A Japanese Factory in Thailand

Abstract

Abstract: The author conducted in-depth field research to examine changes in a three-year period of kaizen activities in a Japanese factory in Thailand. This research showed that for kaizen activities to be effective, (a) commitment from top managers is required at first. Further, since favorable acceptance is important in the introduction/promotion period for kaizen activities, (b) promotion appropriate to the local culture is also required. In this case, managers made the kaizen activities seem fun during the first-year introduction period to fit in with Thai culture and the cheerfulness of the Thai people. From the second year on, the focus of the kaizen activities shifted to become more result-oriented. If cutting costs had been the focus from the first year, the activities would not have been favorably accepted and they may not have penetrated as far as they did. In other words, (c) progressive change is required for kaizen activities to be effective.Keywords: kaizen activities, overseas factories, Japan, Thailand, in-depth field researchIntroductionA key to the overseas development of Japanese companies is the transfer of the Japanese production system. Kaizen activities, in which the entire organization actively seeks problems and solutions, are a well-known part of the Japanese production system (Abo, 1994; Aoki, 2008; Ohno, 1988).1 Especially, a distinguishing feature of Japanese kaizen activities is small groups of operators engaging in continuous improvement (Aoki, 2008; Wickens, 1987).Existing researches discuss about the possibility of transfer of kaizen activities to overseas factories (Abo, 1994; Kenney & Florida, 1993; Nakamura, 2000; Taylor, 1999) and the best way to transfer these activities (Aoki, 2008). However, it is not clearly understood how kaizen activities are actually accepted by local employees in overseas factories. Therefore, there is very little discussion on how kaizen activities should be introduced and promoted on the basis of acceptance by local employees.Accordingly, this paper focuses on Factory A, a subsidiary factory for a Japanese computer products manufacturer located in Thailand, a rapidly developing country whose outsourced mass production for Japanese companies rivals that of China. In this paper, in-depth field research on changes in overseas factories is conducted to clarify the acceptance of kaizen activities by local employees in overseas factories. In recent years, many Japanese companies have been establishing factories in developing countries rather than in developed countries. This paper focuses on Thailand, as Aoki (2008) has already conducted a study on China. The reason for selecting a computer products manufacturer is that the computer industry is so cost-competitive that even overseas factories need to reduce their costs. Factory A also requires continuous kaizen activities.Field research on Factory A was conducted four times. The first was a three-hour visit to Factory A on April 5, 2007. This visit enabled a greater understanding of Factory A. Next, a one-month field research was conducted in August 2007. In this research, the author wore the factory uniform and reported to the factory during the regular operating hours of the factory as the employees did. The author borrowed a desk in the factory office, observed the shop floor, interviewed local managers, and inspected documents. The observation of the shop floor took at least 30 hours and the interviews, including informal conversations, took at least 20 hours. The following year, a similar survey was conducted in May 15-16, 2008. During this time, the surveys at the factory took at least eight hours each day. In the final phase, the same survey was repeated in August 17-20, 2009, to confirm the results of the kaizen activities in 2008.Kaizen activities in 2007Status of Factory AIn 2007, there were 10,000 workers at Factory A, but only three of these were expatriates. …