1993 Competitive Advantage Optimas Award ProfileBRBell Helicopter Textron Inc
Among the companies that bid was Bell Helicopter Textron, whose international headquarters is in Fort Worth, Texas. In the end, Canada chose Bell because the company not only wanted to manufacture commercial helicopters in Canada, but it also wanted to establish a research center there. That's exactly what the organization did.
Bell moved its commercial operations from Fort Worth to Mirabel, Quebec (a 40-minute drive north of Montreal). Setting up shop was easy. Finding enough qualified workers to staff the company wasn't.
Bell Helicopter found itself in the middle of a labor dilemma. Being the only helicopter manufacturer in Quebec, its closest competitors in the aerospace industry were airplane builders, which were experiencing a national shortage of aircraft assemblers. To solve the problem of finding enough qualified production workers, Bell's human resources department set up a training program and had trained 240 people in aircraft assembly within three years.
Not only did the program help Bell Helicopter keep its doors open for business, but it also paved the way for the company's business to take flight. Within four years of starting the training program, Bell had captured 40% of the industry's market share.
For its outstanding work in creating an entry-level production staff out of unemployed individuals, Personnel Journal has awarded Bell Helicopter Textron with the 1993 Personnel Journal Optimas Award in the Competitive Advantage category. Here's how the company did it.
Staffing problems require new solutions.
Bell set up shop in Mirabel in 1984. Management's plan was to move production of all the company's commercial helicopters from Fort Worth to Mirabel during the course of six years (1986-1992). The company's HR department hired engineers and production employees to start work on the first of five helicopter models. Within a few years, Bell realized that it was having problems keeping its shop-floor employees. This proved to be an enormous problem. The demand for trained workers was increasing dramatically in direct proportion to the expanding production schedule.
There was barely adequate time to hire and train enough people. To make matters worse, employees were leaving, giving Bell's HR department the challenge of staffing the plant.
By 1987, Bell management recorded the employee turnover rate at 25%. This figure, although not yet alarming, was certainly unacceptable to them. They sought answers.
During exit interviews, HR managers learned why production workers were leaving in record numbers. It had hired junior-college-educated workers to meet start-up demands. These individuals wanted jobs that offered more challenge and increased responsibility.
"We originally had hired approximately 130 people [who had] junior-college degrees, and about 50 of them left within the first two years because they were overqualified for the type of work they had to do. They were planting rivets and were doing mundane tasks like that, and they just didn't enjoy it," explains Louis Fortin, vice president of human resources.
The lack of a structured company environment at the time also was a problem for these original workers. The new company was growing rapidly, and nothing stayed the same for very long. "Things were moving so fast that a lot of people didn't feel comfortable in that kind of environment," Fortin says.
Unemployment and Immigration Canada (UIC is Canada's equivalent of the U.S. Department of Labor) confirmed the other problem facing Bell Helicopter: the national shortage of aircraft assemblers. There simply weren't any unemployed individuals in Canada skilled in aircraft assembly from whom to choose.
Fortunately, one labor factor seemed to be in Bell's favor: The high unemployment rate in the Laurentian region, which surrounds the Mirabel plant, offered the opportunity to train people to become skilled in aircraft assembly.
Bell management reasoned that it was best not to engage in a salary war with other aircraft-manufacturing companies in the area, such as Canadair and Pratt & Whitney, by trying to lure workers away with the promise of higher compensation. The HR management team decided that it would be better to invest in and train its own work force.
The individuals who were available for Bell's management team to recruit, train, hire and develop were unemployed workers who had had no previous experience in aircraft assembly. The rationale behind the decision to train a new work force, however, was that it would enable the company to:
- Receive financial assistance for training people who were unemployed
- Hire people at a base salary that was significantly lower than the amount that highly skilled workers required
- Introduce and develop a new production method that incorporated a team-based, multiskilled approach, rather than the traditional production-line approach.
This production-team approach was a new concept for Bell Helicopter. Bell based the new approach on the socio-technical model of work-group interaction that was initiated in Sweden at Volvo. Bell Helicopter adapted the model for its own cultural context and technological needs and has renamed the idea the nontraditional approach.
