The Japanese Approach to Productivity
To fully appreciate the elements of Big JIT. it is useful to re, view the history and philosophy of its application in Japan. The ability of Japanese manufacturers to in high quality. low-co t production. which publicized in the 70~ and e.irl, 1980s . . till holds despite their current economic problem” Indeed. the Japanese ,till retain the market dominance in televisions, VCRs. cameras, watches, motorcycles. and <shipbuilding
that they established over 20 years ago-in large part due to.
Many people believe these accomplishments are attributable to cultural differences. They envision the Japanese dedicating their lives to their companies and working long hours for substandard wages. which would be unthinkable in America. The evidence. however. is contrary to these distorted notions. Consider the following: In 1977. a Japanese company named Mat shite purchased a televise iron plant in Chicago from a U.S. company. In the purchase contract. Matsushita agreed that all the hourly personnel would be retrained. Two years later. they still had essentially the same 1.000 hourly employees and had managed to reduce the indirect staff by 50 percent (see Exhibit 1-1-.2).Yet. during that period, daily production had doubled. The quality. as measured by the number of defects per 100 TV sets built, improved .fO-fold. Outside quality indicators also improved. Where the U.S.company (Motorola) had spent an average amount of 5 16 million a year on warranty costs. Matsu hits expenditures were 52 million. (That’s for twice as many TV sets. so it’s really a 16-to-1 ratio.) These are big differences-differences achieved here in the L’nited States with American workers. The sue is. how d.i the Japanese accomplish cane learn from them?A!>a starting point. it’s important to understand that the Japan-,e. as .l nation. have had one fundamental economic goal -since 19.f5: full employment through industrialization. The strategy employed to achieve this goal called fur obtaining market domin.mce 111 verve select product areas. They very carefully selected those induce-series in believed they could become dominant and concentrated on them. rather than diluting their effort, over a broader spectrum. The tactics of the Japanese were threefold: ((/) They imported their technology. (The entire Japanese semiconductor industry was built around a $25.000 purchase from Texas Instruments for the rights to the basic semiconductor process.) Instead of reinventing the wheel, they avoided major R&D expenditures and the associated risks. then negotiated license agreements to make successful. workable new products. (h) They concentrated their ingenuity on the factory to achieve high productivity and low unit cost. The best engineering talent available was directed to the shop floor. instead of the product design department. (c) Finally, they embarked on a drive to improve product quality and reliability to the highest potable levels, to give their customers product reliability that competitors were not able to supply. The implementation of these tactics by the Japanese was governed by two fundamental concepts (most of us agree with these concepts in principle. but the difference is the
degree to which the Japanese practice them 1:
I. They are firm believers that in every ay, shape, and form you must eliminate waste.
2. They have a great respect for people
Elimination of Waste
When the Japanese talk about waste. the definition given by Fujio Cho. from the Toyota Motor Company. probably states it as well as anyone. He calls it “anything other than the minimum amount of equipment, materials. parts. and workers (working time) which are absolutely essential to production.” That means no surplus. no safety stock. That means nothing is banked for future use. If you can’t use it now, you don’t make it now because that is considered waste. There are seven basic elements under this concept
I. Focused factory networks.
2. Group technology
3. Jidoka’-quality at the source.
4. Just-in-time production.
5. Uniform plant loading.
6. Kanban production control system.
7. Minimized setup times.