Nathan Leeming: Head of Quality Lotus Cars

Dave Leggett interviews Lotus Cars’ Head of Quality Nathan Leeming.

Nathan Leeming

Can you describe your role and how you mainly spend your time?

My role at Lotus is Head of Quality, which means I am the senior management representative responsible for the quality of the cars we design, engineer and manufacture as well as the parts we purchase to make them.

One of the great things about this is there is no typical day, each morning that I arrive at Hethel brings fresh challenges to face and it’s this variety that makes the job rewarding.

Whilst I obviously have routine meetings on a daily and weekly basis where we review performance of quality and production and take appropriate management action, the variety could see me out in the factory reviewing product one day, in a design or engineering review the next or off-site visiting a supplier. I really love the fact that I am involved in all aspects of the product lifecycle and value chain, from parts through design and development into production.

Obviously, the priority is to ensure the cars we are making are the best that they can be and this means reacting to issues as they arise, and ensuring the resources are in place to address them. At times this does cause a level of fire-fighting but the teamwork within Lotus when a crisis happens is actually one of the pleasures of the role. Often my role is to pull together different departments to gather the facts and then make a decision on the right course of action and make recommendations to the COO. This makes the role quite high pressure at times but is all part of the challenge of managing quality within any manufacturing organisation.

When not fire-fighting my role sees me stepping back from the frontline to map out medium and long term strategies for Lotus Quality. We have already made significant changes to many of our products and the processes we use to develop, make and check them and with my management team we have developed a three year development plan to move the whole game further forward.

Lotus is obviously a relatively low volume carmaker. Can you describe the approach to quality control at Lotus and how it differs from the typical approach that would apply in larger scale automotive manufacturing?

The quality control processes that we use here at Lotus are based upon many practices that would be found in high volume manufacturing but tailored to the needs of our volumes and product. If I had to summarise the key differences it would be the low level of automation we use together with the amount of work-content a lotus team member needs to learn.

In terms of the former, our quality assurance processes are very much based around manual checking of the product as it is assembled, such is the nature of our manual build processes and the relatively low investment tooling we use to make the parts that go into our vehicles. We have to inspect quality into the product.

This is very much at odds with a high volume car plant where high investment tooling yields low variability parts and hence fully automated lines with minimum human intervention, and therefore only minimal inspections to confirm basic functionality and build is conducted.

If we consider build volumes at Lotus as a small niche manufacturer the cycle time is our other key challenge. Typically in say a Ford plant a quality team member may check just the right hand front corner of a car for fit and finish only and may have a cycle time of less than a minute to do so.

Their approach is a quick overcheck by lots of people to ensure the whole vehicle is checked during its manufacturing process. At Lotus we have dedicated ‘quality inspection points’ at critical phases of the vehicle assembly and in these stations we have highly skilled inspectors who check all aspects of the vehicle including fit, finish and function to find all potential customer issues.

We then work with manufacturing to repair these issues and always ensure that we, as the independent quality over-check, sign off all repairs and adjustments made, to ensure they meet our quality standards.

How has car manufacturing at Lotus and the approach to quality changed over the years?

Having only been at Lotus for some 18 months, that might be a difficult question for me to do justice to. My priority is very much the future and how we can further improve the processes and methods to engineer and manufacture our vehicles. I have many experienced old hands from within Lotus who can ensure we don’t make past mistakes plus a few newer team members from other OEMs such as Aston Martin, BMW, Chrysler and Alfa Romeo, who bring new ideas and different techniques we can adapt and freshen things up with.

In terms of measurability, things like defects per vehicle, how do you actually measure that and how does it feed back into manufacturing processes?

For all of our internal quality measures we run regular cross-functional meetings within the manufacturing plant. Within these meetings issues are allocated owners and we follow these up to ensure we have customer containment in place and a long term countermeasure under development.

For instance, a simple process issue will be allocated to a production supervisor who will feed this back to his team, check the stock and come back to the quality manager responsible with a safe chassis number. We then monitor from this safe chassis number for a minimum number of cars to confirm that we have delivered the improvements we expected to see before we close the issue off.

All issues found from the field are immediately added to our ‘pass to sales’ check process to ensure a fully finished vehicle doesn’t exhibit this fault where it can be detected. Our philosophy is always one of protecting the customer, even where we are yet to find the root cause of a problem it is vital we detect it and wherever possible stop it reaching our customers.

