Strategic management of change within the production department at the Rosslyn of Nissan South Africa

Abstract

In the heart of the well-known industrial area, Rosslyn, just north of Pretoria, lies one of several formidable motor manufacturers. Nissan South Africa, (from here on known as NSA) is currently on the rise to become one of the global competitors in the global Japanese family of Nissan (Ghosn, 2005). Having excelled in the B0's, struggled in the 90's and after a global revival plan, under the direction of Carlos Ghosn, has continued through the last decade to surprise our local consumers with it's impressive line-up of luxury and sporty automobiles, receiving accolade after accolade in both manufacturing as well as after market service and support. (Ghosn, 2005). With a work force boasting 924 salaried employees, 300 temorary staff and 1590 hourly paid employees, NSA contributes around 55000 vehicles per annum combined to either the domestic market or West African export market. An unusual event took place recently at the Rosslyn plant, which was to change the face and attitude of the manufacturing team at NSA. The organisation was about to join it's competitors and roll out it's plan for a new, fully integrated ERP-system in the form of SAP. This project began in July 2003 and through some hard work and combined effort of the organisation's staff and it's IT partner, EDS (Electronic Data Services), was eventually rolled out to business on July 11th 2005. With SAP being the chosen tool, the eventual implementation and roll-out of the ERPsystem to NSA, particularly to the manufacturing division was not seen as a great success. The organisation found itself with tremendous inventory inaccuracies and as a result brought it's manufacturing facility to a grinding halt several days after the go-live date, triggering the need for emergency proposals and counter activities to take place. The resulting impact on NSA, it's marketing and sales division and ultimately it's dealer network and consumers was catastrophic. This put incredible pressure on not only NSA's executive and staff but had Japan and it's executive suddenly scrutinise their overseas market with intensive interest. This is the reason why the researcher has chosen the topic of attempting to understand the real issues that NSA were exposed to during this period of 2003-2005, and identify the root cause of the temporary cease of production within NSA's manufacturing facility. The findings were analysed from a set of data captured as a result of a survey that was presented to a sample group of employees and contractors associated specifically to the production activities and production supporting departments. Further data was captured as a result of structured interviews with a select group of individuals representing the senior executive within NSA that were particularly involved in the ERP-project as a whole. As a result of a survey which was conducted during late September 2006, areas such as resistance to change, the lack of participation, training issues and general "buy-in" from the employees within NSA during this period prior to the go-live stage of the ERP-project were explored. A review of supporting literature will be shared to determine some of the reasons why the organisation was faced with such a difficult task of implementing an ERP-solution for NSA, as well as establish typical norms within industry that contribute to failure in these areas. Furthermore, the researcher will, with the help of business models, attempt to understand some of the issues that could have been avoided, and of course focus on those areas which were seen as being unsuccessful and possible contributing factors to the lack of success of the ERP-project implementation. Areas such as lack of participation, lack of project awareness and general resistance to change were found to be significantly high during the survey conducted during September 2006, approximately 14 months after the actual go-live activity. The data will be reported and discussed within chapter 5, and made visual to the reader. The paradigm chosen for this research project is phenomenological due to the large impact on the human issues and requires both quantitative data types found in the questionnaire as well as qualitative data found during the structured interview sessions, where open ended questions were posed to the executive. Once the data was analysed and processed for understanding and presentation, a number of conclusions were then drawn to allow focus on particularly the vital few areas where the organisation can seriously understand, accept and through adapting their business can

avoid a re-occurrence of this in the future. We will discuss the importance of models such as organisational learning, as well as the typical POCA-cycle, which will be explained later and with the introduction of supporting literature be able to provide the organisation with justified recommendations. These recommendations are aimed at returning to basics and are designed to be in line with Nissan's global strategic requirements and most importantly should be seen as realisticaly possible to implement. The proposed recommendations will also be a result of a number of structured interview sessions conducted with the NSA executive to determine the reality and sustainability of the management of change and transformation within NSA regarding future projects. The interview sessions will be a discussion with the executive regarding the results of the questionnaire, and their input regarding possible contributory factors to these results.

Some of the recommendations include, a suggested return to basics, improved communication and a commitment from senior management to ensure that NSA follows the advice and way forward provided to us by our Japanese collegues in the form of "The Nissan way", Genba Kanri, Hoshin Kanri and Nissan's newly added V-Up methodology. Finally after recommendations to NSA's top executive, the researcher will reflect on the journey taken to get to the stage where all the models, the literature and the understanding have almost become a day to day activity of seeking continuous improvement both within it's own manufacturing boundaries as well as those of it's suppliers. This important reflection will hopefully provide guidance to future students and possibly offer areas that can be further investigated or researched.