How the Chevy Volt Became the Heartbeat of GM
To summarize part one of this article (Inside Chevy's Big Bet on the Volt, Dec. 2010), the Volt program was initiated by vice Chairman Bob Lutz to build a mass market car to reduce petroleum use substantially.
Jon Lauckner, who was then Vice President of Global Program Management, and his small team developed the Volt concept car.
With the unparalleled enthusiasm that the introduction earned at January 2007 Detroit Auto Show, GM made a public commitment to start manufacturing within three years. Tony Posawatz, who was the first employee drafted by Lauckner, was named Vehicle Line Director.
With insights from both Lauckner (who is currently President of GM Ventures) and Posawatz, Part 2 recounts the development of the Volt. The lessons learned by the Volt team are valuable for any organization trying to launch innovative green products.
Inventing On the Critical Path
Nothing demonstrates the shift to an entrepreneurial mindset as inventing on the critical path. To provide context as to the amount of new technology that GM invented in support of the Volt, here are some highlights:
• The lithium-ion batteries that are used in the Volt are the type used in electronics such as cell phones. The innovation made by Volt was in the "secret sauce" -- the chemical formulation of the battery to achieve more power over a longer life. The next step was to invent a battery pack that integrates nearly 300 individual battery cells. Volt took its battery pack a step further by developing sophisticated power and environmental management systems to maintain optimal battery conditions to extend battery life and provide dependable performance.
• The heart of car -- the propulsion system -- was reinvented to blend power from the battery and gas engines depending on power sources available and driving conditions. The new Volt propulsion system consists of two electric motors, one gas engine, three clutches and a planetary gearshift (used for blending). Whether the Volt is traversing a steep grade with a low battery or cruising down the highway with a fully charged battery, the driver will experience consistent performance.
• The Volt made great strides in capturing energy when braking. The typical hybrid captures relatively little, since its battery is too small to hold much captured energy. Posawatz explained that "On a field test going down Pike's Peak, the Volt captured the equivalent of 19EV miles." The Volt team made special effort to make braking experience for the driver equivalent to a standard car by carefully blending the friction and mechanical brakes to provide smooth deceleration without any sudden jolts.
• Integrating the 161 individual electronic controllers into a seamless driver experience is 10 million lines of computer code; more than is needed to fly the new Boeing 787 Dreamliner. In addition to its behind-the-scenes role in controlling the various sub-systems, the computer system takes a starring role when interacting with the driver to provide easy-to-understand data on the various read-outs such as battery status, charge remaining, miles remaining and much more. The data are available in the cockpit through a center stack that auto critics are calling "Apple-like" in its design.
To achieve this remarkable level of innovation in the timeframe, Posawatz shared the three key lessons his team put to work on the project.
1. Cycles of Learning
Posawatz claims that, "The winning companies will be those that learn fastest." The Volt team accelerated its learning by increasing the number of "cycles of learning." Posawatz explained, "Each time there is an opportunity to test, there is an opportunity to learn how to improve." Rather than spend more time on each design, the Volt team emphasized more design iterations to build and test the design to learn what worked and what needed refinement. The engineers would start with a simple version and then layer on changes quickly, retest and iterate again.
Computer-aided design and testing is de rigueur when developing complex products such as the Volt. While the Volt leveraged virtual tools, the team was physically hands-on and around the car more than most programs. "The team was co-located and the vehicle was in the center of the workplace", Posawatz said "this allowed engineers to crawl around and under the vehicle to figure out where their component would fit and uncover integration issues."
Just as important as being innovative is knowing where it is unnecessary. The Volt leveraged off-the-shelf and mature technology whenever possible. The small gas engine that powers the generator to provide electricity when the battery is discharged is a standard part. Most of the materials are standard rather that exotic. Posawatz shared that manufacturing a mass market product requires "the right balance of invention and reuse."
Sizing Up Scope
Typically, programs ruthlessly control their scope once launched, but the Volt's scope continued to grow. The battery pack illustrates how scope can mushroom when innovating. As more information became available, design approaches were refined. The Volt program did not disregard Project Management 101 altogether. Those changes selected for inclusion were critical to customer acceptance or reduced risk.
An early scope change was to design and manufacture a battery pack that would last the life of the vehicle, ten years and 150,000 miles.
Battery life was important to customer acceptance since a customer would be nervous about an expensive financial outlay in the future. To reassure customers that a Volt battery will survive longer than those in consumer electronic equipment such as phones, an eight year warranty is provided.
A decision in one area would often create a cascading impact to supporting systems. Deciding to produce a long-lived battery, for example, then required additional systems to keep the battery healthy.
At first, GM planned to purchase an assembled battery pack. Posawatz explained the change in direction, "Once we got deeper into the battery pack we found that no one had the experience."
Since suppliers had no experience with either a battery pack of this size and complexity and limited automotive experience, it reduced risk for GM to leverage their experience from EV1 (GM's electric vehicle from the 90's) batteries and add experts from other parts of GM. For example keeping a battery pack at a comfortable temperature was analogous to keeping passengers comfortable.
