Management Control in Shipbuilding in Japan

b y I. Takezawa* on March 22,1967,

Read in London at a meeting of the Royal Institution of Naval Architects Professor J. F. C. Conn, D. Sc, (Vice-President), in the Chair.

S U M M A R Y : The present success the Japanese shipbuilding industry is enjoying i s attributable to its competitiveness, consisting in its ability to build high-quality ships inexpensively and deliver them accurately on the delivery dates. This competitiveness was the outcome of the active and aggressive efforts to rationalize the designing, materials procurement and actual production activities through the adoption of the P E R T system. The Key-point i n rationalization of production control is the adoption of the "advance outfitting" system. A s explained in this paper, the success of this system depends on improved efficiency in the various phases of shipbuilding. Improved efficiency, closer co-operation and coordination among the various departments naturally bring about savings in manhours, time and other factors conducive to the reduction in the cost of production. There are also other factors which cannot be overlooked, as their contribution toward making Japan's shipbuilding industry what it is today were as important as those already mentioned. These factors are the unceasing efforts made by a large group of competent university-graduate technical staff in the development of technical innovations and production control methods backed by good labour relations, aggressive and timely investment i n facilities and cooperation among a l l the industries concerned.

1.

ELEMENTS THAT MAKE SHIPBUILDING ENTERPRISE COMPETITIVE

2. RATIONALIZATION IN DESIGNING DEPARTMENT The most important tasks i n designing are the making of drawings which w i l l give detailed and practical instructions to the people engaged i n production, and the securing and timely delivery of the necessary materials so that the p r o ducts that w i l l give the customer satisfaction can be produced inexpensively and on time. In order to accomplish these tasks the following rationalization steps are being taken to produce high quality products inexpensively, with ease and on time. Needless to say that combined with these rationalization steps, every effort must be constantly made i n research and development to improve the designing methods and performance of the products. 2.1 The Use of " P E R T " System for the Control of Designing Work The use of the " P E R T " system makes possible: (1) (2) (3) (4) Making of correct and accurate evaluation of the time for deciding the specifications. Better control of timing of handing-over of drawings for the hull and fittings. Advance outfitting through better coordination of the hull and fittings designing work. C o r r e c t and accurate planning of timing for placing orders for the necessary materials

The reason the Japanese shipbuilding industry can boast the largest tonnage i n the world i s that it i s capable of building ships of good quality, relatively inexpensively and delivering them on schedule. This fact makes Japan's shipbuilding i n dustry highly competitive i n the world's shipbuilding market. There are many varied elements that make Japan's shipbuilding industry highly competitive, such as the following: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) (20) Market research. Sales promotion. Use of customer's operational experiences. Technical research and development. Good design. Planning of productive facilities. Quality control ensuring accurate individual work. Selective tendering. Accurate estimation of cost. Development of production methods. Investment i n cost saving productive facilites. Good labour relations. Value engineering. Cost control. Good commercial relations with suppliers and subcontractors. Availability of finance. Availability of labour and staff. Absence of undue bidding. Absence of unfair competition. Absence of undue modifications by owners.

As a result, the efficiency of productive activities at the yards has been improved. 2. 2 Promotion of standardization in various fields of work Besides the success attained in the o v e r - a l l control of work through the use of the " P E R T " system, the following measures are being taken to improve the efficiency of designing work itself through rationalization. (1) (2) Standardization of methods of calculation, drafting and numbering systems for sub-sections of plans. Standardization of parts for greater economy i n ordering, receiving and price. 423

Of the above elements, Japan's shipbuilding industry has been making special efforts to improve and promote (1), (4), (5), (7),(9),(10),(11),(12),.(13),(14),(15) and (17), which are considered to have great influence i n increasing the industry's competitiveness. The author w i l l take up the more important among these endeavours. * Manager of Shipbuilding Administration Department of Shipbuilding Division, Mitsubishi Heavy Industries Ltd. Tokyo.

MANAGEMENT (3)

CONTROL

IN SHIPBUILDING

IN

JAPAN a joint "value analysis" is conducted by the Designing and Materials departments to avoid, as much as possible, making "over performance" products. 3. 3 Rationalization to reduce materials control expenses Necessary amount of materials at the time they are required is a l l that is needed to carry out production smoothly. A c cordinglyif this is always guaranteed, there should be no need for warehouses or storage sheds for stockpiling m a t e r i a l s . This i s easier said than done. However, a considerable degree of success has been attained i n reducing the m a t e r i a l s control expense by cutting down the materials control personnel expense, interest on materials cost through reduction i n the amount of materials stocked. The most outstanding among them i s the stock control of steel materials, the most important of a l l the shipbuilding materials.

Standardization of structure, materials for parts, shapes and scantlings of parts to effect greater productive efficiency.

2. 3 Mechanization to increase capacity for designing calculations and drafting Special efforts are being made for the mechanization of theoretical and analytical calculations as well as drafting, since increased capacity i n these designing activities w i l l have a very great effect on the overall productive capacity of a yard. Speeding up of calculations and analysis through the adoption of computers, and utilization of automatic drafting machines with numerical computer control system are but some of the measures being adopted on a fairly extensive scale. 3. RATIONALIZATION IN MATERIALS DEPARTMENTS

In order to achieve "cost down" i n the price of a ship, the most important thing i s to have an effective control of materials, as these constitute approximately 70% of the cost of a ship. Effective control of materials comprise delivery control, which consists in securing and delivering the necessary materials when they are required, and cost control which consists in procuring the necessary materials inexpensively. Japan's shipbuilding industry is using the following measures to accomplish this. 3.1 Delivery control of necessary materials through the use of " P E R T " system in the designing and materials departments

According to the stock control system now in effect, a shipyard places orders with the suppliers of steel materials i n accordance with the production plans for the hull. The orders are placed according to the production plans of each block (section), broken down into necessary materials per day. The dates of delivery are staggered (spaced) by 5-day periods, starting 60 days from the placement of the first order. By the adoption of the system, the amount of stockpile oi steel materials at a shipyard which only until 2 years ago used to be an estimated l V months' supply has been cut down to as little as 0. 3 month's (9 days) supply. This also resulted i n reduction in steel materials handling personnel due to reduction i n inspection, receiving, handing out of steel materials at the stock yard.
2

2.0

New

sy stem a p p l i e d

1.5
V Stock ratio
Steel weight stocked in Steel weight

yard
shop

The duty of the Materials Department i s to procure the m a t e r i a l s specified by the Designing Department inexpensively and deliver them to the places and at the times specified by "on-the-job" departments. In order that the duty of the Materials Department i s c a r r i e d out effectively and smoothly, an integrated control of materials must be excercised i n the Designing, Materials and "on-the-job" departments. To achieve this, an integrated "Procurement C o n t r o l " system applicable to Designing, Materials and "on-the-job" departments, based on the " P E R T " system is used. The adoption oi the "Procurement Control" system enables the securing of materials when they are needed, based on the supply plans which ensures the issuing of detailed and accurate i n s t r u c tions for procurement of a l l necessary materials as soon as the decision on specifications i s made. 3. 2 Rationalization to lower the cost of materials The following measures are currently being used in Japan i n order to obtain the necessary materials inexpensively. (1)

supplied t 3 f a b .

0.5

Extensive standardization of P a r t s . Standardization of parts i s being extended to the shape, size and quality of parts so that the same parts may be used, as much as possible, by the different yards and eventually by the industry at large.

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(2)

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Extensive use of Maker Standard products. Although i n the past it was customary to have sub-contractors make products to the design and specifications of the yard, a new policy has been adopted to use the standard products of the first class sub-contractors. This enables the " m a k e r s " (sub-contractors) to m a s s produce these products and thus serve to cut down the cost and ensure "on-time" delivery as well as better product servicing. Expansion of " L o t " purchasing. By purchasing "maker standard" products i n " l o t s " or large quantities, per-unit cost i s reduced. Adoption of "Value A n a l y s i s " method. An important point i n "cost down" is to use "just enough" amount of necessary materials to enable the product to

F i g . 1. Steel stock ratio chart. (Applying 5-day pitch divided delivery system)

(3)

(4)

The reduced stock of steel materials also means considerable savings on interest. (Ref. Fig, 1) This system also served to do away with an important element which often was responsible for raising the cost of a ship or delayed delivery. To put it briefly, this element was a vicious c i r c l e caused by the following facts. In the past, the manufacturers of fittings,

PROJECTED

(It is aimed to make the organization rational by dividing it stagewise Si divisionwise with combined hull fabrication & outfitting work.) -PRODUCTION C O N T R O L D E P ' T fHULL ACCOMMODATION

PRODUCTION C O N T R O L "SHOP PRODUCTION T DESIGNING ENGINE O U T F I T T I N G MINIATURE -NO. 1 PRODUCTION D E P ' T FABRICATION P A R T S Si UNIT FABRICATION. SHOP (b) PIPE SUB-ASSEMBLY L-CONVEYANCE -PRE-ASSEMBLY -ASSEMBLY -ASSEMBLY SHOP (c) -PRE-ERECTION - H E L P E R Si PAINTING -CONVEYANCE SHIPBUILDING DIVISION NO. 2 PRODUCTION D E P ' T -NO. 1 B E R T H -NO. 2 B E R T H -BUILDING DOCK -PNEUMATIC - H E L P E R Si C R A N E -LAUNCHING - ACCOMMODATION - D E C K OUTFITTING H U L L OUTFITTING SHOP (e) -HOLD OUTFITTING -PAINTING -NO. 1 ENGINE O U T F I T T I N G -NO. 2 ENGINE O U T F I T T I N G ENGINE O U T F I T T I N G SHOP (0 NO. 1 O P E R A T I N G Si TESTING NO. 2 O P E R A T I N G Si TESTING -ACCOMMODATION - D E C K Si HOLD E L E C T R I C OUTFITTING SHOP (g) 'ELECTRIC IINSPECTION D E P ' T H U L L SECTION -ENGINE SECTION E L E C T R I C SECTION -ENGINE ROOM -NAVIGATION EQUIPMENT NO. 3 PRODUCTION D E P ' T PRODUCTION C O N T R O L "SHOP p FABRICATION H U L L OUTFITTING SHOP -1-OUTFITTING L PAINTING FABRICATION E R E C T I O N SHOP (d) DRAWING | MINIATURE FABRICATION SHOP DRAWING FABRICATION L-SUB-ASSEMBLY ASSEMBLY A S S E M B L Y & WELDING "SHOP WELDING LMAINTENANCE -NO. 1 S T E E L WORK -NO. 2 S T E E L WORK - E R E C T I O N SHOP -HELPER -PNEUMATIC r~ MAINTENANCE PLANT MAINTENANCE -(-COMPRESSOR SHOP LTOOL -INSPECTION SECTION .HULL -SHIP WRIGHT PRODUCTION ENGINEERING SHOP (a) H U L L OUTFITTING

H U L L FABRICATION "DEP'T

SHIPBUILDING DIVISION

-OUTFITTING D E P ' T ENGINE O U T F I T T I N G "SHOP OUTFITTING O P E R A T I O N Si T E S T

{
O U T F I T T I N G

_ELECTRIC O U T N T T I N G _ R SHOP "(NAVIGATION EQUIPMENT r^ENGINE - I N S P E C T I O N SECTION

Remarks:

(a)

Production engineering shop undertakes the planning of both the hull part and the outfitting part.

