posted 16 Dec 2003 in Volume 7 Issue 4
Driving standards at Jaguar
When mergers and acquisitions bring prestigious automotive brands together, convergence must take place. Trevor Harkin describes how Jaguar and Land Rover’s product-development centres share knowledge and experiences, and have created a tool to standardise and manage the many metrics used across the organisations.
A wise management consultant once said, “What gets measured get managed”. In today’s business environment with various forms of measurement indoctrinated into corporate strategy, balanced scorecards and personal objectives, can technology exist within a product-development arena that aids knowledge workers in their day-to-day business without being an unnecessary administrative burden?
Formalised metric management must be an integral part of any management process as an effective means of keeping the measurable under control or emphasising the need to redirect appropriate resources.
In December 1989, Ford acquired Jaguar for $2.5bn. Ford’s purchase of Volvo for $6.45bn in February 1999 added another premium brand to its empire and included the passenger vehicle product-development centre in Gothenburg.
On 19 March 1999, Wolfgang Reitzle was named vice president of the newly created Premier Automotive Group (PAG) within Ford. PAG had lead responsibility for Jaguar Cars, Aston Martin, Lincoln, Mercury and Volvo with the objective of developing strategies to leverage and grow premium and global brands. Ford’s chief executive at the time, Jac Nasser, recognised the important role played by employees in the formation of this group. He regularly re-iterated these opinions through his weekly feedback e-mail, ‘Let’s Chat’ by saying that knowledge is becoming more important then physical assets.
In March 2000, Ford bought Land Rover’s assets from BMW for £1.8bn. This ended the German company’s break-up of the Rover group that had been acquired from British Aerospace in 1994 for £800m. At this time, BMW chairman, professor Joachim Miberg stated, “We have made every effort to reorganise Rover but we have reached our limit”. However, Nick Scheele, chairman of Ford of Europe, said “Land Rover is the Jaguar of off-road vehicles and a natural fit”. Since its inception in 1948, the Land Rover marque had changed hands several times and responsibility now lies within the Premier Automotive Group.
In April 2002, PAG reorganised its luxury line up, and the Lincoln and Mercury brands moved back into the North American Consumer Business Group. Volvo, Aston Martin, Jaguar and Land Rover continued under the PAG banner. This coincided with the announcement of Mark Fields’s appointment as group vice president of Premier Automotive group to start in July 2002.
Bill Ford, Ford Company chairman and CEO, remained committed to maximising the potential of the premium brands and building on the strengths of its talented people. As the Lincoln and Mercury brands returned to North America we were able to give greater attention to the working
relationships between the remaining brands, with UK-based Land Rover and Jaguar in particular. Volvo, based in Gothenburg, still has a huge role to play in cascading best practices. While Aston Martin, due to its exclusivity and niche market, also has an important role. All brands are conducive to knowledge sharing and have responded positively to the opportunities and challenges presented.
Jaguar and Land Rover have a huge presence in the Midlands with manufacturing facilities at Solihull and Castle Bromwich in Birmingham, and Browns Lane in Coventry. These facilities produce a combined annual volume of over 200,000 vehicles.
As the product-development centres for Jaguar and Land Rover are only 20 miles apart, clear synergies can be obtained. Product development is responsible for developing all future models for Jaguar and Land Rover. The content of each model varies depending on each product lifecycle or the introduction of new legislation. Each vehicle line, such as Freelander or XJ, will have dedicated engineers, from powertrain, electrical, chassis or body engineering, to design new parts or modify existing designs dependent on the drivers for change. The activities of these functional areas are monitored and maintained by dedicated programme managers.
To exploit the opportunities offered by the proximity of the centres, the 4,000 employees (2,500 at Jaguar and 1,500 at Land Rover) under the product-development umbrella have been put through a convergence process, which started in July 2002 and is now coming to an end.
Employees from Whitley were re-located to Gaydon and vice versa. Engineers had the opportunity to utilise their skills on different projects, share lessons learnt, transfer knowledge and enhance corporate learning on an unprecedented scale.
