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Remembering Jim Harbour

by James P. Womack
September 10, 2014

Remembering Jim Harbour

by James P. Womack
September 10, 2014 | Comments (5)

Photo courtesy of Detroit Free Press/AP Photo

We in the Lean Community stand on a lot of shoulders. One broad pair belonged to Jim Harbour, who passed away last Saturday at age 86. While unknown to many in this generation of lean thinkers, Jim deserves to be remembered for his contribution to the movement at an early point in the spread of lean thinking to North America.

Jim learned about TPS largely by accident because Chrysler, where he was a manufacturing executive, needed high-mileage small cars after the first energy crisis in 1973 and didn’t have the funds to develop them on its own. It therefore formed a partnership with Mitsubishi to develop what became the Omni and Horizon models. Jim was sent to Japan and to the Mitsubishi plant in Australia to understand how Mitsubishi – which had carefully studied Toyota methods after the energy crisis as well – did its work. This was so Chrysler could build similar products in the US. He learned a great deal and not at all what he had expected.

Auto executives in Detroit until this time were united in denial about Japanese competitive success. The conventional wisdom was that dramatic Japanese gains in market share in export markets were the result of a weak currency through manipulation, strategic targeting by the Ministry of International Trade and Industry and the Ministry of Finance, secret re-work factories to get quality up to international standards, and suppliers and their workers living on starvation wages.

But Jim analyzed the problem using a very different method: In his visits to the Mitsubishi shop floor (which we now all call the gemba), he observed in great detail how they did the work of making a car. And, as it turned out, they managed this work in a very different and better way they had recently learned by observing Toyota. Jim concluded that they were much more productive in the use of labor and equipment than Chrysler and that their quality advantage was based on building in quality at the source rather than rework at the end of the line.

Jim brought this knowledge home and tried to explain it to anyone who would listen. But most managers were sticking with their more comfortable world view that required politicians in Washington to do something (e.g., Ronald Regan’s Voluntary Restraint Agreement on Japanese imports in 1981) but not auto executives in Detroit. Jim was nothing if not persistent and kept pushing his views about the need for a new approach to American manufacturing to a point that he was soon no longer working for Chrysler.

Instead he was working as a contractor to the U.S. Department of Transportation Volpe Center in Cambridge, Mass. as it studied the competitive position of Chrysler, which the government had bailed out in 1978 with a massive loan. In collaboration with Dr. Richard John, John O’Donnell (now at LEI), and Marty Anderson, one of my co-authors of the 1984 MIT book, The Future of the Automobile, he developed the report to the US Congress in 1981 that showed a $1,500 landed cost advantage for Japanese producers of small cars and traced this to differences in the way the Japanese and American companies designed and made cars. (One of Jim’s other talents was simple product cost calculations that cut through the accounting thicket in the car companies, most of which did not know their own costs.)

After the DOT work was done, Jim decided to create a consulting business – Harbour and Associates – to help any manufacturing company willing to listen in the adoption of lean methods. Its most visible product was the Harbour Report that estimated the productivity of American and Japanese car companies, assigned the differences to management and operating practices, and tracked the trends on an annual basis.

We used Jim’s work extensively at MIT in the analysis behind The Future of the Automobile and had a very productive relationship. I say this despite my clear memories of Jim arriving for our meetings with his signature cigar and scowl and with his clear insinuation that anyone who hadn’t worked in a factory for 30 years – as Jim had and we hadn’t – couldn’t really know anything!

As the transplants started to arrive in North America and Jim documented their ability to match the productivity and quality of their mother plants in Japan, Jim and the Harbour Report became household words in the manufacturing community. They were also an inspiration for us in the MIT International Motor Vehicle Program, beginning in 1986, to dig deeper using more detailed company data than the Harbour Report could access.

Harbour used publicly available data and reported on the performance of individual companies and plants, often to the outrage of poorly performing companies. In our performance comparisons we used and verified at the gemba detailed data supplied by the car companies. But, as the condition for access, we labelled plants anonymously in The Machine That Changed the World in 1990, as “American company plant in North America,” “Japanese company plant in North America,” etc. That left us with a less exciting story to tell about Toyota (which always led our performance data in every category) but a more detailed story to tell about the industry as a whole.

By 1990 MIT and Harbour had become the Big Two of a new industry that publicly reported information on the competitiveness of global auto companies. And this friendly but spirited competition continued for years until the Harbour Report was sold to Oliver Wyman, a global consulting company.

So I’m grateful for what Jim Harbour did for me and MIT, to open our eyes and spur our own efforts. And we should all be grateful to Jim Harbour for going to see the work at Mitsubishi in the mid-1970s and beginning the vast task of raising awareness of the power of lean thinking.

