This lean thinking webcast from India actually does a pretty decent job of providing an overview (for a business TV channel) even if they get some things a bit confused. The discuss TQM in India preceding lean which is an accurate view in my opinion – quality management shared many lean principles. They even talk of lean at Ford doing lean first. But they get the decades for that a bit off. They seem to mash together the “quality is job one” refocus on quality lead by Dr. Deming in the 1980’s with Henry Ford in the early 1900’s.

The webcast includes Jim Womack discussing lean thinking. He mentions the misunderstanding of lean as primarily cost cutting.

Related: Curious Cat Lean Management Resources – 2008 Deming Prize: Tata Steel – Lean management in India – TVS Group Director on India, Manufacturing and the Economy

This edition of the carnival is the first on our new schedule: we will now be publishing 3 times a month. Submit your nominations for management posts to include in future editions. The Quality and Innovation blog is the 6th blog to host the carnival, the others are: Evolving Excellence, Lean Blog, Lean Six Sigma Academy, Capable Blog and our own Curious Cat Management Improvement Blog.

The updated data from the United Nations on manufacturing output by country clearly shows the USA remains by far the largest manufacturer in the world. UN Data, in billions of current US dollars:

See manufacturing data for more countries.

The USA’s share of the manufacturing output of the countries that manufactured over $200 billion in 2007 (the 12 countries on the top of the chart above) in 1990 was 28%, 1995 28%, 2000 33%, 2005 30%, 2006 28%, 2007 27%. China’s share has grown from 4% in 1990, 1995 7%, 2000 11%, 2005 13%, 2006 15%, 2007 16%.

Total manufacturing output in the USA was up 76% in 2007 from the 1990 level. Japan, the second largest manufacturer in 1990, and third today, has increased output 15% (the lowest of the top 12, France is next lowest at 32%) while China is up an amazing 673% (Korea is next at an increase of 271%).
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Tata Steel, India, has been awarded the 2008 Deming Prize. They were the only organization to receive the prize this year.

Mr. B. Muthuraman, Managing Director, Tata Steel, while expressing satisfaction over this accomplishment said, “No other activity made us think so deeply about our business and relationships than the process of applying for the Deming Prize. Total Quality Management (TQM) is a fundamental way of managing business and every organization can gain from institutionalizing the culture necessary to win this prize.” He dedicated this recognition to the employees of Tata Steel, its customers and business partners who have consistently embraced the culture of continuous improvement and demonstrated a great teamwork leading to several recognitions in the last 20 years since the TQM journey started at the Steel Company in 1988.

India continues to do very well, collecting more Deming Prizes than all other countries combined since 2000. Countries of organizations receiving the Deming Prize since 2000 (prior to that almost all winners were from Japan):

The 2007 Deming Prize for Individuals went to Mr. Masahiro Sakane, Chairman, Komatsu Limited, Japan. Previous recipients include: Kaoru Ishikawa, Genichi Taguchi, Shoichiro Toyoda, Hitoshi Kume and Noriaki Kano.

Related: 2008 the Deming Prize Winners Announced – Tata Steel India wins Deming Application Prize-2008 – Deming Prize 2007 – 2005 Deming Prize – Dr. Deming’s Thoughts on Management

India’s Economic Times has an interview with James Womack, Now is the time for lean management, with an interesting quote:

I have discussed TVS several times in the past; TVS has won several Deming Prizes.

Related: TVS Group Director on India – Manufacturing, Economy… – Deming Prize 2007 – Indian Deming Prize Winner Expanding – Toyota Chairman Comments on India and Thailand – Curious Cat Lean Manufacturing

Toyota is investing $350 million in a second Indian manufacturing plant. The plant is focused on producing vehicles for the local market – as the Toyota Production System suggests that production be close to the market.

