4 ms·

I'm reminded of the story of NUMMI [1], the American automobile plant that was a 1980s joint venture between GM and Toyota. (It was covered in an episode of Th

I'm reminded of the story of NUMMI [1], the American automobile plant that was a 1980s joint venture between GM and Toyota. (It was covered in an episode of This American Life). In a nutshell, the story of NUMMI involves American GM workers building Toyota-designed/GM-branded vehicles using Toyota's radically different manufacturing processes. The plant itself was a smashing success for GM; the plant achieved much higher quality and productivity than any of GMs traditional plants, and it gave GM valuable insight into their rival's manufacturing and design processes. But this insight into Toyota's processes failed to transform GM because the GM corporate culture was so entrenched. It took the company the better part of 20 years to really adopt these changes they learned in 1984, as they continued to bleed market share to the Japanese. The point of that story is that I believe the corporate culture of any large tech company is equally entrenched, and in my experience it's this corporate culture that utterly determines how a company's products are designed and produced. So it really doesn't matter how Apple does things, it only matters that they're different and successful; their competitors will be completely unable to react or change. Every company is full of powerful employees who have worked their entire careers to get where they are, and they will fight tooth and nail to prevent losing their position over anything else. Do you think all those PMs at Microsoft are going anywhere? So companies like Microsoft, Motorola, HP, Acer, Nokia, Sony, and Nintendo can only do what they've always done. And if you look at their products, that's exactly what they continue to do in the face of a radically changing landscape. That's why a Toyota or an Apple or a Google is so truly threatening to their entrenched competitors. They achieve dramatically better results by doing things differently. [1] http://en.wikipedia.org/wiki/NUMMI http://en.wikipedia.org/wiki/NUMMI

masklinn 16y ago
> So companies like Microsoft, Motorola, HP, Acer, Nokia, Sony, and Nintendo can only do what they've always done. I'm not sure Nintendo fits well in this list. They have seemed pretty willing to "take risks" (in a controlled way) and do things differently in recent years (since 2002~2003 and the start of the DS project, though they weren't initially as bold with it as they could have been, calling it a "third pillar" alongside the GBA and the GC, which we now know was utter bullshit)
- pmjordan 16y ago
  Nintendo also have "only" just over 4000 employees, which makes them 1-2 orders of magnitude smaller than the other companies listed, except Acer. I'm not sure Acer has ever been known for innovation, though, whereas the others kind of "lost it". In any case, at that size it's probably a lot easier to make drastic changes than when you have 100000 employees. I'd be interested what the lowest number of employees was that Apple has had since Jobs's return, and how big NeXT was compared to Apple at the time of or shortly after acquisition (in terms of headcount).
  - masklinn 16y ago
    > I'd be interested what the lowest number of employees was that Apple has had since Jobs's return It probably grew steadily through his tenure, especially with the retail extension as that requires a number of employees (Apple staff grew from ~22000 to ~32000 in 2008, as they opened 50 stores, and their temps staff grew from 2100 to 3100) > and how big NeXT was compared to Apple at the time of or shortly after acquisition (in terms of headcount). According to wikipedia, NeXT had 520 employees in 1992, before they switched to a mostly software-based model.
- thought_alarm 16y ago
  > I'm not sure Nintendo fits well in this list. I think Nintendo is a great example. The GameCube was clobbered by the PS2. How did Nintendo respond? Not by trying to be more like Sony but by being more like Nintendo. The point is that it's very difficult change corporate culture, for better or worse.
  - deleted 16y ago
    [deleted]
  - masklinn 16y ago
    > How did Nintendo respond? Not by trying to be more like Sony but by being more like Nintendo. Erm… how? Since the NES and the GB, Nintendo had been following a pretty "normal" path of giving more power each time. You could argue that they always had something of an interesting approach to controllers (see N64 and GC controllers), but they'd never entirely opted out of the current/existing performance races and picked "wacko" control schemes before the DS.
jakevoytko 16y ago
The "This American Life" piece on the NUMMI factory was great, and triple-underlined a few points in the article, especially the importance of having a unified vision, and getting all decision-makers on board. According to the piece, the major difference between the Japanese and American production methods involved flagging defects. If an American stopped the line for anything, they would be fired. So cars rolled down the line with fatal defects, needing either expensive repairs or a trip to the trash heap. On the other hand, Japanese workers were encouraged to stop the line for any flaws they saw. This limited the loss to individual parts and components, rather than entire automobiles. This sounds like Apple's 10->3->1 approach: design flaws are discarded as soon as possible. The piece also asserted that GM failed to adopt these measures for two reasons: upper management deferred to individual plant managers for the practices to be used in each factory, and the plant managers preferred the don't-stop-the-line approach, since they already knew it. There was no Apple-like process in place to convince plant managers that they needed to switch their methods, so they never did.
mmorris 16y ago
Slightly off-topic, but interesting - Tesla bought the NUMMI plant this year at a huge discount. They plan to build the Model S there, and owning a factory was a requirement of Tesla receiving the $465 million government loan they got. According to Wired, the plant had been recently valued at nearly $1 billion, but Tesla was able to purchase it for $42 million (it was being shut down because of the recession and after GM pulled out). Sometimes it's about more than just innovation.
sundae79 16y ago
The companies that you listed in the last paragraph, did do things differently at one point in their history. Now they have become bloated. What makes you say toyota, apple, and google will remain exactly where they are in 15 years.

