Управление качеством в международных корпорациях. Практикум на английском языке

Practical training

Other industries – notably consumer electronics – are doing a better job of raising the bar. «Chinese companies that are playing at the higher end of the market understand slightly better how manufacturing works», notes Paul Midler, a consultant and author of Poorly Made in China. Yet those companies seem to be in the minority». Many manufacturers are not interested in making a quality product and building a long-term reputation», he says.

One reason for that, he adds, is China’s booming real estate industry. A number of manufacturers «got into manufacturing mainly because they saw (the money they could make in manufacturing) as a stepping stone to real estate», he says. In a roundabout way, that spells trouble for quality: «Compare two manufacturers. One wants to make a product to generate a small profit and have repeat business. The other simply wants your order so that he can [make enough money to) build a shopping mall. Which one will be focused on the quality and integrity of the product?»

But short-term gain may lead to long-term pain. «If Chinese brands want to have longevity, they need to improve consumer brand perception and build consumers’ trust», states Thomas Isaac, commercial director of the global market research firm TNS in Hong Kong. «Trust comes from ensuring your products are good quality and durable. If there is a problem, you have to address it».

The problems are particularly glaring at companies whose managers suffer from the belief that the trade-off between cost and quality is inescapable. That’s the case in the country’s small, but burgeoning, electric bicycle business, according to Ed Benjamin, managing director of Florida-based e Cycle Electric Consultants. «A Chinese businessman boasted to me that he just made a lot of money by reducing the cost of materials. He thinks that he is a smart businessman», he says. «In fact, he is destroying his business and destroying China’s reputation. In our eBike space, we still have a lot of old-fashioned businessmen who have not learned their lesson. Customers find a lot of trouble with inconsistent quality».

Yet beyond the get-rich-quick ethos, other, arguably harder-to- address forces are at play, notes Meyer. For one thing, the huge number of small companies and widespread fragmentation of industries make controlling supply chain networks far more complex in China than in other developing economies, such as India. That’s compoundedbyendemicsubcontracting–orchengbao,asit’sknown

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locally which leaves companies grappling with layer upon layer of suppliers involved in making their products, according to Meyer.

Kazuto Suzuki, a professor of international politics and economy at Hokkaido University in Japan, points to China’s heavy focus on developing technology for military purposes, rather than civilians, as a key hindrance to upgrading quality. While the government has made huge strides in space and other military applications, commercial technologies have gotten short shrift. «In the military side, you have majormilitaryclients.Inthecommercialworld,youhaveahugemarket where you are not sure what kind of technology is needed or what kinds of products people want», Suzuki says. «Chinese companies don’t want to invest in uncertain technologies. It is less risky to copy technologies that are established or proven to be profitable».

While others say brand perception among locals plays a big role in the domestic companies’ fight for the market, McDuffie also points out that the firms lack the core technologies and know-how to compete with global brands – something that their joint ventures with foreign manufacturing hasn’t provided, despite the widespread assumption otherwise. He notes that while the government requires joint ventures for auto assembly plants, but not for suppliers, his research suggests that the plants provide only limited access to foreign product design data and expertise. What’s more, strong sales from joint venture autos have left local suppliers with little incentive to develop their own models. As for the suppliers, McDuffie says a smart way for them to gain expertise, and quality, is to do what Pacific Century Motors did in 2010 with its outright acquisition of Michigan-based Nexteer from GM.

Many experts draw parallels between China today and other countries once known for low-quality manufacturing, including Japan before the 1960s. The big lesson for China? «Historical examples suggest no real way to bypass the need to develop technological and organizational capabilities internally», McDuffie states. «What they can learn from their foreign multinational partners – via partners or knowledge leakage – won’t be adequate».

That could be a tall order. In Japan’s case, its manufacturers, unlike their Chinese counterparts, never expanded by making productsunderothercompanies’brandnamesasOEMs.Rather,firms used plenty of reverse engineering and innovation and a tradition of craftsmanship to master numerous technologies, becoming leaders in electronics, automotive, chemicals and other high-value industries.

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«The Chinese have a hard time saying no to cash in the short term in exchange for a longer vision of the brand. Sony was famous for turning down the chance to make goods under other brand names», says Midler. «Chinese industry is struck with a kind of myopia that defines its philosophy of doing business».

Perhaps a better comparison is Taiwan. Unlike in Japan, Taiwanese firms have been heavily engaged as OEMs, yet also have improved their own product quality and technologies to become – in the case of HTC smartphones, Acer and ASUS computers, among others – big global brands. A big motivator has been necessity. In Taiwan, «people think differently because their domestic market is so tiny. They have been always looking for exports to U.S. and Europe», notes Chi-Jen Yang, a technology policy analyst at the Center on Global Change at Duke University.

Improvements in quality also depend on countering other tendencies in Chinese industry, including rampant counterfeiting. While making knock-off products that look genuine takes a certain amount of skill, notes Midler, manufacturers cutting corners, adulterating products and other sleights of hand abound. He argues that without a change in attitude across the board, among managers, factory workers and consumers, little is likely to change.

