Ford Motor Company: Ready for the Rebound
Overall injury rates have improved by 90 percent since 1998. Dr. Greg Stone, its global safety and health director, says his team zeroes in on significant incidents and ensures the lessons learned are shared with every manufacturing plant around the world.
Increased production, third shifts, and new factories -– even if they are being built overseas -– are some of the recent signs indicating U.S. automakers and their competitors have shifted into a higher gear. Detroit's Cobo Center was humming this month as top officials from automakers around the world touted their 2011 sales figures and delivered optimistic predictions of strong demand this year.
U.S. motor vehicle and parts manufacturing employment rose last year to 592,100, which was a 13 percent increase from July 2009, according to data presented at a Center for Automotive Research breakfast briefing late last year. CAR predicts U.S. sales will rise from 12.6 million vehicles in 2011 to 13.8 million in 2012, 14.1 million in 2013, and to 15.2 million in 2015, when the center expects 756,800 people to be employed domestically in auto manufacturing.
Ford Motor Company reinstated its quarterly dividend on Dec. 8 and announced that the 500,000th vehicle produced by its Ford Sollers plant near St. Petersburg, Russia, rolled off the production line Jan. 8. Vehicle sales by Ford India rose by 15 percent in 2011, according to the company.
The automaker's safety stats are just as impressive. Dr. Greg Stone, its global director of occupational health and safety since November 1998, said 2011 was the first year during his tenure that Ford globally had a year without a single employee fatality. Overall injury rates since 1998 have improved by around 90 percent, he said.
"We continue to push and push hard," he said during a Jan. 17 interview.
There were two contractor fatalities last year, one in Russia and one in South America, Stone said. "We don't let ourselves off the hook for that, either," he said. "What we've found is that the so-called traditional industrial ways of fatalities -– falls from heights or energy control panel lockout violations -– we've really focused on those and, frankly, eliminated [them], so far. Fingers crossed; we're always vulnerable to those. But we've really driven away the common causes of fatalities. The less common causes are what we really have to grapple with."
Stone said Ford currently has about 160,000 employees globally, with at least 100,000 of them classified as hourly. After two years in which production and employment plunged for the industry as a whole, the company is growing again as it responds to growing demand, particularly in China, India, Russia, and Brazil.
"We worked 17 million construction hours last year and, again, did not have a fatality in the construction area. Again, it's probably one of the hardest-risk things we do," Stone said when asked about the safety challenges involved in opening overseas factories simultaneously. "When we go to places like China, the construction safety standards there generally are nowhere near what we would expect to have here. When you're in China, you're working and negotiating with a joint venture partner, as well. But I think we have been pretty successful in getting better standards applied on our construction sites. In China, you know, there's a lot more manual labor and it's a lot more labor intensive, so the risk is higher."
Stone reports to John Fleming, Ford's executive vice president for global manufacturing and labor affairs, who in turn reports to CEO Alan Mulally. Fleming conducts a business plan review on Monday mornings, and there are afternoon staff meetings later that day. Stone also runs a global, region-by-region incident review process. "We have what we call a significant incident reporting program. We do all the basic data gathering, too, but everything that reaches what we call a threshold of serious injury goes into a separate system, and we require a much deeper investigation of that," he explained. "And then myself and our corporate staff go through that investigation from a coaching and clarification point of view with each of the regions." Each region -- South America, North America, Europe, and Asia/Pacific -- is discussed for an hour on Mondays.
"That process of doing incident reviews has been really instrumental in improving the quality and the thoroughness of the investigations and making sure that we do extract the learnings from those incidents," said Stone, a native Australian who got his medical training at the University of Sydney. "And the other thing we decide at those meetings, if there's a global prevent recurrence action, we've actually got a system that gets that out to every plant globally and extracts the closure for those. The data from that gets reported in John's business plan review meeting, too. So we're not just looking at the output data; we're looking at what are we doing to reduce risk, what actions are we taking, and so on. That process has worked well for us."
Ford has achieved year-over-year improvement in serious injuries and significant incidents, but "frankly not as fast as we'd like," he said.
Bringing In a New Workforce
Stone recently has been conducting special plant reviews at U.S. plants and will do them at European plants in February. Workers in the plants "certainly tell us they sense a lot better and lot higher focus now on things like the basics of energy control and power lockout," he said. "I think each of the regions is kind of different culturally, based on the national culture plus the company's culture. I think the U.S. is still the biggest cultural challenge, from my point of view, and it's still the region that I think has the most opportunity for improvement from a point of view of consistency and stability and making sure that everybody understands what's expected of them."
At plants outside the United States, virtually all of the new employees are new hires. Stone said Ford employs several very good models where it brings people in for training for six weeks to six months before they ever hit the production floor. "That work conditioning, training, inducting process is very disciplined," he said. Inside Mexican plants, new hires wear clothing of a different color so co-workers will recognize them and be able to assist them. For the most recent plant launched in Thailand, the company benchmarked its Mexican operation's approach to training and inducting an entirely new workforce who weren't used to working in industry, he added.
At the U.S. plants, while he's not sure how many of the incoming workers are former employees being rehired, he said he suspects the majority are probably new hires. They'll go through a number of courses of required training at the plants that were developed with the UAW before they, too, ever hit the floor.
Stone's staff includes a regional manager for each region; the North America manager oversees five managers who work with each manufacturing director. A plant risk manager or lead safety engineer is in place at each plant, and generally there is a safety engineer for each operating shift in the plant. Each plant also has one or more union safety representatives. He said this setup is part of the Ford production system, with safety as its first element. The elements are Safety, Quality, Delivery, Cost, People, Maintenance, and Environment.
Operational stability is really key to Ford's overall safety, he said, noting the incident reporting system has brought to light many events that could have resulted in fatalities but did not. "We try to plug any holes that we find," he said. "We just have to keep peeling back that onion and making sure that we address everything we know about that will reduce the risk."
Slips, trips, and falls are a significant cause of serious injuries at the company. Stone said some of these stem from housekeeping issues and others from people walking where they shouldn't. To combat them, the company increased snow clearing and salting; strengthened its requirements for cleaning, which is done by contract personnel; and took steps to mark changes in surface elevation levels more clearly so they would be noticed.
"The most variable part of our system is the people, so we'll always be centered around the people," he said. Musing on the different approach used in Japan, where managers rely much more on discipline and processes and invest less on engineering, guarding, and traditional safety machinery, he said, "I guess it worries me a little bit that you’re almost victims of your own success, where the safer you make the workplace, the higher the risk of people being complacent and then not noticing that something is out of order."