JUST-IN-TIME, LEAN PRODUCTION, AND COMPLEMENTARY PARADIGMS:COMPLEMENTARY PARADIGMS OF JUST-IN-TIME

COMPLEMENTARY PARADIGMS OF JUST-IN-TIME

3T’s as Mutually Reinforcing Activities for Quality, Cost, Delivery Performance Like JIT, total quality management (TQM) and total productive maintenance (TPM) are managerial models that were formulated and systematized in Japan. Each of these managerial paradigms is made up of concepts and tools of great significance for operations management. With TPS used as the name for just-in-time, together with TQM and TPM, a new acronym ‘‘3T’s’’ can be created to denote these three paradigms and their vital contribution to a firm’s competitiveness in terms of quality, cost, and delivery performance (QCD) (Enkawa 1998).

From a historical perspective, it is somewhat difficult to determine when a framework of their joint implementation began to emerge. This certainly took place after the individual advents of JIT / TPS in the 1950s, TQC / TQM in the 1960s, and TPM in the 1970s. If we view these paradigms as a historical sequence, it can be asserted that pressing needs to meet new competitive requirements were the driving impetus behind each of their creations. Being the later-emerging paradigms, TQM and TPM can be considered as systematized activities to support JIT with areas of overlap as well as unique emphasis. This interrelationship is depicted in Figure 4, wherein it may be seen that the three paradigms have roles of mutual complementarity in terms of Q, C, and D.

Total Quality Management (TQM)

The primary focus of TQM is on achieving customer satisfaction through the design, manufacture, and delivery of high-quality products. This addresses JIT’s requirement for strict quality assurance and elimination of defects. Though having roots in American approaches, TQM broadened and ma- tured as a management paradigm in Japanese industry. By the 1980s, industries worldwide began emulating the Japanese model of quality management (e.g., Ishikawa 1985; Akiba et al. 1992) and have subsequently adapted and reshaped it in new directions.

With the concept of continuous improvement at its core, Japanese-style TQM seeks to boost performance throughout the organization through participation of all employees in all departments and levels. In addition to the tenet of total employee involvement, TQM incorporates the following beliefs and practices: management based on facts and data, policy deployment, use of cross-functional improvement teams, systematic application of the Plan, Do, Check, Act (PDCA) cycle, and the ability of all employees to use fundamental statistical techniques such as the seven basic quality improvement tools. One mainstay of TQM is its involvement of front-line employees in organized QC circle activities wherein the workers themselves identify and correct problems. These small-group activities are instrumental in diffusing continuous improvement capability throughout the company. Besides supporting successful JIT implementation, these activities also improve employee morale and enhance skills.

The essence of TQM can also be understood from the many maxims that have appeared to express new approaches and ways of thinking necessitated by competitive change:

• Quality is built in at the process (instead of by inspection).

• Focus on and correct the process rather than the result (emphasizing prevention).

• Emphasize system design and upstream activities.

• The next process is your customer (to emphasize customer orientation).

• Quality first—the more quality is improved, the lower cost becomes.

• Three-gen principle: observe the actual object (genbutsu) and actual situation (genjitsu) at the actual location (genba).

Total Productive Maintenance (TPM)

TPM is a systematic and inclusive approach for achieving maximum utilization of a plant’s capability. In particular, TPM focuses on maximization of overall equipment effectiveness, which is defined as the ratio of net value-added time to total available time (where net value-added time is total available time adjusted for time lost due to failures, setup / adjustment, cutting blade changes, start-up, minor stoppage and idling, reduced speed, and defect / rework-related losses). Many companies identify 16 or more major losses, involving not only the equipment-related losses above but also worker and production system factors. These are measured quantitatively as the discrepancy between their current state and ideal state and are often converted into monetary terms as the target of cost reduction goals. To reach these goals, TPM advocates a clearly defined, stepwise approach for eliminating the losses through systematic, plant-wide efforts.

The principal activities of TPM fall into eight areas:

1. Autonomous maintenance

2. Improvement by project team

3. Planned maintenance

4. Quality maintenance

5. Initial-phase management for development and installation of equipment / products

6. Administrative and indirect operations management

7. Education and training

8. Safety, health, and environmental management

Of these, autonomous maintenance (jishu hozen) is the original core of TPM and involves the transfer of diverse maintenance-related duties to the machine operators themselves. In fostering operator responsibility for maintenance, autonomous maintenance follows seven formal steps starting from initial cleaning. In addition, small-group activities called PM circles are organized by the company to carry out improvement activities and further develop operators’ capabilities. Further discussion of TPM and its implementation is provided by Shirose (1996), Suzuki (1992), and Nakajima et al. (1992).

In instituting the good industrial housekeeping practices required in TPM, many companies use an approach called 5S. This term comes from five Japanese words: seiri (sort and clear out), seiton (straighten and configure), seiso (scrub and cleanup), seiketsu (maintain sanitation and cleanliness of self and workplace on an ongoing basis) and shitsuke (self-discipline and standardization of these practices) (cf. Imai 1997; Osada 1991). These activities roughly correspond to the initial cleaning step of TPM and involve all employees in an organization.

