you of 40-year old advice from the columnist, Ann Landers:
"No one can take advantage of you without your permission." Were the managers blind when they agreed to those featherbedding contracts? Why is the blame only the union's?

I operate under the philosophy "every workman worthy of hire is worthy of pay." Agreeing to pay one wage, getting the work, then stiffing the workman's pay is felony theft in my lexicon. Taking away an agreed pension benefit is the same as shorting the paycheck - it's theft!

If you stiff a cabdriver after you get your ride, he can and should press charges against you. Where on earth are the prosecutors who are charged with protecting their constituents from criminals who steal their benefits?

Some managers at automotive OEM must have thought there was sufficient money to pay union workers the wages they requested. So, if the money is no longer there, how come the union guys take it in the neck and not the top managers who OK'd the original deal? If they go around and diminish all the union retiree benefits retroactively, will they also go around and change some of the golden parachutes of the executives to black crepe? Why can they renege on the contract with unions, but not on the contract with retired executives?

In my mind, the argument is not whether unions were greedy (so what?) The argument is about the basic unfairness of the way the employees (blue or white collar) get hammered while the executives pick up millions in bonuses. If the wage earners get dropped 50% in wages, then executives should ALSO get dropped 50%.
IMO, 'Top Managers' will never take it in the neck. They are sworn to protection of one another and to secrecy.:agree: Retired/active top executives will not be reneged on, nor take a 50% drop in compensation, because their contract binds their tongues even to the grave.:notme: :naughty:

IMO, 'Top Managers' will never take it in the neck. They are sworn to protection of one another and to secrecy.:agree: Retired/active top executives will not be reneged on, nor take a 50% drop in compensation, because their contract binds their tongues even to the grave.:notme: :naughty:And, they know where the skeletons are hidden.

And, they know where the skeletons are hidden.
Indeed they do.:thedeal:

In my mind, the argument is not whether unions were greedy (so what?) The argument is about the basic unfairness of the way the employees (blue or white collar) get hammered while the executives pick up millions in bonuses. If the wage earners get dropped 50% in wages, then executives should ALSO get dropped 50%.

Wes, This is really the heart of the whole matter as far as I'm concerned. :applause: I will not get into another union/nonunion argument here, but why in the name of good sense does high level management believe that cutting their employees to the bone while leaving their own checks intact will keep the company afloat?

One of the things I learned as a very young child is that if you put the welfare of your horse ahead of your own, the horse will be ready, willing and able to outrun the guys in the black hats when you need him to. (sorry, just a little rancher wisdom there)

Ann Landers and 40 years ago?? She also said, "Wake up and smell the coffee"!! If you have not noticed, this is now a global economy, how many toys are made in the good ole USA? Darn few! And there is a reason. Cost!

Even Zenith, the only USA maker of TVs, gets them actually made in Mexico due to the high cost of USA labor compared to the rest of the world. Clothing, shoes, the majority of tools at Home Depot, all made overseas due to cost. The govt buys American, and we know what they paid for a hammer that made the news. Auto companies are no different. Executives getting millions? Companies cannot pay out what they do not have. Golden parachutes cost nothing unless you jump out of the plane. If you do jump, forget finding a job for at least 2 years. Only in the Unions will you find job banks where workers get paid for doing nothing. (well, also the govt!). A friend at my kid's school volunteers 40 hrs a week to help the teachers, he can do it since he is getting 60+ thousand from a GM job bank. That is obviously changing. That is then. No more open ended deals without regard for future costs. Now is the USA labor against the world.

Management deserves more because they have been on the bottom end of the stick for years. The average management position in the world labor market pays 5 times what a position in manual labor receives. (WSJ) Why should it be different in the USA? Go to college, get a degree, and get less $ for being educated? It is ok to be better than the next guy, and get compensated for it, if you take the risk that your ideas are better. It is called initiative, ambition, remember Thomas Edison? Apple Computer? Becoming your own boss is risky, stressful, and often unsuccessful the first time or two. I support 40 families. I do it by making product that the Chinese can't compete with, with high speed presses and just in time delivery , often the next day. By being nimble, being smarter than the next guy in my humble opinion :).