Toyota to invest Rs1,400 crore for “strategic” small car in India

Related: Manufacturing Takes off in India – Toyota Chairman Comments on India and Thailand – Top 10 Manufacturing Countries 2006 – Indian companies have received as many awards as companies from all other countries combined since 2000 – Toyota to Build New Plant in India to Make Small Cars – TVS Group Director on India – Manufacturing, Economy

Jules Verne predicted cars would run on air. The Air Car is making that a reality. The car would be powered by compressed air. Certainly seem like an interesting idea. Air car ready for production:

The car is said to have a driving range of 125 miles so by my calculation it would cost about 1.6 cents per mile. A car that gets 31 mpg would use 4 gallons to go 124 miles. At $3 a gallon for gas, the cost is $12 for fuel or about 9.7 cents per mile. I didn’t notice anything about maintenance costs. I don’t see any reason why the Air Car would cost more to maintain than a normal car. Five-seat concept car runs on air

Now does that sound like the Toyota Production System to you? It should. If I were an executive at Toyota I would sure examine this to see if it really is as promising as it looks. And if it is Toyota sure has plenty of cash and the management practice to make a very compelling case for allowing Toyota to produce this globally. The engineers desires closely match what Toyota has learned. Both seek to eliminate the waste of transportation (friction).

Related: Click Fraud = Friction for Google – Manufacturing Takes off in India – Electric Automobiles

Here is updated data from the UN on manufacturing output by country. China continues to grow amazingly moving into second place for 2006. I plan to write more on this data in the Curious Cat Investing and Economics Blog. UN Data, in billions of current US dollars:

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Bringing ‘Lean’ Principles to Service Industries by Julia Hanna

Iteration is very important. It is important in proper use of the PDSA cycle – many quick iterations are much better than one long slow one. And for software application development it is an excellent strategy.

I think iteration is even more important in software application development than most other areas (for now anyway) because many stakeholders cannot visualize what they need from software. Therefore attempts to force rigid requirements up front fail. No matter how much effort you put in the stakeholder just doesn’t know until they see it and use it – then they can tell you what they want changed. so design a system that works given this – iteration and agile development work very well.

Related: lean thinking articles – Experiment Quickly and Often – Management Consulting (what does the consultants web site show?) – Indian Firms Learning From Toyota (on Wipro posted here in 2005) – posts on improving software development – Not Lean Retailing

Manufacturing takes off in India by John Elliott:

India has a great deal of potential for manufacturing. The roadblocks are largely economic I think. Poor infrastructure is a huge problem that requires huge investments be made. China has made huge investments in infrastructure and they have paid off. Another incredible drain on India’s progress in manufacturing is the government bureaucracy.

Related: Manufacturing in Asia – Hopeful About India’s Manufacturing Sector – Top 10 Manufacturing Countries – articles on manufacturing management

India continues to shine with Deming Prizes (and of course there economy and stock market have been doing pretty well too). Companies based in India took home both Deming Prizes this year and the Japan Quality Medal. Countries of organizations receiving the Deming Prize since 2000 (prior to that almost all winners were from Japan):

The 2007 Deming Prizes went to Asahi India Glass Limited, Auto Glass Division and Rane (Madras) Limited. Three different divisions of Rane received awards in the previous the last 4 years, making this Rane’s fourth prize in 5 years.
The 2007 Japan Quality Medal went to Mahindra & Mahindra Limited, Farm Equipment Sector.

The 2007 Deming Prize for Individuals went to Mr. Masayoshi Ushikubo, Chairman, Sanden Corporation. The Sanden International portion of Sanden was the third USA based organization to win a prize in 2006 (prior winners were: Florida Power & Light Company in 1989 and AT&T Power Systems in 1993). I mentioned India’s economy and stock market above, China’s economy and stock market are doing amazingly well also and then have yet to have a Deming Prize winner. I hope China, USA and many another countries can follow India’s current performance in this area. Deming Prizes are not awarded on a quota or forced ranking basis – any deserving applicants in any year can receive a prize.

Learn more about the Deming Prize.

