American Airlines Workers Think Fast

Checking it Out

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Apr 3, 2003
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American Airlines workers think fast
Innovation is the key to cut costs



11:08 PM CDT on Thursday, July 1, 2004


By ERIC TORBENSON / The Dallas Morning News



TULSA, Okla. – The hunt for "muda" here is about job security.

Muda, meaning "waste," and "kaizan," for "continuous improvement," are just some of the Japanese words rolling off the tongues of aircraft mechanics at American Airlines Inc.'s maintenance base, where planes are stripped to their frames and rebuilt every few years.

Among the projects, all part of a massive cost-cutting campaign as the world's largest carrier overhauls its operations: Taking fewer steps each day to get aircraft parts. Rethinking how to stock chemical cabinets.

Savings vary from several thousand dollars a day to several million a year. But more must come, airline officials say.

"We need a cultural revolution here," said Carmine Romano, an American vice president who heads the Tulsa facility. "We have to be able to adapt."

American chairman and chief executive Gerard Arpey wants to hear the mantra of continuous improvement resonate throughout the operations of the Fort Worth-based airline, which is struggling to regain profitability in an era of low fares and high fuel prices.

Just as American has to battle discounters, the Tulsa base's 8,000 workers will have to outthink competitors.

But while American executives fret over strategies to fight the likes of JetBlue Airways Corp., workers in Tulsa and at two other major overhaul centers in Fort Worth and Kansas City, Mo., are facing off against third-party contractors such as Timco Aviation Services.

Outsourcing firms such as Timco hire licensed mechanics at about half of American's wage rate.

American relies less on outsourcing than most major rivals. United Airlines Inc., for example, recently began to farm out much of its heavy-duty plane work.

As a result, the outsourcing firms are growing quickly. Timco's first-quarter revenue rose 63 percent over last year.


Keeping it in-house

But American executives believe their higher-paid workers function faster and more accurately, making it a smarter choice to keep the business under the carrier's own wing.

Had American followed United's direction, only three of the base's 22 maintenance lines would remain open, according to a recent presentation to employees.

Mastering Japanese-style techniques is only part of the challenge for the Tulsa base.

American is simplifying its fleet of 700 planes, with the last of its Fokker F100s retiring from service by the fall. Tulsa will inherit work on American's Boeing 737s that had been moved from Kansas City to help make up the difference.

Improving processes can mean more business.

After employees helped redesign the shop floor layout in the engine overhaul center here, 22,000 extra square feet of space opened up. That allowed the base to bring in a new engine type to service.

Mr. Romano said he believes more "in-sourcing" will come as his employees become more efficient. Tulsa recently started work on regional jets flown by American Eagle, also owned by American parent AMR Corp.

Workers interviewed in Tulsa said they were initially skeptical about the techniques, but the new thinking is catching on.

"It's not just the line from management," said Gavin Punch, a 16-year mechanic for the airline who participated in several of the more than 350 kaizan events conducted.

One project redid messy chemical supply cabinets by clearly labeling bottles. Continuous improvement techniques have been around for decades; they involve teams that examine every step of a process to find weaknesses and waste. Collectively the group sets an efficiency goal and tracks their progress.

In some cases the jobs became easier and less time-consuming.

At the engine shop, mechanics designed their own movable work stations that made handling the steel shafts far easier, said Oliver Martins, managing director.

Many of the continuous improvement projects involve "kitting," or creating bags that have all the parts and tools a mechanic needs to complete a job.

The kits cut down on time mechanics spend walking to bins to get the right parts. Having the right kits for mechanics shaved 2.7 days off a complex cockpit-rewiring project for MD-80s, for example.

In some cases mechanics are walking several miles less each day; some joke they're worried about their weight rising with the streamlined methods.

The union remains wary of continuous improvement, said Randy McDonald, president of Transport Workers Union Local 514.

"We're not going to support anything that involves more layoffs," he said, noting that more than 700 of his members remain out of work from cutbacks.

American's Mr. Romano promises the projects won't mean fewer jobs, but he can't promise the laid-off workers will return soon.


Increasing productivity

Even if the Tulsa base wins more work from outside, the continuous improvement program aims to raise efficiency without adding personnel, dimming hopes for recalls. The base is down about 1,500 positions from its peak employment four years ago.