The nontraditional approach requires permanent work stations and a semiautonomous work team that's posted at each station in the plant. "It takes a long time to manufacture a helicopter. It isn't like GM, with a production line, where they produce many cars every hour," says Charles Larocque, director of human resources. "The semiautonomous group is a concept that works well with our industry because it isn't go, go, go." Bell's workers set the production rhythm rather than machines. Within the guidelines of a master schedule, teams set their own schedules.
Most semiautonomous teams have approximately 18 employees, although some have more than 40 team members. The more-than-700 production employees meet with their teams each morning for 15 to 20 minutes to discuss the previous day's work, decide where they need to solve problems, discuss production issues and set their schedules for the day. Currently, there are 27 teams.
When the plant first opened, workers spent one month learning about sociotechnical designs and how to work in teams. Montreal-based Social-Technical Systems (STS), an independent consulting organization that's affiliated with Montreal's McGill University, oversaw the initial training.
As its demand for trained workers grew, the company couldn't afford to let employees take a month to go through the training. The company needed its production workers in the plant making helicopters. Although it was important that employees know how to work in the team-based work environment, they had to be back on the job sooner. Human resources reduced the program to a three-day course.
The HR department contacted UIC to see if it could send candidates to Bell for training. UIC could; it also promised funding for setting up a training program. UIC supplied 60% ($2M Canadian) of the financing; Bell provided the other 40%. The total cost of the program was $3.6 million (Canadian). Another government organization, the Professional Training Commission (PTC) of Quebec, also agreed to be an external partner. The PTC researched all of the available training program subsidies, and helped negotiate and administer the program.
Bell, however, made some decisions that most companies that work with the UIC don't make, according to Fortin. Instead of allowing the government to run the show by doing the screening, hiring and training, Bell's staff did it.
"We led the program. It seems like such an obvious thing, but there are a lot of employers that don't want to bother with having to do this," Fortin explains. "They usually just say, 'I'm paying all these corporate taxes; I might as well just let the government send me 10 people.' That's washing your hands of it. We wanted to be involved. I think it worked out a lot better this way."
Finding the right amount of training took time.
Bell's HR department hadn't started out with exactly the right plan from the beginning. First, it had hired the group of experienced assembly workers and had found out that they weren't satisfied with the jobs available. Remember, more than 50 employees in the original production-worker group of 130 left within the first two years of the plant's opening.
In 1987, Bell began hiring unemployed workers identified by the UIC. But after three groups of the new workers had finished a six-week training course (designed by HR and production department members), Bell's HR department found that these employees still were underqualified for the jobs they needed to do in the areas of structural and electrical assembly.
Bell's third approach, which commenced in 1989, worked better because it gave trainees more than six weeks to learn the jobs. HR, with the help of the production staff and a local college, designed the training program to last 14 weeks-eight weeks of theory and six weeks of practical training-a total of 480 hours. Creating the third approach wasn't automatic. "We had to go through a few gyrations before we got it the way we wanted it to be," Fortin says.
Bell needed two training programs-one in structural assembly and one in electrical. Electrical assemblers manufacture and assemble the helicopter fuselage, and electrical assemblers produce and install electrical harnesses and instrument panels.
The Montreal-based National Aeronautics School (NAS) of Edouard-Montpetit College (a three-year public college much like a junior college in the U.S.) helped Bell design the training programs. The UIC gave the funds directly to the college, which in turn dispensed the money for the programs. "This college was the only school able to train people in aeronautics in the province of Quebec," Larocque explains. "It's still the only one."
Although Bell Helicopter's Fort Worth headquarters provided Mirabel's HR staff with some technical materials for some of the courses, Mirabel's management developed the program (with the help of the college) independently of the corporate office staff. The work environment is different at Mirabel from that of Fort Worth. The following are some of the differences between the two plants.
- Production lines
- Union workers
- Average age is 55 years
- Average length of service is 23 years.
- Production teams
- Nonunion workers
- Average age is 29 years
- Length of service for all workers is less than nine years.
Its training also needed to be more generic than the training its Fort Worth counterparts currently receive, because the new Mirabel workers had had no experience in aircraft assembly, and the workers in Fort Worth generally have been on the job for years. "[Fort Worth managers] didn't try to impede us in any way, nor did we ask them for help," says Fortin. "We did our own thing."
