MIT Sloan Management Review

Human Resource Management and Industrial Relations, Leadership and Organization Studies

Cultural Transformation at NUMMI

By Wellford W. Wilms, Alan J. Hardcastle and Deone M. Zell

October 15, 1994

A HYBRID OF ITS JAPANESE AND AMERICAN PARENTS, NUMMI PROVIDES A CASE study of the successful introduction of a new production system. By working on the assembly line in the NUMMI plant and interviewing hundreds of people, the authors observed the transformation of an out-of-date General Motors auto plant into the world-class assembly operation it is today. Their study has implications for other organizations that are trying to learn from each other, particularly across national borders. Their findings also show how organizational culture plays a central role in companies that are adapting to a constantly changing environment.

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U.S. automobile manufacturers have begun to heed the wakeup call that sounded more than a decade ago when Japanese automakers cut deeply into American markets. As General Motors, Ford, and Chrysler began to take stock of what had happened, they were surprised to discover that they had much to learn from the Japanese, not only about the processes of production, but also about the use of human resources. Today, the Big Three have begun to rebound. In 1993, all three companies posted gains simultaneously for the first time since 1984.1 The turnaround stems partly from exchange rates that now favor U.S. exports, and partly because output from Japanese transplants is included in the U.S. figures. But improvements in the auto industry also stem from what U.S. automakers have learned from Japan.

In this paper, we examine a notable case, New United Motor Manufacturing (NUMMI), in which such learning produced significant cultural change. NUMMI is a joint venture formed by the world’s two largest automakers — Toyota and General Motors. Located in Fremont, California, in the shell of a huge GM assembly plant that had closed in 1982, NUMMI opened two years later. Now in its tenth year of successful operation, it has survived the trials that cause most joint ventures to founder.2 NUMMI demonstrates how the introduction of a... To read the complete article, login or sign-up using the form below.

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