Mr. Romano said he realizes that not everyone endorses the continuous improvement or the labor-friendly management outreach under way in Tulsa. But American's future probably means fewer aircraft types, meaning fewer lines of work at all three bases.

But the airline will probably keep its heavy maintenance bases because of concessions it won from civic leaders last year in all three cities, said airline consultant Robert W. Mann, who has worked with American's pilots' union.

Mr. Romano said he's excited about improving an operation that already sets the global standard in how quickly it turns around aircraft. "You sometimes wonder why we haven't been doing things this way for years," he said.


Are you doing your part to bring work in-house???


Contact your Local RO Committee if you see a part that has an outside vendor Tag? Can this part be repaired in-house or has it been repaired in-house in the past and now you see a 3rd party tag? You are the eyes!!!!! Become an advocate!
 
Checking it Out said:
American Airlines workers think fast
Innovation is the key to cut costs



11:08 PM CDT on Thursday, July 1, 2004


By ERIC TORBENSON / The Dallas Morning News



TULSA, Okla. – The hunt for "muda" here is about job security.

Muda, meaning "waste," and "kaizan," for "continuous improvement," are just some of the Japanese words rolling off the tongues of aircraft mechanics at American Airlines Inc.'s maintenance base, where planes are stripped to their frames and rebuilt every few years.

Among the projects, all part of a massive cost-cutting campaign as the world's largest carrier overhauls its operations: Taking fewer steps each day to get aircraft parts. Rethinking how to stock chemical cabinets.

Savings vary from several thousand dollars a day to several million a year. But more must come, airline officials say.

"We need a cultural revolution here," said Carmine Romano, an American vice president who heads the Tulsa facility. "We have to be able to adapt."

American chairman and chief executive Gerard Arpey wants to hear the mantra of continuous improvement resonate throughout the operations of the Fort Worth-based airline, which is struggling to regain profitability in an era of low fares and high fuel prices.

Just as American has to battle discounters, the Tulsa base's 8,000 workers will have to outthink competitors.

But while American executives fret over strategies to fight the likes of JetBlue Airways Corp., workers in Tulsa and at two other major overhaul centers in Fort Worth and Kansas City, Mo., are facing off against third-party contractors such as Timco Aviation Services.

Outsourcing firms such as Timco hire licensed mechanics at about half of American's wage rate.

American relies less on outsourcing than most major rivals. United Airlines Inc., for example, recently began to farm out much of its heavy-duty plane work.

As a result, the outsourcing firms are growing quickly. Timco's first-quarter revenue rose 63 percent over last year.


Keeping it in-house

But American executives believe their higher-paid workers function faster and more accurately, making it a smarter choice to keep the business under the carrier's own wing.

Had American followed United's direction, only three of the base's 22 maintenance lines would remain open, according to a recent presentation to employees.

Mastering Japanese-style techniques is only part of the challenge for the Tulsa base.

American is simplifying its fleet of 700 planes, with the last of its Fokker F100s retiring from service by the fall. Tulsa will inherit work on American's Boeing 737s that had been moved from Kansas City to help make up the difference.

Improving processes can mean more business.

After employees helped redesign the shop floor layout in the engine overhaul center here, 22,000 extra square feet of space opened up. That allowed the base to bring in a new engine type to service.

Mr. Romano said he believes more "in-sourcing" will come as his employees become more efficient. Tulsa recently started work on regional jets flown by American Eagle, also owned by American parent AMR Corp.

Workers interviewed in Tulsa said they were initially skeptical about the techniques, but the new thinking is catching on.

"It's not just the line from management," said Gavin Punch, a 16-year mechanic for the airline who participated in several of the more than 350 kaizan events conducted.

One project redid messy chemical supply cabinets by clearly labeling bottles. Continuous improvement techniques have been around for decades; they involve teams that examine every step of a process to find weaknesses and waste. Collectively the group sets an efficiency goal and tracks their progress.

In some cases the jobs became easier and less time-consuming.

At the engine shop, mechanics designed their own movable work stations that made handling the steel shafts far easier, said Oliver Martins, managing director.

