Learning from Saturn: Possibilities for Corporate Governance and Employee Relations

Rating:
Summary: Good, basic description but many questions arise
Review: Though "Learning from Saturn" will undoubtedly not be high on the general public's reading lists, for those interested it is a book that adequately describes the basics of the Saturn system that has gotten a lot of media coverage over the last decade or so from conception to the present. The various innovative structures of Saturn such as teams, modules, business units, and councils are first described, but the book is far more concerned with the interactions among the Saturn management and the local UAW union and with GM and the international UAW. While the authors liberally point out the successes of the Saturn system, they are equally concerned with demonstrating the shortcomings principally in the areas of communications and decision-making among the various parties that have impacted the performance of Saturn. Despite Saturn's cars consistently scoring high on consumer quality ratings, internally Saturn has had difficulties with problem solving, productivity, organizational learning, and even quality.

The more discerning reader will have many questions while reading this book, especially in light of the fact that the authors are highly experienced labor relations academics. After the PATCO wholesale firings in 1980, US corporations declared war on unions. Yet why did GM agree to share management of a business with the UAW in the early 80s? The authors' explanation of a downturn in sales is insufficient. In actuality it was sheer panic, or desperation, on the part of GM coupled with the UAW being the strongest union in the US that prompted GM to go against its every instinct. That is not a trivial point.

The core production unit at Saturn is the work team consisting of 6 to 15 members with one of those individuals being elected as team leader. Teams have the responsibility of dealing with many aspects of production: work planning and scheduling, material and inventory control, budget constraints, repairs, training, quality, hiring, vacation scheduling, absenteeism, etc. Team members do receive several hundred hours of training in these areas, but it strains belief to find that this amount of expertise can be more or less equally imparted among disparate teams. With so much dependency on teams, a few teams that do not perform well despite their best efforts could easily interfere with overall results. Since teams essentially take on the role of HR management, they have to deal competently with such issues as discrimnation in hiring or discipline. What happens to union solidarity when team leaders are forced to discipline co-workers?

Certainly assembly is an essential part of the quality of an automobile but engineering would have to be more important. But the authors do not address the fact that engineering is not co-located with production and is not part of the UAW. How does the local union or teams determine that the highly technical aspects of the car design are correct? Again, expertise issues do not simply disappear with participation.

The authors do discuss organizational problems. They contend that the lack of communications or follow-up is the key to most problems. But not enough information is provided concerning the actual workings of teams to be sure that deeper structural problems do not exist.

The authors point out that the international UAW is concerned that the local Saturn union takes on characteristics much like the company unions that were essentially banned by the Wagner Act of 1935. But the authors could have indicated that unions are not necessarily even needed for substantial employee participation. For example, the legislatively mandated works councils of northern Europe provide for co-determination by employees in workplaces with resort to labor courts in the event of employer conflicts. It is not unions per se that is the key for employee input. There have to be channels for communications regardless of the system and there must be due process for workers that exercise voice. In addition, participation can occur with or without production teams.

It is surprising that the authors did not mention the efforts by some in the US Congress to pass legislation permitting employers to establish work teams on their own terms with no due process for employees. The authors are concerned with learning from Saturn. The authors are undoubtedly fully aware that the closest that most employers will come to a Saturn system is to install some sort of pseudo employee participation scheme.

I do find much to criticize about this book. But I do think that it is essential reading for anyone interested in labor relations and employee participation.

Rating:
Summary: Good, basic description but many questions arise
Review: Though "Learning from Saturn" will undoubtedly not be high on the general public's reading lists, for those interested it is a book that adequately describes the basics of the Saturn system that has gotten a lot of media coverage over the last decade or so from conception to the present. The various innovative structures of Saturn such as teams, modules, business units, and councils are first described, but the book is far more concerned with the interactions among the Saturn management and the local UAW union and with GM and the international UAW. While the authors liberally point out the successes of the Saturn system, they are equally concerned with demonstrating the shortcomings principally in the areas of communications and decision-making among the various parties that have impacted the performance of Saturn. Despite Saturn's cars consistently scoring high on consumer quality ratings, internally Saturn has had difficulties with problem solving, productivity, organizational learning, and even quality.

The more discerning reader will have many questions while reading this book, especially in light of the fact that the authors are highly experienced labor relations academics. After the PATCO wholesale firings in 1980, US corporations declared war on unions. Yet why did GM agree to share management of a business with the UAW in the early 80s? The authors' explanation of a downturn in sales is insufficient. In actuality it was sheer panic, or desperation, on the part of GM coupled with the UAW being the strongest union in the US that prompted GM to go against its every instinct. That is not a trivial point.

The core production unit at Saturn is the work team consisting of 6 to 15 members with one of those individuals being elected as team leader. Teams have the responsibility of dealing with many aspects of production: work planning and scheduling, material and inventory control, budget constraints, repairs, training, quality, hiring, vacation scheduling, absenteeism, etc. Team members do receive several hundred hours of training in these areas, but it strains belief to find that this amount of expertise can be more or less equally imparted among disparate teams. With so much dependency on teams, a few teams that do not perform well despite their best efforts could easily interfere with overall results. Since teams essentially take on the role of HR management, they have to deal competently with such issues as discrimnation in hiring or discipline. What happens to union solidarity when team leaders are forced to discipline co-workers?

Certainly assembly is an essential part of the quality of an automobile but engineering would have to be more important. But the authors do not address the fact that engineering is not co-located with production and is not part of the UAW. How does the local union or teams determine that the highly technical aspects of the car design are correct? Again, expertise issues do not simply disappear with participation.

The authors do discuss organizational problems. They contend that the lack of communications or follow-up is the key to most problems. But not enough information is provided concerning the actual workings of teams to be sure that deeper structural problems do not exist.

The authors point out that the international UAW is concerned that the local Saturn union takes on characteristics much like the company unions that were essentially banned by the Wagner Act of 1935. But the authors could have indicated that unions are not necessarily even needed for substantial employee participation. For example, the legislatively mandated works councils of northern Europe provide for co-determination by employees in workplaces with resort to labor courts in the event of employer conflicts. It is not unions per se that is the key for employee input. There have to be channels for communications regardless of the system and there must be due process for workers that exercise voice. In addition, participation can occur with or without production teams.

It is surprising that the authors did not mention the efforts by some in the US Congress to pass legislation permitting employers to establish work teams on their own terms with no due process for employees. The authors are concerned with learning from Saturn. The authors are undoubtedly fully aware that the closest that most employers will come to a Saturn system is to install some sort of pseudo employee participation scheme.

I do find much to criticize about this book. But I do think that it is essential reading for anyone interested in labor relations and employee participation.