The curious events in Chattanooga


Folks who work in factories, as a rule, are not stupid. Just about every one of them I have met – and I have met thousands of them – understand that profits are a good thing and continuing, growing profits are not only good for the owners, but a necessity to keep things going. They also understand that management people want to make good money (just like they do) and they are aware of the fact that most salaried folks earn the right to make more money than the hourly folks by suffering through more time in school, working longer hours and putting their jobs at risk by taking responsibility for decisions.

So here we have the curious events at the Volkswagen plant in Chattanooga yesterday. The United Auto Workers union tried to organize the place but in what has to be the oddest organizing effort in union versus management history, management generally supported the UAW, but the workers rejected the union. This, of course, provides solid evidence in support of my assertion regarding worker intelligence, but calls into question whether the same can be said of management.

Generally speaking, when two parties have opposing goals in an important matter, it is a good idea to have someone tough, smart and capable looking out for their interests. The guy buying a house and the guy selling it area pretty good example. The seller wants the highest price possible – the buyer, the lowest. That’s why there are legions of realtors, lawyers and lots of laws camped between them as they battle through their conflict,, all sucking money from both parties – waste to both of them since it is money that neither side will get – but worth it to both sides to keep them from losing even more money to their adversary.

If the two parties are parent and child, however, and the intent is to give the house to the kid, their goals are in alignment and all of that is unnecessary in the eyes of both of them. Oh, the lawyers still weasel their way in to handle the paperwork because that is just what lawyers do, but the amount of the non-value adding waste to both sides is at the barest minimum they can make it.

Likewise, the UAW – or any union – is nothing but pure non-value adding waste. It sucks money from the business that none of the stakeholders who have earned it will get. Probably a good idea when management is driven by the old Jack Welch ‘maximizing shareholder value is all that matters’ philosophy. In such a company the employees and the managers have very conflicting objectives and the employees wanting the union to look out for their interests makes sense.

The union is a complete waste of money, however, in an enlightened, lean company that is driven by a goal of maximizing value for all of the stakeholders – shareholders and employees, as well as suppliers, customers and the community. In such a company any barrier to the communications and collaboration between folks who make their living on the floor and those who make theirs in a cubicle is a bad idea and a waste of everyone’s money.

So what’s going on in Tennessee? It seems the workers are the smart ones, or maybe they are the naïve. They seem to think their goals and management’s are pretty well in alignment. They don’t seem to think they need protection from a management that is out to do them wrong. Or maybe they are just smart enough to know that if management is out to abuse them, there isn’t really that much the UAW can do for them in the long haul; or maybe they are just independent folks who are confident in their own ability to deal with management if such a thing were to happen.

Management down in Chattanooga is a little harder to understand. Maybe they have plans to do their employees wrong and have the decency to want them to be prepared for an inevitable attack. Perhaps they are so bad at communicating and collaborating that they don’t know of any other way to deal with their employees than through a union. Maybe it’s just a German thing – since all of their German pants have works councils as a matter of law, they just assume that is the one and only way to run a business.

In any event, it is abundantly clear that Volkswagen management has absolutely no comprehension of lean, of the Toyota Way. They have no idea of just how important a culture of trust, empowerment and open communications is to their chance of success. Whatever the reason, any management that wants to add the waste of a union to their business is hopeless: Either they are driven by a failed management theory, or they are woefully ignorant of what it takes to succeed with the new theory.

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