2007/08/06 11:40 Takahiro Fujimoto, "Manufacturing as a System of Design Information", ISSS Tokyo 2007
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Jim Kijima
Takahiro Fujimoto, Professor, Manufacturing Management
[Takahiro Fujimoto]
Research Center, The University of Tokyo, Tokyo, Japan
Read social systems theory when an undergraduate at University of Tokyo
- One of first English books read with von Bertalanffy
- Wrote paper on systems approach to irrigation
Entered business administration, particularly of manufacturing, now moving to the services sector
Manufacturing Management Research Center, University of Tokyo since 2003
Systems thinking a common approach
- Many engineers by training, some social scientists
Root view of manufacturing:
- Continue view of material flows
- Would like to expand view to service sectors, by introducing the ideas of design
- Design concept from engineering, social theories of trade theories and competitiveness from economists and management
- Herbert Simon had tried to combine these in the Sciences of the Artificial, which is a big influence
Focus:
- Often visit factories, at least once per week
- Look at the flows of value to the customers
- Where does the value reside? Materials, not really.
- Most cases it's the design information
e.g. a cup: it's made of plastic, sometimes it's glass or metal
- There's someone's design thinking behind this
- The essence of artifacts is design information
Economists haven't thought of products this way, have thought of them as things that are already designed
- But someone designed it, somewhere
- A missing link in standard economics
Design-based competitive advantage
- Key concept: design information has value
- Firm's products and processes are artifacts that have been designed
- This doesn't say anything about materials, could be product or a service
- Manufacturing is the creation and transmission of design information to customers
- e.g. Toyota people think about manufacturing this way, as value flows, and they try to make good flows of value: fast, smooth, precise, accurate information flows to the customer
- Monozukuri: manufacturing capability as a distinct ability to handle flows of design information toward customers
- Service sector is low productivity
Product-process architecture
- Design is common denominator
Basic idea:
- All products and services are a combination of the design information, plus the medium (material)
- Compare to Aristotle: object as form and material, and form is more essential
- Products (as goods and services) are artificial, i.e. something designed
- If the medium is tangible, it's manufacturing; if intangible, it's services
Penrose, nature of the firm
Manufacturing as the control of flows of design information between productive resources
- Design information goes together with materials
- Development, production and sales can all be explained by these ideas of manufacturing as design flows
Value-added time
e.g. body exterior press shop
- Information transmission time = value-adding time
- Information non-transmission time is MUDA (waste)
Organizational capabilities:
- From Nelson and Winter (evolutionary economics) ideas of organizational routines, as repeated control of design information flows between productive resource
Toyota: high productivity and high quality
- Their focus is muda
- Muda is unnecessary non-transmission time, which includes inventory, over-production, and defects on the information receiver side
- Toyota has 600,000 Kaisen activities, because it still has lots of muda
Toyota has 3 layers of capability:
- Routinized manufacturing capability
- Routinized learning capability (kaizen)
- Evolutionary capability (capability-building capability)
- There are many mistakes that were made, that aren't report, but the failures are source of capabilities
- (Have written a 400-page book on this)
- Fortune favours the prepared mind
Don't rush to connect profit performance from organizational capability, at least two intermediaries
- Organizational capability --> Productive performance --> Market performance --> Profit performance
- First two are arean of capability-building competition
- Good companies are alwsys looking at productivity performance: productivity, lead time, conformance quality
Productive performance of Japanese companies was higher in the 1990s, but profits were lower, which speaks to long-term effects
- By late 1990s, Japanese were slow to catch up on profits, suggesting weak strategy but strong operatoins
Architectural thinking and industrial classification
- If decompose the products, are they general components or specific components?
- Modular architecture: product function hierarchy and product structure hierarchy are one-to-one
- Can recombine, e.g. computers, bicycles
- Others have integral architecture, e.g. motorcycles
- Need teams to solve simultaneous equations
- Good retention of employees
- Illusion that Japan is good at high-tech products, much moved to China
Integral architecture: many-to-many mapping between function and structure
Open architecture
Three types of architectures: closed-integral, closed-modular, open-modular
- Closed integral: Japanese automobiles
- Closed modular: American trucks are good at this, body on frame
- Chinese products: quasi-open modular architecture, on Chinese local markets
- Seldom see this in India motorcycles, but do see this in China, where have mix and match of copied types
Japanese cars, 90% are product-specific, compared to computers that are only 50%
Two-staged design process, linked by trial-and-error coordination
- Japanese are good with this, due to long-term employment
Design-based comparative advantage
- Economists ignore where design is done, focusing on where manufacturing is done
Predictions on architecture-based compariative advantage (by country)
- Integral axis and modular axis:
- Japan most integral
- China and Korea most modular
e.g. steel trade pattern, economists can't explain
- Cars use different types of steel in different parts of cars
- Japan exports outer panels, whereas inner panels are Korean
Implication to Japanese Industrial Policy
- Protectionism tries to protect slowest runnings
- Want to chang to front-runner-oriented industrial policies
- Slowest runners need to be handled by social policies, not industrial policies
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