Mike Barry

Monday, May 5

We started our day at Ford’s world head quarters, a large building that required photo identification and id badges in order to gain security clearance.  Security even extended to the prohibition of photography in the lobby.  We met with Ellen Hughes-Cromwick, Ford’s chief economist, and Dennis Tosh, who manages Ford’s cash.  Throughout the meeting, the key point of emphasis seemed to be looking towards the future, and becoming involved in the expanding global market.  In the past, Ford has not had much influence outside of North America, but as the markets in Asia and south America grow, Ms. Hughes-Cromwick believes that Ford will be able to start to match their success in America.  As far as the future goes, they are also very aware of what will be happening in terms of rules and regulations.  By 2025 all vehicles will have to get at least 54.5 mpg, and changing their automobiles to meet these regulations will be very costly.  Although Ms. Hughes-Cromwick and Mr. Tosh are not directly involved with any product manufacturing of design, they know the importance of constantly being in contact with these departments in order to plan accordingly.

After Ford Headquarters we visited Federal Mogul in Plymouth, Michigan.  At Federal Mogul they create many of the key internal part of engines, including pistons and spark plugs, as well as some after market products.  We were given the sales pitch that any of their high profile clients would receive, and it appeared that they placed great importance on many of the same things as Ford.  They were especially interested in how they can become involved in the emerging markets in Asia, where they have a third of their employees, but still only make 19% of their sales.  They were also very concerned with what is still coming, with their application engineers working directly with clients to develop specified products that will used in 2015, ’16, and ’17 models.

On the tour, almost everything we saw was beyond comprehension for me, with equipment so finely tuned that it could measure errors in pistons smaller than 1 1,000th of an inch.  They also utilized many different forms of data along with the help of machines that could test individual parts of engines to expedite what used to be very costly and inefficient methods of testing engines.

The final thing that I noticed, which seemed to be very important to Federal Mogul’s success was the age and experience of their employees.  Everybody there mentioned experience levels that seemed too high for their apparent ages, leading me to believe that they had been involved with the company for most of their careers.  Combined with the very low turnover rate, it seems that their employees really like to be there.  Everybody we spoke to seemed very passionate about Federal Mogul and their products, and I think this must help them continue to push themselves towards innovation.

Tuesday, May 6

Today we started at the Federal Reserve branch in Detroit.  The first thing we saw was the cash room and the vault.  In the cash room they count all the money that comes in from banks and check for counterfeits.  Counterfeits are carefully tracked, and a list of everybody who has handled it is reported to the Secret Service.  Other intense forms of security in the cash room include 600 cameras and different colored coats that people have to wear which represent their levels of security clearance.  Security is even more intense in the vault, with machines handling all of the money so that people never go in.  Machines also check to see if bills are no longer fit for circulation, in which case the bills are shredded and new ones are printed.

Next, Dr. Paul Traub spoke to us, mostly about the state of the United States economy after the recession.  His main message was that, although there is noticeable recovering since the low point through 2007-2009, that recovery has only gotten us back to the point we were at before the down turn, and our new rate of economic growth is much lower than it was before the recession.  This was followed by a talk from Martin Labell on Detroit’s bankruptcy.  He claimed that the overarching issue was very poor management, which emphasized all problems that already existed in the city.

Finally, we went to Ford World Headquarters to meet with Felicia Fields, VP of Human Resources.  The highlight here was meeting in the Thunderbird board room where the weekly business meetings occur, and many very important decisions have been made.  I found the actual presentation to appear like a very scripted answer to any questions about HR, and it didn’t reveal much about the company.  As we were told yesterday, Ford is excited to take advantage of expanding markets in Asia, and they have a high demand for people from STEM fields.

Wednesday, May 7

We started the day with a bit of a break from the auto industry, visiting the Heidelberg Project and the Detroit Institute of Arts.  The Heidelberg Project was built up throughout an abandoned neighborhood and is meant to represent hope for the city.  It is a constantly changing installation piece, and it uses garbage salvaged materials from surrounding areas to symbolize different parts of Detroit’s culture.  When talking to its creator, Tyree Guyton, he shared his vision for it as a symbol of rebirth in Detroit, saying that he believes we can use art to create our own realities, and he seemed to view his work as a way of creating a more beautiful and happy Detroit.

