Our Group’s products flourish in a variety of fields around the world, including shipping, aerospace, industrial machinery, farming, construction machinery, and social infrastructure. As the manufacturer providing these products, we understand that research and development, and quality management serve as the foundation of the Group’s management. In both research and development, and quality management, we promote the development of products that contribute to society, as well as the improvement of their quality, through Group-wide initiatives implemented by our administrative divisions, and through the initiatives of the internal companies and subsidiaries who engage in close contact with our customers.
Research and development approach
The basic policy of our Group’s research and development is based on our Management Philosophy—“To contribute to society, with a focus on our business of leveraging electronics and other advanced technology to create products that embody functions of human senses: measurement, cognition, and control.” Research and development is carried out based on the technology strategy and R&D plans of our research arm, the Research & Development Center, and is also implemented as part of product development by our internal companies and subsidiaries.
Research and development system
Our Research & Development Center primarily engages in relatively long-term research and development and, in general, the development of products utilizing the center’s results is conducted by the development departments of our internal companies and subsidiaries.
Seizing future business opportunities, the Research & Development Center researches and develops technologies that will serve as the core of a business. At the same time, our internal companies and subsidiaries engage in product development, including the development of products that won’t be commercialized for years to come, based on customer needs. In addition, the Research & Development Center is also responsible for providing technical support for individual projects, and for undertaking research and development that would be inefficient for our internal companies and subsidiaries to perform on their own.
The Development Committee is an organizational body chaired by the Chief of Engineering. Its members include the head of the Research & Development Center and managers from various internal company engineering departments. The Development Committee determines a variety of matters concerning the drafting and execution of our Group’s technology strategies, with the committee chair making proposals and reports to the Management Conference as necessary.
Industry–government–academia collaborative research
Our Company also proactively engages in industry– government–academia collaborative research. In the past, we participated in high-precision wearable motion sensor research under NEDO’s Industry-Academia Collaboration Practical Application Support Project. In addition, one example of research and development we are currently engaged in is collaborative research into hull inspection robots together with Nippon Kaiji Kyokai. We are jointly researching and developing robots that use suction to adhere to move on and between walls and ceilings in order to conduct inspections inside the cargo holds of bulk carriers. Going forward, we plan on continuing to proactively engage in collaborative research projects like this with outside organizations.
The robot being jointly developed
The robot’s appearance and components
Moving between surfaces
Our approach to quality management
Our Group’s basic philosophy regarding quality is to “Prioritize quality in our products and earn the trust of customers.” This philosophy is embodied by and integrated on an organizational level through the Group Code of Conduct and the Code of Ethical Conduct, among others.
Common quality control policies
In order to put our basic philosophy into practice, each internal company has formulated its own quality policy and is working actively to acquire and maintain various certifications, including ISO 9001.
Acquisition of ISO 9001 and other certifications
Quality management promotion system
Two tiers of quality assurance activities
We have established a Quality Management Supervisory Office to deal with company-wide issues relating to quality under our Headquarters’ administrative divisions.
The Quality Management Supervisory Office engages in the cross-organizational management and supervision of quality to ensure that our Group’s products remain above a certain level of quality. The office also engages in activities to prevent risks to quality before they manifest. More specifically, in addition to maintaining and managing the Technical Production Regulations, which are company-wide rules regarding the quality of our products, the Quality Management Supervisory Office complements the independent quality management efforts of individual quality assurance departments by conducting inspection quality audits of each internal company and subsidiary.
Within each internal company, the Quality Assurance Department is established independently from the Sales, Engineering, and Production departments, providing advice and guidance in the contracting, design and development, purchasing, production, inspection, and service stages of the work process. In addition, we have established a Company Technical Production Rules framework, allowing each internal company, with their varying characteristics, to draw up its own operational rules as long as they do not violate the Technical Production Rules.
Schematic of the two-tier quality management system
The Quality Subcommittee was established as a forum for sharing information and resolving cross-organizational quality issues within the Company. It meets under the jurisdiction of the Director in charge of quality, with the quality managers of each internal company and subsidiary as members. It is held four times a year by the Quality Management Supervisory Office to identify Company-wide problems and future challenges relating to quality, and to formulate measures to resolve them. In the event that concerns emerge regarding quality at an internal company or subsidiary, a report is made to the Chief of Quality at a Quality Subcommittee meeting.
If the Director in charge of quality deems it necessary, corrections may be indicated and information about the issue may be escalated to the necessary level, such as the Management Conference.
Specific measures for quality management
Inspection quality audits
The Quality Management Supervisory Office conducts inspection quality audits on each internal company and subsidiary. In order to ensure audit effectiveness and improve the quality management capabilities of our internal companies and subsidiaries, audit methods and scope are revised annually.
Activities of the Quality Subcommittee
In order to share company-wide examples of defects and peripheral knowledge accumulated by our various internal companies and subsidiaries, the Quality Subcommittee has set about building a Group-wide defect database with the aim of improving quality through the sharing of defect examples.
Improvement proposal (M-tag) activities
We are using so-called “M-tags” to promote improvements within the Company. M-tags are a way to identify M (“muda,” or waste) in the workplace and describe it on a tag such that it leads to improvements.
All employees participate in this activity, and the seven kinds of workplace waste are tallied for each site and categorized into “individual” and “circle.” The aim is to improve work operations, including the work environment itself, and in turn help increase quality consistency.
Examples of defects are used to create educational materials such as Defect Example Reports and One- Point Lessons. Relevant personnel are also informed about such defects and horizontal deployment and education are provided to change employee behavior with the aim of preventing a defect’s reoccurrence. In addition, internal quality audits are one means we use to strengthen quality management systems, and we conduct internal auditor education in order to maintain and enhance the capabilities of our chief and regular auditors. Further, each of our internal companies holds quality meetings to report defects and share solutions.