Like TQM, TPM has an important role in implementing JIT. Specifically, failure-free equipment is a principal factor behind the high quality and short setup times necessary in JIT. At the same time, TPM has benefited from many of JIT’s approaches, including its emphasis on visual control and the promotion of education and training for multiskilled operators. As for differences between TPM and the other paradigms, it should be noted that TQM and TPM diverge in their approaches undertaken for problem solving. Whereas TQM stresses the use of empirical, data-oriented methods such as statistical quality control, TPM emphasizes the application of technological theory and principle (genri-gensoku). In other words, TQM relies on inductive reasoning while TPM relies on deductive reasoning. These approaches work in complementary fashion with each other because both types of reasoning are indispensable for effective problem solving.

To summarize this discussion of the three paradigms, Table 1 outlines and compares TQM, TPM, and JIT / TPS along the dimensions of focus of attention, methods, and organizational issues.

Joint Implementation of the 3T’s and Case Study

Since the 1980s, the diffusion of the three paradigms from Japanese manufacturers to overseas man- ufacturers has progressed at an accelerated rate. As evidenced by the coinage of terms such as 3T ’s and TPQM (= TPM + TQM), many cases now exist of the simultaneous implementation of part or all of the three paradigms, both inside and outside of Japan. This is underscored by the results of a mail survey of members of American Manufacturing Excellence, an organization whose members are known as leaders in manufacturing practice (White et al. 1999). On average, manufacturers included in the sample had implemented 7 out of 10 listed practices relating to JIT. As a whole, these 10 practices encompass a breadth of activity virtually equivalent to the 3T’s. The percentages of manufacturers implementing each practice is as follows, broken down by size of company (small firms sample size n = 174; large firms sample size n = 280): quality circles (56.3%; 70.4%); total quality control (82.2%; 91.4%); focused factory or reduction of complexities (63.2%; 76.8%); TPM

(51.7%; 65.7%); reduced setup time (82.8%; 90.7%); group technology (66.7%; 69.6%); uniform workload (52.3%; 59.3%); multifunction employees (86.8%; 79.3%); kanban (53.4%; 68.9%); and JIT purchasing (66.1%; 81.8%).

Some caution may be warranted, however, on the question of simultaneously implementing TQM and TPM. One reason is the financial burden arising from their simultaneous introduction. Empiri- cally, there is said to be a delay of up to a few years for TPM, or longer for TQM, before a company can enjoy their financial effects. Another reason relates to organizational issues. Although both TQM and TPM share the same broad objectives of strengthening corporate competitiveness and developing human resources, there are significant differences in their implementation and focus, as shown in Table 1. Thus, the simultaneous introduction of both into a formal organization may be a source of confusion and hamper their success. For this reason, the overwhelming majority of companies in Japan have avoided concurrent implementation. Instead, they have adopted a phased approach wherein one of the paradigms is mastered first before undertaking the second (Miyake and Enkawa 1999;

Mathis 1998). As to which of TQM and TPM should be undertaken first, there is no clear consensus in terms of conceptual grounds or actual industry trends, though TPM is seen as having quicker financial benefits.

As the originator of JIT and TPM as well as a leader in TQM, the Toyota group continues to be known for best practice of the 3T’s. In Toyota’s case, JIT was implemented first, followed by TQM and finally TPM, though this merely reflects the historical order of each paradigm’s emergence and the evolving competitive demands that they address. In most Toyota group companies, the management planning department organizes the implementation and education of the 3T’s. An exception is Toyota itself, where TQM is administered by the TQM promotion department and JIT and TPM-like activities are coordinated by the operations management consulting department.

Outside of the Toyota group, Sanden Corporation is regarded to be one of the best companies for 3T practices in Japan. As one of the world’s three largest manufacturers of car air conditioners and compressors, Sanden is a supplier to most leading auto producers in the world. Beginning in 1993, Sanden introduced TPM to one of its major plants, Sanden Yattajima Manufacturing Site, in response to fierce global competition and pressures to reduce cost. Within three years, it completed the conventional 12-step TPM implementation regimen, enabling Sanden Yattajima to apply successfully in 1996 for the TPM Excellence Award, a prize recognizing outstanding achievements that is granted by the Japan Institute of Plant Maintenance (JIPM). During this same period, Sanden bolstered its quality assurance front through ISO 9001 implementation and certification. Shortly afterwards, JIT was formally introduced in 1997 under the name SPS (Sanden Production System) with the aim of reorganizing process flows and further reducing lead times and inventory. After firmly establishing TPM and JIT, Sanden was poised to complete the triad of the three paradigms through a regeneration of its TQM practices. Its primary motivation was to reinforce the quality of its management systems, as it had already achieved a level of competitiveness in product quality. Sanden’s TQM success was evidenced by its receiving of the Deming Prize in 1998 from the Japanese Union of Scientists and Engineers (JUSE) in recognition of outstanding results in the practice of TQM.