Even if domestic companies were to sell good-quality products on par with foreign brands, Chinese consumers – increasingly wedded to brands might not buy them. «Chinese engineers and companies are capable of making high-quality goods, but will the market reward them for making them? This is the biggest issue», says Clendenin of RedTechAdvisors.«WhyshouldIwaste5%or10%ofmycompany’s R&D resources on creating super products that probably only a few people would buy? I am better off dropping lower end products and focusing on better mid-range products, which are still affordable and which people would buy».

Until recently, China’s long-suffering consumers mostly put up with the poor quality of local goods, especially if they felt a bargain was to be had. But as income levels rise, their tastes – and patience – are changing. Consumer expectations may prove the most powerful inducement for China’s consumer manufacturers to improve quality. With a market of around 800 million low-income Chinese who accept poor quality for low prices, manufacturers can afford to cut corners. «When the majority becomes middle class, aware of quality and

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prefers quality to low prices, I think the Chinese market will change», predicts Suzuki of Hokkaido University. Give it 10 or 20 years, he says, and «the Chinese will not buy poor quality goods even if the price is low».

Tasks

1.Describe the differences between Russian and Chinese quality management.

2.How do you think why modern quality management is not working in Chinese firms?Explain your opinion.

Questions

1.Why did Chinese consumers for a long time suffered from inferior goods?

2.What is the status of Chinese car manufacturers in national market?

3.How Chinese manufacturers can be able to restore confidence in their goals?

References

1.Hofstede G. Cultural constraints in management theories. International Review of Strategic Management Vol. 5, pp. 27–48. 2014.

2.Fernandex D. R., Carlson D. S., Stepina L. P. and Nicholson J.D.Hofstede’s country classification 25 years later. The Journal of Social Psychology Vol 137, no. 1, pp. 43–54. 2013.

3.Yu C. S., Cochran D. S. and Spencer B. Quality Management Practices in China. Quality Management Journal, no. 2, pp. 91–106. 2012.

4.Li C. K. and Cheung F. S. ISO 9000 and Chinese Management Culture. Hong Kong Economic Journal Monthly Vol 228, pp. 70–75. 2013.

5.Wang Y. W. Brief Discussion on Corporate Culture and Product Quality in China. Quality & Management Aug/Sep. 2012.

6.Juran J. M. China’s Ancient History of Managing for Quality. Quality Progress, Jul, pp. 31–35 and Aug 1990, pp. 25–30. 2014.

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Содержание

3Предисловие ПРАКТИЧЕСКИЕ ЗАНЯТИЯ

51. Management of production quality, its modern features and development

Управление качеством производства продукции, его современными особенностями и развитием

152. The economy and quality of products

Соотношение экономики и качества продукции

223. The main international directions of quality improvement

Главные международные направления повышения качества

304. The principles of total quality management (TQM)

Принципы тотального управления качеством

355. ISO standards 22000

Стандарт ИСО 22000

406. Domestic experience of quality management (the USSR and the Russian Federation)

Внутренний опыт управления качеством (СССР и Российская Федерация)

517. Cost Of Quality: UK experience

Стоимость Качества: опыт Британии

578. The UK Retail Industry. Case of TQM at Tesco Supermarket

Британская розничная промышленность. Пример TQM в Супермаркете Теско

669. Standardization in Sweden

Стандартизация в Швеции

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7410. The Swiss index of customer satisfaction

Швейцарский индекс удовлетворенности потребителя

8711. Experience of quality management in Germany

Опыт управления качеством в Германии

9512. The specifics of the quality management in the United States

Специфические особенности управления качеством в Соединенных Штатах

10213. Quality certification on the Brazilian domestic market

Качественная сертификация на бразильском внутреннем рынке

11314. Multi-level system of quality assurance and product safety: McDonald’s example

Многоуровневая система гарантии качества и безопасности товаров: пример McDonald’s

12515. Quality management practices in Asian countries: a comparative study

Практика управления качеством в азиатских странах: сравнительное исследование

13516. Seven Japanese quality management tools

Семь японских инструментов управления качеством

13917. Quality assurance and reliability in the Japanese electronics industry

Гарантия качества и надежность в японской промышленности электроники

15218. Quality Management in China

Опыт управления качеством в Китае

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Учебное издание

УПРАВЛЕНИЕ КАЧЕСТВОМ В МЕЖДУНАРОДНЫХ КОРПОРАЦИЯХ

MANAGEMENT OF PRODUCTION QUALITY IN INTERNATIONAL CORPORATIONS

ПРАКТИКУМ

на английском языке

Авторы-составители: Боброва Елена Фанильевна, Борис Ольга Александровна

Издается в авторской редакции

Компьютерная верстка Н. П. Чивиджева

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Отпечатано в издательско-полиграфическом комплексе

ФГАОУ ВПО «Северо-Кавказский федеральный университет»

355029 г. Ставрополь, пр-т Кулакова, 2

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