Related: Deming Prize 2006 – Deming Prize 2005 – Deming Prize 2004 – Top 10 Manufacturing Countries – Toyota Chairman Comments on India and Thailand – 2006 Deming Medal presented to Peter R. Scholtes

Gopal Srinivasan is Director of TVS Electronics Limited, Joint Managing Director of Sundaram-Clayton Limited and Director of various other TVS Group companies. TVS group companies, based in India, have been awarded 5 Deming Prizes. He discusses Deming and quality a bit. He also discusses their experiences in manufacturing in China and the strengths they have found in each country. And he discusses the Indian economy and manufacturing.

In the second part of the podcast he talks about the growth of the economy of Tamil Nadu and the inclusive approach required to help India grow. via Gopal Srinivasan of TVS Group of Companies on Entrepreneurship

Related: Hopeful About India’s Manufacturing Sector – Toyota Chairman Comments on India and Thailand – Indian Deming Prize Winner Expanding – 2005 Deming Prize Awardees – 2004 Deming Prize

India grows up:

A good post on some of the difficulties of outsourcing. Also a good illustration of how economics is suppose to work. If labor is underpriced in India and the market is opened labor rates should rise to a level where they are equivalent (given productivity… differences). Don’t be lead to believe all labor prices in India have experienced anything like this. Those areas where the value to cost difference was largest is where rates increased a great deal in a short period of time.

Related: IT Outsourcing Slowing – Google India not Finding Enough Engineers – The Power of Silicon Valley

The newest data from the UN confirms most of the recent trends in manufacturing output – most notably that China continues to grow dramatically. The data also shows a stagnation in USA manufacturing output over the last several years, though the USA remains by far the largest manufacturer. The most significant news from this latest data, I believe, is that that manufacturing output growth in the USA has been slower than global manufacturing output growth from 2002-2005. This was not the case prior to 2002. I will be writing more on this data in the Curious Cat Investing and Economics Blog. UN Data, in billions of current US dollars:

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The Economist explores the trend to manufacture in Vietnam, Indonesia, Malaysia… instead of China in: The problem with Made in China:

It is nice to see this reported properly. The USA manufacturing share of global output has risen, not fallen, as we have stated numerous times: Manufacturing Value Added Economic Data – Manufacturing Jobs Data: USA and China – Global Manufacturing Data by Country. The most fundamental facts of global manufacturing – Global output is increasing. Jobs are decreasing (everywhere, not moving from one place to another – decreasing everywhere). China’s output is growing rapidly. The USA is still by far the largest manufacturer, USA output is growing faster than global output and much slower than China’s output. Japan is the second largest manufacturer with China third, by a fairly large margin though China is growing very rapidly.

Related: Manufacturing Jobs – China’s Manufacturing Economy – America’s Manufacturing Future
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Outsourcing bubble getting Busted: What should India do? – commenting on the 2006 Global IT Outsourcing Study

Essentially the study says the outsourcing IT will continue to grow though more slowly than it has. It also states the benefits of outsourcing have not reached the level that was predicted for a number of reasons. The study predicts vastly increased competition from China for IT outsourcing work (which reinforces the general consensus).

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Six Sigma spells success for BPOs by Pradeep Kapur:

Related:

• Six Sigma Won’t Fix Bad Management?
• Curious Cat Six Sigma Portal
• Deming and Six Sigma
• Articles on management improvement in India

Lucas TVS on Global and Local Expansion Mode

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Via Panta Rei, Business Process Outsourcing, Meet Value Engineering, Measure for Measure

Another interesting quote:

Related Posts:

• Indian Firms Learning From Toyota
• 2005 Deming Prize
• Manufacturing and the Economy
• Is India’s outsourcing honeymoon over?

A Wake-up Call From Asia by Patricia Panchak:

From my previous post, Relative Engineering Economic Positions:

The challenges to USA manufacturing will continue. The best hope, as I see it, for retaining manufacturing leadership in the USA is through increasing the adoption of management improvement methods including lean manufacturing.
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