Wayne Smith

And they select, lay out, cut, and sew the interior.

But as stated a couple posts above this, orchestration amongst the vendors and a correct QAS environment are critical.

Rockerchief

@ironman88. I would say that it is even easier today than in the past. We used to have drawings faxed over, and if someone wanted to inspect the piece it either involved shipping or a flight. When I retired 5 years ago I could upload an entire drawing from a Dropbox and cut a part that day…face time for an inspection etc etc. And the sheer number of parts suppliers/experts in their silo today to choose from is much greater than the past. Just an old guys 2 cents lol!

Ironman88

Some valid points for sure.

What's contributing to the increased difficulty today I think are three fundamental things:

1) Decision-making control has shifted away from the engineers to the accountants. If margins aren't maintained then the spec changes - and never for the better.

2) In conjunction with the above - component sharing across brands (look at all of the Audi / VW parts in Porsches today)

3) Social culture impact - affecting hiring decisions, placement decisions, work-ethic of staff

FlatHat

Money, that's what Porsche makes, straight up cash money

Rockerchief

ah yes true true, but #1 is tricky. Any great company is absolutely controlled at the CFO level and the lack of that restraint is what has plunged the US and many other countries into the financial difficulties we have today. The client face of the company is to wax poetic about all the wonderful capabilities it has, but if it can’t do it profitably then it’s all just lipstick on a pig. I’m starting to look for a soapbox hahahaha. let me STOP now!!!! Good conversation this! Makes me long for the C Suite again :-).

Ironman88

I would have to respectfully disagree with you on that one. A truly great company should be driven by a proper CEO.

The CFO should provide insight and guidance with regard to financial impact and direction. In my experience virtually no CFO was a business visionary. Numbers - yes. Product and market insight - no.

Bruce In Philly

I read an interesting account of someone who worked in Detroit at one of the big ones... I think this was in a Car & Driver or one of those publications... He was describing what it was actually like to work there. His job was to design interiors... he described his role in designing a glove compartment door. He noted after the car was in production, he got a message from the accounting department to "take out 10%" of cost or something like that... he then had to compare the door design to other maker's doors... on and on... and ended up reducing the rubber stops and some other features that he noted would result in the door rattling over time. I am sure I have the story not quite right, but the gist is correct. That is the way it works.

I listened to an interview with Bob Lutz who wrote Car Guys vs Bean Counters where he described how design was driven by the accountants. At first, I thought "of course!" as you can't have arty designers doing whatever they wanted. But Bob's point was the accountants had no feedback system for how design decisions effected sales as they just assumed sales would be there. They looked for opportunities to lower costs with no regard to how it affected consumer sentiment. What fascinated me was given his huge "power and position" in the company, he could not drive change... he was downstream from this system.

I suspect that we are witnessing with the above is some sort of lifecycle of power and evolving business processes that drift from innovation to cost as a company achieves a dominant market position. I have learned that no car company wants to innovate at least beyond maybe a neat climate control or interior lighting system. After all, how many more cars are you going to buy in your lifetime given the innovations... answer: no more... none. Yet they dumped huge money into say EVs, or more efficient engines driven not by more sales to you, but from government regulation. No, I am not bashing regulation... that is not my point here... but once a car company acheives a dominant position, their motivations change to preserving the status quo and driving out costs.

I think I see this happening with Porsche, where they seem to be at some mid-cycle point. They want to sell more 911s and more cars in general... that is OK, they ain't a charity. So they expanded their line to SUVs and such, but to sell more 911s, they needed the car to appeal to a broader customer base. Hence the car has moved from a sports car to more of a GT cruiser... bigger, heavier etc. Honestly, I hate these damned zillion-way seats that weigh more than an engine performance package. While Porsche hasn't moved to a priority on driving out costs from the 911, they did discover that they can raise the prices without really adding a proportional amount of stuff.... evidence is that Porsche is still the most profitable automaker on a car-by-car basis and they appear to have moved from an excellent maker to an excellent sourcing manager (yes, a cost move). Anywho... if they do achieve some sort of saturation in the upper-class market, watch out... that rattle in the glove compartment was not just an accident.

Peace
Bruce in Philly (now Atlanta)

Ironman88

Here's a current, real example of what Bruce has conveyed above that illustrate accountants in action...

I have a 2019 Porsche Cayenne. I ordered a new (replacement) floor mat set for it. When the mats arrived, I noticed that the new rear mats design had the anchor connectors removed from them. (Photos below of the new vs original mat).


2019 Cayenne. Brand new mat on the left. Original mat on the right.

There's a German guy with a pocket-protector and handheld calculator that I have to thank for this...

Rockerchief

you are correct that the CEO is the visionary, but must be constrained by the CFO. Without that balance….