Specific activity examples include hierarchy-specific education on quality assurance and quality management systems at the time of company entry as well as when being promoted to a higher position at the Nasu Plant’s Electronics Systems Company and Communication & Control Systems Company. An example of an everyday education activity is our holding of human error debriefings, whose aim is the prevention of defects. In addition, we hold a quality assurance month. Aiming to maintain and enhance awareness of quality on a routine basis, during the month we solicit quality slogans from employees, posting outstanding examples in our plants and also adding them to the signatures to employee emails.
Numerical results: customer satisfaction
The aim of our Group’s quality management is to improve customer satisfaction through the thorough implementation of problem solving-oriented quality assurance that engages with customers from start to finish and that resolves customer issues, even when those issues are inherent to the customer and not caused by the quality of our products. In order to understand and improve customer satisfaction, each internal company is devising various ways to quantitatively measure customer satisfaction in accordance with the characteristics of their respective businesses.
Moreover, because ensuring quality is directly linked to customer satisfaction, we also perform quantitative management based on failure costs and aim to share causes and countermeasures.
Example of a customer satisfaction survey
* Excerpt of FY 2020 Communication & Control Systems Company RF Products Department contract process customer satisfaction data
Setting quality, delivery, and customer service targets at the start of the period, the company surveyed customers each quarter and achieved its targets for all categories.
Supply chain management
Our basic approach
Our Basic Materials Management Policy
The essence of production activities is to procure the materials necessary for product manufacturing at the right time. By building and maintaining relationships of trust with our Group’s suppliers and working to realize reciprocal benefits, we will achieve stable production and contribute to society by providing reliable quality.
Our basic approach to material procurement is to obtain products of reliable quality, at reasonable prices, at the right time, and in the right quantities.
To this end, we will develop, maintain, and manage our role as the center of a company-wide purchasing organization, thereby helping to ensure that the procurement of materials is conducted in a smooth and appropriate manner.
In addition, we will strive to maintain and improve a robust and stable supply system for material procurement that is based on relationships of cooperation and trust with our suppliers.
- Maintain and manage TBB, the core system for purchasing operations, and related systems (purchase requisition B sheet system, accounts payable system, factoring system, Web-EDI, and lease system), and conduct purchasing and related operations based on mutual cooperation.
- Cooperate with the Factory Materials Department to improve the efficiency of purchasing operations through ongoing promotion of subscription to Web-EDI.
- Continue to implement internal controls (compliance with laws and internal regulations, risk management, and purchasing processes relevant to financial reporting) in purchasing management operations.
- Conduct static observations of major suppliers and provide feedback to relevant departments in order to maintain and improve a robust and stable materials supply system. In addition, maintain close relationships with cooperative associations and their members through regular and irregular cooperation on various occasions.
- As the purchasing department of the head office, work on cost reduction and improvement activities aimed at strengthening our organizational capabilities.
Supply chain management system
Our Group’s supply chain management system comprises the Material Management & Purchasing Office, the Headquarters’ administrative divisions; and the purchasing divisions of each internal company. The relationship between the Material Management & Purchasing Office and company purchasing divisions is non-hierarchical, and, as an organization under the direct control of the President, the Material Management & Purchasing Office supports each company’s purchasing activities.
Purchasing management initiatives
The Material Management & Purchasing Office engages in administrative tasks such as maintaining and managing basic companywide policies, the Standard Purchasing Rules, and standard basic business agreements used by our Group. The office also provides companywide guidance on the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors (Subcontract Act), and maintains and manages our core purchasing information system (TBB system). In addition, the Material Management & Purchasing Office is in charge of procuring materials for product development in the Headquarters district.
Each internal company’s purchasing division primarily purchases the production materials necessary for that company’s production activities, engaging in efficient, fair, and equitable transactions with our suppliers in Japan and overseas. When initiating a transaction, it is standard practice to conclude a standard basic business agreement prepared by the Material Management & Purchasing Office. Actual purchasing is conducted using our TBB system, ensuring that the transaction is in accordance with the Standard Purchasing Rules.
Each individual company engages in the development of the skills of its purchasers. The Material Management & Purchasing Office also encourages purchasers to take a seminar on the Subcontract Act, and urges the individual purchasing divisions to promote the taking of the same.
In 2020, 20 out of 47 purchasers took the seminar.
Improving quality across the supply chain
Business policy briefings for suppliers are held in May every year primarily at each of the Group’s production sites (the Nasu Plant, Yaita Plant, and Sano Plant) in an effort to provide accurate information. Quality audits are based on each internal company’s quality management system and are conducted at the start of transactions, on a regular basis, and on other occasions as deemed appropriate. The scale of our Group’s suppliers is varied.
Many of the companies to which we outsource machined components, in particular, are small in scale, and with these we value face-to-face dialogue with purchasers.
Placing importance on direct communication makes it easier to know a supplier’s working conditions and quality management, and also helps to build long-term relationships of trust with suppliers. In FY 2020, we conducted a total of 90 supplier audits.
In addition, there is a system to certify suppliers involved cutting and sheet metal processing, assembly processing, etc. as green procurement companies (companies taking measures against environmentally hazardous substances), which are subject to green procurement inspections that we perform. During these inspections, we provide explanations and guidance on reducing or eliminating environmentally hazardous substances.
Toki-mate J-Kai is an organization for young managers at the Group’s small and medium-sized suppliers and the next generation of business managers. In addition to technical exchanges and study sessions, the association regularly holds events to visit our domestic and overseas production sites for training purposes. The association is fully supported by the Material Management & Purchasing Office and the purchasing departments of each production site.