Japan gemba visit – innovation through kaizen

Two weeks ago I joined a Japan Lean study trip tour led by Makoto Investments and had the opportunity to visit three different Japanese manufacturing organizations.

Mirai Industry

The first company that I visited was Mirai Industry, a company with an unique management philosophy that has a deep understanding of how to delivery value to its customers through constant innovation by their employees.

Mirai's motto is "Constantly Thinking"
Mirai’s motto is “Constantly Thinking” and is lived by everyone in the company

Mirai is a manufacturer of electric installation equipment – basically anything that an electrician would use – based north of Nagoya, Japan. They have six large factories and twenty-seven sales offices in Japan. Mirai has 830 employees and last year made its highest profit margin to-date.

Mirai's Japanese patents
Mirai’s Japanese patents

Mirai has one of the highest number of patents in Japan and has the largest market share in it’s space.

Mirai’s unique management practices and deep commitment to its employees is evidenced in the story of how Mirai was founded by the cast-out thespian son of a Japanese businessman.

The only rule is “no rules”

Mirai attempts to “abolish” rules and management as much as possible. There are some rules “so that there is no chaos”, but as our guide explained:  “we don’t want rules. With rules people are torn. When we make rules, we put people in a box and they can only think inside of the rules. Innovation is suppressed because people think that ‘if I break the rules, I’ll be punished.'”

I think this is an interesting countermeasure to the Japanese cultural norm of rule-following, and has clearly made an impact on the company’s ability to create innovative products that customers want to buy.

Management’s role is to “draw out employee motivation”

Given that the company wants to minimize management, during the Q&A I asked what the role of managers are at Mirai. I was told that “the only responsibility of managers is to draw out the motivation of employees”. Managers have to do the typical duties such as allocating staff and resources, but their primary function is to support the development of innovative ideas.

Treat your employees well

Some of the employee benefits that our host touted included:

  • overtime is prohibited
  • all employees are full-time, but get 180 paid vacation and holiday days (including weekends)
  • every five years the entire company goes on an overseas vacation
  • three-years maternity leave (one year paid, two years not paid but job guaranteed)
  • mandatory retirement by age 70
  • no uniforms
The company just got back from a trip to Italy. The employee who won the best photo of the trip just was awarded the opportunity to start his own company!
The company just got back from a trip to Italy. The employee who won the best photo of the trip just was awarded the opportunity to start his own company!

Spirit of kaizen

12,000 ideas generated last year
12,000 ideas generated last year.

Mirai strongly believes in the value of “small, but meaningful” new ideas. It pays its employees JP500 (roughly US$5) for any suggestion that will improve the work (either their own or someone else’s). The only things not permitted are comments about your salary or “defaming your boss” (I suppose this is one of the rules to help keep chaos at bay). Employees get the equivalent of $500 if the idea is implemented.

Last fiscal year, 12,000 ideas were generated, which is approximately 14 ideas per employee, with some employees submitting hundreds.

Our host said that when they started the employee suggestion process a few years ago, it made making improvements “more fun”.

Some small innovations include putting a bucket of umbrellas out by the front door that employees can borrow so that they don’t get wet walking to the next building and hanging cords from every light so that people can more easily turn the lights off when not in use.

Mirai light cords
Mirai likes to keep the hallways dark unless people are walking in them. Cords hang above individual work stations as well.
Mirai employee suggestions
An implemented employee idea – you’ll see these cards around the factory.
Mirai box taping innovation
Employees came up with this idea to automate the taping of the boxes by adding dots on the bottom of the box that a machine could read.

Creating value for the customer

Mirai’s culture of innovation and kaizen was evident by walking into their demonstration room. Our guide demonstrated some of the new products just launched to market, as well as some of the other unique ideas and products it produces.

Mirai innovative products
A new product, smaller than a box of cards, that is a magnetic three-angle level with a light (and so much more).

Their goal is to make products that are easy to use and that include innovative ideas to make it easier for electricians to do their jobs. If Mirai isn’t able to make something better than what currently exists, it won’t make it.

Mirai innovation
A simple innovation – adding the element of touch so that an electrician can easily tell which tool to grab in the dark. You can also see the new magnetic level tool on the table.

Mirai also does not give it’s sales people quotas. Instead of focusing on the outcome of achieving greater sales, they want their sales people to go to gemba, to work alongside of electricians and to understand the problems that electiricans encounter every day.Through this deeper understanding of their customer’s needs, the sales team is able to work with other staff to develop small innovations to delight their customer.

Another cool invention - a permanent marker that can be resharpened up to seven times so that all of the ink can be used.
Another cool invention – a permanent marker that can be resharpened up to seven times so that all of the ink can be used.

The sales people are able to “share our excitement” about new products with electricians and experiment with new product ideas out in the field.  Mirai counts on it’s products to sell themselves, which they clearly go given their roughly 70% of market share in Japan.