(b)

As has been shown Fabrication shop undertakes not only the hull fabrication and sub-assembly but also the pipe fabrication and the assembly of purchased outfitting parts into units, including their conveyance.

(c)

Assembly shop undertakes the pre-assembly, assembly and pre-erection works, including the respective outfitting work. It also embraces the helper, painting and conveyance sections.

(d)

Erection shop has been divided into 3 major sections, berth-wise, viz No. 1, No. 2 Berths and Building Dock. To service these sections, Pneumatic, Helper & Crane and Launching

Sections have been set up in the same shop. The shop also undertakes outfitting work as in the case of the assembly shop.

(e)

Hull outfitting shop has been divisionally separated into accommodation, deck outfitting and hold outfitting sections. Painting section is also included.

(f)

Engine outfitting shop consists of the engine outfitting section and the operation and testing section. Due to the large amount of work involved each section has been subdivided into 2 sub-sections.

(g)

Electric outfitting shop has been divided as in the case of hull outfitting shop into Accommodation section, deck and hold section and engine room section. Navigation equipment section is also included.

Fig.2

Comparative Tables of OrganizationShipbuilding Division

MANAGEMENT

CONTROL

IN SHIPBUILDING

IN

JAPAN which had to be done after launching can now be done as early as at the sub-assembling stage of the hull "blocks" on the ground, resulting i n a considerable shortening of the period between launching and delivery. 4. 2. 1 Three Systems in "Advance Outfitting" The author i s of the opinion that there are three advance outfitting systems, viz. (1) Advance outfitting system, (2) Divisional outfitting system, and (3) Open-air outfitting s y s tem (called " B l u e - S k y " outfitting system, i n Japan). B r i e f explanation of the three systems follows: Advance Outfitting: T h i s system i s sub-divided into three methods again: (a) Sub-Assembly Stage Outfitting:

This led the shipyards to place orders e a r l i e r than necessary i n order to "cushion" themselves for delayed delivery of fittings. This, i n turn, often led to over-stocking of fittings if they were delivered on time. Thus, creating another element for increased cost for a ship caused by confusion i n stock control. The first break i n this "vicious c i r c l e " o c c u r red when storage space shortage was caused with the development of the "Advance Outfitting Method." In order to overcome the storage space shortage, the shipbuilders started to educate and help develop the fittings manufacturers to e n able themselves to effect " J u s t - i n - t i m e - D e l i v e r y . " This i n turn did away with the necessity on the part of the shipbuilders to place orders for fittings earlier than required. Now that this "vicious c i r c l e " has been solved, the shipyards are enforcing strict coordination, i n ordering, production and delivery of fittings. A s a result of this movement, called the " J D " movement, the "in-stock room" period of fittings which used to be 1-2 months for 40% of the fittings used has been cut down to 20 days at the longest. This fact, naturally, has contributed greatly to alleviating the storage space shortage and i n reducing the stock control costs. 4. MANAGEMENT CONTROL IN "ON-THE-JOB" MENTS DEPART-

This consists i n doing outfitting work while the hull sections are i n the sub-assembly stage. The advantage of outfitting at this stage is that the work can be done easily because the workmen can do it looking down on the work. This also reduces outfitting work done in the "looking-up" position inside the assembled hull. (Ref. F i g . 3)

The task of the on-the-job departments consists i n building ships capable of giving the performance as planned, on time and inexpensively. In order to accomplish this threefold task, each "on-the-job" department is making special efforts to effect rationalization in its own way. The following are some of these rationalization efforts: 4.1 Transition to New Factory Organization suited to New Production Control Systems

With the recent development of shipbuilding method i n which the work on the hull and outfitting are c a r r i e d out s i m u l taneously, the factory organization patterned for the conventional hull-outfitting sequential construction system became unsuitable. P a r t i c u l a r l y where early outfitting (advance outfitting as it i s called i n Japan) system is used, it is far more advantageous from the stand-point of efficient production control to organize a shipyard on the basis of work stages. This reorganization of a shipyard on work stage basis w i l l become a necessity, with the wider adoption of the tendency to make the workmen capable of doing many jobs instead of one. Realizing this need, there are many Japanese shipyards which are making the transition to the work stage control system, while s t i l l retaining the conventional organization for the time being. The change-over to the stage control system of organization can be easily done i n hull construction. The same is not true i n outfitting where the work i s not limited only to the installation of fittings or parts and equipment but includes operation and adjusting and testing, calling for specialized s k i l l s . Accordingly, i n outfitting work, a suitable organization pattern, perhaps mixing the conventional job basis (by nature of work) organization and the new work stage basis, may have to be devised. However, if conversion oi workers into "multi-job workers" is c a r r i e d out thoroughly, an organizational pattern solely based on work stage basis may become possible. (Ref. F i g 2) 4. 2 Adoption of Work Stage Basis Management Control System based on "Advance Outfitting" System In the conventional shipbuilding method, outfitting work was done after hull construction. Accordingly, outfitting work was affected greatly by the progress of hull construction work and considerable time had to be reserved between launching and delivery. But with the recent development of hull construction by "three-dimensional" block (sectional) s y s tem, it has become possible to do outfitting work also by "blocks" (sections) while blocks are s t i l l in the sub-assembl-

F i g . 3. "Advance outfitting" in sub-assembly stage

F i g . 4. "Advance outfitting" in assembly stage. (Side hull

MANAGEMENT (b) Block (Sectional) Outfitting: This i s done on the ground while the fabricated hull blocks are s t i l l on the ground, before they are put in place on the building berth. The purpose i s to minimize the outfitting work after the hull blocks are erected. (Ref. F i g . 4) (c) Large Deckhouse Block Outfitting: This c a l l s for the construction of the deckhouse i n l a r gest possible blocks on the ground as early as possible and also for doing various outfitting work in it before it is erected on the deck. (Ref. F i g . 5)

CONTROL

IN SHIPBUILDING

IN

JAPAN

Exposed Deck Deckhouse (Living quarters) Engine Room Some of these are further divided if and as required.

Open-Air Outfitting (Blue-Sky Outfitting): This consists in bringing the fittings on board and installing them in position before the superstructure i s installed during the erection process. The object of this method i s to get as much as possible of the outfitting work done under good and safe working conditions. Some typical examples of the "openair outfitting" are the installation of auxiliary machinery and pumps, cargo o i l pipes and valves in the cargo o i l tanks, a i r conditioning as well as galley equipment, while the hull is s t i l l in the erection process. (Ref. F i g . 6)

4. 2. 2 Rationalization in Manufacturing and Installation of Fittings In order to do outfitting work in step with hull construction work, shipyards usually follow the policy of restricting outfitting work to only the installation of fittings, leaving the manufacturing of fittings to outside manufacturers. Some fittings, such as pipes and trunks are s t i l l being manufactured at the yards. However, bringing these outside-manufactured fittings into the ship and then adjusting them or doing additional work before installation has always had an adverse effect on the efficiency of the o v e r - a l l outfitting operation. To overcome this deficiency, recently the yards have adopted the system of putting several fittings together into a unit in the fittings-assembling shops and installing the unit. This system has served to bring about higher efficiency in t r a n s portation of fittings and also reduced the work load i n narrow, restricted places on board. Because of these advantages the system offers it has been found highly effective in raising efficiency of o v e r - a l l outfitting work and in creating safer working conditions. The following are examples of " U n i t Outfitting":Unit-assembling of cargo o i l pipes and valves for the pump room. Unit-assembling of pipes and valves for auxiliary m a chinery. Unit-assembling of mast derrick post and its attachments and fittings. (Ref. F i g . 7)

Fig. 5. "Advance outfitting" in assembly stage (Large size deckhouse section) Divisional Outfitting: As is the case in any work control system, the control of outfitting work is made easier if control is effected d i v i s i o n ally. F o r this reason, in carrying out outfitting work, many yards f i r s t divide the ship into appropriate divisions and place one man in charge of each division. These men are responsible for setting up proper working sequence, a l l o cating work load properly and coordinating the work progress of the groups under their supervision so that at no time several groups are working at one place and get into each other's way. A s a result, work efficiency has been i m proved through elimination or minimizing of time-loss while a group or groups of men are waiting for work. Injury rate has also been reduced due to absence of confusion or congestion. The following is a representative example of division used by Japanese shipyards: Cargo O i l Tank Cargo Hold

Fig. 6. "Advance outfitting" in the open air, called "blue-sky outfitting" (Engine room of tanker) 427

MANAGEMENT

CONTROL

IN SHIPBUILDING

IN JAPAN Due to the adoption of the above-mentioned outfitting systems, outfitting man-hour consumption rate at the time of launching has shown a tremendous improvement, and remarkable r e sults are being achieved i n accuracy of work, work efficiency, on-schedule work and safety. (Ref. F i g . 9)

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Some a d v a n c e d

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/ 1 I 1

*/ /
*
t

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F i g . 7. Unit assembly 4.2.3 Management Control Measures to enable Advance Outfitting

50

1
/

The following constitute management control measures necessary to make advance outfitting possible. (1) Timely handing-over of drawings and procuring of m a terials by the Designing and Materials departments in applying the " P E R T " system.

40

/ /

^Ordinary shipyards

30

(2) E a r l y checking on fittings installation and hull construction processes i n the fittings planning stage.
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(3) Pre-planning by the production and designing departments for examination of the places, dates, blocks (sec tion) and methods of installation of fittings. (4) E a r l y procurement of fittings and materials from outside manufacturers and ensuring accurate delivery date. (5) Preparation of "Fittings L i s t s " for "By-Stage" Outfitting and "Subdivision" outfitting.

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F i g . 9. Outfitting manhour consumption rate before launching 4. 3 Adoption of Rationalized Man-hour Allocation System While an accurate work analysis i s an important factor i n increasing productive efficiency, appropriate allocation of man-hours and quick analysis of the results and ability to take corrective action are factors of even greater importance. Shipbuilders i n Japan have developed a new system along these lines, named it S M A C C (Scheduling Manpower A l l o c a tion and Cost Control), and are using it to great advantage. This system i s a method for improving the quality of the highly complicated work process control i n building new ships through the use of computers and raising the shipyard productivity. It comprises S M A C C -I which i s concerned with the hull construction work on the berth and S M A C C -II, with Block assembling work on the ground. A s the system uses computers, drawing up of the plans, analysis of the results of work, discrepancies between plans and actual results, etc. are done i n a very short time. It further enables furnishing of the data needed, such as the following, to people i n charge of controlling the work:

(6) Collecting and distributing of fittings i n accordance with the day-by-day Outfitting Schedule separated into " B y stage" and "Sub-division" Outfitting Programme. A l l fittings that can be palletted and sorted should be palletted whenever and wherever possible. (Ref. F i g . 8)

Fig. 8. Grouping of outfitting parts palleted for transportation

(1) (2) (3) (4) (5)

Day-by-Day Work Schedule by Shops. Work Schedule by Hull Numbers. Personnel Allocation Chart by Types of Work. Work Load Allocation Chart. Assembly Slab A r e a Allocation Chart.

