Made from Scratch
When Honda built a plant in Alabama, it also built a workforce--using local workers who had no experience in making cars.
Eastbound out of Birmingham on Interstate 20, you notice the motels and shopping centers eventually giving way to an Alabama countryside of forests and farms. At exit 65—Lincoln—you might expect to see a quintessential Southern rural town where Aunt Bee makes cookies from scratch.
Lincoln is a small town growing fast—and it’s where Honda has been creating a workforce from scratch.
Honda Manufacturing of Alabama (HMA) built a plant in Lincoln to turn out Odyssey minivans and engines, and, with major help from the state, it has recruited and trained mostly local workers, none of whom had any experience building cars.
The effort has netted amazing results. It was only about three years ago that Honda decided to put a plant in Lincoln. Vans began rolling off the assembly line last December, and the plant is expected to reach full production later this year.
Everything about this newest U.S. Honda plant reflects a determination to start fresh. That attitude is reflected in HMA’s staff and in the partnership that the company has forged with the state of Alabama.
When Honda announced that it wanted to build a plant for manufacturing Odysseys, it was besieged with suitors. Several states competed heavily for the factory, but Alabama walked off with the jackpot.
Honda officials say they liked Alabama for many reasons, including weather, accessibility to suppliers, tax incentives, wage and benefit levels in the region, and the low profile of labor unions in the area.
But the deal clincher, they say, was the availability of labor and the state’s offer to enter into a recruitment and training partnership. Alabama earmarked $30 million for training—aimed primarily at helping the company find and prepare a high-quality workforce. The funds pay for the 62,000-square-foot Honda Training Center in Lincoln—a facility with modern classrooms and replicas of Honda equipment—and for other elements of a state-run program that virtually ensures that Honda’s hires are well-suited for their jobs.
Honda’s partnership with Alabama represents the closest links the company has with any state. “There’s nothing comparable in other Honda plants to the training here,” says Mike Bergman, assistant manager of engine assembly. For example, Honda’s Anna, Ohio, engine plant—where Bergman worked previously—has no pre-employment training.
A New Start
In planning the Alabama facility, Honda decision-makers studied what they viewed as the strengths and shortcomings of previous Honda start-ups in Mexico, Canada and Europe. They concluded that the managers who would build and staff the Lincoln facility not only had to be competent and embody Honda’s values but also had to be excited about going to the South. And since the individual is paramount in Honda’s philosophy, HR had to play a central role.
In July 1999 Honda offered the top HR post at the newly formed HMA to Andy Ritter. He was working at Honda’s corporate office in Marysville, Ohio, and had headed HR operations at Honda’s plant in East Liberty, Ohio.
Honda knew Ritter’s HR competencies were a good match for the job in Lincoln. He had not only the necessary people skills but also the analytical and organizational savvy that Honda demands in its manufacturing areas. “He had very strong project planning skills, was detail-oriented, thought things through well and had a high level of integrity,” says Kathy Jones, HMA’s executive vice president. “With Andy, there are no surprises. Good news or bad, he lets you know what’s happening.”
Ritter understood the challenges he faced. “I knew I would need to find and train about 1,500 employees by April 2002,” he says. “The clock was ticking.”
Ritter set out to recruit a human resources team that was passionate about Honda and the chance to be part of a new beginning. Jim Willman was among the first to sign on. A training manager at Honda’s plant in Marysville, he was itching for a change. “Everything in Ohio, I had inherited,” he explains. “The systems were in place; anyone could have done it. Andy gave me license to come down here and do it my way. He said, ‘If it worked well in Ohio, we’ll take it, but we don’t have to use anything we’re not comfortable with.’”
Ritter also tapped Michelle Turner, currently HMA’s coordinator of staffing, to honcho the hiring of non-exempt, hourly workers. It probably helped that Turner, like all Honda HR professionals, knows what it’s like to work on the assembly line. “You had to work in production for six months to a year when I started with Honda 12 years ago,” she says. “Now it’s been reduced to two weeks. Whatever the time, it’s worthwhile.”
Honda rounded out the Lincoln project team with line managers who would run the various aspects of the manufacturing process—welding, assembly, quality, purchasing—and would take part in the initial managerial hiring. Like Ritter, they were excited.
“I saw an opportunity to live out a vision in quality that I had,” says Ken Pyo, manager of the vehicle quality department. “It would have been very difficult for me to change things in Ohio because they’re so instilled.”
In turn, Pyo began selecting others who met his criteria. “I picked the best guys I could find from the other factories,” he says. “I looked for attitude, drive and passion, people who exemplified the Honda philosophy. Then I got lucky: These guys selected people like themselves.”
The Alabama Difference
Ritter and his HR team began building good relationships with state labor and training officials in agencies such as Alabama Industrial Development Training (AIDT), which specializes in economic development, and the Department of Industrial Relations (DIR), which administers the state’s labor programs. Jacqueline Burns, manager of the DIR’s Talladega office, says: “Andy gave us a lot of information, charts and graphs, and we got to visit the plant in Ohio. It was so different than what we were used to—so clean, visibly happy people working on the lines.”
Lee Hammett, AIDT project manager at the new $10 million Honda Training Center, says, “I’ve had 30 other projects with employers, and Honda is the best.” Honda’s associates aren’t pushy or demanding, he says. “They’re cooperative.”
Ritter’s HR team and the AIDT staff got things in gear quickly. In December 1999, AIDT, in conjunction with Honda HR, ran an ad seeking candidates for a free training program that was a precondition for applying to Honda.
Participants were required to have a high school diploma or a GED, a two-year established job record without unexplainable gaps and residency in Alabama. Prior industrial or manufacturing experience was listed as desirable.
