It makes perfect sense if you're a bigshot, bean counter or number cruncher: You source parts globally to get the best quality at the lowest cost. You put factories all over the world to be close to foreign markets, avoid currency shocks and take advantage of low labor rates. You move your small-car engineering programs to Europe, because more people drive small cars over there; or you divide the world into geographic market segments and do all your vehicle design, manufacturing and engineering within those areas so you stay in touch with the culture and the consumer... hey, whatever.
Globalizing the automotive industry looks great on paper. But is it making sense to the engineers who actually have to do the work?
Well ... 230 automotive engineers responding to Ward's Auto World's 18th annual engineering survey answer with a very definite maybe. Most think the increased globalization of the automotive industry is a positive change for U.S.-based engineers, but they are divided over whether or not it's truly the best way to produce the highest-quality products for hugely divergent markets. One thing is for sure: global engineering is a bigger hassle for most engineers because of communication and time-zone problems, and more turf wars.
Besides globalization, WAW's annual non-scientific survey queries engineers about salaries, job satisfaction, their use of the Internet, platform teams, cost control and OEM/supplier relationships.
About three-fourths of all participating engineers say globalization is a positive industry trend. However, more automaker engineers (79%) than their supplier counterparts (68%) agree.
One supplier simply states, "Global engineering is good, but you cannot produce a product that pleases everyone."
One Ford engineer responding to our survey echoes the comments of many disenchanted engineers when he says: "It makes life much more difficult for no cost/quality enhancement." Another automaker engineer complains that it lengthens the purchasing process.
"The only on staff engineers here are Japanese expatriates," grumbles an American manager at Mitsubishi Motor Mfg. Corp. in Illinois.
One thing seems to be clear, globalization - right now at least - is having a greater impact on OEM engineers than on suppliers: 65% of automaker engineers, but only 45% of those at suppliers say global purchasing and global product development changed their jobs.
Of those that say globalization changed their jobs, 40% say the biggest difference is dealing with engineers and suppliers from around the world. Some 33% say they're doing a lot more international data and voice interchange. Another 30% say they're working on more world vehicles. Yet only 36% of OEM and 41% of supplier engineers say they are working on vehicles or components actually sold extensively outside the U.S.
Supplier engineers say dealing with more foreign engineers (31%) and more foreign specifications (25%) are the biggest changes caused by globalization.
Most engineers on both sides of the ledger agree that globalization is changing responsibilities within their departments and that communications problems and turf wars are worse than normal on engineering programs that span several continents.
"Hell yes," says one supplier engineer about communication trouble and battles over who does what, when.
"Turf wars are the worst problem," says another. However, most of the complaints about global engineering from the supply base center on culture clashes and language barriers.
But OEM engineers also are having difficulties with global engineering. "Due to time zones, it's difficult to arrange meetings to resolve issues," says one. "Language and cultural differences don't allow us to see barriers until we are close to collision," quips another.
"The extra time spent bridging cultural divides is not necessarily worth the effort," says a senior project engineer at GM.
Despite good job security and "adequate" salaries, overall career satisfaction among OEM engineers nosedived compared with last year, when survey respondents seemed uncharacteristically content with their jobs. After years of griping about lack of recognition, limited career paths and fighting with "bean counters," a relatively high 65% of OEM respondents to the '95 survey said they still would be an automotive engineer if
they had to do it over again, and 21% said they'd never go into engineering if given a second chance.
That was still low compared with 1979, when 72% of OEM respondents thought auto engineering was the best career choice, but things appeared to be looking up.
But only 43% of OEM engineers responding to our latest survey say they'd definitely want to do it over again, representing a drop of 22 percentage points. Job satisfaction at suppliers dropped somewhat, too, compared with last year, but it never soared as high as engineers at OEMs. It could all be a statistical glitch, but it leads us to speculate that unusually large profit-sharing bonuses paid out at Chrysler Corp., and Ford Motor Co. last year may have given many disgruntled automaker employees a brief rush of euphoria.
Now it's back to the old grind, which, compared with most other white-collar jobs nowadays isn't all that bad. Half of the OEM respondents and 42% of supplier participants say their j ob security is good, and a strong 26% of those at automakers say job security is "excellent." Unfortunately, only 12% of their supplier counterparts agree.
Satisfaction with salary is another issue. 70% of all engineers participating in the survey say salaries at their companies are adequate. Last year, 83% of respondents said pay was adequate. Again, it very likely reflects lower profitability at Ford and Chrysler.
One unfortunate supplier engineer relates that he has received a total increase of 4.5% over the last five years. He adds that "times are lean, and one must continue doing the same job for 10 years."
Half of the automaker engineers say their companies are developing new career paths that allow good engineers to remain engineers while climbing the corporate ladder. Only 31% of suppliers say that is the case at their companies.
"We hired a PhD for his technical expertise, then rewarded him five years later by making him an inept manager," says one supplier engineer, in a typical complaint.
Others gripe that only MBAs and other "non-techs" are promoted, and that "engineers work hard but do not get rewards for that."
"The less you know, the farther you go," adds a supplier engineer sarcastically.
"The best engineers get technical management' positions, the best communicators (or those prone to throw the bull) become paper-pushing managers, and the dumb stay in entry-level jobs," says an engineer at Honda of America Mfg. Inc.
Automaker engineers who are not pleased with their chances to advance there may be official career paths but not enough time is devoted to explaining them to employees. Some complain women and minorities get preferential treatment.