As part of the convergence, the processes used at both brands were examined in detail as part of the adoption and identification of good practices. Particular emphasis was placed on tools and processes that utilised knowledge retention and knowledge collaboration. This reflected part of the overall Ford policy: “Our people are our most important assets. Their knowledge and actions define Ford Motor Company and enable our success.” We recognised the potential of a metric-management tool known as the ‘programme metrics dashboard’. It was in the embroyonic stages of development at Land Rover and the edict was to develop it further and roll it out across Jaguar and Land Rover programme management.
We adopted a metric-driven approach as we believe that this is the only way to know where you are, where you’ve been and where you’re going. We need precision in our delivery, which requires a robust quality-operating system (QOS) built on a solid foundation of metrics.
To understand the metrics currently being used within product development a metrics-blitz session was organised. This amnesty session gathered all known metrics from Ford, Jaguar and Land Rover and grouped them by functional area, such as marketing or finance, and programme on a simple web page. To keep the number of functions at a reasonable level they were rationalised into coherent groups and named strands. Each strand was then allocated an owner. Rather then having the two distinct functions of marketing and service, for example, they were combined to form a marketing and service strand. This contained metrics at a programme level such as:
- Marketing launch plan;
- Timing of service activities;
- Group insurance ratings;
- Global volumes.
Strand owners analysed the metrics within their strands, spoke with the metric owners and identified any areas of trade-off between the metrics in use at Jaguar and those at Land Rover and Ford. To aid this process a metrics convention was developed. These guidelines prompted the team to re-define their metrics and included:
- Suggested colours for optimal printing;
- Possible scales for X and Y axis;
- Classification confidential or proprietary;
- Optimal size for viewing.
With this rationalisation complete, the metric set was confirmed and the outcome presented for approval by the product development director. Throughout the process, understanding increased as the metrics evolved. Those metrics not approved were re-submitted and were usually settled after three attempts.
The complete set of approved metrics were then communicated by the strand owner to the metric owners and authors. This communication included any relevant documentation, such as spreadsheet-based templates, which enabled the metrics to be completed and generated to the standard. Use of the metric was then leveraged through key meetings and forums.
Prior to the blitz almost 400 metrics were in use at different levels, but this was scaled down by 45 per cent in the rationalisation process to 220. The applicability of metrics is now agreed in meetings by the programme and functions, which is largely dependent on the scale of the programme and the areas affected. For instance, a programme that required a derivative of an existing engine would not require the same metrics as that of a new vehicle. Metrics were also assigned a lifespan, a point at which the metric must start and end. At any one point on a new programme there could be up to 50 metrics active.
The drivers for standardisation are obvious but need to be spelt out to be fully appreciated in terms of bottom-line savings in effectiveness and efficiency. Having an agreed standard makes it easier for publishers to regenerate, it makes it easier and quicker to understand than discussing the metric itself. The effectiveness of and reaction time to the metric can also be improved. By standardising metrics we have managed the content aspect. In any arena where metrics are discussed they are normally accompanied by a narrative explaining the metrics or actions being taken. To assist here the dashboard contains an optional area where users can add any additional information to support a metric.
The dashboard’s development
Having identified the standard metrics and owners, the web-based tool was developed further. The dashboard’s purpose is to offer maximum information at a minimal glance, similar to a plane’s dashboard.
One of the principles of the dashboard is transparency. The dashboard provides a window for everybody to see programme metrics, although some security levels exist on financial metrics. The dashboard is a process for tracking and controlling all Jaguar and Land Rover metrics, and is a metrics-management tool that is structured around tangible items that the business has chosen to measure.
The left-hand side of the dashboard shows users current programmes. For auditors, non-current programmes are archived automatically. Simply clicking on the programme brings up the metrics currently in use or those that could be available.
The pilot, like a programme manager, has to keep his eye on many facets at one time. To ease this, a rating of red, yellow or green is available to rank each metric and the overall status, which appears on the start-up screen of the dashboard. The status is required for the current and next milestones. A red rating means off-track and no plan to get back on target, yellow represents off-track but with a plan, and green means on-target for completion within the given parameters. This standardisation has significantly helped in understanding the health of our programmes .
Each metric’s author and owner are responsible for keeping their metric up-to date within the set ‘update frequency’ that was agreed at the meetings with the product development director. We can also drill down through the metrics to an appropriate level. For example, a top-level metric might show 19 required components, but only when you drill down can you identify the functions responsible. For example, electrical=15; Powertrain=4 and Chassis=O.