(7) Personnel Control in the Production departments i n a c cordance with Production Schedule. Production departments work out the necessary man-hours, broken down into " B y stage" and subdivision man-hours, based on quantity of materials indicated on Materials Control Chart. According to these man-hour charts, the Production departments allocate men each day and exercise

With the adoption of the system, making of the production plans for the complicated "on-the-berth" work i n detail and with accuracy has become easy. It also made it possible to get an accurate picture of the progress of work easily, r e s u l ting i n greatly increased work-controlling capacity of super-

MANAGEMENT 4.4 Adoption of High Efficiency Machinery and Facilities Japan's shipbuilding industry has developed new machinery and facilities for increasing the efficiency and accuracy of various types of work and is making very active use of them. The following are some of these newly developed machines and facilities: Adoption of conveyor system for the line from receiving of hull plates, fabrication and assembling.

CONTROL

IN SHIPBUILDING

IN

JAPAN

Adoption of E P M (Electro P r i n t Marking) System for marking of plates. (Ref. F i g s . 10 and 11) Wider use of various automatic welding systems: (1) (2) (3) Twin rod union melt machine. One-side automatic welding machine. Gravity-welder (one person i s capable of using 6-7 w e l ders) (Ref. F i g 12)

'7
F i g . 12. Gravity welding in operation (4) (5)

Non-gas type automatic welding machine (small and light) High Frequency Pressure-welding machine for welding of pipes and flanges.

Rationalization of " i n - t h e - y a r d " Transportation through the use of Large-Capacity Cranes. Many yards have two sets of such large-capacity cranes as 150T, 200T, 250T and 300T. By using two of these cranes together, hoisting of the following has been made possible. (1) (2) Large hull blocks outfitted on the ground. Main engine, boilers and other large machinery parts besides transporting efficiently large and heavy objects weighing hundreds of tons.

F i g . 10. E . P . M . (Electro print marking) facility

4. 5 Shortening of Building Period and Reduction in Manhours due to rationalization in Designing, Materials and On-the-job departments A s explained above, the successful rationalization and c o operation among the Designing, Materials and On-the-job departments, i n the case of large ships of over 60KDW, (60, 000 tons DW) i n spite of the sudden increase i n size, have greatly shortened the periods from keel-laying to launching and from launching to delivery. A great reduction i n manhours both i n hull construction and outfitting has also been achieved. However, where 12KDW (12, 000 tons DW) class cargo ships and 40-50 KDW (40-50, 000 tons DW) class tankers are concerned, no appreciable difference i n period of construction has been effected, as there are sufficient building berths available for these ships. (Ref. Figs 13,14 and 15)

5. COST CONTROL WORK IN SHIPBUILDING The purpose of Cost Control i s "to produce high-quality p r o ducts at low cost, thereby creating large profits". A c c o r d ingly, i n order to achieve this objective, it i s necessary to set up a department responsible for cost control and make the department function properly to accomplish the following three-fold mission: Drawing up of cost control plan Execution of the cost control plan Examination and analysis of the results. 429

J
CD-

F i g . 11. E . P . M . marked plate

MANAGEMENT

CONTROL

IN SHIPBUILDING

IN JAPAN

Generally speaking, Japanese yards are engaged i n f a i r l y effective cost control activities with appropriate organization for the purpose. A n elaboration oi the subject follows: 16
,11 -12 K.D.W.T , cargo ship

( (
' 40 - 5() K.D.W T. rank 65-75 K.D.W T. tank er

L_

120 K.D W.T. fanker -

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10

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F i g . 15. Outfitting and hull fabrication manhour ratio 5.1 Cost Control Organization in Designing Stage
'60 90 K D.W T tanker

120 K.D.W.T. tanker' ^-40-50 K.D.W.T. bulk carriei

The major objectives i n working out estimates at this stage should be:

12 K.D.W.T.

bulk carrier 120 K.D.W.T tanker

(1) T o work out a set of "ready-made" fully competitive estimates based on standard types of ships with p a r t i culars and elements of cost so that competitive estimates " t a i l o r e d " to customers' requirements could be worked out quickly and accurately as variations of the "ready-made" estimates.

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(2) T o make such estimates sufficiently detailed so that the estimates may be used as a "base" for working out the budget and also as cost control data i n building. The above requirements make it imperative that the other departments keep the cost control department fully abreast of a l l changes that affect the cost of a ship, particularly the following: (a) Quantity of Materials to be used: - Designing Department should notify a l l changes i n design and particulars.

F i g . 13. Building period chart for various kinds of ships

H 0

r~ ir
ull fabr urfitling cation

. . . 2 K.D.V /.T. cc rgo ship

(b) Changes i n prices of materials and results of market surveys:- Materials Department should advise on a l l these matters.

c
Q
10

(O

Other factors affecting the cost of a ship: - a l l sections concerned should advise on changes i n such matters as charged wages, man-hours, etc., with the exception of those pertaining to materials.

(3) To work out a practicable Operational Budget, based on the data supplied by the departments concerned and reflecting the views of the profit controlling section.
4 ) - 50 K D.W.T. tanker

5-75 K.D.W.T. tanker

(4) To work out the most suitable building procedural plans, taking into full consideration the "boundary conditions, " as the cost of a ship i s favourably or adversely affected by whether the building procedures are planned w e l l o r badly. 5. 2 Cost Control Organization in Operation

120 K D.W.T. tanker

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F i g . 14. Manhour efficiency chart

Cost Control Organization i n Operation i s an information gathering organization centred around the "on-the-job" departments. It should be able to obtain information about procurement of materials, fluctuations i n prices of materials, changes in planned man-hours and other factors that affect cost c o n -

MANAGEMENT mation of this type i s comparatively easy, the cost control activities at this stage should be concentrated on comparative studies of the personnel allocation plans with particular e m phasis on welding personnel allocation i n the case of hull construction work and for divisional outfitting i n the case of outfitting work. 5. 3 Cost Control Organization in examining stage In cost control of a new ship, emphasis i s placed in the planning stage on controlling materials expenses, which constitute a considerable part of the whole. Where labour expenses are concerned, emphasis i s placed on the actual work when it i s being c a r r i e d out. It must further be remembered that the aim of cost control activities at this stage i s two-fold:viz. to bring the cost of a particular ship down and to make the data thus obtained, available for making estimates for future orders. Accordingly, at this stage, action should be taken from the o v e r - a l l stand-point of profit control. The objectives of the activities should, therefore, be the following: (1) To obtain the rate of decrease i n cost fluctuations by ship types based on results obtained from actually b u i l d ing ships. (2) To make a re-evaluation of fixed expenses necessary, based on the building of new ships. (3) T o get a thorough understanding of conditions surrounding ship prices. Based on the results of the above, such activities as working out of "product m i x " (combination of products),the dividing line between profit and loss, selection of a ship type most suited for each yard, compilation of data which would be useful i n cost estimates for future orders, etc. should also be engaged i n , and organizations capable of undertaking them should be set up. 6. PERSONNEL MANAGEMENT IN JAPAN'S SHIPBUILDING INDUSTRY

CONTROL

IN SHIPBUILDING

IN JAPAN

bine the system based on individual ability with the old s y s tem. Labourers are generally paid their wages on a daily basis while c l e r i c a l employees are paid on a monthly salary basis. Besides the wages and salaries, both labourers and c l e r i c a l people are generally given extra pay twice a year (commonly known as "bonus"). In addition to the above, i n the past i t was general practice among Japan's shipbuilding companies to give "incentive pay" based on individual piece-work basis. However, more recently it has been felt that the o v e r - a l l efficiency of a section i s affected considerably by the e x i s tence or absence of s p i r i t of cooperation among the workers i n the section. A s a result, the tendency among the shipbuilding companies now i s to base the incentive pay on the overa l l efficiency increase (of whole sections). The rate of wage increase of employees of Japanese shipbuilding companies over the last 10 years has been fairly higha little over 7% annually. The average monthly pay, including the twice-yearly extra pay, for labourers and c l e r i c a l personnel, i s approximately 60 Sterling. This figure i s considered high compared with that of the o v e r - a l l average for Japanese labourers and is not much lower than that of the West European countries. Considering the high annual rate of increase in wages it i s believed that i n a few more years it w i l l catch up with those of the West European countries. Because of the retirement allowance system i n effect, an employee retiring after 30 years of service i s entitled to a retirement allowance of approximately 3, 000 Sterling. 6. 2 Efforts to obtain Able Technical Personnel Extraordinary efforts are being made by Japanese shipbuilding companies to obtain a large number of superior technical personnel. F o r instance, a breakdown of personnel by background in the case of a leading Japanese shipbuilding company shows that the percentage of technical employees i s very high and that of technical employees who specialize in naval architecture i s also quite high. (Ref. F i g . 16) Of these technical employees, approximately 40% i s assigned to the on-the-job departments, contributing to technical i m provements and development as well as production and quality control. This, indeed, could be said to be one of the c h a racteristics of Japan's shipbuilding industry. A s a means of ensuring a flow of qualified technical personnel to the industry, the 22 member companies of Japanese Shipbuilding Indust r y ' s Association have employed each year, for the last five years, some 800 university graduates with engineering degrees, representing 5-6% of the total of a l l engineers g r a -

6.1 Relationship between Management and Labour A s i s the case with most enterprises in Japan, shipbuilding companies have industrial labour unions (one union per i n dustry) and the relationship between the unions and management are generally good. Generally, once a person i s e m ployed, his employment continues until he reaches the r e t i r e ment age. Because of this, the majority of labourers have a fairly strong feeling of loyalty to their company. While p r o motion has generally been on seniority and years of service, recently more and more enterprises are beginning to c o m -

Staff (1)

Labourers (II)

Grand total

Technical (A)

Administrative (B) University graduates Total

Direct

Indirect

labourer labourer

Total

(III)

University graduates Others Mechani- Electrical Naval cal engiOthers architects neers engineers Total (A') Total (A'+B')

Others

Total

(A+B)

U >

(l+ll)

613 1,331

201

742 2.887 4,123 7010

800 1.469 2.2 69 9,279 1 6.509 10.646 27,155 36,434 7. 25.5 7. 74.5 7. 100

7. 7. i. 41.2 58.8 100 21.2 46.2 V. 7. 7. 7.0 25.6 100 431

F i g . 16. " X " shipyard personnel breakdown chart. (As of A p r i l 1966)

MANAGEMENT

CONTROL

IN SHIPBUILDING

IN JAPAN clearly indicated by the fact that both the Frequency and Severity rates of injuries of the outside labour are approximately 4 times those of the permanent labour. Special efforts are being made by the yards to rectify this situation. (Ref. F i g s . 17 and 18)

duated each year from a l l of Japan's numerous universities. Besides this, these companies, from time to time, engage highly qualified young engineers from universities and the government's research organizations. 6. 3 Safety Control Taking the Injury Rates of the last 5 years, from 1961 to 1965, of the 27 yards of the member companies of the Japanese Shipbuilding Industry Association, i t i s seen that injuries requiring more than one day's absence from work numbered 2, 546 i n 1961 for permanent labour, decreased to 1, 744 i n 1963, increasing to 2, 304 i n 1964 and again dropping slightly to 2, 128 i n 1965. The s i m i l a r figures for outside labour, belonging to related industries i n the above mentioned yards, showed a near 50% drop to 1, 620 i n 1963 compared with 3, 072 i n 1961 but showed an increasing trend i n 1964 and 1965 with 2, 806 and 2, 888 respectively. However, when these figures are compared with the annual total tonnage launched by the same 27 yards of 5, 220, 000 tons (gross) i n 1965 against an approximate 1, 600, 000 tons (gross) i n 1961, representing an increase of some 330%, the injury rate against tonnage launched has been cut down to about \s seen i r o m the figures of 3. 55 cases of injury per 10, 000 tons (gross) launched i n 1961 to 0. 96 i n 1965. The results of a study made of "off-the-job" Frequency Rate and Severity Rates of injuries against tonnage launched over the last 15 years from 1951 to 1965 shows that the Frequency rate i n 1965 shows drops of 90% and 75%, respectively, compared with those oi 15 and 10 years ago. A s i m i l a r comparison i n Severity rates shows that the rates dropped by 60% and 50% respectively compared with those of 15 and 10 years ago. (Ref. F i g . 18) While these figures show that the situation has improved considerably over the years, safety control governing the outside labour i s far from satisfactory. This i s
Year Items Absence due injury (o) (Over 1 day) Off-ihe-iob" Frequency rate (b)