GM needs to make something that we want to buy, something besides SUVs. I don't see Chrysler whining. Chrysler concept cars are made into production cars basically unchanged from what the public loved. Result? Sales!! GM concepts are run through the comittee wringer. That is management not earning their pay. The workers can only assemble, like it or not, that is their job, but right now every car that GM assembles costs $1,500 more than a Toyota to assemble. If it is a poor design not worth the difference, well, GM market share has dropped for a reason. Once you provide something people want, sales happen, profits may even occur if you don't give them away in discounts.

Pensions?? What happened to people saving for retirement on their own? Would you really retire at 30 and out? at 50 years old? You could not afford it ..... Americans are the worst savers in the world, less than 2% is saved.
I used to manage our company pension fund 20 years ago until someone complained that 30% investment return a year that I am giving my employees was not enough, and threatened to sue. I don't need the stress. Now everyone has 401s and IRAs and I am out of it. Some have done well, others have done poorly.... not my problem. Then was then, now is now.

Most of your post doesn't address the discussion topic.

I do think your statement at the end sums it up for you - "Not my problem". Why should you care about anyone else? Important point.

Even Zenith, the only USA maker of TVs, gets them actually made in Mexico due to the high cost of USA labor compared to the rest of the world.

Zenith got out of manufacturing about 8 years ago after closing their last American manufacturing plant in suburban Chicago--they're now strictly a licensing company.

Executives getting millions? Companies cannot pay out what they do not have. Golden parachutes cost nothing unless you jump out of the plane. If you do jump, forget finding a job for at least 2 years.

It seems that corporations have been consistently paying out, whether the skydivers jump or get pushed, and I think I could go jobless for a few years if I had a few million to help me get by.

Only in the Unions will you find job banks where workers get paid for doing nothing. (well, also the govt!). A friend at my kid's school volunteers 40 hrs a week to help the teachers, he can do it since he is getting 60+ thousand from a GM job bank.

This is a result of something the executives of GM agreed to, no?

Management deserves more because they have been on the bottom end of the stick for years.

Nothing I can say can emphasize your disconnection from reality better than that statement. There was a time when it was considered honorable for the captain of a sinking ship to be the last one off. Honor and dignity are considered passé these days, and the executive's rallying cry is "Get what you can and get the **** out before the ship goes down!" What about all of the sailors who actually kept the ship afloat? You have a simple answer for them:

...not my problem. Then was then, now is now.

Nothing I can say can emphasize your disconnection from reality better than that statement. There was a time when it was considered honorable for the captain of a sinking ship to be the last one off. Honor and dignity are considered passé these days, and the executive's rallying cry is "Get what you can and get the **** out before the ship goes down!" What about all of the sailors who actually kept the ship afloat?
Honor and dignity...although the flame seems to be but a flicker today, it still sheds light to those who wish to see clearly. Your statement is a breath of fresh air that makes the candle's flame shine a bit brighter. :applause:

Marc,

Interesting that you twist my words out of context to suit your needs. In context, I was referring to letting others do their own investments and decisions, thus making the investment management issue "not my problem".

The Unions , with obviously much larger compensation and benefits compared to the rest of the labor force gained through bargaining over the years, can say, "Hey, management agreed to it, I just twisted their arm a little with a possible strike. Not my problem". Can you blame management for taking the same survival attitude? Manual labor costs are cheap in the rest of the world, business has a responsibility to reduce manufacturing costs so their product is affordable, again, look at where products are made in the stores that you shop in. Walmark buys 80% of their goods from China. People flock to Walmark because they get the best deals. What is so hard to understand about that? Lower costs mean survival in the business world.

Adapt or become extinct

The US is declining into what we used to call a 'third world' country.