The program's objectives were:
- To increase the number of employees skilled in aircraft assembly.
- To reduce the production-personnel turnover rate.
- To strengthen the nontraditional work environment on the shop floor.
The program began on January 1, 1989, with the recruiting process, and went through December 31, 1991. During that time, the company recruited and trained 240 high-school graduates.
Recruiting the right people was crucial.
The UIC identified individuals who were collecting unemployment insurance or who were in poorly paying jobs that provided little opportunity for advancement. Bell looked for individuals who had:
- A high-school diploma
- Excellent math scores
- A good overall employment record in the manual trades
- A good understanding of written English
- An interest in working in a nontraditional team environment.
The UIC sent the resumes of prospective trainees to Bell Helicopter's human resources department. Bell usually reviewed between 60 and 120 candidates' resumes at a time.
Next, Bell invited approximately 60 trainee candidates at a time for initial on-site, prescreening interviews. All candidates came to Bell Helicopter's plant, where they took paper-and-pencil tests. The tests included a psychological test (the General Aptitude Test Battery), a math test, an English-comprehension test, and various mechanical, dimension-perception and manual-dexterity tests. They also viewed a videotape about the company, learned about the training program and went on a tour of the facilities.
After the group interviews, the human resources staff reviewed the test scores and resumes, and reduced the list of 60 candidates to approximately 15. From there, human resources conducted reference checks and checks of medical background. The medical checks were helpful in determining whether candidates had any physical limitations that would prevent them from performing the tasks of the jobs they would be learning. For example, having a bad back might prevent a candidate from being able to crouch inside the tail of a helicopter.
The individuals whom Bell chose for the training program typically weren't fresh out of high school. "We soon realized that we wanted people who had a high-school background. We also wanted people who had had two to three years' experience working in a garage, or at McDonald's; or in places where they had had to work hard, such as in construction jobs, under difficult conditions or in jobs in which they had had to put in a lot of overtime. These people appreciated the environment at Bell a lot more," says Larocque. Bell HR professionals usually chose individuals who had graduated from high school, had received good math scores and showed an aptitude for working with their hands. Bell wanted individuals to train who had had some experience in the work world, but it also wanted them to be interested in working for a company that valued a nontraditional production environment.
"We had the opportunity to build something new," says Larocque. "We wanted to initiate something different because we knew that people were highly unionized in the Fort Worth plant. We wanted to implement a little bit more flexibility in the management of our human resources here at Mirabel."
People who had worked for a few years after high school, the HR staff reasoned, would have a more mature attitude toward work than individuals just coming out of school. They would lack ingrained traditional attitudes about what a work environment should be, however. "We wanted a program that we could use to train people from scratch," says Fortin. "We didn't want people who had a bunch of bad habits that we'd have to undo."
After the initial interviews, Bell's HR team reviewed applicants' test scores and called them back in for additional interviews, based on their apparent aptitudes for the jobs. In addition to questions about work experience and career goals, the HR staff also asked applicants about their interest in working in a nontraditional work environment. Bell extended offers to approximately 12 people from each group of 15 to join the training program. (Fifteen percent of all the trainees were women.)
-Charles Larocque, Bell Helicopter Textron, Inc.
Bell guaranteed jobs to the individuals who completed the training. "We didn't guarantee them where the job would be in the company, but we did guarantee them a job," says Ross Capogreco, a full-time training consultant who was responsible for helping design the program.
Job offers, however, weren't automatic. Bell offered them jobs based on three conditions: 1) that the applicants successfully completed the training, 2) that there was an opening available after the trainees completed the training program and 3) that the trainees were acceptable to the team that had the job opening. The final three weeks of the training program consisted of practical experience working with an existing work team. The team reported back to the HR staff about how well each trainee got along with others and communicated, and what his or her levels of leadership and technical skills were. Based on the team's verbal evaluation, the HR department either placed each graduating trainee with that group, or found a more suitable position within the organization.
Bell's managers had decided that it would train groups of people only if it was reasonably sure that there would be enough job openings for them when they completed the courses. "We didn't want to train people [to whom]we wouldn't be able to offer a job. It wouldn't have been good for our reputation," Larocque says. "Also, the federal and provincial governments were subsidizing the program, so we didn't want to train people just for the sake of training them." Nearly all the trainees were on unemployment when Bell chose them for the training program. Individuals continued to receive their unemployment checks while they were in training at Bell.