1961 1962 1963 1964 1965

NOS

2.546 100 8.68 100 0.90 100 3.072 100 28.62 100 3.24 100 1.580 100 5.618 356 100 121 330 360

2.143 84.0 7.28 83.5 0.82 91.2 2.188 71.2 24.60 86.0 2.81 86.6 1,990 126 4,331 2.18 61.3 101.2 338 343

1,744 68.4 6.1 2 705 1.00 111.0 1,620 53.0 2 2.48 78.6 3.62 111.5 1.980 126 3.364 17 0 . 47.8 93.2 368 362

2,304 91.0 7.86 90.5 1.32 146.2 2306 91.5 25.28 88.5 2.69 83l2 4,010 253 5.110 1.27 35.7 121.5 322 204

2.128 84.0 F i g . 18. Frequency and severity rate of injury 7.37 85.0 1.17 130 2.888 94.0 23.56 825 4.47 138.0 5,220 330 5.01 6 0.96 27.0 136 321 382

7.
NOS

%
NOS

Severity rate (c)

7.
Absence due injury o _o _o _o _o _o _o ( ')
a

7. RATIONALIZATIONS O F FACILITIES AND TECHNICAL DEVELOPMENT

NOS

.(Over J day) .(Over J day)

7.
NOS.

"Off-the-iob' Frequency rate (b')

7.
NOS

O Severity rate (c')

7.
KGT

Annua! launched Annua! launched tonnage (L) Total number of injuries (a + per KGT a'/a a'/a a'/a B/A b'/b b'/b b'/b c /c c /c c ''' / c

7.
NOS NOS

o'j o'j o'j

(+a')

Since shortly after the end of W o r l d War n , Japan's Shipbuilding industry entered into a very heated race wit,h the overseas shipbuilders and has been fighting a severe battle i n the international export ship market. In order to win this severe battle and receive orders for export ships, Japan's shipbuilding industry found it imperative to become capable of producing ships of high quality and deliver them by the agreed delivery date i n spite of the many adverse conditions created by limitations i n the price of ships. To develop this ability, Japan's shipbuilding companies have had to make extraordinary efforts, like the following:7.1 Post-war Investment in Facilities Post-war investments i n facilities in Japanese shipyards for the most part, were made i n three major periods. F i r s t P e r i o d (1950 - 1955)

Number or injuries

7. 7. 7. 7.

R e l

"

r i

"

1 Based on slolislics Irom 27 member yordi of Jopon Shipbuilding Association.

Frequency role of injury = " " ' '"i""" total labour in hours
m b r

1 0

00

KH,

Sfivfiritv rnt f iWy.-y

'O'al davs lost total lobour in hour-;

Investments i n new automatic welding machines, automatic gas cutting machines, replacing or augmenting of older, s m a l ler-capacity cranes with new and large-capacity cranes. Investment i n facilities such as new lay-out for the yards necessitated by the much wider use of welding and the development of the "block" (sectional assembling) building system. Second P e r i o d (1956 - 1960)

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CONTROL

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IN JAPAN

Total investment on facilities in the major shipyards 1956/1965

Items

Investment (m - )

Ratio (%)

Berths Docks Quay (Transportation facilities Hull processing and assembling facilities Power source Machinery MFG facilities Indirect facilities Miscellaneous Total

1 6.1 9.7 5.3 21.9 2 3.9 6.6 4 9.7 3 3.2 2 7.9 1 9 4.3

8.3 5.0 2.7 1 1.3 1 2.3 3.4 2 5.6 1 7.1 1 4.3 1 00.0

ceeded i n the development of economical hull form, ship automation, specialized c a r r i e r s , multi-purpose cargo ships as w e l l as many high-efficiency high-speed ships. In s h i p building technique, it has attained the world's highest standard by automatic fabrication, development of various automatic welding methods and establishment of the "block" (sectional assembling) building method, advance-outfitting method as w e l l as short-delivery-period-building, through efficient management and production control.

8. REASONS FOR THE SUCCESS Japan's shipbuilding industry has gained a position of p r o minence as Japan's representative export industry as w e l l as the major contributor to its plant export business, boasting the largest shipbuilding tonnage i n the world for the last 10 consecutive years. There are many reasons advanced by many people the world over for the phenomenal success it has attained in spite of the devastated state i t was in i m mediately after W o r l d War II. However, those i n Japan's Shipbuilding industry f i r m l y believe that the following are the reasons that contributed to the success: (1) Superior managerial sense of those i n management positions. (2) F u l l and unstinted cooperation of the industries concerned.

F i g . 19. Investment table berths and docks to meet the trend for larger ships. Investment for enlarging engine plant facilities to meet the demand for larger out-put diesel engines and high-temperature, high-pressure turbine engines. T h i r d P e r i o d (1961 - 1965) Investment for building super -large docks, modernizing and rationalizing of existing facilities in preparation for receiving large orders of super-large vessels to come. The details of the above-mentioned investments by periods are shown i n F i g . 19. The total investments made i n the last 10 years by the industry amounts to 194, 300, 000 Sterling (Ref. F i g . 19). 7. 2 Post-War Technical Development Japan's shipbuilding industry suffered a period of complete technical stand-still during World War II and several years following the end of it. However, i n order to make up for this "gap", i t made a very quick recovery, absorbing the good points of the advanced technology and techniques of other countries and building up on the good technical foundation nurtured from the pre-war days. These, combined with concerted efforts made i n the fields of research and development, as well as i n improving of techniques, brought about many achievements. In the field of design,the industry s u c -

(3) Securing of a large number of superior naval architects and engineers as well as continuous efforts to help the flow of r e c r u i t s . (4) Active exchange of technical knowledge and information among the shipbuilding technical personnel and the u n ceasing efforts for the development of new technology. (5) Technical improvements and cooperation of manufacturers of steel plates, main and auxiliary engines and those in other related industries. (6) "One company-one union" industrial labour union system and cooperation of the Union members with management. (7) Relatively abundant labour force and the industriousness of the Japanese people. (8) Ability to deliver i n a short period, relatively low-cost, superior quality ships, made possible by the above r e a sons combined. Whatever the reasons for the success the shipbuilding i n dustry of Japan has attained may be, a l l who are i n the i n dustry wish to continue the unceasing efforts, as members of the world's shipbuilding community, with a view to making whatever contribution we may be able to make toward the progress of shipbuilding technology and the industry as a whole.

DISCUSSION M r . W. Muckle, M . S c , Ph.D., D.Sc. (Member of Council): F i r s t of a l l I should like to express my thanks to the author for this very able summary of the shipbuilding business in Japan. There are many people in this audience who are more fitted than I am to talk about the actual shipbuilding business and shipbuilding production, but the main point I should like to refer to i s F i g . 16, concerning the personnel in the industry. If not concerned in the production of ships I have at least been concerned in the production of graduates over a number of years and I am interested to see that the Japanese shipbuilding industry employs so many graduates i n the business of designing and constructing ships. I think 613 naval architecture graduates out of a total force of 36, 000 is a very considerable proportion, and I wonder if M r . Takezawa would enlarge upon how these people are employed in the shipbuilding industry? If we proportioned this down to our own industry in Great Britain we would feel that we might have difficulty in employing that number of graduates profitably. I must say I am one who is obviously in favour of having more graduates in the shipbuilding industry but I should like to know how these people are employed in Japan. I note, too, that there i s a large number of mechanical engineering graduates employed, in fact twice as many as naval architects. In a l l there appears to be 433

MANAGEMENT

CONTROL

IN SHIPBUILDING

IN

JAPAN

one technical or administrative member of staff for every four people employed. Again to me this seems to be a large proportion, but obviously this sort of thing is having results because undoubtedly the Japanese have the record for producing ships, large in size, relatively cheaply and quickly. Mr.K.G.Evans,R.C.N.C., (Member): This is a most interest ing paper. I once had an office in a Japanese shipyardat SSK Sasebo in 1953and then, as now, a paper like this most informative one by M r . Takezawa could well have been written, entitled 'Management are in Control in Shipbuilding in Japan'. Since 1953 I have witnessed the struggles of shipbuilding managers in this country, trying to introduce new methods against entrenched trade union opposition. I note the author gives 'One companyone union' as reason (6) for Japan's success: would he not agree that it may be the biggest single factor ? Another reason for success (in 8 (3)) is given by the author (in 6 (2)) as enlisting superior talent in the Japanese shipbuilding industry. I have remarked on this before (Trans. R.I.N.A. Vol. 107, page 521) in connection with Network Analysis needing good people. Again, the theory of the 'Multiple Points' process, described by M r . Masataro Muto-the deduction of the most preferable starting time for construction of any part of the hullwhich apparently has widespread application in Japanese shipyards, would probably be beyond the comprehension of many non-graduate shipyard managers in B r i t i s h yards. There are very fixed ideas here about how to build a ship.

cult to say. Nevertheless, it is generally accepted that when allowances have been made for the above four factors there s t i l l remains a gap in price alone between s i m i l a r B r i t i s h and Japanese ships of 107 -15% which is impossible for us to explain.
o

The Japanese Shipbuilding Industry also gives among the r e a sons contributing to its success its ability to secure a large number of superior naval architects and engineers and it is stated in the paper that the 22 Member Companies of the Japa nese Shipbuilding Industry's Society have employed each year for the last 5 years some 800 university graduates with engineering degrees, representing 5%-6% of a l l engineers graduating in Japan. T h i s , indeed, is a number to be envied and yet care must be taken that comparisons are made on a s i m i l a r basis. The Chapman R e p o r t ^ states that for every 1, 000 ship yard workers in Japan 17 are graduates in naval architecture and in the United Kingdom 19 are qualified in Naval Architecture or another subjectqualified in this sense being defined as a person who possesses at least a Higher National C e r t i f i cate, and it is impossible for me to make a comparison between the standards of graduates of Japanese universities and qualified engineers in B r i t a i n .