Interesting comment as we have felt this way about Australia for a while for similar reasons.

I remember back in 1990 when Nissan announced that they were closing their manufacturing in Australia and then kept the plant going for another year.

They quickly got a reputation for building rubbish.

It is always an uphill battle trying to put quality management into an organisation where the bosses treat the workers with contempt, as a commodity.

Union leaders and rank and file are different in different industries, but they all share one thing in common regardless of how "sweet" their contracts seem to be:
They have absolutely no power to steer the direction of the company they work for!
The managers and the investors make all the decisions about product design, marketing strategy, and profit margin targets. The union members fall into the same category as a good machine for most managers:
"Will my investment in this (machine or person) return a profit?"

The other side of the coin is what separates a good manager from a poor one: The good manager asks, "Am I deploying this (machine or person) to most profitable use?" Finally, the very best managers ask, "What can I do or provide to make this (machine or person) even more efficient?"

I keep getting this image of Pharoah asking slaves to make bricks without straw, jeopardizing the integrity of the building to save money on the cost of construction. I see nothing but trouble on the horizon when management takes a strong "us versus them" stance with their union members. When a manager views his workforce with open animosity, it seems to me the manager is transferring some of his frustration at being unable to compete in a global marketplace on to his workforce, when the true blame rests on the manager for poor planning and strategy.

The managers and the investors make all the decisions about product design, marketing strategy, and profit margin targets. The union members fall into the same category as a good machine for most managers:
"Will my investment in this (machine or person) return a profit?"

The other side of the coin is what separates a good manager from a poor one: The good manager asks, "Am I deploying this (machine or person) to most profitable use?" Finally, the very best managers ask, "What can I do or provide to make this (machine or person) even more efficient?"

Your points are well taken. If , as you say, your union is a good machine, and it becomes outmoded and obsolete, as a manager/investor, the choice is whether to replace with a more efficient machine/union or modify what you have (union) to compete with the rest of the world. Today that means a paycut. Ditto for management. I acquire more efficient presses that are 100 times more productive than 10 years ago (look at computers), and cross train my employees to be adaptable to a variety of jobs, all new concepts to many unionized plants. That is what will happen to the automotive unions, but they will kick and scream about it to the end. Outside factors such as spiraling health care and cheap world labor make change necessary, and 'unfair', but it is no one's fault, and all good things must come to an end eventually, especially when the money runs out.

If you are not all going to play nice, you'll get sent to bed without supper....lol.

My dad is a staunch union advocate. As a teamster member, he made about $10,000 more than his degreed son. He has a pension that today, combined with social security is more than I make working as a quality manager, sad but true.

Without the unions and the concessions they gained, we would all (managers included) be working for poor wages and no benefits.

That being said, we must compete. If we fail to do so, we ALL lose our jobs!

A person that puts screws into a hood making $26 an hour should realize that he is in a precarious position, I mean come on, there are people in China that make less than that a week.

In a global market, it is compete or die.....it's just that simple.

WWilliams,

Well said.

There is still enough manufacturing work in the USA to provide plenty of work. As you say, in a global economy, the work has to be competitive.

Heavy complicated parts give the USA the advantage. Actually not entirely true. Molds and Castings are 90% rough done in China with cheap labor, the finishing is done in the USA with highly skilled and paid labor. Everyone wins to some extent.

Benefits are expensive today, compared to the past. There is no law cast in stone that requires a company to give any heath benefits, free of charge, to its employees. In the 40s, 50s , 60s , and even 70s, health care was cheap, people worked until they were 65, died at 70, and if you had a bad heart, nothing could be done. Now, with 30 and out, retiring at 50 is no big deal, most live to at least in their 80s(my dad worked until he was 65, got bored and worked again till age 93) and just a day in the hospital for observation is $4000 or more. Not cheap anymore. Benefits are based on agreements, made in good faith under cost conditions of the time they are made. When costs go up, is it fair for the company to absorb all of the additional costs.? I could cancel my share of the contributions to health insurance for my employees today. Save a ton of money. As a result , they would leave and work for someone who provides better benefits. Freedom of choice. But not an option for me as it is a poor business choice. Instead, share the costs, and work together.
At job interviews, the hot underlying question is "what is the benefit package?" As you say, Unions won great benefits. Now they need to give them back, at least somewhat. As you say, we have to compete in a global economy where our competition pays little or no benefits, and others have national health care. It is , as you say, just that simple, be competitive or die.

