For decades, Lear Corp. made car seats. Today, with the help of virtual reality and other digital technologies, Lear makes a whole lot more—and makes it a whole lot faster. Lear Corp used virtual reality to envision the interior of the Chevrolet Express LT, a new luxury van that Lear helped design and build. Within two years, the first models started coming off a GM assembly line near St. Louis.
In the automotive world, that kind of turnaround time is almost impossibly quick. Even when the shell of a vehicle already exists, as it did in this case, the vehicle design schedule traditionally spans about three years. Between the initial concept and the production-ready design lies a painstaking clay-modeling process that typically involves at least a half-dozen costly iterations. But by shifting much of that process to a virtual reality environment, Lear cut the product development period to a year and a half. GM awarded Lear the lucrative contract for the Express LT largely because of the speed and flexibility that Lear’s use of technology makes possible. “We always thought of Lear as a great seating company,” says Linda Cook, 45, GM’s planning director for commercial trucks and vans. “We didn’t realize how much else it could do. Lear really needed that technology to get our attention.”
Lear, based in Southfield, Michigan, has roots that go back to 1917. By the 1990s, it had become the world’s biggest manufacturer of automotive seating. (If you’ve sat in anything from a Chevy to a Ferrari recently, then you’ve probably enjoyed the comfort of a Lear product.) But in the mid-1990s, the auto parts industry entered a period of aggressive consolidation. Instead of relying on thousands of small vendors to make each part separately, automakers wanted to buy complete systems from a few big suppliers. So Lear snapped up smaller companies and combined them into an operation that was capable of making an entire vehicle interior. It also invested heavily in the latest computer-aided design (CAD) software and in other new technologies. By 2000, thanks to acquisitions and expansion into new product areas, sales had climbed to $14.1 billion.

CAD first appeared in the auto industry in the late 1970s, but it didn’t reach a critical mass of power and capability until the mid-1990s. That’s when Lear decided to invest in an animated virtual reality package from Alias|Wavefront, a software subsidiary of Silicon Graphics. By 1998, the Reality Center was under construction, complete with a triple-projection screen and three digitized drawing boards. Out went the chisel; in came the cursor. Thanks to this technology, Lear has all but eliminated the slow, muck-filled process of building prototype after prototype from brownish-orange sculpting clay. However, Lear typically makes at least one physical prototype of every product that it develops in the Reality Center in order to test tactile issues. In exploring new technologies, the Lear team was tempted at first by the prospect of using them to change long-standing ways of working together. Take the Internet. By digitizing much of the design process, Lear made it possible for designers to send their work back and forth over the Net—thereby creating a virtual workplace that brings together people from all around the world. In November 1998, for example, Rothkop traveled to a Volvo design center in Sweden and used the Net to work with colleagues at the Reality Center back in Southfield. Where the Internet extends or enhances communication, the Lear team has embraced it. For the most part, though, the real work of designing auto parts remains an up-close-and-personal business. For that reason, when it came to building the Reality Center, Lear put a premium on creating an environment that would foster collaboration. The team considered a stereoscopic “cave,” a space in which people can sit and be completely surrounded by a screen. While that arrangement simulates being in a car, “it can kind of make people nauseated,” Rothkop says. Worse yet, only one or two people at a time can sit in the cave—a situation that has dismal implications for collaboration. Instead, the Lear team chose a simpler design for its virtual reality room, one that has a flatter screen and a more open space. There’s even room in front of the screen for a full-sized truck, so Lear designers can bring together the real and the virtual whenever their work calls for that. Another temptation that Lear executives faced was to think that CAD and VR would let them break down traditional job barriers and combine the roles of designer, sculptor, and animator into a single worker. But, in Lear’s experience, the seemingly artificial barriers between jobs often turn out to be quite natural. So Lear drew back from the notion of combining jobs.

Discussion Questions

1. What is the strategic advantage afforded to Lear from virtual reality? How does this
technology help it compete?
2. Do you think the CAD system offers Lear strategic advantage? Explain.

3. Apply the value chain to demonstrate how the virtual reality system adds value for
Lear and for General Motors.