Functions, as well as programmes, can check their metrics’ health for levels of:
- Conformity to standard;
- Overdue (past required update period);
- Active missing (status but no metric).
As we developed the dashboard, the need to use it as a strategic tool has gained momentum, so these measures become less important and have levelled out to the target level of sub-five per cent. Currently, the dashboard has over 2,500 active metrics and over 30 programmes with more than 20,000 already tracked through to completion. This means that only 125 of the metrics in use do not comply to the standard, which will be reduced by communications between the strand owner and the offending party.
Metric owners who fall into the overdue and non-conformance category receive an automatic e-mail requesting an immediate update or revision so the metric is compliant.
Training material was developed in the form of Powerpoint presentation, which linked to a ‘help’ section on the dashboard. The main focal point for help is a downloadable software tool called ‘ripper’. Ripper was developed by our IT department to take graphs from Excel spreadsheets and map them into the dashboard. It is particularly useful to owners with multiple metrics. The IT department dedicated one person for nine months to develop the dashboard and react to customer feedback on the implementation of new features. Weekly consumer-insights meetings were held to turn real customer feedback into functionality. Dashboards are not new, they are in use at BP and Heineken for example. Various vendors sell software for self-developing dashboards, however, we decided that our application required a bespoke solution.
Prior to the dashboard
By using the dashboard to manage metrics, we have prevented the adoption and replication of worst practice. Prior to the dashboard, metric owners kept their metrics on shared areas with restricted access to each specific programme. Alternatively, data custodians maintained the metrics on their own drives only to be projected at key reviews, to the astonishment of the audience. However, while developing the dashboard, we realised that any methods for uploading metrics had to replicate, in terms of speed and ease, the metric-publishing methods used previously.
Five methods were made available, which catered for all eventualities:
- Upload image;
- Link to page URL;
- Link to image URL;
- Pasted data;
- Graphs taken from Excel using ‘ripper’.
It is easy to illustrate the importance of having the right knowledge and information in the right place at the right time. Disasters such as the Challenger explosion with its faulty ‘O’Ring, the infamous bow doors on the Herald Of Free Enterprise car ferry, and the Union Carbide toxic leak in Bhopal, India offer chilling examples. It is important to recognise the difference between having the right information available to the right people, and failing to deliver the right information to the right people. The lack of access to key knowledge on a daily basis does not always have such catastrophic consequences, although the cases illustrated here serve as a reminder to everyday practitioners of the worst-case scenarios.
The dashboard is a prime example of how knowledge workers distribute information, which can be used as a signpost to others to take any necessary evasive action. While technology is an enabler, actions and interactions still need to occur within the organisation, such as prioritising available resources to counteract any ‘off-track’ projects.
Senior management recognised the importance of the tool from the outset but believed it ran the risk of including too many metrics that would put off the intended audience. This initiated the metrics blitz. With senior-management support and IT resources, we were able to develop and respond to customer concerns in a timely fashion.
The dashboard and metrics function at several levels have defined the channel for ensuring explicit knowledge is generated in an agreed format. The dashboard gives data custodians a channel for converting the tacit to the explicit. Once captured, it can be codified, stored and disseminated for use by future programme teams.
The dashboard has been recognised as a tool for continuous innovation and will be fully integrated into the recognised toolset for all programme managers throughout the Premier Automotive Group. The dashboard can also be cloned to other areas of the business that require a metrics-management tool.
This knowledge-management initiative has had an impact on our 4,000 knowledge workers in product development. It has introduced an incremental change to the organisational culture over a nine month period rather than a radical transformation. The need for metrics had already been recognised, the requirement for standards and a transparent publishing tool hadn’t.
The Jaguar and Land Rover product-development organisation has been re-shaped and re-organised. Approaches have changed and technology has been reviewed, which has led to behaviour changes in knowledge workers.
This is only one example in the hunt for synergistic approaches and collaborative working between the Land Rover and Jaguar product-development centres. Indeed, the merger of two organisations
with differing heritages and cultures is a case study in its own right that will no doubt appear in the future.
Trevor Harkin is knowledge manager at Jaguar Cars. He can be contacted at email@example.com