The views expressed in this post do not necessarily represent the views or policies of The Lean Enterprise Institute.
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5 Comments | Post a Comment
Daniel T Jones September 10, 2014
3 People AGREE with this comment

With his deep experience in manufacturing Jim Harbour challenged us to really observe how work is done in making sense of the huge differences we saw walking through auto plants in the US, Europe and Japan. This helped us learn to see the Gemba and later to make sense of the Toyota Production System.
It also convinced us to develop a detailed methodology for benchmarking plant performance that was robust enough to withstand criticism from those who actually ran those plants. The results caused ripples as they trickled up to senior executives, whose natural instinct was to bury the bad news.
However, simultaneously Jim Harbour was using less detailed publically available data to challenge these executives to act. He also advised the US government to resist calls for protection and negotiate a temporary Voluntary Import Restrain agreement instead. This finally convinced the Japanese to open plants in the US and Europe, which removed any excuses for not following their example.
The dam burst when the publication of The Machine that Changed the World in 1990. It took two more decades for the consequences to run their course and for Toyota to reach the top spot. Jim also encouraged us to be bold and provocative in challenging the concrete heads running the world’s largest industry. In doing so we learnt a lot and had a lot of fun, thank you  Jim Harbour.

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Steven Bollinger September 10, 2014
3 People AGREE with this comment

I was also saddened by the news of Jim passing away.  I had the opportunity to meet Jim in 2009 when the Society of Manufacturing Engineers was publishing his book, Factory Man. He was cantankerous, a tough negotiator, and totally focused on trying to get people to respect the art of manufacturing.

http://www.sme.org/ProductDetail.aspx?id=14239

He told some great stories, and for a time, had everyone in the automotive manufacturing business listening.  And that is a lot of people. RIP Mr. Harbour. 

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Jeff Liker September 11, 2014
2 People AGREE with this comment
I also had the opportunity to meet Jim when I was part of a similar (to the MIT study) US-Japan comparative auto study at University of Michigan.  His presence lit up the room. He commanded attention with his dynamic, forceful personality and obvious deep knowledge.  I also was amazed at how he could pull out data from the auto companies and turn it into powerful information.  The Harbour Report became the gold standard for productivity in auto.

His passing is a great loss.  His living was a great joy


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Ron Harbour September 16, 2014
1 Person AGREES with this comment
Jim,

Thanks so much for your tribute to my father, Jim. I was at his side last Saturday at the very sad ending. He continued his curiosity and questions about the latest right up until the end. Jim devoted his life to make the auto industry, particularly in the U.S. more competitive and he made a big impact.

I was fortunate to become a part of my father's consulting practice in 1982, just shortly after the period which you so eloquently detailed. The curiosity about what had been brought to light not only about the auto industry, but industrial compettiveness in general in America was overwhelming to his new business at that time. Jim wanted help and the handful of ex-Chrysler retirees wasn't going to be enough. It was an incredible opprtunity for a young guy like me and I traveled the world with Jim for near 20 more years, not only growing The Harbour Report, but the consulting aspect also. It didn't make sense to just rank plants, the best was to work with them on practical solutions to cost, quality and productivity.

To date we have done work for most every automotive OEM in some capacity whether it was plant improvement, logistics, new vehicle programs, new plants or labor issues.

The Harbour Report is alive and well and has expanded to include most of the world's factories in North and South America, Europe, Asia and Africa. (Australia is pretty much abandoning auto production.) We cover vehicle assembly, powertrain and stamping and so much has changed in the over 30 years from those first government studies. The sudy is published annually, but is private to the participants. The detail we go into on labor, automation, sourcing,etc. is extensive. We visit 40-50 factories around the world to see how they are performing relative to the numbers they report. We then present the findings to top company management every year.

We work under the ownership of Oliver Wyman who have provided the capital and support to make sure what Jim Harbour started decades ago continues and grows. I personally remain godfather to the Report, insuring his legacy will continue for years to come.

Thanks again for you tribute. The whole family enjoyed the little bit of Jim Harbour history at his memorial.

Ron Harbou


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Ron Harbour September 16, 2014
1 Person AGREES with this comment
Just one additional note- The Harbour Report no longer uses publically available data. When we were continually using public data for years, they finally came to us and said "If you're going to keep publishing, at least let us give you the right data!" (the blackmail worked) The companies have submitted actual data to us since 1992.

Today we have the worlds largest data base on automotive manufacturing. It is web based and the companies submit the data directly and extract the results in any form of format and analysis that is useful for them. It is now an electronic book


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