Where issues are more complex or cannot be solved simply, these are escalated into a weekly senior management quality review which we call the Quality Management Committee. This gives us a forum to escalate issues where additional resource may be required with owners having to present their progress to the COO. These reports provide a level of focus and direction that they often need.

If quality control and manufacturing activities are separate, how do they actually interface and how does that work in practice?

When I joined Lotus the quality department reported to operations as part of the wider manufacturing department. One of the first changes implemented by our new COO was to transfer quality out of operations as a directly reporting function into him. This separation might have caused tensions between the two groups but to be fair it hasn’t – I think the fact that the teams have been so closely aligned previously means that excellent working relationships have helped in that respect.

That doesn’t mean that it is always a bed of roses though, for sure we face a conflict or two on occasions. My priority is towards the quality of products whilst others may have differing priorities. But as a quality manager you also have to recognise the need to make pragmatic decisions that don’t negatively impact either the customer or the bottom line.

Also, my management style is not one of conflict and in reality the best way to make high quality product is through close teamwork and cooperation. Digging my heels in or getting aggressive may work at times, and I have been known take that approach when necessary, but it’s not a good management approach in the modern working environment.

Are there industry standards that you can employ to help with, say, quality auditing?

Indeed, we have recently changed our product quality audit process to align it more with industry best practice. We take a finished product that has been through our full manufacturing and quality assurance process and assess it for full cosmetic, functional and dynamic performance. We call this assessment the Lotus product quality audit (LPQA).

It is important for us as this is our quick feedback measure of how effective our quality control process is and a real driver for improving the perceived and actual quality of the products we make.

The assessment is conducted from a critical customer perspective and any error states we find are rated based on their severity to customers. All high scoring issues are allocated owners from within the Lotus team who then investigate the issues and put in place corrective actions within the manufacturing process as appropriate.

Since introducing our new quality audit process we have made significant strides to improve our build quality. If you take our Evora model as an example this new process and the efforts of the Lotus team to address the issues we find has seen a 59% improvement in performance in the last 6 months.

This type of audit process is used by the majority of auto makers worldwide – although the scoring and weighting may differ, the principles are pretty common globally. So this is a good example of how we are taking the best processes of our peers and industry leaders and tailoring them to the needs of Lotus.

And how does the picture look in terms of things like defects per vehicle on Lotus cars?

Our internal measure of defects per vehicle (DPV) has seen significant improvement since we introduced our revised quality assurance process. Evora has improved 46% and the Exige has seen a 33% improvement.

The main driver for this level of performance has to be the willingness within the Lotus team to accept the issues found and fix them. The quality process itself only highlights the problems, it is the positive attitude of the wider teams within manufacturing and engineering and the drive from Lotus management that has turned these problems into opportunities and delivered the improvements we see in KPIs.

The problems that we have fixed include process concerns where manufacturing have made changes, engineering concerns where we have made design changes to address and of course supplier part issues which we have fed back to our suppliers for resolution.

I guess there must be quality issues that also involve parts suppliers, for example a component that is prone to fail. How do you deal with that?

Supplier concerns are handled via our Supplier Quality Assurance (SQA) department, and this is an area we are now paying a lot of attention to having stabilised our internal quality control processes. For any OEM assembling a complex product the quality of parts we receive from our supply chain is critical and we recognise we have much to improve in terms of supply chain management.

Today, we have a small dedicated team of engineers who take component problems found at Hethel and then engage our part suppliers to resolve. This will often involve last minute travel across the UK and Europe to visit our suppliers’ manufacturing facilities to understand how we can fix these problems.

At the moment this area of the quality function is very reactive. One of the things we have agreed going forward is to expand this team by 40% to have a split role – teams dedicated to reactive problem solving like today, and more importantly a team dedicated to pro-active work to break the fire-fighting cycle for the future. Our intention is to have engineers dedicated to supplier development and supplier preparation activities. These teams will work to ensure we get improved long-term supplier performance and that for new models and new parts we have clear agreed standards, capable processes and good quality parts in advance of start of production.

In terms of readying a vehicle for production from the prototype stage, can you describe how that process works to ensure that quality in series production is not compromised and that quality is built in?

In terms of new model development and launch we have made several changes to ensure the quality is right before we release the product to market, as was demonstrated with the Exige S model in 2012.

