UK: Toshiba's vision of the future. (1 of 3)

UK: Toshiba's vision of the future. (1 of 3) - Toshiba's Plymouth television plant holds lessons that British industry would do well to learn, writes Annabella Gabb.

Last Updated: 31 Aug 2010

Toshiba's Plymouth television plant holds lessons that British industry would do well to learn, writes Annabella Gabb.

Last summer an executive on secondment from Toshiba Corporation in Tokyo sat down at its Plymouth subsidiary with some plain pink paper. He proceeded to fold it into intricate, pink paper swans. Since then the origami swans have become a familiar, if incongruous, sight on the shopfloor. Awarded to employees as part of a three-month quality initiative for "a perfect previous day's work", they are a small symbol of the Japanese attitude to managing people.

Their acceptance by the British workers on the assembly line at Toshiba Consumer Products (TCP) is indicative of a potentially more significant factor - a willingness to adapt to Japanese ways which has been fundamental to Toshiba's manufacturing operations in this country. If such flexibility became widespread, it could instil new life into British manufacturing.

But many managers, not to mention trade unionists, would be highly dubious about the power of a paper swan as a motivator, however marginal. Understandably so. That gesture, like so much of the Japanese approach to people management, challenges the time-honoured confrontational traditions of British industrial culture which, despite commendable exceptions, still persist in most UK production plants.

Toshiba has built up an efficient television manufacturing operation where British manufacturers have failed. Ironically, not a single British-owned TV maker has survived independent into the 1990s. Uncompetitive, some have simply gone out of business; others have been absorbed into more competitive foreign rivals. The last to go, THORN EMI Ferguson, was taken over in 1987 by the French electronics giant Thomson.

The Japanese meanwhile have thrived. Eight firms now have local production in the UK, dominating the market. In 1990 the colour TV sector achieved a trade surplus of £271 million, against £58 million in 1989 and a previous deficit almost since colour TVs came onto the market. In the 10 years since TCP started production in Plymouth, its turnover has increased tenfold to over £100 million. Output has risen from 76,000 in 1981 to 600,000 colour televisions a year. Not a single day has been lost to industrial action. This year a second factory nearby will start production of air conditioning units, representing an investment of £23 million. Total investment in colour television manufacture amounts to £49 million.

Back in 1981 it was by no means certain that "the Plymouth experiment" would be a success. All the production planning and systems in the world would have been worthless without the right industrial relations, so the Japanese set about engineering them - through sympathetic British managements and union officials. Much was made in the media of the so-called "no strike" agreement concluded with the Electrical, Electronic, Telecommunications and Plumbing Union (EETPU) in April that year. The deal allowed for pendulum arbitration in the event of total disagreement between management and unions but, happily, has never been invoked.

However, the agreement alone might have proved less effective without accompanying broader changes in people management. George Williams, who took over as managing director in 1988, had not previously worked for a Japanese company. Before coming to Toshiba he was European operations director with RCA, first under the ownership of General Electric of the United States, then under the German group Bertelsmann.

A cheerful, unassuming Liverpudlian (whose accent was "educated out of him" at grammar school), Williams wholeheartedly endorses the Japanese philosophy. "The difference between the Japanese approach and the traditional British scene is that they like dialogue and co-operation rather than differences and confrontation. In confrontation, everyone loses. Round the table we exchange views and should come up with a recommendation that is best for the company. It may sound trite, but I believe it," he adds.

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