masklinn 16y ago

> So companies like Microsoft, Motorola, HP, Acer, Nokia, Sony, and Nintendo can only do what they've always done. I'm not sure Nintendo fits well in this list. They have seemed pretty willing to "take risks" (in a controlled way) and do things differently in recent years (since 2002~2003 and the start of the DS project, though they weren't initially as bold with it as they could have been, calling it a "third pillar" alongside the GBA and the GC, which we now know was utter bullshit)

pmjordan 16y ago
Nintendo also have "only" just over 4000 employees, which makes them 1-2 orders of magnitude smaller than the other companies listed, except Acer. I'm not sure Acer has ever been known for innovation, though, whereas the others kind of "lost it". In any case, at that size it's probably a lot easier to make drastic changes than when you have 100000 employees. I'd be interested what the lowest number of employees was that Apple has had since Jobs's return, and how big NeXT was compared to Apple at the time of or shortly after acquisition (in terms of headcount).
- masklinn 16y ago
  > I'd be interested what the lowest number of employees was that Apple has had since Jobs's return It probably grew steadily through his tenure, especially with the retail extension as that requires a number of employees (Apple staff grew from ~22000 to ~32000 in 2008, as they opened 50 stores, and their temps staff grew from 2100 to 3100) > and how big NeXT was compared to Apple at the time of or shortly after acquisition (in terms of headcount). According to wikipedia, NeXT had 520 employees in 1992, before they switched to a mostly software-based model.
thought_alarm 16y ago
> I'm not sure Nintendo fits well in this list. I think Nintendo is a great example. The GameCube was clobbered by the PS2. How did Nintendo respond? Not by trying to be more like Sony but by being more like Nintendo. The point is that it's very difficult change corporate culture, for better or worse.
- deleted 16y ago
  [deleted]
- masklinn 16y ago
  > How did Nintendo respond? Not by trying to be more like Sony but by being more like Nintendo. Erm… how? Since the NES and the GB, Nintendo had been following a pretty "normal" path of giving more power each time. You could argue that they always had something of an interesting approach to controllers (see N64 and GC controllers), but they'd never entirely opted out of the current/existing performance races and picked "wacko" control schemes before the DS.

jakevoytko 16y ago

The "This American Life" piece on the NUMMI factory was great, and triple-underlined a few points in the article, especially the importance of having a unified vision, and getting all decision-makers on board. According to the piece, the major difference between the Japanese and American production methods involved flagging defects. If an American stopped the line for anything, they would be fired. So cars rolled down the line with fatal defects, needing either expensive repairs or a trip to the trash heap. On the other hand, Japanese workers were encouraged to stop the line for any flaws they saw. This limited the loss to individual parts and components, rather than entire automobiles. This sounds like Apple's 10->3->1 approach: design flaws are discarded as soon as possible. The piece also asserted that GM failed to adopt these measures for two reasons: upper management deferred to individual plant managers for the practices to be used in each factory, and the plant managers preferred the don't-stop-the-line approach, since they already knew it. There was no Apple-like process in place to convince plant managers that they needed to switch their methods, so they never did.

mmorris 16y ago

Slightly off-topic, but interesting - Tesla bought the NUMMI plant this year at a huge discount. They plan to build the Model S there, and owning a factory was a requirement of Tesla receiving the $465 million government loan they got. According to Wired, the plant had been recently valued at nearly $1 billion, but Tesla was able to purchase it for $42 million (it was being shut down because of the recession and after GM pulled out). Sometimes it's about more than just innovation.

sundae79 16y ago

The companies that you listed in the last paragraph, did do things differently at one point in their history. Now they have become bloated. What makes you say toyota, apple, and google will remain exactly where they are in 15 years.