NASHVILLE, Tennessee - BMW sent two of its top bosses to do some research in the USA when it started to consider a site for its new North American plant.
Helmut Panke and Bernd Pischetsrieder visited churches. They peeked into backyards. They parked their minivan at truck stops and stepped inside for coffee.
They wanted to know the soul of the people who were to work at the German automaker's US plant. BMW wanted not just good workers, it wanted good people, too.
BMW ended up picking Spartanburg County, South Carolina, in 1992. The two scouts have since risen to bigger roles: Pischetsrieder is chairman and Panke is a board member. The plant they helped create now employs 2,000 people.
But Panke hasn't forgotten the lessons from the search. By knowing the South Carolina work ethic and moral ethic, BMW avoided a common hazard that trips up some companies when they set up new plants in unfamiliar places.
He listed other hazards in his address to the Automotive News Southeast Conference:
Not understanding the motive behind the plant
In BMW's case, the US plant was a major step towards an international strategy. BMW was reacting to some alarming trends. BMW was a small German automaker. Conventional wisdom said small companies wouldn't survive. BMW was hurting in the USA, the world's biggest market. The boom years of sales to yuppies had come to an end. The plant has strengthened BMW in the USA and internationally by sending cars to 100 markets abroad.
Not having a long-term strategy
BMW couldn't transfer its German manufacturing practices to the USA. And it couldn't have separate standards on two continents. So it used the South Carolina plant to create a new common system for the world.
Not understanding how the new operation would change a company
BMW knew its young plant in South Carolina couldn't handle engineering changes in the same way BMW plants in Germany could. So BMW created simpler, more efficient processes in Europe to match those in the USA.
Not understanding the impact of actions on the new home
Lots of states wanted BMW. Some offered tax breaks. BMW turned down some offers because the tax savings meant less money for local schools. Panke said BMW didn't want to hurt education in a new home.
Forgetting the needs of suppliers
BMW needed its suppliers to be deeply involved in the venture. But it can be tougher for suppliers than it is for automakers to move into a new area. Production problems can result. Because BMW expected them, and planned for them, the South Carolina production start went more smoothly.
Not accounting for regional differences
Not all areas of Germany are the same. Neither are those in the USA. Automakers must realize that vast cultural differences can exist, Panke said, even if a new plant is just a few hundred kilometers away from home.