Nummi and Gm

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The extraordinary success of NUMMI over GM can be attributed to NUMMI becoming a learning organization, and bears evidence to Senge’s description on learning organizations. The words of Ray Stata “The rate at which organizations learn may become the only sustainable source of competitive advantage” ring true in every aspect in considering the NUMMI vs GM case.

The following factors played a key role in developing a ‘generative’ learning approach in NUMMI, a key source of its competitiveness: •Management philosophy that car making is a people business - building a relationship of trust between management and employees, exemplified by a no lay-off policy, encouraging loyalty and increased productivity. •achieving production efficiencies – by laying out an efficient plant design and a simple product design – encouraging a culture of “getting it right the first time” •empowering people to take a continuous improvements approach and eliminating waste – building responsibility and accountability •having a lean structure, hiring the right people, believing that people genuinely want to do a good job and rewarding productivity.

Trust and rewards increase motivation, motivated employees increase productivity and quality, better quality and integrated production systems results in reduced costs and increased profits, thus supporting the success of the entire organization. --------------------------------------------------------------------------------------------------------------------------------- NUMMI demonstrates a strong sense of leadership by having a positive intrinsic vision based on mutual respect and support. This vision was further strengthened when the management created opportunities where people could correlate their jobs with the overall vision.

Though using the same GM employees, NUMMI leadership seems to have broken all the established GM mental models, and implemented an entire new management philosophy based on people and productivity....
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