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Katie Anderson
About Katie Anderson 114 Articles
Lean thinker and coach. Passionate about developing people. Healthcare change agent. Living in California again after 18 months in Tokyo. Writing about lean and leadership.
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  • David Rasmusson

    Thanks for the post, Katie.

    It brought to my recollection Lord
    Wilfred Brown’s 1950’s statement, “Every role has its requisite
    development component: nothing is more likely to advance the career of
    the individual, and the well being of the Company, than the ability for
    as many people as possible to grasp this simple fact. It is a major
    responsibility of all managers to make this clear to their subordinates,
    and themselves to set the example.” (Exploration in Management, p.
    103.) Certainly, to improve the way work is done is essential to
    success, and innovation is a mode of improvement that blesses all
    involved, from idea conception, through development and fulfillment, to
    consumer use.

    It might be worth calling out what might be
    obvious: “no rules” does not equate to “no roles.” I believe that,
    although “no rules” can be a liberating rule, role boundaries—those
    prescribe components of one’s job—help engender innovation; one ought to
    remember that although there may be an expectation to liberally give
    suggestions and ideas prompted by a “no rules” slogan or even operating
    rule, there must still be role boundaries: what one must do (prescribed)
    and what one can choose to do (discretionary judgment or
    decision-making).

    Creating and maintaining work role clarity
    contributes to social behaviors (no chaos—the absence of operational
    dysfunction) even in an environment of
    “no rules” idea solicitation.
    “No rules” is not a license to do another’s job. I supposed to most whom
    work or live in an organization that that context is clear, and
    probably doesn’t need to be belabored here.

    I would,
    nonetheless, like to call out that, as the western world understands,
    liberty is maintained through just and constitutional law–policy, rule,
    procedure, process, even standards and standard work if you will. When
    speaking about models of transformation, we speak a lot about changing
    behavior and culture, and often such discussions end by pointing to
    current management as an impediment, which one could expect in a
    government of “benevolent despotism.” However, in a government of “rule
    by law”—constitutional government—those so governed have principles by
    which to operate rather than management to whom to defer. (This might
    well be a major reason for management being swamped with work—doling out
    decisions that employees could make themselves given correct and
    requisite principles.)

    Brown’s point may be relevant here: “There
    are those that are convinced that formalization [of organization,
    language of management, work role specificity] means a loss of freedom.
    Their cry is, ‘Let’s leave it vague so that individual creativeness can
    have a greater chance.’ But there is plenty of evidence that vague and
    confused organization is the great enemy to creativeness.”
    (Organization, p. 14.)

    So here’s the ask, Katie. Since I am
    interested in government, or rather, the way in which the social
    organization has evolved through the government of it—government
    defining the social ambient of the workplace—I would like for you, if it
    isn’t to bold or presumptuous for me to ask (you’re proving wonderful
    insights already) to provide observations in this context of government,
    or laws, or principles. Or better still, can I call out to your blog
    readers to help explicitly identify the governing principle(s) in
    operation that are associated with the behaviors you are observing and
    reporting on?

    Kaizen, gemba walks, hansei, etc., are
    manifestations of how a workplace is governed and its social
    organization. (All enterprises are, at their core, social
    organizations.) To me, ascribing a principle along with describing the
    behavior would be most beneficial. Such context may be deeper and much
    more profound than noting the surface behaviors of gemba walking,
    heijunka boxes, etc. So, “Why that behavior? What’s its origin?” (Is it
    the principle of servant leadership in operation? How does any such
    principle survive? How does principle “X” get established? What is its
    root(s)?)
    Thanks, again, for sharing your reflections, and for inviting and tolerating mine.

  • David – thank you for your thoughtful comments and questions. Some of which I don’t have the answer to, but I do seek active input from others as I continue to learn about the more fundamental reason and origin for behavior.

    I just read an interesting book on Japanese culture and I intend to bring in some of the author’s points when talking about how Lean thinking has evolved in Japan and Western cultures. And I certainly welcome your insights and those of the other blog readers to provide additional thoughts and context.

    As for your comment about “no rules” not equating “no roles”, I believe that this company that was the focus for this blog post would agree with you. Our host was clear that managers had a very specific role, which was to support the innovation and creativity of their employees (in addition to the “typical” managerial tasks that have to happen, which he didn’t really elaborate on, but I would imagine things like staffing, financials, etc). And front line staff had clear roles about the scope of their work – but within their scope, they were asked to innovate and come up with new ideas and improvements.

    He also said that there are “rules” to ensure safety and no chaos, but that they like to talk about the concept of “no rules” to remind themselves not to be constrained in being rigid about following rules (which is a strong Japanese cultural trait).

    All very interesting and I look forward to learning more while in Japan – and from the readers of this blog – about the how principles have influence behavior on many levels.

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