While brushing his teeth, Jeff Liu does squats. Otherwise, he says, those minutes go to waste. The Chinese-born businessman also does 140 pushups daily: 70 when he wakes and again before bed. Whether convenient or not, whether sick or not. He’s done this for 15 years.
On this Thursday morning, during our Zoom call, he stands up from his chair in his Ohio office and, angling sideways, demonstrates the pushup technique he’s found most effective: fists closed and downward to the floor. Never an open palm.
“A pushup is then equal to one and a half regular pushups,” explains 59-year-old Liu [MSc/93].
Maximum output from the strategic use of resources. It’s the same lean efficiency the UM engineering alum brings to his leadership in the auto manufacturing industry where, he says, a day of lost production can cost their clients US$20 million and companies vie to be suppliers for the biggest players. Liu offers a clever quip to describe this race to produce quality—and do so more quickly than anyone else—while also balancing realistic expectations: You don’t need to be the fastest in a group outrunning a bear, just faster than the person beside you.
Netflix viewers got a glimpse of his business savvy in the 2019 documentary American Factory, which follows a captivating experiment that unfolded in Moraine, Ohio, with Liu at the helm as president and CEO of Fuyao Group North America. The film (which Rotten Tomatoes gave a 95 per cent, and which likely got more eyes given its famous producers—Barack and Michelle Obama) begins with old footage of the shuttering of a General Motors plant, the main employer in this city of fewer than 7,000 people, and the laid-off workers navigating a blow to the community’s livelihood.
Things look up when, in 2014, the auto-glass maker announces their plan to take over the site, bringing managers and technical experts from its home base in China and rehiring hundreds of locals to work alongside them. The move flips convention—that North America only outsources to China, not vice versa—with the intent of bringing supply closer to distributors in the United States. By following this JIT (or Just in Time) model, they reduce their costs for the storage, managing and shipping of goods. A US$1-billion commitment made it one of the largest greenfield projects in U.S. history.
Over three years, a film crew tracks clashing cultures among plant workers. In one instance, a Fuyao staff member tries to bridge the gap, teaching Chinese employees about how American demeanor may differ from theirs. “Americans say what they are thinking…. They don’t hide anything,” he explains. “They dislike abstraction and theory in their daily lives.”
Unexpected friendships emerge. From the Americans, the Chinese workers learn how Wheaties cereal makes for good bait when fishing for carp. One U.S. worker, Rob Haerr, invites 13 of his Chinese co-workers for Thanksgiving, buying a 25-pound turkey and the biggest honey-baked ham he can find, before giving them rides on his Harley. He calls his closest colleague, Wong He, his Chinese brother; “I think the world of him.”
But tensions mount as differences in job expectations surface, compounded by language barriers. Disciplined Chinese workers, some of whom won’t see their families for a year, are accustomed to longer shifts and work weeks, with greater productivity demands. We hear criticism that the Americans are lazy, too chatty, and joke around too much.
“We have to find something in the middle,” says Liu. They can learn from one another, he adds. Liu sees Fuoya as a global company—not Chinese, not American. Four years removed from the release of the film, which won an Academy Award for best documentary, he says, “How do you merge the culture? I don’t think there’s a bad or good people. I think the only problem is communication.”
He was brought in by Fuoya’s chairman to turn things around a year after the plant’s opening—by then they had lost US$90 million. Despite decades of experience in global purchasing and Chinese-American relations from working at General Motors, Liu had never before been on the floor of a production line. To complicate matters, management and workers were butting heads over a push by employees to unionize.
“To be honest, when I took the job, the first day, sitting in my office, I regretted it,” says Liu. “Everything was kind of chaos. But for me I have no way to go back. You know, I have to move forward. So, I promised myself that give me one year. See, [if] I can survive.”
During his tenure, Liu managed to turn a multi-million-dollar loss into the most profitable auto-glass company in North America. How did he do it? A huge part was breaking down barriers, he says. “I started from the beginning.”
He worked 18-hour days for those first six months, with an open-door policy, weekly roundtables and chats over coffee, inspired by his approach to raising his then-teenage son: Even if the two of them disagreed, they worked through their differences, no matter what. Liu also led every new employee orientation for the next five years.
“If you want to earn the trust from somebody else, you got to respect them first. They don’t respect because…you’re the boss. It’s not automatic [that] people respect you. No, you got [to] respect your people first. That’s my philosophy.”
He says he learned about hard work in his younger years as a waiter, putting in 14-hour shifts. Liu insisted his daughter, now an industrial engineer, first log hours as a factory worker.
“I work from [the] bottom so I know exactly how all the people [are] thinking. So that’s why, as the top guy…I’m going to think, you know, how do we actually motivate people to work together? So that’s exactly what I did.”
He regrets losing employees over the union debate, which took centre stage in the film. While viewers might have been left thinking management took too hard a line, Liu argues what they didn’t see was the human connection happening behind the scenes that prompted the majority of workers to vote “no.” The better way to meet their needs—and keep a production line moving—is to nurture a good work environment, rather than introducing a third party, asserts Liu.
Creating a better place to work means rethinking conditions typical of factories, he says. For example, at Fuoya, no longer do employees work within the extreme heat of their furnace equipment, he points out. Fuoya spent US$20 million to automate the production line, with robotics taking over in strategic places, including heavy lifting. With reduced workload and improved productivity came greater profit shares for existing workers.
“That’s why everybody doubled their bonus every year,” says Liu.
What Fuoya did in Moraine has since become a Harvard Case Study. And Liu’s contribution propelled him to his latest venture, as CEO of Semcorp Advanced Materials International, which produces separator film—a component in electric car batteries. From America’s rust belt, Liu manages operations in three time zones, beginning with Europe in the morning and ending with China before bed. They’re building a US$1-billion factory nearby, in Sidney, Ohio.
As manufacturing needs evolve so too must the face of factories, he says. Today’s workforce—young people especially—are less interested in filling a monotonous job that can wear on you day in and day out, Liu adds. Automation and human roles in this industry must become increasingly complex for plants to prosper.
“It’s something you got to change otherwise you won’t survive.”