Other traditional career-advancing procedures do exist, says one politically astute OEM engineer: "Sometimes an amount of brown nose is required for some people."
"Yes (there is career advancement for engineers), but you'd better be able to simultaneously walk on water and remove your own appendix," says a GM engineer. Well, that could make overseas transfers less expensive, and probably lower health-care costs as well.
When it comes to using the "information superhighway," engineers are split almost evenly about how important it really is to their jobs. We invited those who aren't much interested in the "Net" to skip the questions.
Only about half of our total respondents say they are currently interested in accessing the Internet, and less than that say they currently are on-line. "I spend enough time on the computer at work. I don't need any extra help going blind," gripes an engineer at a Japanese transplant.
However, 47% do way they would like to have access to the Internet at work, although some of their motives may be questionable.
About half of the OEM engineers who now are on-line say they are doing it more for fun than work. This statistic could be low. A confidential Ford source says the company last year did a study of what World Wide Web sites were being visited most by company computers with access to the Internet. The number-one site visited - by a huge margin - belongs to PEI: Playboy Enterprises Inc.
This source, however, is quick to point out that Ford - as well as most other major automakers - has a huge internal electronic information network protected by a "firewall" from outsiders. No doubt engineers are getting technical engineering data and crucial statistics from these internal sources much more than the 36-24-36 variety offered outside the firewall at PEI. Yeah, sure.
While the largest plurality of respondents say they spend less than 30 minutes per week on the Internet, they did reveal a desire to do more in the future than just sneak a quick peak at this month's foldout. They express a strong interest in accessing new technology forums and reference material, and real-time video conferencing also is desired.
These utilities already are available through dedicated information lines. Some high-end CAD/CAM terminals such as those offered by Silicon Graphics Inc. also allow engineers to converse in real time through small television monitors with engineers all over the world while they simultaneously view and make changes on CAD designs. But this technology is expensive, and beyond the reach of most. Lower-cost Internet connections clearly are desired.
Cost-cutting pressures continue to be a concern among both OEM and supplier engineers. With the automotive industry in the midst of what is being called an affordability crisis, cost pressures are, at least to some extent, hurting the engineering quality of future vehicles, say 77.5% of automaker and 71% of supplier engineers.
"Cutting costs sometimes means cutting corners," worries a product designer at Hawtal-Whiting.
However, a Ford engine component engineer counters that cost-cutting initiatives such as having fewer engine families and cutting back on vehicle content take out cost without hurting engineering quality.
"Design for manufacturing," also cuts costs without burting quality, adds a manager at Honda of America Mfg. Inc. in East Liberty, OH.
The trend toward vehicle platform teams continues to pick up steam in the auto industry. More than 75% of automaker engineers predict that someday all vehicles will be developed in this fashion. Only 52% of supplier engineers agree.
Only 30% of automaker and 16% of supplier engineers have seen any backlash as a result of platform teams, such as disgruntled members bailing out of teams early or refusing to become a member.
A strong majority of OEM and vendor engineers say platform teams improve product quality, product efficiencies and engineering job satisfaction at least to some extent.
Some supplier engineers aren't so enthusiastic. One doesn't appreciate driving six hours for a one-hour meeting. Another says "platform teams put more cooks in the kitchen."
The struggle for influence between OEM purchasing and engineering concerns continues: 28% of automaker engineers say the departments share power equally but another 26% say engineering and 26% say purchasing has the upper hand.
From the supplier perspective, 31% say both departments have equal pull; 28% say purchasing has more influence. Only 17% engineering has more power.
Another vast majority agrees that in order to drive costs down, the first priority should be component and process commonization at least to some extent. Only 7.5% of all participating engineers disagree.
"Design for quality and design for manufacturability must be more highly focused," says one supplier engineer. Another vendor engineer brings up one of the industry's greatest mysteries: "Auto companies are pushing suppliers out of business with their 4% to 5% back each year, and auto prices keep going up."
"One pitfall can be to focus only on a single area such as piece cost, rather than weighing all costs with value and function," a surprising comment from a Ford engineer.
A significant 61% of automaker engineers say the shift of more engineering and product development work to suppliers is affecting their department. Yet, a plurality of supplier engineers (40%) say their department has not added people or equipment because of the trend.
At the OEMS, 38% say the impact of increasing supplier responsibilities has been positive and only 14% of these automaker engineers say their job is threatened by this switch. Nearly 60% of OEM engineers, however, are concerned about car companies losing their core capabilities by shifting too much engineering work outside.
One surprising finding of the 1996 survey was Ford Motor Co.'s standing among suppliers. Even with the reported conflicts over Ford 2000, 26% of supplier engineers say they prefer to deal with Ford. Perennial favorite Chrysler Corp. checks in for a second-place finish with 22%. General Motors Corp. gets the "bronze" with 19%.
Not surprisingly, when asked which automaker they least prefer to deal with, suppliers say GM by 33%. But Ford receives 22.5% of this vote, making it the customer suppliers both love and hate.
"GM needs to clean its own house before demanding from suppliers," says one engineer from ITT Automotive. "GM purchasing is usually ignorant to reality," says one supplier development engineer who also says Ford engineering is difficult to deal with.
"We work in fear of our customers, rather than as a team," says a supplier. But, "Any of the Big 3 are easy when compared with the Japanese," says another.