Those who completed the program were not guaranteed employment—only the chance to apply for jobs. The ad ran until March 2000, netting 18,000 respondents. AIDT reviewed and qualified the applications, eliminating some for lack of education or appropriate experience and giving preference to applicants within the closest 20 counties.
Since then, AIDT has been training 340 people every six weeks at a facility near Talladega, about 15 miles south of Lincoln. So far, 2,600 have graduated, and there’s a backlog of nearly 1,400 candidates still to go.
Participants attend one-hour sessions two evenings a week for six weeks. The first three weeks are devoted to classroom instruction in subjects such as math, precision measuring and how to work with the Japanese. (See “The Honda Way.”)
Orientation includes AIDT-produced videos showing Honda employees—all are called associates—in action in plants in Canada and Ohio. Some applicants who see the pace and repetitiveness of the work decide it’s not for them. “We explain it up front, so there’s no surprise,” Hammett says. “About 15 percent drop out.”
In the second three weeks, the program focuses on hands-on training, and the pressure is intense. Forty assessors, who are part-time state employees, peer over trainees’ shoulders, rating them in reports that only Honda and AIDT see. The assessors measure applicants’ ability to perform tasks as well as their speed, accuracy and ability to follow instructions.
Program participation can be risky. Some local employers have reacted punitively when they learned their prize workers were thinking of jumping ship.
“Ninety-nine percent of the people who participate in the training have full-time jobs,” says Hammett. “They commit to the time and effort of the program with no guarantees. If they survive till the end, it tells Honda something special about them.”
Those who have landed jobs at Honda look back appreciatively at the skills and perspectives they gained during pre-application training. “I was nervous at first, but overall I enjoyed the six weeks,” says Wendy Curvin, a vehicle quality administrator from Alexandria, Ala. “They taught you how to do things over and over so you’d see what it was like, and I’m using things I learned in the classroom—like precision measuring—every day.”
Julius Fitten, a production associate from Anniston, Ala., says: “I hadn’t been in a classroom in many, many years. I realize now that without the training, it would have been much more difficult for me. I wouldn’t have been able to do things as quickly as I have.”
Hiring and Training
After graduation, candidates are invited to complete Honda applications. Then HR takes over, inviting each department to participate in interview teams. Teams meet the candidates, review their AIDT training records, rank them and decide who (if any) will be hired and what departments they will join.
New employees submit to a one-time drug test and a physical exam. There are no additional paper-and-pencil tests or credentials required beyond those listed in pre-employment advertising.
To date, 2,300 interviews have yielded more than 1,400 hires. Eighty percent of the hires have come from a five-county area that includes Talladega County, where the plant is located.
After a three-day, HR-run orientation, it’s up to the departments, working with HR, to turn the novices into productive team members. Assistant managers in each department coordinate nuts-and-bolts instruction, but everyone pitches in.
During the start-up phase, line managers faced the problem of getting hands-on experience for their green recruits. The problem: The Alabama plant was not yet operational. One option was to give all trainees on-the-job experience in Honda factories in Ohio and Canada.
Some managers were skeptical. They didn’t like some of the practices in other plants, and they had gone to Alabama for a clean slate. They didn’t want their workers influenced by those in plants where things were done the old way.
In the end, however, all took the gamble to some extent. Depending on the department, trainees spent as little as two weeks or as much as six months in residence. HR handled the logistics; associates flew to the sites and stayed in hotels, accompanied by HR professionals and department coordinators.
Greg Askew, manager of the frame assembly department—the Lincoln factory’s largest department, with 40 percent of HMA’s associates—says whatever unwanted practices the trainees might have seen at other Honda plants didn’t stick. “Group after group came back and said, ‘Can we change what we saw there?’”
Today, Ritter says, there’s consensus that the departments that took full advantage of off-site training fared better in tests of speed and quality.
Home Field Advantage
Now, with the Lincoln plant up and running, there are plenty of local opportunities for trainees to get hands-on workplace experience.
AIDT continues to deliver applicants who, some say, are the best-prepared workers in the auto industry. And HR and the line departments continue to work together to provide the training that is proving so effective.
Associates are cross-trained so they can perform a number of processes within their department. The goal is to make sure every worker can switch tasks every two hours during an eight-hour shift. In some departments, associates are cross-trained in five or six processes, enabling them to switch tasks every two hours and never return to a task they’ve already performed during the shift. In other departments, cross-training involves only two processes. Even office workers are cross-trained in assembly line jobs so they can fill in when needed.
“Teamwork is the difference,” says vehicle quality administrator Curvin, whose job generally keeps her in the office. “Everybody’s job is important. If they need me, I go to the floor. It takes everybody to build the van.”
Discovering a Better Way
So far in Alabama, the advantages of prior screening and training are paying dividends, in both speed and quality. “With a totally inexperienced workforce, we’re achieving everything that we could accomplish in Canada, where 50 percent of the workforce is experienced,” says Askew.
“The quality of the people we’ve attracted through AIDT is amazing,” says Dan Barker, on loan from Marysville to serve as assistant manager in the Vehicle Quality Department at Lincoln. “The screening, selection and training have made a huge difference. It gives people an opportunity to see if they want to pursue the job. They know what it’s all about before they come on board. They understand the pace.
“I’ve never seen anything like this. It’s an incredible achievement that can be explained in part by good planning, but mainly it’s the workforce.”
A workforce made from scratch.
Robert J. Grossman, a contributing editor of HR Magazine, is a lawyer and a professor of management studies at Marist College in Poughkeepsie, N.Y.