Bruce In Philly

Ya know, I met quite a few CFOs and CEOs in my career, and always wondered what made good ones. I came to a set of conclusions.... the following in no particular order. Warning: I am in a bad mood right now.

1 - They are selling something the market wants. No cht you say? I can go on and on about this one, but if the core business is not dialed into and aligned to a needy and growing market, all bets are off. If it is, the CEO does not need vision or leadership. Usually the CEO that did this alignment is usually not running the place, that guy/gal left a long time ago. The needs of a big place are very different than one that is blazing a trail. Could the woman who runs GM today build it from scratch? No way, that is a whole different set of skills and talent.
2 - Darwin rules. We see the downstream consequences of the failures... the winners. Luck plays in here sometimes more than we like to think. I poured over business plans looking for capital and virtually every one of them looked great. I mean this.... sometimes I think it is all a crap shoot. Startups fail at a rate of 9 out of 10 and their business plans were sound... the owners are passionate, speak convincingly, and sure seem to know what they are doing. Did I say 9 out of 10 fail?
3 - They know what being in their market requires. For example, in old-line manufacturing, cost is king. Selling shoes to twenty somethings? Deep marketing savy and insight into hormone-filled brains is required. Selling an addictive substance? Maybe a law degree and litigation experience is required.
4 - Leadership qualities? Foooooweeeeee..... If they have it, great as that is a better place to work. But sorry, not required.
5 - Can manage a balance sheet. For the CFO? Well, not really... in a public corporation, hitting quarterly numbers and manage a stable stock price by driving behaviors around the organization is a talent and a near full time job.
6 - Vision? Nah. Dot coms and internet phenoms get the press, but most organizations require basic blocking and tackling to succeed. Vision can be purchased through market analysis, well selected consultants, and a few well chosen, periodic hires. The world is full of great ideas and visions... it is focus on day-to-day alignment that wins the long races.
7- They follow their passions. Now this is just a big bucket of stinky crap. If I hear one more rapper or sports star say this garbage to youth, I am going to puke. That is why we have tons of graduates who can't pay their loans. I don't blame them for being angry, they were told crap. The winners just put in hard long work pounding a rock that was in the main stream of our economy. Good CEOs get this one... stick to what you know.

What about Wendell Weideking, the Porsche CEO who saved the company? Was he a great CEO? Sure, in that he recognized he could not do it so he hired ex-Toyota executives who revamped the company. Then he led the company through a period of great growth only to be indicted in some sort of stock-fixing scheme in Germany... Go Wendell ! I am not sure what I mean by this except don't believe hype.
Elon is cited as a genius... maybe, but by his own admission his companies almost failed in flames if not for miracles... he talks frankly about this. Do you want to work in those environments? I did in my twenties and thirties... after that, screw it as my health matters more now. Further, do you want to put your money with a guy who totally understands he has a gambling addiction? Steve Jobs who looked straight into the eyes of potential clients and lied? These folks get the press, but they are not the people to run Porsche or General Motors... no way.
I played a small part many years ago, helping AT&T downsize... they ended up going POP! Whata history, whatta place, what briliiant people. I was walking into meetings talking about how much they could cut/chop/blow up while I was hearing over the PA system that they just won some great management award by some university. Fooooweee..... AT&T was one of America's best run companies but had an alignment problem... bummer, down the swirlies with all their awards.

What do I mean by all of this? The best CEOs are the ones you don't hear about and if you met them, probably would not be impressed. You would not be impressed because you would be looking for the wrong qualities. What works is what is needed at the time and most of those times, running a big place is not glamorous and requires endless hours pouring over spreadsheets. Vision? Yea like 3.0 reading glasses. I am not saying CEOs can be dopes or it is just luck or showing up... but how the press glamorizes the roles or how sociopath narcissists are held up as an example to inspire... well..........hmmmm...... The best are those who grew up in that market, worked closely serviing customers, worked all over the organization, and, well, simply know what they are doing. Yea, not sexy.

Peace
Bruce in Philly (now Atlanta)

Ironman88

I think most CEO's today are pursuing two things:

1) "Just calm the waters" approach

2) Do whatever it takes to maximize their incentive compensation

But not in that order...

CEO's with guts and vision?

Peter Schutz - the last really good one Porsche had.

Tj40

At the Detroit Auto Show on the Engineering day and you’d see engineers going around with clipboards and digital cameras benchmarking various features. I was sat in a car once when a guy benchmarked the glovebox, measure height, width and depth and take a picture.

Other teams were benchmarking steering wheels, seats you name it….


And I was chatting about cost engineering with a senior guy from one of the Detroit big three and he said to me “you know we had an engineering project to take 25c out of the front passengers seat, I was the lead engineer on that project….”

Engineers when they join the company are given a training, the summary was “never add cost to the vehicle” and most importantly “always deliver 2 or three suppliers who can provide the part to purchasing so they can get the lowest price”

It’s all about the cost engineering….