Quality: lessons from Japan

JAPAN is well known for its excellent quality products which have immensely contributed to the competitiveness of that country’s products and the growth of its economy. 

Before World War II, Japanese products were considered the poorest in quality among the developed world. 

This is an important lesson for Lesotho as the economies of both countries are not supported by a considerable natural resource base.

The journey on quality started for Japan after World War II when the West, particularly the United States, sent teams of experts to help rebuild that country’s economy.

Among the American experts sent were Edward Deming and Joseph Juran who were experts on statistical quality control.

From the beginning, the Japanese quality movement was given impetus by active participation of its leadership in both the public and private sectors as well as by early realisation that quality extends into all business functions.

In contrast, in America quality was generally considered the realm of technicians and confined to manufacturing. 

It is this leadership participation in Japan that is believed to have resulted in considerable contribution by Japan to the global quality movement over the years. 

Approaches such as Kaizen’s and the quality control movement were developed and popularised by Japan.

Senior management involvement also resulted in the recognition of the importance of quality through the establishment of a national quality award. 

The award was named the Deming Prize in recognition of Deming’s contribution.

By the 1960s, Japan was already a force to be reckoned with in terms of the quality competitiveness of its products and Japanese industries began to encroach into and, at times take over, markets previously dominated by their  American and European counterparts.

Significant importation of commodities into America was an unprecedented development to them for they were used to consuming their own. 

Of concern was the car and electronic industries which had existed for a long time without any competition whatsoever. 

By this time Japanese cars were seen to be equivalent, if not superior, in quality to their competitors. But their products were at considerably cheaper cost of production even when transport costs were included. 

The only conclusion Americans could draw was that Japan was subsidising its car and electronic exports and in response, there was pressure on the American government to introduce heavy duties on such imports.

However, closer examination confirmed that Japanese cars and electronic products were indeed superior. 

In one study conducted by Hewlett-Packard in 1980, involving thousands of computer chips from both the US and Japan, it was found that the Japanese chips had zero failure rates during in-coming inspection whereas 11 to 19 percent of American chips failed inspection. 

In addition, after 1 000 hours of use the American chips failed at the rate of 5.9 to 26.7 percent compared with 10 to 19 percent for Japanese chips. 

The biggest eye-opener for America and Europe was the finding that such improvements could be achieved without increasing the costs of production.   

The acknowledgement of Japanese superiority shocked Americans into action. 

One initiative was the debate on national television in 1980 under the heading: If Japan can, why can’t we? 

In other words they wanted to understand what it was that Japanese were doing differently and were willing to learn from them, which was the reverse of what had happened immediately following the war.

It was on this programme that Deming explained how he and others had helped the Japanese to improve quality and how the Japanese had responded. 

This was the beginning of the renaissance of American quality. One of the key developments from this intervention was the establishment of a national scheme to encourage and reward quality performance, named the Malcolm Baldrige National Quality Award (MBNQA) in honour of the then commerce secretary.

It is important to note that the MBNQA was only established in 1987, more than 30 years after the Japanese had established theirs. 

The MBNQA has helped to put on the agenda the national leadership. 

It involves their participation and the award is handed out in person by the president of the United States. 

It is reported that, with this new leadership, American companies have recaptured some of the markets they had lost, suggesting that quality does work.

Another important finding was based on the result of a study by the Strategic Planning Institute (SPI) which involved about three thousand business units for a period  of two to 12 years and was entitled Profit Impact of Market Strategy (PIMS). 

It sought to establish which market strategies resulted in the most impact such as return on investment (ROI) when adopted. 

Factors considered included market conditions such as total size of the market, the rate of growth, inflation and distribution channels.

Alongside these were competitive position factors such as market share, competition, quality of products or services, prices, costs as well as degree of vertical integration.  

The finding was that, in the long run, the most important single factor affecting the business unit performance was the quality of its product and services relative to those of its competitors.

A lesson can also be taken from the performance of the East-Asian countries — the Asian Tigers. 

Their success cannot be easily divorced from comprehensive support and leadership on quality they receive from Japan.

While most Japanese quality management training is open to all developing countries, there are comprehensive courses designed exclusively for Asians some of which are even in specific Asian languages.  

Altogether, the above findings suggest that quality does work.

The lesson for Lesotho, in the discussion, above is that quality does pay and that even economies without abundant natural resources can compete if they apply quality principles.

Tlhako Mokhoro is the principal consultant of Paradym Consulting, a company that specialises in the management of quality and productivity.  He has been active in the field of quality since 1982 and is a member of the American Society for Quality (ASQ).

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