So Volt elected to purchase the individual components and took on the design, development, and validation of the battery pack. GM then needed to invest in a large battery facility that includes a test lab that operates 24 by 7 to mimic on-road conditions such as a special "shaker room" to create the effect of bumpy roads.
It was then decided, as Lauckner put it, "That it made sense for us to assemble all the individual components [cells, electronics, etc.] into a finished battery pack the same way we would for any complex assembly operation." The time to complete knowledge transfer to support manufacturing of the battery pack was not available and there weren't any established suppliers for battery pack assembly. Consequently, leveraging in-house manufacturing engineering resources made sense. That required work to develop special manufacturing equipment that loaded individual battery cells into blocks of cells, welded the tabs of individual cells, mounted electronics to monitor the cells and tested the completed pack.
Posawatz expanded on the strategic importance of the components such as the battery, propulsion, braking and computer systems that were developed in-house. "These components are the key IP [intellectual property] that will help GM differentiate and establish market leadership. "
One area that causes unnecessary holdups in most organizations is the decision-making cycle. The bureaucracy is well-intended - to avoid poor decisions that cause expensive setbacks. But there are often unnecessary layers of approval, more time spent on the PowerPoint presentations than engineering and scheduling delays given stakeholder's full calendars
Although Volt's "date with destiny " to start production by November 2010 added high-octane pressure, it also benefited the team by providing a level of visibility and support from GM management. It allowed the Volt team to manage the program more like a Silicon Valley start-up than a century old firm.
Lauckner estimated that 20 percent (nearly a year) was cut from the Volt schedule using these new approaches:
1. Established a Volt Leadership Board. The board included Lauckner and a few key sponsors plus core Volt team members. The Volt board would meet once or twice a month.
2. Drafted the most capable people. Engineers with background beneficial to the program were added. For example, the propulsion system really was rocket science as technologists from GM's Hughes Aircraft division led its development. More people were full-time than part-time on the program than was typical, which helped keep the team lean. Team members were selected who were comfortable with ambiguity.
3. Shared vision. The Vehicle Line Director (Chief Engineer / Program Manager) ensured team members were clear about the vision and continued to advocate for customer interests during detailed design so the vision was not compromised. Posawatz stated. "I maintained a maniacal focus on the goal." A program of this magnitude and complexity with many sub-teams required a clear understanding of integration points, so the components would work together seamlessly. The team bonded organically over solving thorny problems and on long road trips testing cars.
4. Empowered the program team. The team was given more latitude as to decisions they could make on the ground, including spending limits, acquisition of resources and design approaches. Posawatz described, "The message was to make decisions to keep the program moving."
5. Made leadership available to resolve issues and clear roadblocks. For items that were delaying the team between Volt Board meetings, team members were encouraged to email /call upon a Volt sponsor who would provide a decision on-the-spot. Posawatz confirmed that "access to senior leadership was unprecedented."
6. Co-located team. Typically GM uses co-location as a best practice. With the Volt program, however, the number of people co-located was greater than other programs to eliminate distractions and increase the ease of collaboration. The battery facility, field testing and manufacturing plant were also nearby.
7. Avoided unnecessary meetings. Keeping communications overhead low in large programs is critical. Otherwise more time is spent on-boarding, sharing information and tracking status then doing the real work. The pre-review meeting was an anathema. When a meeting was necessary, the team came quickly together to work through an issue and move on.
Many companies talk about empowering teams and flattening the organization to encourage innovation and accelerate development. On the Volt program they actually did it. For example, the strategic decisions on the battery that were outlined in the previous section such as in-sourcing design, investing millions in a new battery facility, in-sourcing manufacturing were made in a single or at most a few Volt leadership meetings.
Volt: The Heartbeat of GM
The program made a substantial effort to increase the cycles of learning, banish bureaucracy, add the best resources quickly, and then empower the team. That was a good start.
At the end of the day, innovation is still hard work. Many on the program worked long into the night, on weekends and postponed vacations to bring this car to market. They maintained focus all the while GM struggled with bankruptcy.
What is remarkable about their accomplishment is that unlike their entrepreneurial cousins in Silicon Valley and elsewhere who toil for that pot of gold at the end of the rainbow, the Volt team is made up of regular corporate folks that Dilbert pokes fun at and Tom Peters harangues.
A long time ago, Detroit was the Silicon Valley of its time launching disruptive innovations in technology, manufacturing, and marketing. Volt is a worthy descendant - cutting edge technology coupled with a customer-focused design that was developed using fast and efficient processes.
Part one of this series started with how disruptive innovations change markets. But before disruptive innovations change markets, they change teams. As Lauckner summed it up, "To the credit of the Volt team, they kept motoring ahead despite a challenging environment. Their attitude was to make the Volt a reality no matter how hard it got. They had a date with destiny and the company's reputation was on the line; it was a point of personal pride."