We are almost getting close to the end of EDM. Today, we started earlier at 6.30am for an inspiring lecture by Martyn Bradfield on Safety Circle. This technique explains and puts into practice the safety and health improvements in our company. After that, we set out for more great learnings visiting 2 more plants. We arrived at the first plant at 9.00am, AVEX (www.avex-inc.co.jp). It is a manufacturing company that produces high precision cutting and grinding of small parts for automotive companies.
It was established in 1953, and it started supplying sewing machine parts to Toyota Loom. When Toyota started to produce vehicles, as their suppliers, they started to produce automotive parts. Initially, in search of new customers, the director himself was marketing at that time with the approach that “AVEX produced everything”. However, no order was requested. Reflecting on the reason for the low sale, they concluded that perhaps the very approach that the company “produced everything” could make the customers not understand exactly what AVEX really did. It would be like a small star within thousands of bright stars in the sky.
The lesson AVEX learned was to change their product strategy and start focusing on the manufacturing of a specific product in a target market. During that time, they found that things had changed and 80% of cars in Japan had automatic transmission. They responded to this market change by focusing on oil pressure control parts for automatic transmissions and parts for fuel efficiency. AVEX succeeded in benchmarking other companies and implementing several kaizen and so they could differentiate from other competitors. Currently, in any automotive supplier projects, the AVEX name is well-known in the market.
With the Lehman shock (bankruptcy of Lehman Brothers), the economy was bad, and AVEX had to lay-off part of their labor force, but their president has strong commitment to not employees. His thinking was that human resources are not labour cost, but precious assets for the company. In production, there are specific works that require special skills. Some of those tasks are done only by experts. In response, AVEX utilized the “available” time due to low demand and “broke down” those special operational tasks by visualizing all expert skills needed and standardizing them to train their team members. This approach impacted in drastic growth for the company.
The director said that there are things that don’t change with the times: producing 100% good products (trust / brand) and serving society (creating jobs and paying taxes to the government). AVEX aims to be a professional organization that masters high-accuracy, small-item cutting and grinding to be a company that lasts 100 years.Their management approach is based on 3 pillars:
- Be observational (think and act for yourself; continuous Kaizen; all hands participation)
- Kindness (teamwork; stick to what is decided)
- Growi together (be honest and straightforward, say everything openly)
This deep understanding of how people development and training really do impact in a company’s growth and their commitment to create mutual trust with the employees was provided in a presentation even before we reached the shopfloor! With our minds full, we went to the gemba to go and see.
The first impression was of an outstanding machining shop-floor, but also one that was incredibly well-organized and clean. AVEX was totally different from the machining factories we normally see. Very clear standards, abundant evidence of Kaizen implemented, impeccable 5S, visual management all around and very solid maintenance activities. Their machine availability is between 92% to 95%. The management team gives commitment to keep production capacity considering Monday to Friday, in order to keep the weekends for maintenance activities. For areas working 24h per day, the management team set Friday as a day off for the production team to allow for preventive maintenance.
After this striking gemba visit, we left AVEX. Consistent with previous companies we visited before, the entire team that welcomed us in the morning stood in front of the company’s entrance shaking their hands to say “good bye” until our bus disappeared from their view. We went straight to lunch and then, to the second plant visit at Meidoh Co (www.meidoh.co.jp).
Meidoh Co. is a manufacture of high-strength bolts and cold forging parts for automotive industries. They started their Lean journey 35 years ago. It has recently been awarded the Deming and TPM (Total Productive Maintenance) prizes, and it has been receiver of the Toyota Quality Management Excellence Award for 6 consecutive years.
Mr. Masayuki Einaga, Advisor at Meidoh, in behalf of the Meidoh’s president, presented the overview of the company. As a mission he explained that they want to ensure that the company continues and develops to pass it on to the next generation. For the employees, the aim is to take pride in their work and feel it is worth doing to enrich the life of employees. They aim to be number 1 in their industry sector. Currently, they are number 2 in sales volume, and they are number 1 in profit. The president has 7 management principles:
- Clarify the vision
- Employee’s involvement in management
- Provide satisfactory evaluation and treatment
- Company as a place for individuals to grow (continue in training the employees)
- Attach importance to company image
- Provide above the average treatment
- Challenge for unknown.
The world is always changing so they want to be a company that is always challenging. As the sales increased, the number of employees increased. So, the quality issues and delivery delays started to increase too. They focused on defect preventions, developing human resources, management system and Kaizen activities, and also searching for a new motivator to enhance employees motivation. That was to win the Deming prize, a global quality award that recognizes both individuals for their contributions to the field of Total Quality Management (TQM) and businesses that have successfully implemented TQM. It is the oldest and most widely recognized quality award in the world.
Similary with AVEX, after the Lehman crisis, they had 60% of cutback in production, which generated a large amount of excess personnel, but the president did not lay-off one single person. Instead, they developed people to improve their skills and implemented several Kaizen and a structured Hoshin Kanri (policy deployment). They developed the Rokkaku Juku, a place for skills training which included:
- Safety Dojo
- Quality Dojo
- IT Dojo
- TQA (Total Quality Assurance) Dojo
- TPM (Total Productive Maintenance) Dojo
- Manufacturing Dojo
They rigorously kept the routine of quality kaizen meetings, breaking-down of work content, setting of judgement criteria and conditions for good products (analyzing the causes), implementing improvements, and standardizing the process.
After Mr. Masayuki’s presentation, we went to gemba. Again, we were impressed (any single bolt dropped on the floor), a very good 5S implemented (for them safety and 5S are basic things for manufacturing), visual management, Kaizen implementation, and also strong and reliable maintenance activities. They also have machines availability close to 100%. Their current lead time is around 40 hours. Their model plant in Mioshi already achieved the lead time of 24 hours, so they are aiming to achieve the same as the model plant.
We could grasp lot of learnings and the importance of people development. We returned to the bus and went to Nagoya station to take the bullet train straight to Tokyo. It had started to rain in Tokyo when we arrived there, but we are very excited and looking forward to our final visit tomorrow!
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