1. Ignorance of best practices
Over 95% of factory owners are not aware of the benefits they would gain from a lean transformation.
Actually, they don’t even believe it when I tell them. The batch-and-queue system, with tons of work-in-process inventory, seems to be the most efficient. That’s how their former employers, their friends, and their competitors do, after all.
Very few Chinese factory owners are engineers. And the State media aren’t going to recognize Japan’s superior know-how anytime soon. So this obstacle will not disappear quickly.
2. The whole supply chain would need to be restructured
Manufacturers are not focused on streamlining the flow in their supply chain. As I wrote before, they tend not to think in terms of systems. But there are two other factors at work:
Their export customers themselves encourage a batch-and-queue organization, because they often purchase full containers at a time. Their suppliers give low prices when materials are purchased in large quantities.
3. No interest in improving processes
In Toyota factories, processes are automated only when they are physically hard or dangerous for workers. The objective is to keep improving each process by using the operators’ brains. A robot has no brain, runs no pilot test, and makes no suggestion.
In contrast, Chinese factory owners usually think automation is a solution to reduce their costs and their quality problems. They automate their existing bad processes!
4. No respect for people
A lean transformation is only possible if people are respected. For example, productivity gains (thanks to increased throughput, more orders shipped, and more efficient processes) should not result in layoffs.
This is very, very far from current practices in China, as described below:
Short-term thinking on the owner’s side (his wife is often using the factory’s profits to invest in real estate). No investment in training, little investment in equipment. Short-term thinking on the employees’ side, and in particular the migrant workers who might not come back after Chinese New Year. Constant fear of losing one’s job in many factories.