Countries Don’t Have Production Systems, Companies Do

Kobe Steel CEO apologizing (10/2017)

“Companies Everywhere Copied Japanese Manufacturing. Now the Model Is Cracking. Concepts celebrated in business publications worldwide have been tarnished by a string of scandals.

Japan’s reputation for flawless manufacturing quality and efficiency transformed the country’s postwar economy, changed business practices worldwide and spawned a library’s worth of management manuals and business advice books. Now, the model is cracking.

Kobe Steel Ltd., Mitsubishi Materials Corp., and Subaru Corp. have all admitted in recent months to manipulating quality inspections, though all say no safety problems emerged. Takata Corp. declared bankruptcy last year after admitting to supplying more than 50 million defective vehicle airbags in the U.S. Mitsubishi Motors Corp. has admitted covering up vehicle faults and falsifying fuel-economy data.”

Sourced from The Wall Street Journal

Michel Baudin‘s comments: What does the Volkswagen diesel emission scandal say about eyeglass lenses and telescopes made by Zeiss or A320s assembled by Airbus in Hamburg? Nothing. Factories for these companies are all located in the same country but a lapse by one is just that, and the Wall Street Journal did not publish articles suggesting that it made a statement about German industry as a whole. When it comes to Japan, however, this is exactly what they are doing with this article, assuming there is such a thing as “Japanese manufacturing,” which is blemished by the misbehavior of any Japanese company.

What top management recently did at some Japanese companies does not invalidate the ideas of managers, engineers and production operators at other companies in the past 70 years. And whoever thought ideas were valuable just because they came out of Japan was as misguided as the authors of this Wall Street Journal article.

Forget about where innovators and inventors are from! Regardless of their names, if you are from Ohio, pretend they’re from Wapakoneta and then evaluate their ideas on their own merits. Don’t let nationalism get in the way.

Incidentally, at the level of a country, scandals are more revealing of social reaction to behaviors than of their frequency of occurrence. People who cut corners under pressure exist everywhere but, when they are found out, it only becomes a scandal when the public finds it intolerable.

#Nationalism, #ManufacturingImprovement, #Manufacturing, #Japan

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11 comments on “Countries Don’t Have Production Systems, Companies Do

  1. Never heard of Wapakoneta, checked on a map and found it just outside the cosmopolitan area known as Russel’s Point, now it’s clear.
    That aside, when the author says, “Japan’s reputation for flawless manufacturing quality and efficiency transformed the country’s postwar economy, changed business practices worldwide and spawned a library’s worth of management manuals and business advice books” I largely agree. It was their quality and price that changed Japan. But to generalize in this way — that is……it is good if its from Japan and if some individual company fouls up, the Japanese system (all the rest of the guys) are slipping is just intellectual laziness….as I guess most stereotypes are.

  2. Wapakoneta is where Neil Armstrong was born. It’s a small town I discovered 20 years ago when my colleague Kevin Hop brought me there to teach a class to Honda engineers.

    That Japan is treated this way and not Germany tells me that you are being charitable when you call it laziness. I think it’s prejudice. In Germany, there have been the following scandals:

     
    On top of that, German trains are chronically late.
    In spite of all this, Germany’s reputation in manufacturing and business is undented. Tell me there isn’t a double standard.

  3. When companies ‘copy’ the activities of another organisation in hope of emulating their success, it is important they understand all the elements of their activities — Methodologies, Technologies and Peopleology.
    There are three V’s needed to focus and guide the activities and create and sustain the culture of any organisation.
    1) VISION, What is your purpose. What do you want to achieve or create?
    2) VALUES, business, numerical, attitudinal, behavioural and moral to guide, support and focus your vision.
    3) VECTORS, the direction of your activities to make your Vision and Values a reality.
    The key to success is to ensure the 3V’s are deployed and shared by all your people and everyone knows their team’s and their personal roles and goals to achieve them.
    The main reason so many companies fail to achieve the success of the company they wish to emulate, is they only copy the visible V’s and ignore the critical invisible ones. They also only use the Methodology and Technology and miss the importance of Peopleology. Comparing TPS and Lean illustrates this difference.
    When organisation have moral behavioural problems it is important that they identify the specific negative Values and Vectors that caused the situation, and make it clear that they are unacceptable. VW and Toshiba are recent examples of the effect of negative Values and Vectors. It would be interesting to do a negative Values and Vectors analysis on the banking industry.
    I think the words of Pavlov and Ohno describes this process.
    “Don’t just be collectors of facts. Try to penetrate to the secrets of their occurrence, persistently search for all the laws that govern them.” Ivan Pavlov. –
    “Understanding is my favourite word. I believe it has a specific meaning – to approach an object/subject positively and comprehend its nature.” Taiichi Ohno.

