Will an auto industry bailout help US automakers long term?

http://biz.yahoo.com/ap/081108/autos_what_happened.html

“They” say US automakers won’t survive unless the government steps in with a bailout package for auto makers, just like for financial firms. That may be true, short term. But what about long term effectiveness? The above article says the business decisions of the US Big 3 during the flush times led to their demise. Fine – fix the business decisions by taking on the Unions, etc, etc, to reduce costs. But what of consumer preference? Will a bailout will fix that problem? No chance.

The only fix to consumer preference is producing a high quality product that consumers want to buy. The Japanese have studied this point for years and developed the “know how” that now allows them to provide the excellent quality products US consumers have come to recognize. They call it “monozukuri”, or the science (not art) of making things. The US manufactures have generally ignored the fine details of monozukuri and have instead pushed technology down hill and out the door to suppliers. They themselves have largely become coordinators and program managers. The suppliers in turn were allowed to become sloppy (by Japanese standards) because all the OEM’s care about is whether they can produce test results showing their parts meet the OEM specifications (and more importantly to them, whether they are they the lowest cost supplier). The OEM engineers generally have lost the technical depth to fully understand the technology details of the products assembled into their vehicles (relative to their Japanese counterparts).

Ask any global Tier 1 supplier which customers are more difficult to satisfy. The answer – the Japanese, no question about it. Why? Because they demand to understand in minute detail the technical characteristics of every component they use.

Unless US automakers and their suppliers learn the same principles discovered by their Japanese counterparts over the past thirty years, no bail out package will have the capability to save them from their oncoming demise.

Read more in the book, "Becoming Re-Successful" www.lulu.com/content/4339719

Prove by Test vs. Prove by Design

So you want to develop a new product or service. You thoroughly research the market expectations and they become your requirements (i.e. the specification). You plan your approach, do design work, build samples and run tests to check the results. Maybe the first results weren't so good so you make modifications and the new results show the product meets the specification requirements. You run additional tests to confirm - they're positive. You're elated you achieved success, right? After all, your test results prove the product is capable.

Although a bit oversimplified, the above paragraph describes the product development process generally used in the US and Europe. Will a Japanese customer accept the product as developed? Absolutely not! Why?

The fact that 10, 100, or even 1000 tests were successful does not guarantee the 11th, 101st, or 1001st sample will also be good. Japanese engineers have been conditioned to seek to understand the details, the process that caused a part to be good. Test results themselves do not prove the product design is robust. A detailed explanation of what caused the product to function properly is expected.

Along with an explanation of why the part functions, an analysis of the potential failure points and how the design was carefully thought through to avoid them is required. Only then will the Japanese engineer agree the design is robust, and will view the test results as an indication the design itself is robust. In other words - prove by design.

The concept of Prove by Test vs. Prove by Design is one of the most significant differences in the Japanese and Western product development processes. Learn the method of Prove by Design and you'll see your product performance increase while at the same time significantly reduce warranty and quality issues.

Five Key Points to Understanding Japanese Thinking

When working with Japanese counterparts it is helpful to know some of the background behind why they think the way they do. Below are listed five key points to understanding Japanese thinking. Each of these points cause the thinking process used in Japan to be different than that accustomed to by most Western people.

If you can adjust your mindset to understand this background, you will become positively enabled to interact at an elevated level of efficiency and even better, to use the positive aspects in your own methods of developing products and services.

Key Point #1: The level of service considered ‘extraordinary’ in the US is generally only considered ‘average’ by Japanese standards

Key Point #2: To the average American, the macro level end result is important. To the average Japanese, the details that cause the end result are more important.

Key Point #3: The Japanese language leads to logical thought patterns using progressive building blocks laid out in graphic detail. The English language more easily enables wordy statements not rooted in logic.

Key Point #4: While Americans tend to be direct and transparent with intentions, Japanese tend to be indirect. Be aware of “tatemae” and diligently search to discover and understand the “honne” position.

Key Point #5: In the US, "who you know" can often be as important as "what you know". To win credibility in Japan, you must personally through your own experience, absolutely, positively, without a doubt seek out and understand the fundamentals, the basic essence of every idea and concept – no shortcuts allowed

Innovation and Development

Checkout the research shown in this TED video clip (see link below) found on YouTube.

Why do I talk about it here; what is Japanese about it? Both cultures (Western and Japanese) hit on the same note - when you don't know the answer to a problem, look to nature.

