The Toyota way to perfect pyjamas
Poisonous pyjamas! Toxic toothpaste! Deadly dog food! For the last couple of months newspapers around the world have been full of headlines screaming about the latest product safety scare to hit mainland exports.
They have hardly fuelled a balanced debate. Around the world, local producers have seized on safety scares to call for protectionist barriers against mainland imports. In South Africa, for example, trades unions last month called for a boycott of mainland products following reports that hazardous pesticides imported from the mainland had contaminated local crops.
The mainland response to the problem has hardly been any better. Many senior officials have simply opted for denial. The chief of the mainland's quality inspectorate, for example, accused foreign media of whipping up anti-China alarmism, and blamed US design faults rather than poor mainland manufacture for the worldwide recall of 19 million dangerous toys by Mattel.
Even more troubling, Commerce Minister Bo Xilai dismissed international concerns over dangerous mainland products, claiming over 99 per cent of the country's exports are safe. If he is right about his proportions, there could still be tens of millions of unsafe mainland toys on the shelves of the world's shops.
Safety scares are a big problem for the mainland. Although the recent scandals are unlikely to make any impression on export growth rates, perceptions that mainland goods are shoddy will hinder the emergence of mainland brands on the global market. And in the absence of homegrown brands, mainland manufacturers making goods under contract for foreign brands will have a powerful incentive to cut corners and save costs by skimping on quality. If Beijing wishes to develop the economy by moving up the value curve, it must address concerns over product quality.
Sensitive to criticism, mainland officials have promised a crackdown. But promises are easy to make and harder to deliver. In any case, the real solution to the problem of poor product quality lies not with Beijing, but with the country's companies and their management culture.
Overhauling a company's image for quality is not easy, but there are notable precedents. For example, when Toyota Motor exported its first car to the United States - the Toyopet Crown - in 1957, it was greeted with derision. A bestseller in Japan, the Crown was considered underpowered, uncomfortable and unreliable by US drivers and sold only a handful of models. Even as late as the 1970s, Toyota cars were dismissed in America as held together by baling twine and chewing gum.
No longer: today Toyota is the biggest and most profitable automotive company in the world. Its cars consistently top surveys of product quality, reliability and customer satisfaction.
Toyota's success is underpinned by its management culture, which is founded on a few basic, commonsense ideas. For example, each employee is responsible for quality control. If there is a defect during the production process, the individual worker must ensure it is corrected immediately. If necessary he or she must halt the entire production line rather than allow a faulty car to reach the next stage of the manufacturing process. As a result, vehicles leave Toyota factories with remarkably few defects.
Empowerment does not stop there. Under the company's doctrine of continuous improvement, individual workers are expected to propose ideas for streamlining production and improving quality; and they earn handsome bonuses when their suggestions are put into effect. As a result, workforce motivation is second to none, and product quality hard to beat.
These management principles could work equally well in mainland factories. In some they already do. Car engines made by joint-venture manufacturer Guangzhou Toyota Engine recently passed Toyota's own stringent quality tests and are now exported to Japan to be fitted to the company's midsized saloons.
For the foreseeable future, however, most mainland companies will continue to operate rigidly hierarchical management structures and to compete on price rather than quality. Until and unless mainland managers empower workers to focus on quality and safety, we should expect more scandals.