History repeats itself (in one fashion or another). IMO, the chains are forged that will bind our financial future. Patrick Henry said it best, "Give me liberty or give me death (http://libertyonline.hypermall.com/henry-liberty.html)." You may ask, what the h*ll does this have to do with this thread topic. Well, we've talked and talked and talked about it. What do we do about it that will make even one iota of difference. Is our financial future as important to us as liberty was to Patrick Henry and others of his day. Apples and oranges, maybe! But thunder without a lightening strike now and again is just noise.

Our chains are forged!

History repeats itself (in one fashion or another). IMO, the chains are forged that will bind our financial future. Patrick Henry said it best, "Give me liberty or give me death (http://libertyonline.hypermall.com/henry-liberty.html)." You may ask, what the h*ll does this have to do with this thread topic. Well, we've talked and talked and talked about it. What do we do about it that will make even one iota of difference. Is our financial future as important to us as liberty was to Patrick Henry and others of his day. Apples and oranges, maybe! But thunder without a lightening strike now and again is just noise.

Our chains are forged!Glory Hallelujah!

In today's marketplace, all workers, hourly, salaried, managers, independents must look at the product or service they provide, and ask whether it is worth what they are paid for it. If they provide less value than the payment received, it is unsustainable, and will inevitably fail. They either have to increase the value put in, or reduce what they expect to be paid for it.

If unions and highly paid executives don't learn this, they will fail sooner or later.

There is no free lunch...someone has to pay the check.

Do any of you really think the Chinese will continue to work for peanuts as the country prospers? Companies are moving work out of Mexico because wages are on the rise. The same thing will eventually happen in every other low wage country.

As far as GM taking it to the union...have any of you spent any time in an assembly plant? Not just GM, but Ford or DCX also. I beleive you would leave shaking your head wondering why the work being performed doesn't equal the wages earned. Don't blame it all on management. The unions are just as much responsible or even more so.

Do any of you really think the Chinese will continue to work for peanuts as the country prospers? Companies are moving work out of Mexico because wages are on the rise. The same thing will eventually happen in every other low wage country.

As far as GM taking it to the union...have any of you spent any time in an assembly plant? Not just GM, but Ford or DCX also. I beleive you would leave shaking your head wondering why the work being performed doesn't equal the wages earned. Don't blame it all on management. The unions are just as much responsible or even more so.
YuP!!! In the late sixties/early seventies I worked DCX for 2 years and Ford for one. Wasn't my cup of tea. Was trying to accomodate parents wishes for me to have a good union job.:tg:

As the wages in China go up, and the union wages in the good ole USA come down, eventually the Chinese will be importing goods from the USA instead of the other way around as it is now due to our 'new' competitive edge. This will provide new jobs in a market driven by costs.

I worked in a Ford plant for 3 years as a relief man, later as an inventory control supervisor, at the age of 18,19,20. Most boring work in the world.
As there was no crossing job designations, you did one function and then vegetated. Example: A job was to keep an instrument panel line stocked with washers, nuts and etc. Each box held 10,000 pieces. There are 30 boxes of different parts. The line uses 3000 pieces in a 12 hour day. I spent 1 hour filling 30 boxes full of parts, actually just topping them off, then had 11 hours to kill. I went to the roof and read a book or two each day. The guy I replaced took to a bottle instead. With cross training, I easily could have been doing something else productive. I was dumb enough to even suggest it. The Union asked me, no, bullied me into following the status quo, and avoid change at any cost. It's different in the Japanese run plants, and they are making money!! GM has not gone far enough in slashing health care costs. They will go under unless they face the reality that they can no longer afford to pay retiree health care at all, and at least split the costs of heathcare with current employees. Then GM might have a glimmer of hope.