The fact is, Western cultures are usually superior to Japanese cultures in the field of idea generation. Japanese technology development strength typically lies in the capability to perfect good ideas.

Japanese are excellent at what is known in Japan as monozukuri, or the way of making things. The way they think through issues and apply logic allows them to investigate an idea in minute detail to clearly understand the physics behind it and to then apply the same logic in the process to make it reliably.

So the point is - use the best of both cultures for optimum benefit.

Capitalize on the idea generation capability of the West and add to it the analysis and monozukuri capability of the Japanese technology culture to create a world class technology engine second to none.



http://www.youtube.com/watch?v=BUmOKfllAEo

Excerpts from book, "Becoming Re-Successful"

Here are some excerpts from Chapter 9 that help explain the importance to Japanese companies of "thinking correctly". When one begins to master the principles associated with Japanese thinking, reasoning and the ability to apply sound logic increases at quantum levels.

Best of Success!

Demeron

...the single biggest complaint voiced by Japanese business people working with Americans: “Nihon no kangae-kata ga wakaranai,” or, “They don’t understand the Japanese way of thinking.” The US businessperson often fails to think in the manner his or her Japanese counterpart takes for granted. Overcoming this obstacle by learning to understand the Japanese kangae-kata (way of thinking) is crucial to the ability of the engineer, planner, sales person, manager, or other knowledge workers to effectively work in or with a Japanese company.

Unlike US companies, Japanese organizations place heavy emphasis on the way each employee thinks, or their kangae-kata. These companies believe that if a person has the right kangae-kata, he or she will take the proper action to solve and eliminate problems under any circumstances they encounter, from development to manufacturing to all other business issues. As a result, Japanese managers go to great lengths to coach individuals on the best way to think through a problem and to correct improper thought processes that come to their attention. Japanese kangae-kata enables Japanese companies to operate within the knowledge-based environment discussed in Chapter 6, and failure to use Japanese kangae-kata relegates US companies to a position of heavy reliance on less effective task-based development systems.

The Japanese mindset theory (or Japanese kangae-kata) is a thought process that builds upon a solid foundation of principles and facts held in place by strong logic, and these (facts/principles and strong logic) are the key components of kangae-kata.

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...When listening to proposals and evaluating ideas, knowledge workers in a Japanese organization are keenly searching to understand what logic has been applied and will expect to see the entire why, why analyses, cause-effect relationships, and logical reasoning that led to a conclusion. If they know why you say what you say, then they can either agree or disagree based on their own logic, but without knowing the “why”, it is difficult to apply logic.

For the individual who is part of the American Business Engine, success in developing products and services in a Japanese-influenced environment requires him or her to personally understand and think in terms consistent with the Japanese kangae-kata.

The four elements of Japanese kangea-kata listed below are components of the two key factors Facts/Principles and Strong Logic.

Kangae-kata elements:

1. The Story Line

Why is the product or service needed? What problem does it solve? Why should it be considered for use? Why is it any different, better, or worse than anything else available? Why should any time be spent on its consideration? Is there an overall philosophy being followed? What is the path of logic to be applied?

2. Functional Theory

What is the genesis of the design concept or service? Why start there? What must be considered in the beginning? Why? Why should the concept work? What principles are in play? What can cause the product to malfunction? Why? Why is a certain size or dimension or mass needed? Why is one material or method any better than another? What physics and theory are in play? What is the next step beyond the initial concept? Why? What options are available to move to the next step? What judgment criteria should be applied to evaluate?

3. Confirmation

Do the results confirm the design theory? Are the cause and effect relationships understood? What must be controlled? How tight must the control be? What happens outside the control limits? At what point does the product breakdown?

4. Conclusion

What conclusion can be drawn? Why does it make sense in the overall scheme? Does the conclusion support the story line? What concrete statements can be made based on data? Do the merits stand out?

These elements are points that are used by knowledge workers to evaluate most business activity in a Japanese-influenced company. Be it deciding whether or not to provide a loan, approve a product for use, purchase a machine, or evaluate a commercial quotation, these elements are considered in one form or another. Always, there must be a story line (element 1) with which the other elements must be in complete alignment.

It is a rigorous application of these kangae-kata elements that differentiate the Japanese approach to product development projects from that of Western cultures. Japanese capability to apply logic (as explained in the last paragraph of Chapter 3) with these Japanese kankgae kata elements forms a super powerful analysis technique that is used every day in product development and other business activity.

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