Workers, Managers, Productivity Kaizen in Developing Countries Edited by Akio Hosono · John Page · Go Shimada Workers, Managers, Productivity Akio Hosono • John Page • Go Shimada Editors Workers, Managers, Productivity Kaizen in Developing Countries Editors Akio Hosono John Page JICA Research Institute The Brookings Institution Tokyo, Japan Washington, DC, USA Go Shimada School of Information and Communication Meiji University Tokyo, Japan ISBN 978-981-15-0363-4 ISBN 978-981-15-0364-1 (eBook) https://doi.org/10.1007/978-981-15-0364-1 © The Editor(s) (if applicable) and The Author(s) 2020 This book is an open access publication. 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The registered company address is: 152 Beach Road, #21-­01/04 Gateway East, Singapore 189721, Singapore FOREWORD Development practitioners and researchers have long been confronted to the reality of a productivity gap between developed and developing coun- tries. However, the role of management methods as an important deter- minant for quality and productivity outcomes has only surfaced in the recent past, and little is known about the effectiveness of initiatives that aim to increase managerial capital and improve productivity in the private or public sector in developing countries. Kaizen, as a model that has attracted much attention and captured imaginations from the 1960s on, and that has been adopted in many firms all over the world, provides an interesting lens to study the mechanisms at stakes. Kaizen can be defined as an inclusive and participatory approach to continuous improvement in quality and productivity, rooted in a distinctive philosophy and using spe- cific tools and methods. In 2015, the Japan International Cooperation Agency—Research Institute (JICA-RI) and the Global Development Network (GDN) felt that there would be high value in taking stock of the experiences of the various initiatives that disseminated and implemented Kaizen in different contexts and hence decided to join forces to document the adoption of Kaizen approaches. This partnership was based on shared interests and strong complemen- tarity. JICA-RI, the research arm of JICA, had invested much in private sector development. It was particularly interested in assessing how a now famous Japanese innovation, dating back to the 1960s and that it contrib- uted to disseminate, can unleash innovation and productivity gains in v vi FOREWORD developing country firms. GDN, a public international organization devoted to building research capacity in social sciences in developing countries, had supported research on productivity and industrial policies. It reckoned that a firm-based approach would provide both ample ground for capacity development and an opportunity to learn more about the driving forces underpinning the adoption of new managerial practices and their impact as a complement to research work on the conduct and impact of industrial policies. This book is the product of this cooperation, which involved research- ers from developing countries and Kaizen practitioners who worked on specific case studies and three co-editors, Akio Hosono, John Page, and Go Shimada who took the leadership in directing the book toward a coherent and meaningful object. It also involved researchers who advised research teams while they conducted their research, and we are grateful to Jocelyn Olivari, Aniceto Orbeta, and Tetsushi Sonobe for their comments and reviews. Because a book like this is more than a collection of individ- ual studies, the contributors gathered several times in Tokyo, Nagoya, Bangkok, and Washington to discuss their research, identify commonali- ties and differences across context, and learn from the experience of each other. We hence hope to have planted the seed of a community of research- ers in developed and developing countries interested in the dissemination and implementation of Kaizen approaches. Through the voices of its co-editors, developing country researchers, and Kaizen practitioners, the book aims to present the diversity of Kaizen approaches in firms in developing countries and to address a number of a questions related to their effectiveness. Going beyond a traditional theory of firms, and by providing a deep dive into the intervention mechanisms used to introduce and sustain Kaizen, it also aims to put in the organiza- tions- and countries-specific context the different experiences it describes. Such a book usually raises more question than it answers, but we hope it will provide the reader with an understanding of the mechanisms through which Kaizen initiatives may or may not work, how is Kaizen shaping the relations between workers and managers and the conditions for its adop- tion in a variety of firms from SMEs to Multinational corporations. We would like to thank the book’s chapter authors for their unerring dedicated involvement and the three co-editors Akio Hosono, John Page and Go Shimada for their invaluable analytical and editorial contributions. FOREWORD vii We would also like to add here a special word for our colleague, Professor Nestor Raneses who led the work on Chap. 13 on the MPex Program in the Philippines and express our deep sadness at his passing before the pub- lication of this book. Global Development Network, New Delhi, India Pierre Jacquet JICA Research Institute, Tokyo, Japan Izumi Ohno ACKNOWLEDGMENTS The editors are most grateful to the Global Development Network (GDN), Japan International Cooperation Agency Research Institute (JICA-RI), and the Brookings Institution, which provided efficient logis- tical support for our research, the organization of authors’ workshops, and the preparation of this volume. The editors would like to extend their deepest gratitude to the President of GDN, Pierre Jaquet, and former and current directors of JICA-RI, Ichiro Tambo, Naohiro Kitano, Nobuko Kayashima, and Izumi Ohno, who all supported us during the process of conceiving, proposing, and carrying out the research project. The editors would like to express their sincerest thanks to advisers to the research and writing of case-study chapters: Tetsushi Sonobe, the National Graduate Institute for Policy Studies (GRIPS), shared many valuable insights with us in the course of the project. The editors deeply appreciate valuable suggestions from Tsuyoshi Kikuchi, Japan Development Services Co., Ltd., Hiroyuki Tomita, JICA, and William Maloney, the World Bank. The editors would also like to express special gratitude to several orga- nizations that allowed us and the chapter authors to learn about the imple- mentation, significance, and nature ofKaizen on site: Toyota Motor Corporation, Tahara Plant, Aichi, Japan, Denso (Thailand) Co., Ltd., Samrong Plant, Samutprakarn, Thailand, and Thai-Nichi Institute of Technology, Bangkok, Thailand. We appreciate the support of the JICA Offices in Bangkok, Nagoya, and Washington as well. The editors and chapter authors would like to express their deep appre- ciation to those who supported the research and writing of individual ix x ACKNOWLEDGMENTS chapters: members of the Malaysia Productivity Corporation (MPC), Petaling Jaya, Malaysia; Leo Guzman-Anaya, University of Guadalajara, Mexico; members of the Brazilian Development Bank (BNDES); mem- bers of the Institute of Applied Economic Research (IPEA), Brazil; mem- bers of the Inter-American Development Bank (IDB); Fekadu Nigussie Deresse, Agriculture Transformation Agency (ATA); Ethiopia; Girum Abebe Tefera, Ethiopian Development Research Institute (EDRI); Mekonnen Yaie, and Seblewongel Hargawin, Ethiopia Kaizen Institute (EKI); Nigusse Gebre Gebremedhin, Federal TVET Agency (FTA), Ethiopia; Gebeyehu Benti, Yasuto Kikuma, and Hiroyuki Tanana, JICA Ethiopia Office; Getafun Tadesse Mekonnen, Ethiopia; members of the Automotive Industry Development Centre (AIDC), Rosslyn, South Africa; Jocelyn Olivera, Universidad Alfonso Ibanez, Chile; Aniceto Orbeta,