September 30, 2003



Keywords: Newsletter 

JFS Newsletter No.13 (September 2003)

For many people, the term "modern factory" conjures up an image of products being assembled on a conveyor belt. A production system using conveyor belts was invented as early as 1785. U.S. automaker giant Ford began production using such a system in 1913.

The conveyor belt system with well-designed production lines used to be considered a very efficient production method in terms of productivity and thus was installed in many factories. In the last several years, however, a new production system has been introduced in Japan's manufacturing industry. It has brought with it both economic and environmental successes.

The conventional method, in which workers line up along conveyor belts, has been switched to the new "cell" (small unit) method in which one or a few workers completely assemble each product from start to finish. In contrast with the U.S.-born idea of mass production, this new system is known as "on-demand" production, which is based on actual consumer orders.

Here's an example from Ricoh, a leading company in the field of on-demand production. As introduced in the June issue of the JFS Newsletter, Ricoh's environmental management policy is "advocating environmental conservation and achieving profitability."

Ricoh has undergone significant changes in its production process over the last few years. It switched from mass-market production based on sales projections to on-demand production, based on a new system requiring no conveyer belts.

Upon receiving an order right at the customer's premises, a Ricoh salesperson fills in the electronic order form with the product name and optional features desired by the customer, and transmits this information to the company's Gotemba Plant immediately by electronic network. The information is transferred into an order slip in the plant, immediately initiating the manufacturing process.

This plant has adopted the "Cell-Formation Production System" in which the whole manufacturing process is completed in the cell, with no conveyor belts. Having several production patterns (called "cell formations") ready, this system can flexibly change the volume of production on a weekly basis, and efficiently and speedily supply products, even in the face of big fluctuations in demand.

To meet the diverse needs of consumers, the company has shifted from conventional mass production to the Cell Production System, suitable for manufacturing just the right number of products in many variations. One big plus of this system is the elimination of conveyor belts, resulting in substantially lower power consumption.

Ricoh Unitechno's plant has also shifted from conveyor belts to carts, and from large electric carts to handmade robot carts. As a result, both power consumption and carbon dioxide (CO2) emissions dropped to one-eightieth of previous levels. Now in this plant a photovoltaic power generation system can supply all the electricity needed in the assembly process.

"Our factories used to work hard to make products that customers might or might not buy, but now we provide products that they have decided to buy," Ricoh says.

In Japan, not only Ricoh, but also other majors such as Canon, Sony, and NEC have adopted the Cell Production System with good results.

For example, as a result of introducing the Cell Production System between 1998 to 2001, Canon successfully eliminated the need for 18 km of conveyor belts, 549,000 square meters of space, 37 automatic warehouses, and 17 external warehouses. In 2001 the company's productivity went up by 35 percent, production time was cut by 31 percent, and electrical savings cut the equivalent of 41,650 tons of CO2 emissions. As a result, Canon cut its production costs by 35 percent and saved 118.8 billion yen (about U.S.$1 billion).

Professor Tadahiro Mitsuhashi of the Chiba University of Commerce, also a director of Japan for Sustainability, praises the Cell Production System from both environmental and economic viewpoints. He said, "To solve environmental problems, we have to shift from systems of 'mass production, mass consumption, and mass disposal' to 'appropriate production, appropriate consumption, and zero emissions.' This revolutionary beltless Cell Production System is a step toward appropriate on-demand production, where factories only make products that are needed, in contrast to the old style of mass production based on the build-for-inventory production system."

Nearly a hundred years after Ford introduced the conveyor belt system, a new paradigm shift in the manufacturing industry is now occurring in Japan. Its implications for business, and for the environment, are huge.