It's a 2 way street. In the late 1980's I worked with Ford on a project. The 'big boys' took me to strip clubs in Windsor after lunch in the executive dining room near Rotunda and we were generally drunk by 4 PM. We 'worked' about 3 or 4 hours in the morning and that was it.

That was upper management. They're no different than the folks down below. Blaming unions and the average worker is an old hat trick. You can stop bashing and blaming the work habits of the folks down below now. We've hear all the stories before. We get the idea.

What will be interesting is what the US will be like when the income gap is as wide as it is in China and the majority of US workers are making US$50 a week or something such. Considering the US is essentially a consumer purchases based economy, it will be very interesting. Not to mention healthcare will be unaffordable (which it already is for many, many people).

Marc,

You somehow think we as a workforce in the automotive field 'get the idea'. Not so. We need more examples of ineptitude on the job that "not all others have heard before" so the reasons for change have a basis. Many workers , upper and lower, don't realize that there is a problem with the status quo of jobs, perhaps even their job, and are they really earning a honest buck for effort expended? Pointing it out to them with examples makes the reason for change very clear. Case in point. Last week at Ford an employee and also neighbor friend, after 5 months, boasted that he did not need FICA taken out of his check as he had earned in excess of 70+ thousand already this year. How so I ask? His job is in quality, checking test fixtures for parts with a no-go gage 7 days a week, 12 hours a day, in launching the 'Fusion' program. Why can't management hire someone else and split the work duties? At least bring in a temp that is trained. Not Union policy. Another case where cross training would have saved time and $. Of course you can blame management somewhere in this, probably for not outsourcing the testing program to Mexico. Playing your 'what if' game, As for $50 per week, by the time that happens, figure with deflation driving consumer goods to 1930's levels, a dime to see a movie etc, there won't be much difference, except that the $50 you mention is all that is left from a $1000 per week check after all taxes have been subtracted to pay for food, heath, housing, pay toilets, and other 'you name it' govt programs, with entertainment fighting for the scraps of discretionary income by dropping costs to almost free.

More sad one sided stories. You might want to start with some upper management horror stories. We all know the ones you're essentially repeating directed at the folks at the bottom of the barrel and everythng is the fault of the unions and their members.

And as if these 'problems' were limited to the automotive industry...

Case in point. Last week at Ford an employee and also neighbor friend, after 5 months, boasted that he did not need FICA taken out of his check as he had earned in excess of 70+ thousand already this year. How so I ask? His job is in quality, checking test fixtures for parts with a no-go gage 7 days a week, 12 hours a day, in launching the 'Fusion' program. Why can't management hire someone else and split the work duties? At least bring in a temp that is trained. Not Union policy. Another case where cross training would have saved time and $. Of course you can blame management somewhere in this, probably for not outsourcing the testing program to Mexico.

:soap: Nothing like a post like this to get your heart started in the morning, especially after being up until the wee hours watching the longest game in World Series history. This will be a little bit long, but sometimes it takes time to give an honest appraisal instead of just tossing off an anecdote and walking away.

Let's have a closer look at your example, and see if we can find a root cause. Before I start, though, let me just say that little or nothing is accomplished by bickering about blame when it's obvious that assignment of blame won't help to solve the problem--at least not the present problem. Citing gross examples doesn't help, as it just serves to demonstrate that the person citing the example either has some personal agenda or doesn't understand the concept of a specious argument, or thinks he can construct a specious argument and not have to actually think about the problem.

But let's look at the example of the check-fixture checker and see what we can see. I'll give an example that's actually a composite of some of my own experiences with a B3 OEM.

