Japanese example tipped to double productivity

Japanese example tipped to double productivity for New Zealand businesses

19 October 2005: Massive productivity gains are in store for a group of New Zealand companies just back from a trip to Japan to view competitive manufacturing practices in action.

In a spin-off from New Zealand’s presence at the World Expo in Aichi, Japan, earlier this year, four companies are engaged in a pilot project aimed at doubling their productivity in two to three years using proven Japanese lean or competitive manufacturing techniques and philosophies.

The companies are meeting in Auckland today for the first time since they returned from Japan.

Two training organisations are also involved in the pilot, which is managed by New Zealand Trade and Enterprise (NZTE) and funded through the Aichi Leveraging Fund, set up to take advantage of business opportunities presented by the recent Expo.

Intensive training for the participants in the basics of competitive manufacturing kicked off in New Zealand in September, and they have just returned form a study tour of Japan to view the system first hand.

Project Manager, Clinton Yeats, says international research shows that most companies waste more than 70% of their available resources through unnecessary double handling of production material and poor inventory management.

“The potential gains from introducing competitive manufacturing principles are massive and many can be made very quickly and for very little cost.”

Competitive manufacturing has been successfully used by large manufacturers around the world, and a few in New Zealand, for decades says Clinton Yeats. “Now it’s vital for small and medium sized enterprises to come on board with it. New Zealand manufacturers are facing stiff and growing competition for customers and they have to become more efficient.”

One of the companies taking part in the project is Hamilton’s Stainless Design. Managing Director, John Cook, says seeing competitive manufacturing in action in Japan was an eye opener.

“They use the term ‘Treasure Mountain’ to describe inefficiency and our mountain is huge. It’s not about spending more but doing things better - some of the operations we saw in Japan had quite old technology, but they worked the equipment hard and maintained it well.”

Mr Cook says the Japanese companies visited put huge effort into keeping their staff fully involved in the drive for continuous improvement and in sharing the successes.

“This is not about people working harder, but smarter. Some companies struck resistance from staff when the programme was first introduced, but the strongest sceptics seem to ultimately end up being the biggest fans.”

Training organisations Competenz and the Auckland University of Technology (AUT) have joined the pilot to ensure education and training programmes being developed in competitive manufacturing are aligned with practical implementation in the work place.

Competenz is part of a consortium of nine industry training organisations developing competitive manufacturing qualifications to be offered at tertiary level and AUT will incorporate these competitive manufacturing concepts into existing degree and diploma programmes.

Ken Gardiner, NZTE Sector Manager, Specialised Manufacturing and Co-Manager of the project, says it has delivered unexpected benefits, in addition to bringing new world class knowledge to New Zealand and building business capability here.

“Along with building relationships with Japanese businesses, the New Zealand companies taking part are also identifying ways in which they can help each other compete more effectively offshore.”

The businesses taking part in the pilot project – Clearlite Bathrooms, RPM International, Stainless Design and Alto Plastics – are holding a two day strategy session in Auckland this week (18-19 October).

The project is likely to be expanded next year to include ten companies from a range of other industry sectors.

ENDS

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