D r . Hisashi Shinto of IHI has been reported as saying, last October, that 'the number of naval architects with university degrees employed in the Japanese shipbuilding industry exceeds 5,000 and about 300 persons are entering the different companies every year'. This is higher than the 200 per annum assessed in the Chapman Committee R e p o r t * ) to this Institution in 1966 (page 36) and I note in the author's F i g . 16 the number of graduate naval architects is 23 per 1,000 shipyard workers, compared with 17 quoted in the Chapman Report (page 4). Could the author confirm D r . Shinto's figures? Is the intake per annum s t i l l r i s i n g ? When w i l l it start falling?
1

Increases in yard efficiency are brought about p r i m a r i l y by good Management Control and active Technical and Planning Departments. In this connection the advanced outfitting shown in F i g . 4 is what a l l shipbuilders would like to see and are aiming for. To obtain this, however, does mean that the norma curve of effort, by drawing offices and planning and order departments in particular, expressed approximately now by half of a sine curve w i l l have to be replaced by a line parallel to the base. Much more effort w i l l have to be put in by these departments in the early stages of every contract and this pre supposes an agreed and virtually unchangeable Specification and, most important, the ability to obtain from sub-contractors a l l items at the times dictated by the shipbuilder. Some B r i tish shipowners, whilst lauding the efforts of Japanese shipbuilders, s t i l l apparently wish to retain the traditional ability to change at w i l l the Specifications of ships built in B r i t i s h shipyards. It does seem to the shipbuilder that at times the shipowners get the best of both worlds. They accept inflexible specifications as the norm in Japan and Sweden and thereby obtain quick deliveries and yet they expect to retain the ability to change items if the contract is placed with a B r i t i s h shipbuilder. Standardisation of materials should certainly be aimed for, an in one recent contract 28 different types of flat bars were spe cified, 10 of which accounted for 97-5% of the total. S i m i l a r l y , out of 25 different types of angle bars 5 accounted for 90-5% of the total. I would welcome the answer to two questions. One is the r e l a tive monthly salaries of a man aged 30 who is either a shipyard manager, a draughtsman, a foreman or a plater or welder The other, included in the elements that make Japanese shipbuilding competitive, is an explanation of what is meant by the absence of undue bidding and unfair competition.

According to the Geddes Report (paragraph 293) in 1964 there was a total of 900 staff qualified in subjects ranging from naval architecture to production engineering in the whole of U.K. shipbuilding, of whom only 22 per cent were graduates or equivalent^ qualifiedsay 200. So far as I have been able to trace, between 1949 and 1964 some 519 naval architects have graduated from a l l universities and colleges in the United Kingdom, and about 35 are now qualifying annually. That gives some idea of the comparison with the Japanese output. So I should like to ask M r . Takezawa if he considers that the second biggest factor in Japan's success is that they have ten to twenty times the number of able people in their shipbuilding industry than we have,and would he not agree that the prime requirement is to have enough of the right people in management and then the plans and their implementation naturally follow? Reference 1. The Higher Education and Training of Naval Architects. Report of a Committee under the Chairmanship of M r . J . H. B . Chapman, C . B . to the Council of the R.I.N.A.

Mr. B. Baxter, M.Sc, (Member of Council): The author lists under 20 headings the reasons why the Japanese Shipbuilding Industry is highly competitive. What contribution to this efficiency can be apportioned to what may be termed the inherent advantages of shipbuilding in Japan, i.e., (i) One Company one Union. (ii) Integration of shipbuilding activities with banking, steel making, ship-owning, etc. (iii) Relatively restricted types of ships built. (iv) Relative abundance of labour, and what contribution is due to superior management, is diffi-

This contribution is not in any sense meant to be an apologia and I am sure the reasons for success of the Japanese Shipbuilding Industry given i n the paper are accurate and the Indus try has every reason to be proud of its success. However, many of the items listed in the paper as being necessary for success are not in dispute and are being adopted quickly by most progressive B r i t i s h shipbuilders about whose future I am not despondent. The Chapman Report and the Geddes Report between them have, in my opinion, done much to encourage optimism in new entrants into the ranks of naval archi tecture and shipbuilding, and it may be recalled that the Chapman Report states that the number of graduate naval architect and those with H.N.C. qualifications employed in shipbuilding and related activities should be more than doubled in each instance, according to the industry's own estimates of their requirements for optimum staffing. In addition, the Geddes

MANAGEMENT Report states that world shipbuilding w i l l almost certainly remain a growth industry and that B r i t i s h shipbuilding can grow with the world market provided that a l l concerned make a fresh start together. Mr. M. H. Chambers, B . S c , (Member): The author is to be congratulated on so ably summarising the progress of Japanese shipbuilding during recent years. I should like to delve more deeply into one or two of the aspects mentioned in the paper, in the hope that the author w i l l be able to elaborate on them. P E R T is mentioned in the paper several times. As far as the technique is concerned it is fair to say that B.S.R.A. has pioneered the application of network analysis to merchant shipbuilding and we have developed it a long way from its original ' P E R T ' form, i.e. an event based technique for the control of items bought-in from sub-contractors for naval vessels. The latest computer programs available i n this country enable resource aggregation and allocation based on networks to be calculated and subsequently printed out. The computer p r i n t outs can be used directly as production control documents. The author states that Japanese shipyards are using ' P E R T ' for the control of design and drawing office work and the delivery of materials, and I entirely agree that these departments can derive great benefit from the technique. No mention is made of the use of network analysis for hull outfitting and engine installation. This is s u r p r i s i n g because, to my mind, probably the greatest savings can be made in these two vitally important areas < ', and B r i t i s h ship and engine builders have not been slow in applying the technique to good effect. Could the author please state to what extent, if any, network analysis i s used in Japan for full and engine outfitting planning and production control?
2

CONTROL

IN SHIPBUILDING

IN

JAPAN

This concentration of effort must be a major factor in keeping Japanese man-hours per ship low, and the author makes it quite plain that this cannot be achieved without detailed planning and production control. The shipyard stock level figures given in para. 3. 3 of the paper are impressive, even h a i r - r a i s i n g for steel, but surely they are an even greater credit to the sub-contractors supplying the yards. The most efficient shipyard stock control s y s tem in the world cannot make goods a r r i v e on time; only the production control system of the subcontractors can do this. Presumably, the nine-days' supply of steel applies only to ' A ' grade, m i l d steel, and not to the special quality steels. Although the list of manufacturing methods and production control techniques in the paper is impressive, it is no exaggeration to say that the great majority of them have been, and are being, studied by B.S.R.A., and the findings passed on to B r i tish shipbuilders. Why, then, have the same results not been achieved as the Japanese yards? I agree with D r . Muckle and M r . Baxter that the key to the problem is summed up in F i g . 16 it is the high proportion of qualified staff to labour. The Japanese have not only invested heavily in facilities, but also in men. Many good B r i t i s h ideas drain away i n the sand after much research and development time has been spent on them because, when the time comes to implement the new methods in the shipyards, there are not enough people to devote, their full time and energy to piloting these methods through the inevitable teething troubles and ensuring their acceptance. It is not quality but quantity of men that is lacking. F i g . 16 shows the proportions of technical and administrative staff and labour for a typical yard in 1966. Surely this table is for a group rather than a single yard? Could the author please comment as to whether these proportions are considered to be ideal i n Japan. If not, is there a significant trend towards a higher (or lower) proportion of technical staff? Looking at the figures under technical (A), are there any significant trends in the proportions of naval architects to mechanical and electrical engineers? Reference 2. Chambers, M . H., Cullum, M . H. and M o r r i s o n , W. I. 'Network Analysis and its Application to Shipbuilding'. Trans. R.I.N.A. V o l . 107,1965.

In para. 4. 3 of the paper mention is made of two systems called S M A C C - I and S M A C C - I I , which appear to be used only for the control of steelwork. A r e these systems based on network analysis? The 'Advance Outfitting', para. 4. 2. 1, is most interesting. Overlapping of outfit work with steelwork must lead to cost reduction by reducing the time that construction work is in progress. This system can only be achieved, however, if both outfit and steel drawings, and materials, are available when construction starts. For a series of identical ships there is no problem after the first ship, but for one-off ships the only way to achieve the same objective is to delay the start of steelwork until outfit drawings are complete. Would it be true to say that, rather than being an 'advance outfit' system, it is a 'delayed steelwork' system? F r o m published data, it would seem that the average overall contract to delivery time in Japan is not much shorter than that of B r i t i s h yards. What is very significant, however, is that manufacture is started much later than in B r i t i s h yards, p r e sumably because then the great majority of drawings and mater i a l s are available. To give an example, for a 70,000 ton d.w. tanker in Japan the keel would probably be laid about 11V months after signing of contract, the vessel launched and delivered respectively I4V2 and 18 months later, so that the steel and outfit drawing offices and buying departments have 11V nionths in which to arrange their part of the work to their own best advantage. In contrast a typical building cycle for an equivalent tanker in the U.K. would have the following periods after signing of contract, keel 6 months, launch 17 months, delivery 21 months.
2 2

Mr.R. Vaughan, B.Sc. (Student): Someone once said that the only problems in shipbuilding which we cannot solve are those we do not know about. If management is to do its job properly it must have a l l required information available at the time that it needs it. The control function ceases to exist without feedback, thus modern techniques attempting to quantify managerial decision processes were developed to improve information feedback by making the flow and categorisation of data more logical. It is therefore a little disappointing that in a paper on management control from what i s , at the moment the world's leading shipbuilding nation, few of these techniques are mentioned. In fact even that perpetual begetter of new ways of managing, the United States of A m e r i c a , which has surely played some part in the emergence of Japan as an advanced industrial nation, goes without reference; except perhaps in the use of mnemonics such as ' S M A C C , which have a ring of that earlier 'new world'. Would the author please explain the depth to which P E R T is applied, since, from the paper, it appears to stop at materials control. Is it used for cost control or in the production of ready-made estimates? Has it overtaken simple electronic data processing to form the basis of the S M A C C systems? A r e any of the standard operations research models used; for example in Section 3. 2(3) with reference to ' L o t ' purchasing, i s the well known square-root formula for economic lot size applied? Would it be fair to say that the enviable reduction in steel stock is helped to a large extent by the vertical integration of steel and shipbuilding plants?
435

The really significant difference is the point in time at which erection work is started (keel laying), after 11V months i n Japan and 6 months in the U.K. The early start of steelwork construction in the U.K. prevents the drawing offices from planning their work to best advantage and also prevents the buying departments from achieving cost savings from batching and variety reduction, (this is specially true for hull steel).
2

MANAGEMENT

CONTROL

IN SHIPBUILDING

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JAPAN ship manufacturing processes occupied by men educated as naval architects or mechanical engineers or have they receive some major education in shipbuilding science? Perhaps this latter subject forms a normal part of the education of naval architects. It may be that some of the 800 administrative graduates hold line positions in ship production and if so what has been the nature of their education? Is a l l of the education d i s pensed in Japan or is there some general policy to educate at least partially abroad for example, business studies and computer technology in the United States who have set the pace in these fields? To educate internationally would be in accordanc with the author's closing remarks concerning world improvement; sentiments that we should a l l share. Mr. M.R. Hargroves (Student): I would first like to thank M r . Takezawa for his valuable and comprehensive paper. One point, however, s t i l l remains in my mind; this i s , that we have not been enlightened as to how the Japanese industry programmes and co-ordinates its production effort.