Expanding the training benefited the program.
Bell based the new training program design on the original six-week training program. Bell's HR department thought that the pace of the previous training program was too fast. "We sat down with some production managers and with the trainers, and we designed a program that would help the employees perform the tasks that they were going to do on the line," explains Larocque.
By expanding the courses to 14 weeks, Bell obtained better results. In the first eight weeks, students learned theory. The trainers devoted the next six weeks to practical application-a segment that they added later after discovering that they weren't giving trainees enough time in this section. "We added some practical time-some floor time-so that the people would get involved in their jobs and would know exactly what kind of job they would be doing before they finished the program," says Capogreco. "I think this was a motivator and helped the people in their short-term vision of what the jobs were and what [the trainees] would be doing."
Bell Helicopter installed two semipermanent trailers approximately 50 feet behind the plant. The college provided the trailers, using funding from the UIC, although Bell paid for leveling the ground and provided rest rooms. Bell since has bought one of the trailers from the college and plans to buy the other one. They cost approximately $50,000 to $65,000 ($42,000 to $55,000 U.S.) each.
Finding enough qualified teachers to instruct the classes proved to be a problem. The college placed recruitment ads in local newspapers. To everyone's surprise, many experienced Bell employees applied for the positions. Although it was reluctant to lose valuable workers, Bell agreed that it was an excellent idea for Bell production workers to teach some of the classes. It solved the problem by scheduling most of the theory-section classes in the evening, which allowed the employees to complete their normal duties each day. Evening classes started at 6:00 p.m. and continued until 9:00 p.m.
Most of the practical-application classes had to be conducted during the day, so that trainees could get experience on the shop floor. There were 12 students in each class. Two instructors from the college and about 10 experienced production employees from Bell Helicopter taught the classes.
"Most of the [Bell instructors] were supervisors," says Fortin. "The majority of them had never been in the classroom [as teachers]." Bell prepared them for the task by involving them in some train-the-trainer activities so that they would be more at ease in the classroom. "It wasn't too stressful for them because we prepared them reasonably well," he says. "Most of them really enjoyed it." Bell's in-house instructors and the instructors from the college were paid by the college out of UIC funding.
To make sure that the students learned the material that they would need on the job, the training staff in the HR department checked in periodically with production supervisors. By the time three groups (36 students) had gone through the entire program, HR asked for formal feedback from the supervisors and the next level of management, to find out if the training program was meeting their needs. Bell made adjustments to the training program as needed. Sometimes students needed to spend more time learning riveting techniques, for example, and less time learning how to read blueprints. "By the time the 20th group had gone through, we knew for sure what the needs were," says Fortin.
Although each group of 12 students stayed together throughout the training program, the group had different teachers for different sections of the course. For example, the shop-math teacher was different from the blueprint-reading instructor. Trainees had to take periodic exams and perform tasks throughout the training period-all of which they had to pass to advance in the program.
The language spoken in the classroom was French-the primary language in Canada's Laurentian region. Although Fortin says that at one point, HR considered conducting a class in English (some of the students were bilingual), the need for teaching classes in French was greater. All students, however, had to be able to read and understand written English, because all the manuals, software and blueprints that the company uses are in English.
Capogreco says that although the production department needed approximately 60 newly trained employees a month, they were getting only about 20. "It was better than getting zero," he says. Because Bell has a total-quality initiative, everyone agreed that it was better to teach the trainees well, rather than teach them quickly. "In aeronautics, you've got to remember one thing," says Capogreco. "There are no parking lots up there. That's the first thing we teach. Every time you touch an aircraft, you have human lives in your hands. Everything is of the utmost importance. It's better to take 30 seconds more to get the job done right than to take 30 seconds less and kill somebody."
Several departments at Bell worked together with HR to accomplish the program's goals. Other departments were: marketing, production, industrial engineering, finance, quality assurance, facilities, recruitment and training. Through a communications program, HR kept all departments up-to-date on how the program was progressing.