Many of the continuous improvement projects involve "kitting," or creating bags that have all the parts and tools a mechanic needs to complete a job.

The kits cut down on time mechanics spend walking to bins to get the right parts. Having the right kits for mechanics shaved 2.7 days off a complex cockpit-rewiring project for MD-80s, for example.

In some cases mechanics are walking several miles less each day; some joke they're worried about their weight rising with the streamlined methods.

The union remains wary of continuous improvement, said Randy McDonald, president of Transport Workers Union Local 514.

"We're not going to support anything that involves more layoffs," he said, noting that more than 700 of his members remain out of work from cutbacks.

American's Mr. Romano promises the projects won't mean fewer jobs, but he can't promise the laid-off workers will return soon.


Increasing productivity

Even if the Tulsa base wins more work from outside, the continuous improvement program aims to raise efficiency without adding personnel, dimming hopes for recalls. The base is down about 1,500 positions from its peak employment four years ago.

Mr. Romano said he realizes that not everyone endorses the continuous improvement or the labor-friendly management outreach under way in Tulsa. But American's future probably means fewer aircraft types, meaning fewer lines of work at all three bases.

But the airline will probably keep its heavy maintenance bases because of concessions it won from civic leaders last year in all three cities, said airline consultant Robert W. Mann, who has worked with American's pilots' union.

Mr. Romano said he's excited about improving an operation that already sets the global standard in how quickly it turns around aircraft. "You sometimes wonder why we haven't been doing things this way for years," he said.


Are you doing your part to bring work in-house???


Contact your Local RO Committee if you see a part that has an outside vendor Tag? Can this part be repaired in-house or has it been repaired in-house in the past and now you see a 3rd party tag? You are the eyes!!!!! Become an advocate!
Hey cio, ask your buddy 'ol carmine for an RO report, because little jimmy just can't seem to get one. You twu bubba's don't even know what work is going out the door. I would be finding out that imformation a priority, since it states in our contract the twu will have 2 RO reports a year.

Have you ever seen an RO report? Another twu farce.



NO VOTE? NO PEACE!!!!
 
Check it out: Do you like history? What do you think would have happened at TWA and United if the mechanics had not been denied there right to vote over 10 Years ago. Do you think maybe they would be in better shape now if they had treated there mechanics with the respect the every US citizen deserves and let them vote. Keeping the mechanics from voting is not healthy for the longevity of the company. Look at history and decide what is true and right , it's not that hard. The company needs mechanics that are motivated and professional. You can not get that from a group of mechanics held hostage by the Company and the NMB, I don't care how many Japanese words you teach them or lies you tell them. Stand up for Democracy secure your future. <_<
 
Dr. Demmings 14 steps to business success



Unless you are so flush with bucks your business is immaterial to you, take a moment and think about how your customers think about your business. Does your creation ooze the image of quality or just another so- so business? Unless you are living in a cocoon you know the hype on the need for quality and happy returning customers-our management "experts" lay on to the "I wanna be rich" crowd. But that was not always the case.

Do you remember when “Made in the USA,†meant poor quality? Do you remember when our top manufacturing companies were so over confident of dominating market share that product quality and customer satisfaction was secondary to the price of their stock? Sad but true.

About the time of the Korean War, Dr Edward Demmings, a nerdy and bespectacled professor from MIT was on a campaign to alert the GM’s of the day to pay attention to quality of their products and services or risk the loss of market share to competitors who would. But the over confident self- satisfied management-with cash balances bloated from being the only game in town- viewed such advice as rabble from the left and closeted academics who did not understand cash flow and profits and assumed it so much nonsense - not worth listening too.

But, the struggling Japanese industrialists listened and made business history in short time. What was this way-out bit of business advice considered by some to be on par with crackpot medicines? Just a list of fourteen suggestions aimed at fostering customer satisfaction and loyalty. The “Sharp’s, Panasonics, and Toyota’s, of Japan Inc., honed their business strategies and management philosophy around these famous fourteen points of Professor Demmings. He became their hero, while American industry acted like headwaiters in some of Manhattan's elitist eateries.

Demmings basic message was that the cause of inefficiency and poor quality is management, not employees, and it is management's responsibility to correct the problems to achieve desired results.

