Change in the world and the problems with Japanese manufacturing industry. 5
But from now on, competition starts from finding real customer needs because the competition will be done based on attraction quality assuming that functional quality is good.
The important lead-time is not only the production lead-time so far but also the total lead-time starting from finding out the customer needs, design it, produce it and sell it with reasonable price in a very short time from now on.
I name this lead-time “customer satisfaction lead-time” and Japanese production companies should shorten the customer satisfaction lead-time rather than the production lead-time.
In order to cope with it, all the company skills not only production engineering and Genba Kaizen but also marketing, designing, and sales should get together.
Question : Previously quality was evaluated mostly by function but these days by attraction. What do you think of it?
Change in the world and the problems with Japanese manufacturing industry. 4
This time, I will start talking about changes in the market and manufacturing.
This means that Japan’s manufacturing industry can not survive just by doing 5S, removing wastes, or shortening production lead time, which have shown a lot of good effect so far. In order to acquire the strength again, we have to understand that we are entering new era in which new improvement and further change are required while keeping the on-site improvement ability which we have made so far.
Then, what kind of change is coming in the future? Consumers already have most of the things and they do not show interests except what they really want, and even if they are interested they will not buy it if the price is high.
It has been said that if you make a good product you can sell it, but the good product then was the product with high functional quality. So Japanese manufacturing companies have been improving quality and cost competitiveness. In other words, competition has been in the field of production engineering and Genba Kaizen ability for high quality and low cost.
Question : I wrote that consumers have been changed. What do you think?
Change in the world and the problems with Japanese manufacturing industry. 3
Last time I wrote a visible part of the changes in the world. And this time I will write about invisible part of changes in markets and in manufacturing.
Markets themselves are also changing drastically, and as a result manufacturing has been forced to change too.
In the era when all the products were sold out, it was called as the product out era and the production process was simple, mass production with small variety. At the time, on-site improvement activities that realized quality improvement and efficiency improvement like the QC circle expanded production capacity and produced great results in improving profitability.
After that, when the variation increased gradually, it shifted to the production of small-lot size with a lot of variation, which was called as the market-in era. At that time, to respond to the customer orders without making the customers waiting although with very small amount of inventory, many Japanese manufacturing industry studied Toyota production system. That helped the Japanese manufacturing industry to get shorter production lead-time and to be profitable and they got high reputation.
Nonetheless, in Japan many small and medium-sized companies have already disappeared due to bankruptcy or lack of successors. And many companies which show good level of 5S and have done high level Kaizen like removing Muda or wastes are facing difficulties that their products are not selling as before or their profits are not as big as before.
Question: The level of Japanese manufacturing industry is high represented by Toyota production system. Nevertheless, many of them are facing a lot of difficulties and struggling . What are the problems?