June 24, 2002
GM changes vehicle development process
Milford, Michigan – General Motors’ new approach to advanced vehicle development will reduce vehicle development times through improved productivity, elimination of bureaucracy and focused decision-making, said the automaker on Friday.
“This new approach is possible because the overall product development organization has continued to increase productivity and become more focused under the vehicle line executive (VLE) system,” Mark Hogan, GM group vice president, advanced vehicle development, said here today during a media briefing. “The up-front work that has to be done to determine if a program is viable and profitable is very complex and includes many different variables. Our teams orchestrate the work and resources associated with the development of a new product idea and then see it through to the point where we know the product can be executed with a sound business case.”
“Advanced Vehicle Development starts with Portfolio Planning,” said Ron Pniewski, General Motors North America vice president, planning.
Portfolio planning assesses emerging market trends, competitive products and regulatory concerns such as fuel economy and emissions and evaluates the portfolio to show areas where GM can grow or cut back. “We are the first step in the process of sorting and balancing the product portfolio plan,” said Pniewski.
Portfolio analysis also takes into account business objectives and assets, including divisional market positions, manufacturing footprint, product architectures and powertrains. “We combine all this with great product ideas from dealers, designers, senior management and others to come up with high level product plan recommendations,” Pniewski said.
“We are making sure we have all the key stakeholders more involved from the start,” said Pniewski. “The previous sequential approach, using a lot of hand-offs, is time consuming and invites communication breakdowns.”
The new advanced program teams essentially resemble the same players on the vehicle line teams GM put in place several years ago – engineering, design, planning, purchasing, manufacturing, marketing, quality and the like. Once the up-front work is completed and the leadership decision board approves the program, the transfer to a vehicle line team is essentially seamless. In some cases, the same key team members executing the advanced work from various organizations will migrate with the program to the execution phase.
Decision-making has also been simplified and focused under the product development leadership team headed by Bob Lutz, GM chairman of North America and vice chairman product development. To facilitate faster decision making, ensure quicker response to changing market conditions and provide a more up close and personal approach to products during decision-making discussions, planning has created a new area — Portfolio Zone — in the Advanced Vehicle Development Center at the Warren, Michigan Technical Center. This highly secure area features a state-of-the-art conference room, a vehicle display room, a three-screen, full-size vehicle imaging area and a portfolio business analysis room.
This high level recommendation, the Document of Strategic Intent, sets the boundary condition for a product program with specific architecture, target plant and start-of-production date, financial targets, and role in the GM portfolio and places it into the future product plan. “The program then goes through three phases of evaluation and development with clear direction and understanding of the target market and competitive entries,” said Hogan. “There is an intense focus on styling and design through all of the phases.”
In phase one, a full range of styling themes within the program boundaries is explored. Initial engineering architecture and manufacturing implications of the design themes are assessed, along with a feasibility assessment of the business case.
Phase two begins with narrowing down the number of styling themes from as many as nine down to three. Initial engineering solutions supporting these styling themes are generated based on the program requirements and the business case. Subsystem proposals to enable sharing of existing components and a balanced engineering solution are identified. Key vehicle level dimensions are also established and issues and resolution plans identified.
In phase three, three full-size models are developed and assessed in preliminary clinics. Comprehending clinic feedback and a balanced business case, a single theme is selected for the program. High-level tradeoff decisions are completed and issues and resolution plans updated.
According to Hogan and Pniewski, the major benefits of the new approach to advanced development include:
- Great designs by having design competitions that produce a single “proven” winning theme.
- Elimination of costs and non-value added work through strong leadership and accountability.
- Increased competitiveness through reduced development times, reduction of unnecessary inputs/opinions and downstream reworks.
- Better production execution through increased up-front collaboration and fewer organizational hand-offs.
“In essence, we’re managing a virtual organization, since most of the critical players associated with the up-front work are parts of the bigger product development organization,” Hogan said. “It’s our role to ensure the directions and desires of GM’s senior product leadership are being effectively and efficiently applied in creating and evaluating product programs. This means keeping a tight focus on workload, investment and structural costs. In this intensely competitive environment, we cannot afford to expend scarce resources answering questions that the marketplace is not asking.
“This is not simply a matter of removing time and costs from the system. It’s about aligning some of the industry’s best talents and resources to deliver the best, most desirable products to the marketplace. Many of the same groups and players that were doing this type of work prior to the realignment remain. What has changed is our ability to make the right product decisions and execute them faster through streamlined decision making and better organizational focus.”