It is interesting to note the s m a l l amount of money that has been spent on docks, shown in F i g . 19. At first sight E9-7M seems little enough to lay out for mammoth tanker building docks, but perhaps this expenditure is included in the figure for berths. My own research work at the University of Newcastle on the application of industrial dynamics to the shipbuilding industry attempts to synthesise the whole business of building ships, by considering the interacting flows of information, material, manpower money, orders and capital equipment, to demonstrate objectively the p r i o r i t y of points (1) to (20) given in the first section of the paper, and others which are not mentioned. Would the author please intimate to what extent this problem has been tackled in Japan? I would like to thank the author for giving such a stimulating, indeed fascinating, paper and particularly for his references to the very advanced methods of production. I hope it w i l l not be too long before the U K industry returns the compliment, thus increasing the co-operation between our two nations, who obviously have a lot to learn from each other. Added after the meeting An interesting comparison may be made between the section in the paper 'Elements that make shipbuilding enterprise competitive' and Appendix N 'The Anatomy of Competitiveness', page 187 of the 'Geddes Report'. With the exception of element (18), the other nineteen elements agree almost word for word with the factors given in the Geddes Report. The nearest factor to element (18) is 'No undue bidding up for labour.' Could the author please comment on the striking s i m i l a r i t y between these two descriptions of the way in which the industry may be made more competitive.

Turning to the practical side of the shipbuilding process, the author has outlined the principal features of 'advance outfitting'. When this concept is applied to large block sections, various problems have to be overcome: those of dimensional control, section distortion and the accurate sequencing of the work activities for each section. Thus I hope the author w i l l touch on these problems. For example, what tolerance ranges does the author's company work to during the various stages of 3-D assembly? How are the distortion problems overcome when sections of a non-symmetrical and 'un-box-like' form are erected? To what extent is 'fairing' required between adjacent block sections ? Being aware of the feasibility and problems involved in large deck house block outfitting, I would be interested to know to what extent the manhour content has been reduced. With the example shown in F i g . 6 is it not a big problem to avoid considerable damage to the extensive array of equipment during the erection and 'fairing' of the structure above? Considering the adoption of advanced machinery and facilities, how does the E P M system compare economically with an integrated system involving numerically controlled automated equipment? I note that rationalisation has resulted in substantial cuts in building times for the large bulk cargo c a r r i e r s , while for the more specialised medium size merchant vessels no appreciable change has occurred. Manpower efficiency has increased through this rationalisation, although I note that Japanese manpower productivity is not as high as that in several European shipyards. At the University of Newcastle I am endeavouring to show that the large-scale application of block construction in the case of cargo liners w i l l yield overall savings in building costs. Thus I would be interested to learn why these techniques have not been used in Japan for this particular size of vessel. The advantages obtained by concentrating the effort in large sections embodying complete cross-sections of the hull of the medium sized merchant ship could outweigh the increase capital costs in terms of facilities. I shall be grateful if the author w i l l comment on the points I have raised. Mr. A. B . Hotchkiss, M.M. (Associate): As is often the case with a late speaker in a discussion such as this, most of my points have already been covered by previous speakers. However, I would like to underline some of the points which have been made. I am sure M r . Chambers w i l l forgive me if I point out that we at Cammell L a i r d have been in the networking business as long as the B.S.R.A., and therefore I am also very surprised that networking has apparently not been applied to the one part of a ship where it seems most likely to be applied; this is the

Mr. J . A. Teasdale, B . S c , M.Sc, (Member): The value of the paper is contained in the convincing manner in which it is demonstrated that it is not only what to do, but the method and depth in which it is done, that makes the difference between competitive and struggling industries. In other words, there is no magic formula or secret technique described in the list of Elements stated in the f i r s t section of the paper. A l l items are familiar to a l l shipbuilders and are practised to varying degree. If a l l of the elements are treated scientifically, and a sufficient number of qualified personnel are employed to push the techniques, then the cumulative effect is to make the enlightened industry very much more efficient than one which fails to do so. The Japanese shipbuilding industry is to be complimented upon its application of scientific method to the manufacturing process. With regard to the science of design, there is perhaps not such a great discrepancy between competing countries, although B r i t a i n may have lost the lead in some areas of design; the publicising of achievement being the most notable. A study of Section 2, which concerns the Rationalisation of the Designing Department, rather surprisingly does not distinguish between creative design and communication design functions. The section comprehensively discussed the latter function, c a r r i e d out by what is usually called the Drawing Office, and yet this contributor would have thought that the rationalisation and management of the creative design office is of fundamental importance. It would be of interest if the author could describe his organisation' s philosophy concerning the size, constitution, organisation and rationalisation of the creative design teams, including comment upon the communication loops between this office and the drawing office, cost control and planning and production control departments. The table of personnel, F i g . 16, shows a large number of technical graduates and the contributor is interested in two points; the nature of the education that the graduates have received and the subsequent duties that they c a r r y out in the shipyards. If the author may speak generally, are the line positions in the

MANAGEMENT integration of the various outfitting problems i n the outfitting of a ship. I would go so far as to say that I am not absolutely certain that networking is the ideal planning medium for producing steel, anyway. It i s certainly the ideal medium for putting the ship together. One of the points brought out i n the paper was the execution of the design. I w i l l add to that the execution of the programme. I personally believe whole-heartedly that the planning problems can a l l be solved by networking and associated techniques. What we have not seemed to achieve is the successful execution of these programmes out i n the yard. This is vitally important. One of the points we find so continually is an attempt to lay a keel s i x months after receiving the go-ahead, at the end of five months we have not got a l l the design information anyway, and it is my earnest belief that If we can solve this first six months the rest of the job w i l l be comparatively simple. If after five months you have not even got off the ground you have very little chance of achieving a programme on date, without the usual panic measures of the last 25 per cent of the job. I think a l l our efforts should be devoted to getting these early parts of the job completed on schedule. This includes the supply and delivery of a l l the various bought-out components which appear to be outside the direct control of the shipbuilding yard. We can demand that our suppliers programme in the same way as we do. We can place restrictions on them, we can apply penalties, and so on, but at the end of the day these do not necessarily prevent us receiving a letter saying ' V e r y sorry, but your delivery date at the end of September w i l l now have to go out', without very much further explanation as to why this is so. I should like to reinforce M r . Chambers' question about how ' P E R T ' is used in the outfitting side of Japanese Shipbuilding. I should also like some information on a point which is vitally important in relation to getting the f i r s t six months right: it is that in order to build on the berth in such a short time there must be about 60 or 70 per cent of the fabrications lying at the head of the berth before the f i r s t unit is laid down. I would certainly want to see this. So my final question would be this: could the author please give us some indication of what the average percentage of assembly is at the point of laying the first unit? I should like to thank M r . Takezawa for this paper. Mr. J . M. Girling (Associate-Member): This is a most interesting and informative paper and I think we can learn a good deal from it, but we need to make a distinction between the two things that this paper reports. F i r s t l y , there is the management policy with regard to control tools and their areas of application and, secondly, there are the specific systems and building methods which have followed from their application. I suggest that whilst the second are of great interest, other methods and systems could be applied equally effectively to the shipbuilding operation. It is the actual control techniques used and the general steps taken by the Japanese shipbuilding management since the War to ensure the competitiveness and the profitability of their f i r m s which it i s c r u c i a l that we should grasp. In general terms management is concerned with making the optimum use of the resources it requires to c a r r y out its objectives. If we compare the Japanese and B r i t i s h shipbuilding industries on a resource basis the most striking difference is the lack of human resources, specifically management and engineering resources, i n the B r i t i s h shipbuilding industry. If we agree with M r . Takezawa that the use of these management control tools is necessary to compete profitably in the world markets as they are, then it must follow that until shipyards in this country employ sufficient specialists to operate these tools we shall make no headway whatsoever. Personally, I cannot understand the past and present hesitancy on the part of most B r i t i s h shipbuilding managements to make this investment i n management. After a l l , i n doing this we would only be

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following the pattern set by nearly a l l modern manufacturing industries, including shipbuilding as applied i n Scandinavia and Japan. I would therefore be most interested to hear M r . Takezawa's views on when and how the decision was made to increase management s k i l l s and numbers. I should like to hear whether innovation was followed by the need for control resulting in this policy of increasing the numbers of management and engineers, or whether the management came f i r s t and resulted i n controlled innovation. M r . Baxter referred to M r . Takezawa's list of reasons for the success of Japanese shipbuilding, and wanted to weigh the contribution made by four of them (one union per companyvertical integrationrestriction of ship typerelative balance) against the contribution made by superior management. I think he was wrong to want to apportion merit in this way, since the two groups are inseparable. The question that we should ask ourselves i s , who must initiate and be applying constant p r e s sure towards establishing a situation in which these four points w i l l exist? I suggest that the answer would be 'management'. Widely differing s k i l l s of a high order and much time must be used to make significant headway on the problems that must be tackled before this situation can be approached in the U.K. It follows that the industry requires adequately large numbers of specialist management and engineers, and that the single item on M r . Takezawa's listsuperior management, being common to the remaining items, has by far the greatest significance. Commander T. B . Wilson Jr., M.S., USN (Member): My first experience with Japanese shipbuilders was in the early nineteen-fifties when one of our minesweepers had a crane topple on it while moored in India Basin in Sasebo, Japan. We called on the local shipyard to provide workers to accomplish the repairs and enjoyed a new experience ourselves. A group of workmen came aboard equipped with only s m a l l hand saws, a few chisels and hammers, some wood and glue. The equivalent of our lead man gathered the men together, they discussed the matter for about twenty minutes and then set to work to repair what was a jumbled mass of broken timbers. The end result was hard to t e l l from the original and little more was said during the course of repairs. The ability of the Japanese to manage a job apparently goes down to a very low level in their organizations and their success today should come as no surprise. I think that their success has been due in part to the fact that once they developed their management plan they have the courage to carry it through to a successful stage and then to modify it as necessary to keep it current. This has been one of our failings in the United States. It is quite heartening to me to see the relative importance they place on their technical personnel; a total of roughly 20 percent of the personnel in the yard are technical in nature. Many of them are in top management. Even in our Navy the ratio of technical personnel is not nearly as high and only a few are in top managementthe head of the Navy Material Command is a line officer and not a technical man. This has both its good and bad points. I would like to ask two questions. The first i s that in any closely scheduled operation such as you have there must be some system of checks in order to ensure compliance by each group. Do the Japanese shipbuilders have penalty clauses with their sub-contractors for failure to deliver on time? My second question is this: Since money spent at home stays at home and makes a maximum contribution to the economy, do you have figures on percentage of work done and materials obtained in Japan versus those imported or done elsewhere? Finally, I should like to thank the author for coming this long way to speak to us. Professor E.V.Telfer,D.Sc, PhJ)., (Honorary Vice-President): I have been very satisfied, i n listening to the present discussion, 437

MANAGEMENT

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JAPAN o f t h e b a t t l e s h i p ' D r e a d n o u g h t ' a t P o r t s m o u t h 1905/6 d e s c r i b e d by M r . J .H . Narbeth.< )

3

This very

c o m p l e x v e s s e l , so n o v e l that it d i v i d e d two her c r e w after

main after on a

to f i n d o u r y o u n g e r m e m b e r s t a k i n g u p the c h a l l e n g e of the a u t h o r ' s p a p e r a n d s h o w i n g u s that they, at l e a s t , a r e p r e p a r e d to w o r k a l o n g s i m i l a r l i n e s a n d w o u l d h o p e to a c h i e v e e v e n better r e s u l t s than those d i s p l a y e d so c o n v i n c i n g l y by the author.

e r a s i n c a p i t a l s h i p d e s i g n w a s l a u n c h e d o n l y 131 d a y s keel-laying, received t r i a l s in a year and a day.

