I have visited many companies in southeast Asia, and I can tell you, of those that do not have financial ties to western or Japanese companies, only about 1 in 10 really do understand lean manufacturing. The trick is – how do you know?
Conduct an Audit –
The first and best way is to send a person knowledgeable in lean manufacturing to their production facility to perform an audit. For many, this may be a cost and inconvenience they cannot afford.
Evaluate Markting Materials –
The second, and much more difficult is to evaluate their marketing materials (website, brochures, etc) for signs that they understand lean manufacturing. This may include looking for or asking for certificates such as ISO9000, QS9000, or TS16949. But certificates are not truly accurate indicators of a company understanding lean principles. From a distance, you end up making assumptions that this information is truthful. In one extreme case, I found a company’s brochure that showed their lone manufacturing facility on the cover. Upon arriving at the facility for a site review, I realized that the building on their brochure was not theirs!
Supplier Questionnaire –
A third method that is frequently used in many industries is the supplier questionnaire. While I firmly believe in these, their effectiveness is questionable if you are not going to make an on-site audit to confirm their replies to the questionnaire. Additionally, finding the sweet spot in level of detailed questions that results in an accurate picture of the LCC supplier can be very difficult (too many questions may result in no reply). The first obstacle will be the language barrier. The LCC company may not understand many of the questions being asked. The second is the cultural differences. By this, I don’t some much mean the differences between western and LCC cultures, but even business cultures. Frequently, these supplier questionnaires will make assumptions about business systems, acronyms and buzz words that the LCC company will not understand. I have seen many of these where the questionnaire asks question after question such as: Does company use FTA? Where the response is simply yes. The LCC company has no idea if FTA stands for Fault Tree Analysis or Foreign Trade Agreements. Even if the questionnaire asks for supporting documentation of the use of FTA, your reply will still be a simple yes in the reply, and you will wonder if the missing documentation is an over-site or an indication that they don’t really use it.