A job shop quality manager gets a call from his company's engineering guy who says the shop is being asked to quote on a significant project, and the drawing should be arriving shortly from the customer, so be ready to review it. Timeliness is everything in responding to RFQs, because the early bird often gets the worm if all else is essentially equal.
The drawing arrives via overnight delivery the next morning, and the engineer hustles it over to the QM, who at that particular moment happens to be up to his :ca: in other alligators. The QM unfurls the drawing and sees that it's essentially just a 2D rendering of the CAD file, and is completely lacking in dimensioning, including GD&T. The engineer and the QM shake their heads ruefully, because there's no way to offer an accurate quote without at least having the GD&T on the drawing.
A phone call is placed from the engineer to the customer's engineering contact. "Where's the GD&T?", the engineer asks. "Oh, we're in a big rush here," responds the customer engineer, "Just go ahead and apply the GD&T scheme yourself, then return the drawing and we'll review it."

Meanwhile, the customer's purchasing person is on the phone to your company's sales department, wanting to know where the quote is. The QM gets a call from the sales manager, and explains the drawing situation. "We can't quote until we get the GD&T established," he says. Meanwhile, the engineer beats off some of his personal alligators and sets to work on applying the GD&T to the drawing. When he's done, he and the QM review what he's done, agree that it's reasonable, and the drawing is overnighted back to the customer's engineer for approval.

The next morning, a phone call is placed to the OEM engineer to make sure he got the drawing. He doesn't answer, and a voicemail message is left. In the meantime, the sales guy gets another call from the OEM buyer wanting to know the status of the quote. He tells the buyer that the ball is back in their court and nothing can move forward until the GD&T is approved.

After not receiving a response to the voicemail message, the engineer calls the customer again, and gets voicemail again. Rather than leaving a message, he does an end-around and calls another contact in the customer's engineering department, and is informed that the engineer he needs is taking a few days of vacation.
"Can anyone else help, and have a look at the drawing?"
"No, no one else is familiar with that particular part or has the authority to approve anything."
"OK, can you just look and tell me whether the drawing was received or not?"
"Well, we're pretty busy, but I'll try to have a look around and see. Call me back later."
He is called back later, but his voicemail answers.

After several days of this the proposed GD&T scheme is rejected because it's been discovered that there's an error in the CAD file, and it's another two weeks before it's straightened out and there's a drawing everyone can live with, and the quote process proceeds.

Next up for the QM is the securing bids for a check fixture (there have to be three), which eats up another week of the process. Meanwhile, the GD&T changes again, so the fixture quotes have to be updated. Another week.

Finally everything is set, the quote is submitted, and the business is awarded. What should have taken a few days--a week at most--has taken close to two months, all because of the customer's lack of preparedness. Because of all of the shuffling around and some internal changes not shared with the supplier, by the time the check fixture has been delivered and sample parts are ready, the customer's engineer is no longer sure about whether the check fixture will even work or not, so it has to be checked out...

This is one small part in a very large vehicle, and similar scenarios are being played out from bumper to bumper. First thing you know there's an hourly quality guy who's doing nothing but verifying check fixtures 12 hours a day. But everything would be OK if not for the *&%$ union, and we'd be able to outsource the fixture verification.

What's wrong with this picture?

JSW05,

Point well taken and illustrated. You must be peeking over my shoulder as what you describe happens all the time around here. Add the fact that the bidding for the quote is done on-line with a non-flexible submission date and your analysis is dead on.

How can we fix the system to be competitive with the rest of the world?

The Steel industry knew they could not afford the contracts they agreed to with their work force, but agreed anyway and went out of business for all practical purposes. Hopefully the Automotive Industry can turn it around while they still have some resources. Foreign car makers seem to be able to make cars at a hefty profit, in our own country, and not have the hassle that the big three generate. One third of my business is now with the Japanese, and they are straight shooters and a pleasure to deal with compared to Ford and GM. Anyone else out there see it different?

How can we fix the system to be competitive with the rest of the world?

