Question

You are the president of a new division of a major auto producer. Your organization has been chartered to design and build a line of cars to compete with intermediate-size Asian and European imports. The division is to be located in a historically agricultural state that has the availability of unskilled labor but no experience in auto manufacturing. Your key staff and mid-level managers will be handpicked from among other divisions. The corporate headquarters staff has not been able to come to terms with how the new division should be set up. The options seem to be these: (a) set up as a lean organization, using JIT in the factory or (b) because the corporation has little experience with either, set up like the other divisions in a traditional hierarchy and production system, converting to total quality and JIT little by little as time and experience permit. You believe that in the long run, total quality and JIT are necessary to compete, especially with the Japanese and Koreans. But you and the people who will make up the division’s management team are experts in mass production. Going the traditional route looks like an easier start-up path.



The CEO is leaning toward letting you make the call, but he wants you to convince him and the senior staff. You have to prepare a briefing for the corporate staff for that purpose. Which course will you choose? Explain the advantages and possible pitfalls of both, and make the argument that supports your choice.

Answer 1

Answer:

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