Individuals representing the UIC came to Bell to monitor the progress of the training program. When a class completed its training, the UIC asked the graduates to fill out a questionnaire. The survey asked them to evaluate the program. "Every now and then, they also would come and take a peek at the classes to see how it was going. They were putting out the money, so they wanted to know what was happening," Capogreco says. "We had a good relationship, and they were pleased with what they were getting," he adds.
What the program cost.
Unemployment and Immigration Canada subsidized the training program in part throughout the four years. Specifically, the program fell under the Manpower Shortage and Custom-based Training program areas. The funds were administered by the Laurentian region of the Professional Training Commission and paid directly to the National Aeronautics School, which was the main services supplier.
In all, Bell has recruited and trained 240 people in assembly techniques but actually hired 228 of them. "Ninety percent of the original trainees whom we hired are still here," says Capogreco.
The average annual salary for a college graduate between 1989 and 1991 was $30,000 ($25,000 U.S.). By recruiting, training and hiring high-school graduates instead, Bell could lower starting salaries to $20,000 ($17,000 U.S.) a year. For every shop-floor employee whom the company trained and hired, Bell Helicopter automatically saved $10,000. Multiplying $10,000 by the 228 trainees that the company hired indicates savings of more than $2.28 million (in Canadian dollars).
The starting salaries are lower for the high-school graduates than for college-educated employees, but Bell's employees have good opportunities for advancement. The company takes a pay-for-knowledge approach. "People aren't paid for the jobs they do; they're paid for the knowledge and the abilities they have," says Larocque. Although employees must perform certain specific tasks, they also must learn other tasks so that they become multiskilled.
Employees receive evaluations twice each year to determine the extent of their knowledge newly acquired on the job. Employees set new goals biannually. If they achieve their goals, they're eligible for salary increases. Approximately 95% of Bell's employees have their salaries adjusted upward twice each year.
The employees also discuss their career aspirations during their performance evaluations, and supervisors help them achieve their goals. Some individuals, for instance, prefer to move out of the production area and into office jobs. "If we can, we try to accommodate people and see if we can match their goals with ours," says Fortin.
Although the trainees learned a lot during their initial training, it takes as long as five to 10 years for an aircraft assembler to become highly skilled at this craft. The company's goal is to develop further the people it initially hired for the program.
Management plans to start another training program for three new groups of trainees in September of this year. Human resources hopes to have 36 more newly trained employees by early 1994 to meet the demands created by a new contract. "Also, we've had a little bit of turnover [lately]-about 2% or 3%," says Fortin.
The organization also intends to increase its development of employees. In 1992, for example, Bell Helicopter invested in 50,000 hours of training. This training included some advanced assembly courses to increase the technical skills of the people who initially had gone through the shorter version of the basic assembly-techniques program.
"We couldn't have given them this advanced-assembler course two or three years ago because it would have gone about 20 miles over their heads," quips Fortin. "They wouldn't have caught onto it. You have to pace the training you give people."
In addition to skills-improvement courses, Bell Helicopter also gives supervisory training courses to individuals who are interested in becoming supervisors. These courses include seminars on motivation, leadership and interpersonal skills, and on team-building techniques.
Training produces favorable results.
As a result of the training program, HR managers at Bell say that turnover has taken a turn for the better. The numbers prove them right. The percentage of people who leave Bell Helicopter has declined, from approximately 25% in 1987 to 17.5% in 1988, then down to 3.3% by 1992. This represents a 78% drop in turnover, even though the number of employees increased by 83%-from 773 workers to 1,250 workers-between December 1989 and December 1991.
The company's productivity has risen 181% and sales by 280%. Bell Helicopter's market share has increased from 27% in 1988 to 37.7% in 1992-an increase of 40% overall.
The entire program cost the company a total of $3.6 million ($3 million U.S.) for the four years. Bell HR managers estimate the return on investment of this project at $2.5 million ($2.1 million U.S.).
Human resources management at Bell admits that the training program wasn't the only reason for the plant's success in the past few years, but human resources managers say that the people they've trained to work in the production area have contributed favorably to the company's overall performance. Because there had been a shortage of qualified personnel in the assembler field, Bell Helicopter had to train its own work force, if it was going to stay competitive and grow.
"It wasn't easy," says Larocque. It required a lot of hard work. The payoff, however, seems to have been well worth the effort.
Personnel Journal, May 1993, Vol. 72, No.5, pp.60-76.