Right now there are two men standing across the street from a burning building arguing about what started the fire. Unless they can quickly resolve to work together to extinguish the blaze and then try to figure out what caused it, the building will be a total loss. If that happens, I have no doubt that something will rise out of the ashes, but it probably won't look very much like the original building. Time and tide wait for no man...

Let's establish some bona fides here.

I have nearly 40 years of experience as a "suit" in the C-level suite. I tell you all absolutely, without qualification, Deming was correct - all responsibility and authority for a smooth-running organization is in the hands of TOP MANAGEMENT. No union in history EVER dictated a policy that some top manager didn't have to agree to. When top managers agreed to the kind of featherbedding described in some of the posts here, it was because they believed in the "greater fool" theory. "Greater fool" essentially states "there is always a greater fool [consumer in BIG 3 focus] who will pay more money!"

Anyone who believes that a union caused the crisis the US auto manufacturers are in is the victim of management propaganda.

American health care providers have gotten themselves into a similar pickle because their "greater fool" was perceived to be the third party payors of health care. As a result, health care providers raised rates and costs far beyond the corresponding inflation rate. Today, we see a rash of mergers and consolidations and even layoffs in health care fields as those third party payors say, [I]"He!! no. We won't pay!"

The problem cannot be laid at the foot of nurses and interns who formed unions to get better working conditions and more pay.

Similarly, department stores and furniture stores and grocery stores enjoyed relatively large markups on most of their products, also subscribing to the "greater fool" theory.

In each and every case, the margins got so large and tempting that smart operators came in and said, "We can do the same thing for less and take market share away from these arrogant, greedy corporations."

Into the fray leaped foreign automakers, big box retailers like "wally town," outpatient health care, etc. and simply walked away with large market share, forcing the previously high-flying corporations to swallow a bitter pill.

We are talking about macro-economics and market-based economies on a global scale. As each new set of "efficient" providers jump into the market, they displace the preceding set of providers.

Some think they can compete on price alone, but go down in ignominious defeat. Ultimately, the marketplace gains knowledge and is no longer a "fool." The marketplace, armed with knowledge, demands VALUE, not merely low price.

The relatively short periods where each set of providers seem to reign is roughly comparable to the lulls between volcanic activity or earthquakes or massive storms. Eventually, an event will happen which changes the field of play, giving advantage to the next stage of evolution.

Who has the responsibility and authority to keep an organization current, so it isn't wiped out when the outside change occurs? Certainly not the union; certainly not the middle managers; certainly not their customers; certainly not the governments which regulate them.

ONLY top managers have the power and authority to maintain their organizations in a state of readiness to adapt to the external forces of change.
ONLY top managers can deal with investors and bankers to maintain a flow of capital to fund necessary change.
ONLY top managers have the power and authority to expand into new products and markets.
ONLY top managers are responsible for the success or failure of an organization.

I realize this is not much information but I was looking for some advice to share with a friend.

My friend has been offered $150,000 to give up his health insurance benefits from TRW automotive. He is pushing 60 years old. It is taxable. Which means - he may get $100,000? What do you think?

Maybe if they don't take the money the insurance could disappear anyway?

Your thoughts are appreciated.

It is tax deductable. Which means - he may get $100,000?

Then I think you mean that it's "taxable"?

Then I think you mean that it's "taxable"?
Yes taxable.

Take the money! Invest it in an annuity. Let the income from the annuity go to buy an individual health care policy with as many of the same provisions as the current policy as can be found.

Practically speaking, this person only has to cover big health insurance bill up until eligible for medicare, then can switch to less expensive medicare supplement policies.

Points to consider:

coverage for spouse
existing health problems for covered persons (which might preclude getting other coverage)
any minor or handicapped children in the coverageThe temptation might be to treat the payment as "found money" and spend it on some glitzy upgrades to living standard - not smart!

Take the money! Invest it in an annuity. Let the income from the annuity go to buy an individual health care policy with as many of the same provisions as the current policy as can be found.