The most important step taken was to ensure clear concise communication of product status and manufacturing readiness between the project team and senior management. To realise this we implemented a formal ‘handshake’ review prior to each prototype stage to ensure all of the key elements were in place and all stakeholders agree to proceed with vehicle build.

It was these reviews that drove the right behaviour within the Lotus team to stop with Exige S and address some of the technical and process challenges we faced prior to pushing the car into the market. This was a very difficult decision for all of us given our belief in the product and the desire within the market. But escalating the issues to senior management, on a daily basis in the latter stages, ensured that the right decisions were made and that the product was the best it could be before we were happy to start shipping the first cars out to expectant customers.

From a product quality perspective we also set clear targets for key vehicle performance attributes applicable to the end customer. We then measure these at each prototype build and where we have a gap to target we develop action plans to close. At the series production phase we don’t release the cars to market until all of these targets are achieved and quality have signed off the functional and aesthetic performance of the new model. To deliver this we have put in place a dedicated team of quality engineers to work on new model development to drive quality into the design and development process going forwards.

The next step for this team is to focus on failure mode avoidance (FMA), ensuring we prevent recurrence of previous issues on new models and removing potential new failures during the design phase. Through these actions, I am confident the new cars we build in the future will be of an even higher quality than those we are making today.

As we all know, human beings make mistakes. How far is manufacturing automation progressing at Lotus and what impact will that have on future quality levels?

In all honesty the Lotus manufacturing process we use today does not really feature much in the way of automation. The nature of our build process and our low volumes means the return on investment for automated lines or robotic assembly just doesn’t add up.

Currently we have no plans to significantly change our manufacturing strategy and our medium-term investment is being targeted towards new model development rather than purely on facility investment for current models.

From the customer perspective (the customer experience) how are expectations in the area of quality ‘managed’?

Our inputs from a customer perspective mainly come though the aftersales operations team based in Norwich. We have a small team within our aftersales and service support function who provide a contact and technical support function for both dealers and customers alike.

The issues they escalate from the ‘field’ are fed into a dedicated quality team at Lotus who do an up-front investigation, allocating them to team members within Lotus to resolve.

This team runs regular reviews to follow the problem resolution process which is reported weekly to Senior Management.

This regular forum is the driver to get the right resources in place to tackle issues affecting our customers and dealers. Since its inception in Summer 2012 this weekly quality management committee has already closed 46 real customer concerns across our three model lines.

We are also looking to gain more direct feedback ourselves from the field in terms of two separate activities for 2013. Firstly, we are going to pilot a postal customer survey. This will enable us to get real feedback on our products, not just in terms of hard faults, but also the usage and perception of our customers. This information will then be analysed by the quality department and fed into both current and future models to drive improvements in customer satisfaction. Our second initiative is to work closer with our aftersales operations team and dealer network through regular Lotus-dealer reviews. This will get us closer to our partners and understand their issues, the feedback they get from customers and also allow us to share with them the actions we taking within the factory to make improvements.

Can you give an indication of where Lotus is today, quality-wise, and where you would like Lotus to be in the future? Are there targets to aim at?

I am very pleased with the progress we have made within Lotus over the past 12-18 months. I believe that in terms of functional performance and reliability we have made significant improvements in a number of areas for our current models.

The support of our new owners in particular and their recognition of the importance of quality for a brand like Lotus have helped immensely in making these changes possible. Their continued commitment in terms of resources today and for the future is a welcome platform for us to build upon.

As we look to develop future models we have to acknowledge that our quality in terms of aesthetics, function and usability is competitive in all areas and that we match the current accepted industry norms.

I believe we can achieve this and maintain the driving purity that makes our brand unique, and success for me would be to see more customers stepping out of competitor products into ours without having to feel that they are making too many compromises to do so.

From an automotive business perspective our quality by any measure is competitive and the processes we are now using or implementing are all industry best practice. The combined experience within my team from both Lotus and other companies from which they have joined are a strong asset for us.

I am pleased with the progress we have made internally in improving our performance and our focus now is to work with our supply chain to deliver similar improvements in process and performance for the materials we buy to assemble our vehicles.

I would be the first to acknowledge there is still much to do at Lotus but the journey we have started on is an exciting one and we will all be proud to continue improving our current models at the same pace cars and to deliver exciting future new models with even higher levels of customer satisfaction.