Blog: Thomas Meloche

Thomas Meloche has been an entrepreneur for as long as he can remember. A native Detroiter and U-M grad, he co-founded, managed, and sold nine different start-ups in Michigan over 20 years, including the professional service firm, Menlo Innovations LLC. He is currently President of Procuit (pronounced Pro-Q-It) Inc.

Thomas will be writing about untapped Michigan potential, and more importantly, how to tap it!

Post No. 2

Chrysler, Want To Make an Extra 50 Billion?
(Or Why Detroit Needs Open Source)

Did you know that there is an IT breakthrough hidden inside of Chrysler that in the right hands could be worth 50 billion dollars or more? I’m not talking research, I’m talking developed, deployed, and operational software. The funny thing is, Chrysler almost assuredly doesn’t even know what it has! In fact, it is likely they have already turned off and abandoned this bit of amazing IT innovation.

Don’t get me wrong. At least two Chrysler employees knew exactly what they had, but they were just lowly software engineers in an auto company. They didn't have the temperament to spin-off, raise capital, and start a new industry.

Here is what happened. An internal software initiative had already failed two or three times, and yet another team had taken seven person-years to try to do it right. Unfortunately, the resulting system was slow, buggy, and behind schedule.

The project involved data collection for manufacturing plants. Not just a little data, but a great pile of data for nearly every part for almost every machine (several hundred to several thousand machines per facility.)

To make it more interesting, the data being collected would be different for different machines and the data may change over time. Chrysler needed to know how many machine cycles a particular piece of tooling has made on one machine, and on another machine, how long the cycle time was, and on and on. And this was just the data collection. Once the system had the data, they needed to provide alerts on certain conditions, warnings on others, and reports and real-time views on it all. And these needed to be able to be changed in real-time.

To make a long story short, a miracle occurred, and a completely new version of the system was written by one individual in two months – put another way, 84 months worth of work was reduced to 2 months, and the results were error free. This is what an employee told me later:

"A little less than two months later, this guy tossed me the product release, I had to laugh, he emailed me the release! How could something that will fit in my email possibly accomplish even a fraction of the requirements! I chuckled under my breath, and performed the install.

Then it hit me! This was working, just like he said it would.

And, I didn’t have to code the changes for each machine; it would create what was needed from the machine specifications!

I am always the skeptic, so I presented my first challenge: O.K., smart guy, each minute on this line costs $1000.00, sure you are collecting the down time, but I want to split the cost between every “Downed” machine on the line, on a per minute basis, and at the end of the day, I want to know which machine cost me the most dollars in productivity.

The next morning, I opened my E-Mail to find a configuration file.

I had him now….he forgot to send me the new release! A quick trip by his desk left me shaking my head, I didn’t need a new release, all I needed to do was apply my new business rules to the existing system!

My friend, this is agile.

This is what development was supposed to do for us.

I threw seven man-years of code in the trash that day, and launch a great system at a fraction of the cost. Using traditional methods, I could have spent years trying to design a system just to tell me the high cost machine on my lines, I got it from this system in a single day."

Basically, Chrysler was shown by a lone consultant on a small project a totally new way to develop industrial software, a way that dramatically reduced cost and improved quality. This approach was so innovative that it could have been spun-out into an entire new software industry. Of course, that would require time, energy, and capital, and automotive companies are not software companies.

So what happened? The innovation was never developed further. All of our big automotive companies treat IT as proprietary and confidential. And, near as I can tell, all of them are continually redoing the same projects over and over and over again.

The result of this secrecy policy? Well, I am sure even Sue Unger never knew this particular innovation existed. You see innovation is a delicate thing that needs to be carefully tended, most of the time it isn't even recognized as innovation by experts in the field. Make every line of software internal and highly confidential, and even you will not know about your own innovations when they happens.

Innovation born. Innovation dies.

Sadly, I know of many of these stories in Michigan. Michigan has incredible talent in software engineering. We have tremendous innovation. However, because all of the software is treated as an internal secret, it dies internally and is a secret EVEN TO THE COMPANY THAT CREATED, FINANCED, AND USES IT.

The solution? In my opinion, Detroit automotive companies should seek to open source almost all of their software initiatives. Everyone needs to control a factory floor, everyone needs to meet payroll, everyone needs to manage suppliers, and frankly none of you are that good at developing software.

So, when you do spend a fortune developing and deploying it, don't hide it, open source it! Let others unabashedly benefit from your investment and nurture your innovation.

Had this innovation at Chrysler been properly nurtured in an open source community, the IT costs at all of our Michigan automotive companies would have been slashed, and it would still be dropping! Not by moving to cheap offshore labor, but by eliminating most of the labor entirely. Think about it, 80 months of labor reduced to 2 months of labor. I won't even calculate the percent savings because it is too embarrassing to the industry!

Detroit, do you want to dramatically reduce your software costs? Then open source your software projects! It is probably the only way you will actually be able to benefit and leverage the innovation that is incurring inside your walls. It you are clever, or perhaps I should say if you are stupid, you might even get a piece of the 50 billion dollar non-competing industry that arises from the innovation.

We'll talk more about being that stupid tomorrow.

Tip of the Day: Two open source packages I use continually are are Open Office and Firefox. Check them out.