How America Can Fight Back Against Low-Cost Labor in China

The Harada Method promises to create workers who are masters of their positions and champions of continuous improvement -- at little to no cost.

Norman Bodek has visited Japan 78 times to study Japanese continuous-improvement philosophy. On his 78th trip -- in March -- Bodek met with a man named Takashi Harada, who Bodek believes has the ultimate recipe for competing against low-cost labor in China and India.

The recipe is one part monozukuri (which, loosely translated, means craftsmanship, or product excellence) and one part hitozukuri (an organization's commitment to the lifelong development of its employees, or people excellence), and it's steeped in respect for workers.

It's called the Harada Method, and it's designed to help shop-floor workers develop their skills and capabilities -- on their own.

Bodek can hardly contain his excitement over it.

"I believe in what it does, thoroughly," says Bodek, who teaches a course called "The Best of Japanese Management Practices" at Portland State University. "I teach it at college, and I see the transformation with my own students."

The key to the Harada Method, Bodek says, is "self-reliance," which is "the sense that you [the shop-floor worker] can make a decision for yourself and for your company and for your customer that is right."

"This is missing in so many American corporations," Bodek tells IndustryWeek. "You call a company in America and the first thing you get is, 'This call is being recorded.' Why are they recording it? Because they don't trust their people, and they don't empower them to be trusted."

But it's not just an American problem. Bodek shares the story of a woman who went into a UNIQLO clothing store in Tokyo and asked to use the store's phone, because her baby was ill and needed medical attention. The store manager refused, insisting that it was against company policy, and the woman had to walk to another store to use the phone.

Afterward, the woman sent a letter to the president of the company -- Tadashi Yanai -- asking him why the store manager would not allow her to use the phone in the midst of an emergency.

Yanai, who was "ashamed" by the incident, called Takashi Harada.

"He said, 'Harada, I have rules and regulations that people must follow, but they have to be human beings,'" Bodek says. "'You have to teach us self-reliance.'"

Bodek notes that the Harada Method is enormously popular in Japan, for much the same reasons that American manufacturers are taking an interest in it. Japan, like the United States, is struggling to compete with low-cost labor in China and other emerging economies.

"But they can compete by raising the skill level of [their] companies," Bodek says.

'A Hero in Your Own Life'

The fundamental concept of the Harada Method, Bodek explains, "is that you can be a hero in your own life."

Harada, a former junior high school teacher, used the methodology to transform the track and field team at one of the worst schools in Osaka into one of the top teams in all of Japan, Bodek says.

Since then, the Harada Method has been taught to some 55,000 managers at 380 companies in Japan.

How can ordinary people become heroes in their own lives, and how does this apply to the factory floor?

Through the Harada Method, workers are encouraged to pick a skill that they'd like to master, and to set goals to help them accomplish it. Much like athletes striving to win a gold medal, employees write down their goals, create a step-by-step plan to attain them, measure themselves against their goals and receive guidance and feedback.

A key ingredient of the Harada Method is mentoring.

"To achieve hitozukuri, masters from inside and outside the organization provide the lifelong training and mentoring of employees," Bodek wrote in a recent blog post. "This enables the employees to:

  • Learn new skills and technology to increase their value to the organization.
  • Become 'masters' of their current positions and serve as mentors to more junior employees.
  • Advance within the company to positions requiring new knowledge and skill sets.
  • Develop a level of self-confidence and self-reliance that grows over time.
  • Create and implement ideas to improve work processes and the organization as a whole."

Ask your workers to name their favorite day of the week, and invariably most will say "Friday," Bodek laments. In teaching the Harada Method to American manufacturers, Bodek aims to change that.

"What I'm trying to do is get American managers to focus on their people -- developing their people and recognizing that developing people doesn't even cost you anything. It doesn't," Bodek says. "You just get people excited and they will do it on their own."

The IndustryWeek Manufacturing Hall of Famer emphasizes that he's excited about the Harada Method. "I love this concept," he declares.

Considering that Bodek is credited with discovering and publishing the writings of lean pioneers Shigeo Shingo and Taiichi Ohno, that's saying something.

Bodek will discuss the Harada Method in greater detail during an IndustryWeek webinar at 2 p.m. EDT on Nov. 1. To register for this free webinar, click here.

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