Dear  Friends,   

Following is just one of 200+ letters that I wrote to 7500 employees of Larsen & Turbo Ltd’s, Mumbai factory, when I was General Manager (1979 - 1987). This open honest communication led to a remarkable improvement in industrial relations. If you wish to download the entire set, just click here  

Regards,

Hemen Parekh

www.indiarecruiter.net

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 To,
Dear Colleague : 

 

59 LAKH SUGGESTIONS !       

The enclosed article was distributed at a recent seminar on "Japanese Management" which I attended.

One session was devoted to "Small Group Activities". It was conducted by Mr. Sekijima who has been with Hitachi Ltd. for last 17 years and currently designated 'Manager - international Personnel Relations Section'.

The article describes the small group activity at just one of the factories of Hitachi Ltd. But Hitachi has 26 factories in all. And Mr. Sekijima gave the following statistics for the entire Hitachi organisation.

HITACHI - 26 FACTORIES
1983 DATA

 

1. Total no. of suggestions

58,77,000
(58.77 lakhs)

2. No. of employees who sent suggestions

57,617
(62,000 employees have joined SGA)*

3. Average no. of suggestions per person

102.6/ year
(All-Japan average is 70/ year)

4. Average saving per suggestion

$ 31

5. Average saving per each suggestion

$ 3145

6. Total saving during the year

$ 182 million ( Rs. 218 crores)

7. Hitachi's Sales Turnover

$ 19.4 billion

8. Best suggestion saved

$ 4000 per month approx.

* SGA "Small Group Activity"

Other things which Mr. Sekijima told me are :

  1. Hitachi have a total of 6205 small-groups (of 8-10 employees each) of which half are of "blue-collar" workers and half belong to "white- collar" workers.
  2. In many Japanese companies, the small group activity is known as "Quality-Circles".
  3. Suggestions must relate to the "Goal/Objective" set by the Section/Unit/Department for itself and must be job-related.
  4. The suggestions are distributed amongst various topics as follows :

 

 

HITACHI

JAPAN

1.

Improvement of Quality

36%

31%

2.

Improvement of Mgt. or Control

7%

5%

3.

Cost - Reduction

36%

42%

4.

Safety

11%

3%

5.

Improvement of Equipment

10%

6%

6.

Miscellaneous

-

13%

 
  1. "Meeting-time" for the small-group meetings is as follows:

 

Meeting - time

% of meeting
held in Hitachi s held in Japan (avg)

During Working
Hours

During Rest-time Morning
or Evening During Idle-time Actual working-time

54%

80%

Outside Working
Hours

After Shift-end Before
Shift-start

46%

20%

TOTAL

100%

100%

 
  1. There are no monetary rewards for the suggestions given The foreman or manager gives to the suggestors small token gifts such as a ball-pen or a diary - never exceeding Rs. 400/- in value.

    I could not quite appreciate why each Hitachi employee sent in, over a hundred suggestions every year, when there was no monetary reward! So I posed this problem to Mr. Sekijima.

    Here is his answer :-
    1. The single biggest factor motivating a Japanese employee to send in a suggestion for improvement is the RECOGNITION he receives through acceptance and implementation of HIS suggestion. Nearly 70% of all suggestions are accepted and implemented.
    2. There are other ways of recognition such as:
      • publishing photograph in factory or company newsletter
      • requesting the worker (or the group) to make a presentation before Colleagues & managers
      • accepting a particular suggestion for inter-dept, inter-unit or inter-factory competition
      • organising a lunch with the General Manager of the plant.
 
  1. Introduction of "small group" activities is a pain staking process, in Hitachi, it took nearly 8 years as follows :-

    1968 - 1971

 

  • Improvement of relations between the employees and the Managers
  • Orientation & Training of Managers.


1972 - 1976

 

  • Training of worker-leaders
  • Introduction of program at worker-level.


1977-

 

  • Small-group activity becomes an ordinary event for employees.
 
  1. Every 6 months, there is an intensive training program for "worker-leaders". The program is conducted by engineers from quality-control, production and industrial engineering functions. The curriculum includes, Methods-Study and Time standards. Preventive Maintenance, Quality-control techniques and Industrial Engineering techniques.

In conclusion Mr. Sekijima added,

"If you wish to introduce such an activity in your company, everybody, starting at the top, must attend orientation/ training seminars.

The small-group activity is more transplantable in your country than other Japanese techniques, because it was born in the West".

The only way we can find out if Mr. Sekijima is right or wrong, is by trying!

H. C. PAREKH

December 12, 1984
M - 18