Next we switched to some more traditional art at the Detroit Institute of Arts where the main attraction was a large mural by Diego Rivera.  This was a massive room with murals willing up both walls.  The main scene on the murals was of workers in Ford’s Rouge factory.  It shows the significance of the auto industry in Detroit’s culture, with people from all walks of life involved, from high paid managers, to angry floor bosses, to the strained factory workers.  The busy image gives a sense of how hectic the entire industry was.

After the art we went to the University of Michigan Transportation Institute (UMTRI) where they are working on making cars safer.  The first thing we saw was their driving simulator, which puts test subjects in a car that has a road projected on screens around them.  They drive it like a normal car, and cameras inside of it can track where the driver looks and what they do.  Different scenarios are presented, such as yellow lights and long stretches of cars that prevent left turns, in order to test a driver’s aggressiveness.

The other main focus we learned about at UMTRI was inter-vehicle communication, or V2V communication.  This is a system that uses small satellite boxes in cars to send signals to others that allow the cars to “communicate” and know when there might be a problem like a car stopping too fast in front of another, a car going the wrong way, etc.  At UMTRI they believe that this is the future of autonomous cars.  It is much simpler and cheaper to use satellite signals than to cover a car in sensors, and there is the added benefit that a satellite can be added to a car post-production.

We finished the day at dinner with journalists from Automotive news.  They shared their thoughts about their jobs and their perspectives on the auto industry today.  Some of the points that stood out were that it is nice to work for Automotive news because they only ask questions that should be asked (they don’t have to harass people) and they aren’t always in competition with other similar publications which allows them to focus on what they find important.  They also touched on the importance of technological advancement in journalism, as it has become crucial for them to tweet breaking news, otherwise the credit for the story will go to somebody else, and people will not go to them as a source.  I thought an interesting perspective on the auto industry came in the description of Toyota.  Originally, it was “a very nice appliance on wheels”, meaning that they are the most well built cars, but do not get any credit as being “nice”.  However,, their release of the Prius, and the attention it got in Hollywood, helped to rebrand Toyota as a “luxury” company that had something special to offer.

Thursday, May 8

The first thing we did on Thursday was visit the Rouge factory and the Henry Ford museum.  We took a factory tour at the Rouge, where they only make F-150s.  It was very impressive to see how smoothly the assembly line worked, with jobs divided perfectly in order to prevent back ups and make full use of all workers.  I was equally impressed by the technology and automation on the line and the aspects that seem left up to humans.  There were many very sophisticated machines that were used to do everything from stamping letters on the sides of the trucks to attaching beds to the cabs.  However, it seemed that a lot of small things were left up to humans, especially when it came to customization.  For example, it seemed like the workers were picking out which model label to put on the bed.  It is likely that there was some system that we couldn’t see from above, but I was surprised the whole process wasn’t automated.

We had a little time after the plant to look around the factory, which is full of some of the most impressive and influential cars from throughout history, as well as beautiful trains and planes.

Next we went to Borg Warner, a tier one supplier similar to Federal Mogul.  They told us of similar goals for growing their business in developing markets, and gave us a tour of their workspace.  They did not seem to be quite as technologically advanced as Federal Mogul, but they are the leader in most of their fields and make different parts, so it was interesting to see how small differences in a company’s focus can warrant an entirely different factory and environment.

Prof’s comments

Thanks for a thoughtful overview. I edited the word “garbage” but the phrase “installation piece” is helpful, I’ll use it henceforth. I actually liked the presentation of Felicia Fields – Mary Anderson. One was the centrality of what they do to corporate strategy; HR used to be peripheral. The second is the “matrix” for specific components that made different execs responsible for reporting red/yellow/green in the Thursday Thunderbird Room meetings. I don’t think that’s all that widespread a practice, even though I suspect it’s there in HR textbooks as a principle. Are employees “happy” (as defined by concrete metrics) and if not, what are you as the exec responsible for that area doing about it? Is it one part of the company that treats people as disposable? A couple problem individuals who can be counseled – as a first step?