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| Malcolm
Baldrige National Quality Award 1990 Winner
But the maker of luxury
automobiles has risen to the challenge. Over the last several years, its
cars have improved markedly in quality, reliability, durability, and performance.
Through its greatly expanded warranty coverage and unique new service
offerings, including a nationwide Roadside Service program, Cadillac has
intensified its commitment to the customer. And it has become a nimbler
competitor, the result of a simultaneous engineering process guided by
a finely tuned information system that helps translate buyer preferences
and expectations into new CADILLAC: A SNAPSHOT Founded in 1902, Cadillac is the flagship division of the General Motors (GM) North American Automotive Operations. It manufactures or directs the production of nine car models -- including two (Reatta and Riviera) marketed by the GM Buick division and one (Toronado) by the Oldsmobile division -- that compete in the luxury segments of the automobile market. Cadillac models are the Allante, Brougham, Seville, Eldorado, DeVille, and Fleetwood.
CUSTOMER SATISFACTION AS THE MASTER PLAN Cadillac's turnaround began in 1985. That's when top management started implementing simultaneous engineering (SE). SE contrasts sharply with the traditional serial approach to automobile development and manufacturing, in which individual departments functioned largely in isolation from the others. Product design and development now begin with integrated knowledge of all essential elements, including performance targets, product features, systems and parts, processes, and maintenance requirements. Thus, SE anticipates how changes in one functional area will affect the others, making it easier to prevent problems and bottlenecks, to determine in advance how to monitor and control production processes, and to identify opportunities for quality improvement. The effectiveness
of SE, however, hinges critically on carefully orchestrated teamwork.
More than 700 employees and supplier representatives now participate on
SE teams responsible for defining, engineering, marketing, and continuously
improving all Cadillac products. Their Successes achieved by SE teams were the springboard to a complete transformation in Cadillac's quality culture. Its partnerships with the United Auto Workers (UAW) have been a catalyst in this transformation. Along with Cadillac executives and plant managers, union leaders serve on the Divisional Quality Council, which is part of the UAW/GM Quality Network. At Cadillac, the Quality Network also includes plant councils at each of its seven major facilities, which are supported by the efforts of nearly 600 work teams and cross-functional teams, each composed of between 10 and 15 hourly and salaried employees. Pledging to involve
its employees "in the running of the business," Cadillac solicits
the views of all employee teams during the preparation of its annual business
plans, which embody short- an long-term quality improvement goals. The
open, yet disciplined, planning process, guided by A comprehensive program of competitive analyses -- of products; product features; services; and planning, development, and manufacturing processes -- provides Cadillac management and employees with a clear picture of what the division must do to maintain or achieve world-class status in each category. Thorough planning is also a hallmark of Cadillac's "people strategy" for improving the effectiveness and job satisfaction of hourly and salaried employees' efforts. Especially close attention is paid to educational needs. Each plant and staff unit has a Training Priorities Committee to determine what skills and knowledge workers must have to accomplish quality goals, and training programs are crafted to individual needs. In 1990, for example, skilled hourly personnel will receive a minimum of 80 hours of formal instruction in such areas as quality improvement, leadership skills, process modeling, statistical methods, and health and safety. Suppliers and dealers also are fully integrated into Cadillac's customer-focused quality improvement efforts. Three-fourths of the division's 55 Product Development and Improvement Teams have suppliers as members. External suppliers must demonstrate continuous improvement in meeting "targets for excellence" in five key areas: quality, cost, delivery, technology, and management. A well-developed assessment and part qualification process assures conformance, eliminating the need for regular inspection of shipments. In reliability and durability tests equivalent to 100,000 miles of customer use and 10 years of corrosion exposure, all models have improved markedly, as determined from measures of the "number of things gone wrong" during the test. For all nine models, the number of such problems decreased between 27 percent and 71 percent since 1986 or, for new models, since production began. In tests of 1990 and 1991 cars, nearly all models met or exceeded world-class levels for reliability and durability. For the customer, these product improvements and Cadillac's commitment to improving service have resulted in expanded warranty coverage -- to a minimum of four years or 50,000 miles, as compared with one year or 12,000 miles in 1988. Improved product quality, however, has resulted in a 29-percent drop in warranty-related costs during the first year or 12,000 miles, from 1986 to 1989. In step with service and product quality, customer satisfaction has risen, as measured through extensive surveys and analyses of complaints handled by its 24-hour Customer Relations Center, for instance. On three key measures -- satisfaction with cars, service, and total ownership experience -- 1985 customers rated Cadillac at about 70 percent. In 1989, Cadillac's scores in all three categories were 86 percent or better.
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