    • Sid, well said. I think it was contained in what you said, but I would like to pull out one common flaw I find as people “copy”. They normally just add those techniques to their existing system…a dynamic I call “bolting on”. The irony is that I find that 90% of the improvements that need to be made in most manufacturing systems fall under the category of “fixing some part of the existing management system”. The new whistles and bells are just bolted on, rather than appropriately integrated.

  4. Michel,

    You argued this point more eloquently than I could have. I worked in two Japanese companies (non-manufacturing) in Japan in the 1980s, and they didn’t have any of the characteristics the authors attribute to Japanese companies — as you say, companies have systems, not countries.

    Moreover, I’m flabbergasted that the authors take Japanese executives to task for delegating authority and “shirking responsibility” for operational decisions when, for example, the Wells Fargo scandal epitomizes this approach in the US.

  5. Michel, regarding intellectual laziness versus prejudice I do not have enough data to comment. I guess my excuse in this case is ….. intellectual laziness. As for prejudice, the first thought that comes to mind is that maybe since many Japanese companies have grown and prospered so much since WWII, they have collectively been pedestalized. Such entities often suffer from the golden halo effect which has an inappropriate upside perception. Yet when those expectations are not met, the the downside criticisms are overstated as well. But this dynamic of the golden halo applies in many venues. Be well

  6. What model are the authors referring to? TPS? I think they are giving Japanese companies too much credit by suggesting their reputation is “flawless manufacturing quality.” Michel is right about the over-generalization.

    All production models are subject to variability, entropy, and human fallibility which means flawless is not possible. TPS is just the best known way to produce cars. That doesn’t make it flawless.

    • It’s an aside but I noticed you said “all production models are subject to […] entropy.”
      Could you elaborate on what you mean specificaly by entropy in this context?

      • The general definition of entropy where systems move from order to disorder in the absence of an outside force. We fight it with periodic training, mistake-proofing, and preventative maintenance as examples.

  7. Great commentary, Michel.

    In my article in Planet Lean in November 2016 I posed a similar observation that it is not about country culture, and that what we call “Lean” here is the West is not inherently easy for the Japanese:

    “Every country and organization has its own unique strengths and limitations that impact their ability to be “lean” – Japan and Japanese companies are no exception.”

    http://planet-lean.com/japanese-culture-and-lean-culture-not-always-the-same-thing

    This article also reminds me of a conversation that I had with Mr. Isao Yoshino, John Shook’s first manager at Toyota, two years ago about some recent scandals at Toyota and issues faced by other Japanese manufacturers. He told me that one of the biggest differences with Toyota is that it has a practice of “hansei” or deep reflection. The test for Toyota would be how it *learned* from its mistakes. He was not so sure the other companies had as deep of a practice of humility and reflection.

    Yoshino’s reflection on these various issues across different Japanese companies was
    “If you believe you are perfect, you won’t find the answer. If you don’t believe you are perfect, then you are open to finding the answer. Once you are ready to accept that mistakes can happen, then you are okay because you will learn.”

    (More found here: https://kbjanderson.com/toyota-leadership-lessons-part-5-if-you-believe-you-are-perfect-you-wont-find-the-answer/)

    • I will go further: when trying to make improvements in any organization, national culture as a topic must be completely off the table. It is only ever invoked to support the claim that something can’t be done. I discussed the topic extensively some years ago in an interview for Russia’s Business Excellence magazine.

      In your Planet-Lean article, you say many things about Japanese culture. I did too when I was living in Japan. The longer I stayed, however, the less confident I became with general statements about cultural traits as I grew to know exceptions to every one of them.

      When I think of the country now, it is primarily about the individuals I know there, and their personalities are not determined by the culture. When I think of the culture, it is about the literature, the arts, the architecture, the movies, the cuisine, the jokes,…, not operations management and technology.

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