10 m o n t h s a n d w e n t

Political pressures demanded

fast c o m p l e t i o n and an u n u s u a l l y great effort was put into her o v e r a l l d e s i g n , t h e r a t i o n a l i s a t i o n of h e r s t r u c t u r e , t h e u s e of s t a n d a r d s i z e p l a t e s a n d a l i m i t e d r a n g e of r o l l e d s e c t i o n s , a l s o t h e p l a n n i n g of p l a t e m a r k i n g . T h e i n t e n s i t y of management remote from effort was w e l l r e m e m b e r e d steelworks. It those who built her. the by thirty years later

A l t h o u g h b u i l t p l a t e b y p l a t e , at a y a r d

A w o n d e r f u l s h i p r e s u l t e d at a r e m a r k a b l y l o w h u l l c os t . seems evident to m e that even without expensive

capital equipBri-

ment, investment in managers and their science can result i n c h e a p e r s h i p s b u t i t s e e m s t h a t f l u c t u a t i o n of d e m a n d i n tain has discouraged this investment. The Professor's other reference (The t o t h e p r o m p t l a y i n g of a u t h o r ' s p o i n t 3. 3 i s a

keel, in m y view, demonstrates close cooperation with a steelm i l l rather than efficiency. here.) relevant I suggest that the y a r d ' s a i m w a s to s e c u r e the q u i c k

p a y m e n t of i n s t a l m e n t s a n d s o h e l p f i n a n c e d e t a i l e d d r a w i n g work and early steelwork. I have k n o w n a y a r d to l a y a k e e l and then put it a s i d e a g a i n after c o l l e c t i n g the i n s t a l m e n t .

S p e a k i n g as a m u c h o l d e r m a n but one who s t i l l v i v i d l y r e c a l l s the d a y s when B r i t a i n r e a l l y c o u l d t u r n out good a n d p r o f i t a b l e s h i p s , a t h o u g h t I w o u l d l i k e t o l e a v e w i t h s o m e of o u r y o u n g e r colleagues arises f r o m m y apprenticeship days. Then, when a n o r d e r for a s h i p w a s r e c e i v e d , that s a m e m o r n i n g a s i m p l e but adequate p e n c i l s k e t c h of the flat k e e l w a s p r e p a r e d , the plate m e a s u r e m e n t s w e r e noted and the p l a t e s w e r e o r d e r e d by t e l e p h o n e f r o m the l o c a l s t e e l w o r k s . N e x t m o r n i n g the p l a t e s w o u l d a r r i v e i n t h e s h i p y a r d a n d at l e a s t one of t h e s e w o u l d be p r o c e s s e d and l a i d on the w a i t i n g b u i l d i n g b e r t h . A d m i t t e d l y , this apparent expedition w a s to s e c u r e the c o n t r a c t u a l k e e l i n s t a l m e n t p a y m e n t but at l e a s t the s h i p w a s p h y s i c a l ly started. N o eleven months had to elapse before elaborate s t e e l p l a n s h a d been p r e p a r e d , the d r a w i n g office just k e e p i n g s u f f i c i e n t l y a h e a d of the y a r d to e n s u r e c o n t i n u i t y of p r o d u c t i o n . That s t e e l w a s on the doorstep undoubtedly h e l p e d to s u s t a i n t h i s s i m p l i c i t y of p r o d u c t i o n ; a n d t h e f u r t h e r f a c t t h a t t h e p l a t e r s w e r e r e a l l y s k i l l e d meant that plans, though h i g h l y s i m p l i f i e d w e r e q u i t e s u f f i c i e n t u n i t s of c o m m u n i c a t i o n . M a n a g e m e n t w a s c e r t a i n l y there but unquestionably was m i n i m a l . What w a s t h e r e c o u l d not b e c a l l e d s c i e n t i f i c b y a n y s t r e t c h of t h e i m a g i n a t i o n but it w a s undoubtedly s u c c e s s f u l .

T o d a y ' s v a u n t i n g of m a n a g e r i a l s c i e n c e i s c u r i o u s l y s i m u l t a n e o u s w i t h t o d a y ' s d e p l o r i n g of i n d u s t r i a l m a l a i s e . W h i c h c o m e s f i r s t ? Is the s c i e n c e r e a l l y s c i e n c e ? In s h i p b u i l d i n g o u r m a l a i s e i n this country most probably a r i s e s f r o m the fact t h a t i n a m i l i e u of g r o w t h i n d u s t r i e s w e a r e a d e c l i n i n g i n d u s t r y . M e n i n a d e c l i n i n g i n d u s t r y a r e denied the hope and s e c urity enjoyed by newer industries. Japanese shipbuilding i s c l e a r l y and s t r i k i n g l y a growth industry. T h u s , quite apart f r o m t h e s k i l l of t h e w o r k m e n , t h i s s k i l l i s h o p e f u l l y a p p l i e d ; and m a n a g e r i a l science has a v e r y different t a s k f r o m that i n this country. Obviously, rapid advance and rearguard action r e q u i r e v e r y different m i l i t a r y s t r a t e g i e s ; a n d one w o n d e r s w h e t h e r m a n a g e r i a l s t r a t e g y i s not m o r e c a l l e d for i n t h i s country than managerial science.

A s investment i n the techniques M r . T a k e z a w a d e s c r i b e s s h o u l d be g o v e r n e d b y f i n a n c i a l c o n s i d e r a t i o n s a n d e s t i m a t e s of e c o n o m i c t r e n d s c a n t h e a u t h o r p l e a s e a d d t o t h e p a p e r s o m e g u i d e t o t h e e f f e c t of b a n k e r s ' i n t e r e s t r a t e s o n t h e i n vestment in capital equipment and management, also what m e a s u r e s the J a p a n e s e G o v e r n m e n t takes nowadays to e n c o u r a g e t h e s t a b i l i t y of t h e i n d u s t r y a n d t o h e l p t r a i n s t a f f a t v a r i o u s l e v e l s ? C a n a n o u t l i n e p l e a s e b e g i v e n of a t y p i c a l p l a n of p a y m e n t s i n u s e b y J a p a n e s e s h i p b u i l d e r s w i t h s o m e i n d i c a t i o n of h o w t h i s f i t s i n w i t h b u i l d i n g s c h e d u l e s t h a t d e l a y w o r k on the b e r t h u n t i l d r a w i n g s a r e w e l l r i g h t c o m p l e t e d a n d a p p r o v e d ? ' G o v e r n m e n t e n c o u r a g e m e n t of t h e J a p a n e s e s h i p b u i l d i n g i n d u s t r y i n y e a r s l o n g p a s t h a s b e e n d e s c r i b e d at t h i s I n s t i t u t i o n b y R e a r A d m i r a l M . K o n d o , ( > D r . S. T e r a n o a n d M r . M . Y u k a w a . T h e s e p a p e r s d e s c r i b e the t e c h n i c a l help given to the J a p a n e s e i n d u s t r y by W e s t e r n E u r o p e a n y a r d s at that t i m e , p e r h a p s the t i m e has c o m e for s o m e E u r o p e a n s to have f a c i l i t i e s to study techniques i n J a p a n .
( 5 )

E a r l i e r s p e a k e r s have m e n t i o n e d the one c o m p a n y - o n e u n i o n labour s y s t e m i n J a p a n . H o w e v e r d e s i r a b l e , I think it f r u i t l e s s f o r u s i n B r i t a i n t o h o p e f o r e a r l y i m p r o v e m e n t of o u r i n d u s t r y w i t h s u c h a s y s t e m . N o w , it w o u l d c e r t a i n l y be u n w o r k a b l e . W e h a v e a l m o s t a t r a d i t i o n of a n u n e v e n f l o w of w o r k i n t h e v a r i o u s t r a d e s , steel m e n have i n effect been s h a r e d between yards and some fitting-out m e n with the building trades. The a u t h o r i n 6. 1 s t a t e s t h a t t h e J a p a n e s e s h i p y a r d w o r k e r g e t s steady employment. U n l e s s B r i t a i n achieves a steadier flow of s h i p y a r d w o r k , I t h i n k w e m u s t a c c e p t l a b o u r u n i o n s w h o s e s t r u c t u r e e a s e s t h e t r a n s f e r of m e n b e t w e e n i n d u s t r i e s . F i n a l l y r e f e r r i n g t o F i g . 19, c a n s o m e m o r e d e t a i l b e g i v e n o f 'transportation facilities' and 'indirect facilities'. References 3. Narbeth, J . H . ' T h r e e Steps i n N a v a l Construction: " K i n g Edward V H " , " L o r d Nelson", "Dreadnought".' Trans.I.N.A. Vol.64,1922. K o n d o , M . ' P r o g r e s s of N a v a l C o n s t r u c t i o n i n J a p a n ' . T r a n s . I . N . A . V o l . 53 ( P a r t II) 1911. T e r a n o S., a n d Y u k a w a , M . ' T h e D e v e l o p m e n t of M e r c h a n t S h i p b u i l d i n g i n J a p a n " . T r a n s . I . N . A . , V o l . 53 ( P a r t n ) 1911.

The p r o b l e m s facing those younger m e n who have to c a r r y on and further develop B r i t i s h shipbuilding are many and unnecess a r i l y difficult. One difficulty i s soon evident w h e n one v i s i t s a n y o f o u r s h i p y a r d s o r d r y d o c k s . If o n e l o o k s r o u n d a n d q u i c k l y n o t e s the n u m b e r of m e n o b v i o u s l y w o r k i n g a n d a l s o t h o s e o b v i o u s l y not, the r a t i o of the l a t t e r to the t o t a l on a n y s u c h spot c h e c k w i l l g e n e r a l l y be found to be d i s t r e s s i n g l y h i g h . T h i s spot activity ratio must obviously reflect production costs a n d i t s h o w s t h a t t h e r e a l p r o b l e m of s c i e n t i f i c m a n a g e m e n t i s n o t the a p p l i c a t i o n of s c i e n c e , a s s u c h , but r a t h e r h o w t o m a k e the u n w i l l i n g w o r k e r as p r o d u c t i v e as the w i l l i n g w o r k e r a l w a y s h a s b e e n i n B r i t i s h S h i p b u i l d i n g . If o n e c o u l d o n l y r e gain these w i l l i n g w o r k e r s , management c o u l d devote itself to r e a l l y s c i e n t i f i c p r o b l e m s , but for m a n a g e m e n t to c o n c e r n i t s e l f w i t h s u c h p r o b l e m s i n the a b s e n c e of the w i l l i n g w o r k e r i s c l e a r l y i n d u s t r i a l n o n s e n s e . I w o u l d suggest, therefore, to o u r young f r i e n d s i n the s h i p b u i l d i n g i n d u s t r y that they s h o u l d r e s e a r c h t h e p r o d u c t i o n r e c o r d s o f o u r s h i p y a r d s o f 50 y e a r s ago, b e f o r e they e n t i r e l y d i s a p p e a r . T h e y m i g h t , thus, be able t o f i n d t h e r e a l c a u s e of B r i t a i n ' s g r e a t n e s s i n s h i p b u i l d i n g and to r e - o r i e n t a t e t h i s into o u r m o d e r n c o n d i t i o n s . I have a s t r o n g s u s p i c i o n that J a p a n h a s done e x a c t l y t h i s and has p l a n t e d h e r s c i e n c e o n f e r t i l e g r o u n d . S t r i c t l y we c a n do the same.

