Focused Factory Networks
The fir« decent is focused factory networks. Instead of building a large manufacturing plant that docs everything (i.e a highly vertically integrated facility), the Japanese build small plants that are highly specialized. There are several reasons for doing this. First. it’s very difficult to manage a large installation: the bigger it gets. t e more bureaucratic it gets. The Japan-.e style of management does not lend itself to this kind of environment. Second. when a plant is specifically designed for one purpose. It can he .onstructed and operated very economically. Fewer plants in Japan have a, man ,h 1.000 or more employees. The bulk of them. some AI 1.000 plants. have bet« can 31J and I.O()O workers and over IRO. have f. When we talk about the Japan approach to productivity and the impure-. I’ve thing’ they’re doing. we’re primarily about middle group. in which not of their model manufacturing plant, arc located. Two illustrative examples of factories have been cured by the Ford Motor Company: The Escort automobile needed ” trans-axle. which a going to require a 300 million expansion at the Ford plant in But Ohio. Ford asked the Japanese . furan equivalent quotation and Tokyo-Kogyo offered I,) con-true: ” brand-new plum I uh the same rate of output at a competitive unit price for $100 million, a one-third ratio. A second example relates to Ford’s Valencia engine plant. which produces two engine per employee per day. and requires 900.000 quare feet of floor space. An almost identical engine is produced by the Toyota Motor Company in Japan. where they make nine engines per employee per day in a plant that has only 300.000 quare feet of space. The issue is not only productivity per person but also a much lower capital investment to achieve this manufacturing capability.