Practically speaking, this person only has to cover big health insurance bill up until eligible for medicare, then can switch to less expensive medicare supplement policies.

Points to consider:

coverage for spouse
existing health problems for covered persons (which might preclude getting other coverage)
any minor or handicapped children in the coverageThe temptation might be to treat the payment as "found money" and spend it on some glitzy upgrades to living standard - not smart!
Sounds like good advice, thanks.

I enjoy reading this thread. Each of us can add a story or two from our experiences. And all the comments are sincere. I wonder though, are we going to be able to bring a solution out of this broad-scale mess? Will this industry we all work for have to cave in before the guys in the really expensive suits become true change agents? Because right now, all they are doing is tinkering...and I think it will take a lot more than tinkering.

Anyone have any ideas?

I enjoy reading this thread. Each of us can add a story or two from our experiences. And all the comments are sincere. I wonder though, are we going to be able to bring a solution out of this broad-scale mess? Will this industry we all work for have to cave in before the guys in the really expensive suits become true change agents? Because right now, all they are doing is tinkering...and I think it will take a lot more than tinkering.

Anyone have any ideas?The problem is quite complex and far-reaching, so there can't be a straightforward solution.

Economics: I agree with economists that claim markets must adjust to compete with each other. However, they use the term "efficient" to describe the process and my sociologist mind-bent sees a lot of slop as individuals are required to guess what fields they should target (and will manage to succeed in obtaining adequate training for), as they would hopefully prosper. I submit there is enormous productive waste as underdeveloped or unemployed talents languish in this giant, slow-motion Blind Man's Bluff labor market.

The so-called great American dream relies on employment security for the masses, and our economy relies on the self-perpetuating commerce machine of the great American dream. Our labor methods and trends thus, in my view, work to undermine the "dream" and might undermine or even sabotage the commerce machine. Reduce Americans' ability to spend, and the service-based economy must shrink. The more the scales tip toward service economy, the more force is applied to this theory. We need more vocational education investment and a better method for matching talent to jobs and good-fitting organizations.

Lifestyle: Our culture contributes to the problem by insisting on the "nuclear familiy" method of spreading the family among several households--each demanding its own set of expenses that go up, not down. Last week's BusinessWeek featured an article noting this is starting to change. We'll need to discard the remaining stigma of cohabitating to manage living well on lower wages. We will also need to learn how to manage our money better, but are not openly demanding this specific training in public schools so there's practically none available.

Management: Some will argue that there are shrinking numbers to fill the good paying manufacturing slots. The workers are getting old and young people don't want that kind of work. I have observed some truth to this, but I wonder: if the work were being done in a more creative manner, would they gravitate to it? The assembly line idea is, I perceive, definitely not appealing to the upcoming workers so the big businesses see little reason to lament the high wage jobs shifting offshore.

As Wes has asserted, the manner in which work is designed is up to top management. Changing the work to make it more appealing (including job security, which has replaced compensation as "most important" to new college grads) is a management decision, but they instead claim "No one wants to do the work" or the schools aren't producing enough brainy workers. Cultivating their workers and leadership is passe, deemed too expensive; apprenticeship programs (that provide some assurance the trained worker will stay) are not widely used anymore.

Government: In the end, the competition is directed toward satisfying our firmly entrenched publicly-owned business model. Since the 401K was pressed on workers decades ago, the Wall Street effect is widely accepted because increasingly large portions of our society depend on it for our retirement, if we hope to see any (I don't expect to). Management responds to the Wall Street effect's downward pressure by cost cutting, and personnel is very often the highest business expense. Government nods to it via its top economist officials and by insisting that a centrally run single payor health and/or retirement programs would be bad, even though the costs of both are relentlessly dragging down the economy.

It will require a mass-scale enlightenment among all these spheres at once for effective and appropriate changes to occur. I suspect only some major catastrophe will do the trick (and then I expect a lot of arm waving, posturing and jockeying as power figures argue their positions and propose responses) as we are not a pragmatic culture.