Here is what the good Dr. prescribed:

1. Create constancy of purpose toward improvement of product and service with a plan to become competitive and to stay in business. Decide whom top management is responsible to.

2. Adopt the new philosophy. We are in a new economic age. We can no longer live with commonly accepted levels of delays, mistakes, defective materials, and defective workmanship.

3. Cease dependence on mass inspection. Require, instead, statistical evidence that quality is built in. (Prevent defects rather than detect defects.)

4. End the practice of awarding business on the basis of price tag. Instead, depend on meaningful measures of quality, along with price. Eliminate suppliers that cannot qualify with statistical evidence of quality.

5. Find problems. It is management’s job to work continually on the system (design, incoming materials, composition of material, maintenance, improvement of machine, training, supervision, retraining.)

6. Institute modern methods of training on the job.

7. The responsibility of foremen must be changed from sheer numbers to quality ... [which] will automatically improve productivity. Management must prepare to take immediate action on reports from foremen concerning barriers such as inherent defects, machines not maintained, poor tools, fuzzy operational definitions.

8. Drive out fear, so that everyone may work effectively for the company.

9. Break down barriers between departments. People in research, design, sales, and production must work as a team, to foresee problems of production that may be encountered with various materials and specifications.

10. Eliminate numerical goals, posters, and slogans for the work force, asking for new levels of productivity without providing methods.

11. Eliminate work standards that prescribe numerical quotas.

12. Remove barriers that stand between the hourly worker and his [or her] right to pride of workmanship.

13. Institute a vigorous program of education and retraining.

14. Create a structure in top management that will push every day on the above 13 points.

Well, how does your business stack up? Demmings advice can be summed up in the word "caring.†That is, you and your employees caring to do the best job possible for your customers. Be selfish, hoard your customers, and make them happy so they don’t go down the street to your arch rival.

It is just common sense to woo and hold your customers. Boom or bust, the underpinnings of the future of your company lies with satisfied customers. So simple but so many entrepreneurs cater to the whims of all but the guy or gal who pays the bills. Take Demmings points to heart-it is good advice

Reference: W. Edwards Deming, Quality Productivity and Competitive Position (Cambridge, Mass. MIT, Centre for Advanced Engineering Study, 1982).

Copyright 2003 Paul E. Adams

Dr. Paul E Adams, Professor Emeritus Business Administration Ramapo College of New Jersey Author “ Fail Proof Your Business: Beat the Odds and be Successful.†Available Amazon.Com. If you have questions or comments- contact me: [email protected]


Typical TWU sheep CIO falls for whatever BS the company puts out.
Who do you think taught the Japanese???!!! If the company was really serious they would listen to Dr. Demmings.

Suckers!
 
After employees helped redesign the shop floor layout in the engine overhaul center here, 22,000 extra square feet of space opened up. That allowed the base to bring in a new engine type to service.

Gee, getting rid of the JT8D/727 and CF6-6/50 engines didn't clear up some floor space too? uhh... yeah.

This is the biggest farce to come down the pike. I was involved in CI in the TEO, in fact I was in the first 5 day class to ever go to CI. Mangagement sold it as a way to bring in contract work. Seen any contract work lately? What this is, is the same people that do the work now having to do MORE work while the lazy SOBs continue to do nothing. How the hell do you support CI CIO, when it will ultimately lead to reduced headcount? Huh? You, the one that swears we're not overmanned. How will you let this lead to a RIF?
If, and this is one hell of a big if, the company properly impliments CI, it SHOULD lead to either a RIF, or the bringing in of a HUGE amount of work that doesn't exist in the first place.
 
The base is down about 1,500 positions from its peak employment four years ago.

So Tulsa has in reality not only reduced everyones pay by 25% but they also have reduced headcount by 1500. Isnt that basically how many they have in MCI?



The company can introduce all the feel good programs they want. It does not matter. As long as a company focuses more efforts on taking money from their employees instead of making money with them they are doomed. No airline ever slashed wages to consistant profitability. Go ahead and steamline OH, but on the line productivity will follow morale. And morale is sinking fast as inflation drives up costs and the effects of what we lost continue to accumulate.