4. 5.

Mr. A . F. Warner, B.Eng., ( M e m b e r ) : P r o f e s s o r Telfer has suggested that B r i t i s h s h i p y a r d s w e r e s u c c e s s f u l fifty y e a r s ago without m u c h m a n a g e r i a l s c i e n c e ; a r e we to accept that a l l t h e B r i t i s h i n d u s t r y r e q u i r e s i s a r e t u r n t o ' t h e s p i r i t of t h e p a s t ? E v e n g r e a t e r s u c c e s s m i g h t have been a c h i e v e d then, h a d t h e c o n t e m p o r a r y f o r m s of the t e c h n i q u e s d i s c u s s e d t o d a y b e e n i n g e n e r a l u s e . A n e x a m p l e of t h e i r u s e w a s the b u i l d i n g
1

The C h a i r m a n , P r o f e s s o r J . F . C . Conn, D . S c : G e n t l e m e n , the a u t h o r h a s c o m e a v e r y l o n g w a y to g i v e u s t h i s p a p e r . M a y I a s k y o u to r e c o r d y o u r t h a n k s i n the u s u a l m a n n e r ? T h a n k you very m u c h indeed, M r . Takezawa. The vote of thanks was carried with acclamation

MANAGEMENT Written Discussion M r . S . J . P a l m e r , O . B . E . , R . C . N . C . ( M e m b e r of C o u n c i l ) : This paper ing Industry gives several is successful. r e a s o n s w h y the J a p a n e s e The author places and detailed overall Shipbuilds t r e s s on the planning course.

CONTROL

IN

SHIPBUILDING

IN

JAPAN vessels

s h i p o w n e r p r o b a b l y w o u l d not have o r d e r e d s t a n d a r d techniques described in this paper.

f r o m J a p a n , e n a b l i n g the b u i l d e r s to institute the p r o d u c t i o n

necessity for comprehensive Y o u cannot benefit f r o m of h u l l parts, advance

based on c r i t i c a l path a n a l y s i s methods.

H e i s r i g h t of

rationalising designs, prefabrication 1 unless you expen-

M r . K . A . Slade ( A s s o c i a t e - M e m b e r ) : R e a d i n g t h i s p a p e r one r e a l i s e s why J a p a n l e a d s the w o r l d i n s h i p b u i l d i n g . W i t h s u c h a provocative paper there i s bound to be a l i v e l y d i s c u s s i o n that I s h a l l confine m y s e l f to only a few c o m m e n t s . W i t h the accent on s t a n d a r d i s a t i o n and r a t i o n a l i s a t i o n , one r e a l i s e s that for the best e c o n o m i c gain, no y a r d can o p e r a t e o n i t s o w n . Is t h e r e a c o n t r o l o r g a n i s a t i o n that i m p l e m e n t s and c o n t r o l s the o v e r a l l s t a n d a r d i s a t i o n , s o that a l l y a r d s do the s a m e ? W i t h r e g a r d to the s t e e l s t o c k b e i n g only 9 d a y s s u p p l y , how w a s t h i s e x c e l l e n t s t e e l d e l i v e r y a c h i e v e d ? H o w w e r e the steelmakers won over so easily, or are certain steelmakers g e a r e d u p to s u p p l y i n g s h i p y a r d s o n l y ? S i m i l a r l y , I w o u l d l i k e to k n o w how the s u b - c o n t r a c t o r s w e r e brought to heel so that "Just i n T i m e D e l i v e r y ' b e c a m e p o s sible. Twenty days before being r e q u i r e d s e e m s too good to be t r u e a n d I w o u l d a p p r e c i a t e i n f o r m a t i o n on the m e a n s u s e d by the s h i p y a r d s to educate the m a n u f a c t u r e r s a n d what w a s i m p l i e d i n t h i s p r o c e s s . It i s d i f f i c u l t t o b e l i e v e t h a t d e a l i n g s w i t h s u b - c o n t r a c t o r s a r e a s s m o o t h as the p a p e r s u g g e s t s and I w o u l d w e l c o m e a n i n d i c a t i o n of the m a j o r d i f f i c u l t i e s encountered. T h r o u g h o u t the p a p e r the accent i s on d e t a i l , g r e a t d e t a i l , d o w n to s l a b a s s e m b l y , a l l o c a t i o n c h a r t s , day by day w o r k s c h e d u l e s , m a n h o u r c h a r t s ; w h a t i s t h e t r u e r a t i o of b a c k g r o u n d w o r k e r s to p r o d u c e r s ? I s u s p e c t that the t r u e p i c t u r e i n the table ( F i g . 16) m a y b e d i s g u i s e d s i n c e a l l t h e p e r s o n n e l a r e l i s t e d , a n d t h i s m i g h t not r e f l e c t the a c t u a l s i t u a t i o n r e g a r d i n g P r o d u c t i o n and P l a n n i n g staffs i n the y a r d . W i t h r e g a r d t o c o s t c o n t r o l , t h e o b j e c t of w h i c h i s t o b r i n g t h e c o s t of t h e s h i p d o w n w o u l d t h e a u t h o r s u p p l y i n f o r m a t i o n o n w h o a r b i t r a t e s b e t w e e n the f i n a n c e d e p a r t m e n t a n d the t e c h n i c i a n s o that q u a l i t y i s not s a c r i f i c e d for quantity ? R e a d i n g that the l a b o u r e r s a r e c o n s i d e r e d t o g e t h e r w i t h the c l e r k s i s heartening, and u n d e r l i e s no doubt the r e a s o n why J a p a n ' s s h i p b u i l d i n g t e c h n o l o g y i s s o w e l l a d v a n c e d . It s e e m s that the T e c h n i c i a n r e c e i v e s m o r e and the C l e r k l e s s r e c o g n i tion i n Japan than their counterparts in this country. Finally, welding provide carried not a n d repair. I w o u l d a p p r e c i a t e the a u t h o r ' s v i e w on the q u a l i t y of a c h i e v e d w i t h the ' g r a v i t y w e l d e r s ' . W o u l d he a l s o i n f o r m a t i o n o n the a m o u n t of n o n - d e s t r u c t i v e t e s t i n g out, w h o d e c i d e s w h e t h e r a defect i s to be r e p a i r e d o r s o m e i n d i c a t i o n of t h e p r o p o r t i o n of w e l d i n g r e q u i r i n g

o u t f i t t i n g , c o n t r o l of m a t e r i a l s a n d m a n Building modern ships, i n the M i n i s t r y

power or introducing new techniques or processes plan the whole o p e r a t i o n m o s t c a r e f u l l y .

be they t a n k e r s o r g u i d e d m i s s i l e d e s t r o y e r s , i s a v e r y sive and complicated business. O u r experience of D e f e n c e s h o w s t h a t n a v a l v e s s e l s reasonable

cannot b e p r o c u r e d at Indeed

c o s t o r to t i m e u n l e s s m e t i c u l o u s p l a n n i n g a n d

p r o g r a m m i n g i s i m p o s e d r i g h t f r o m the beginning.

current contracts being placed for R . N . ships include mandatory clauses specifying r i g o r o u s planning and scheduling and an effective quality control organisation. Of c o u r s e this req u i r e s the s h i p b u i l d e r to r e c r u i t the n e c e s s a r y he c a n s e e t h a t i t w i l l a l s o i m p r o v e and help h i m make a profit. staff, and i n business the

t i m e s of f i n a n c i a l s t r i n g e n c y he i s r e l u c t a n t t o d o t h i s u n l e s s his c o m m e r c i a l T h i s paper shows how w e l l

Japanese shipbuilder has learnt this lesson. I s h o u l d l i k e to s e e B r i t i s h S h i p y a r d s f o l l o w the e x a m p l e perior technical personnel. Department. The In n a v a l w o r k I a m c o n v i n c e d of the

J a p a n e s e a n d m a k e a n e f f o r t t o o b t a i n l a r g e r n u m b e r s of s u that be our b u i l d e r s r e l y too h e a v i l y on t e c h n i c a l help f r o m the competitive Navy

a b i l i t y of o u r s h i p y a r d s w o u l d to firms

e n h a n c e d i n t h e l o n g r u n i f o u r b u i l d e r s c o u l d d o m o r e of t h i s w o r k themselves, and we give every encouragement to take o v e r d e t a i l e d d e s i g n w o r k on our behalf.

T h e c u s t o m e r a l s o has a n i m p o r t a n t p a r t to p l a y in c o n t r i b u t i n g t o s h i p b u i l d i n g e f f i c i e n c y . A t t h e b e g i n n i n g of h i s p a p e r M r . T a k e z a w a s a y s t h a t t w o of t h e r e a s o n s f o r s u c c e s s i n J a p a n a r e t h e a b s e n c e of u n d u e t e n d e r i n g a n d r e d u c t i o n i n m o d i f i c a t i o n s b y o w n e r s . I n the p a s t t h e N a v y h a s b e e n g u i l t y of both these h i n d r a n c e s to o u r s h i p b u i l d e r s but we hope for an i m p r o v e m e n t in the future. T h e c u s t o m e r c a n a l s o help i n a b i g w a y b y o r d e r i n g i d e n t i c a l s h i p s f o r d e l i v e r y at i n t e r v a l s w h i c h w i l l e n s u r e an even l a b o u r loading i n the s h i p y a r d and t h e m o s t e c o n o m i c a l u s e of r e s o u r c e s . H e s h o u l d t h e n b e r e w a r d e d b y p r i c e s w h i c h get p r o g r e s s i v e l y c h e a p e r f o r s u c c e e d ing ships, in accordance with a ' L e a r n i n g Curve'this perhaps i s o n e of t h e m o s t i m p o r t a n t l e s s o n s f o r B r i t i s h o w n e r s a n d for the I n d u s t r y .

M r . T . E . Mackenzie ( M e m b e r ) :

I w a s m o s t i n t e r e s t e d to

read

this p a p e r and m a k e c o m p a r i s o n s between the methods used i n Japan and those in this country. z a w a to a m p l i f y the f o l l o w i n g points: (a) It i s s t a t e d t h a t s t e e l a r r i v e d i n t h e s t o c k y a r d n i n e p r i o r to b e i n g r e q u i r e d f o r p r o d u c t i o n . D o H e a v y I n d u s t r i e s L t d . , of w h i c h M r . T a k e z a w a ' s g i v e the s h i p y a r d p r i o r i t y o v e r o t h e r u s e r s ? (b)

being

I would like M r . Take-

M r . R. J . Johnstone B . S c . S . M . , ( A s s o c i a t e - M e m b e r ) : days Mitsubishi yard is a y a r d l e v e l s h o w n i n F i g . 1.

was stockthe

v e r y i m p r e s s e d b y the s p e c t a c u l a r r e d u c t i o n i n the s t e e l E v e n a l l o w i n g f o r t h e s i z e of s h i p y a r d and the high p r i o r i t y w h i c h s h i p y a r d w o r k i n J a p a n , it has been a r e m a r k a b l e a c h i e v e m e n t .

commands paper. same

d i v i s i o n , p r o d u c e the s t e e l u s e d by the y a r d a n d t h e r e f o r e

I would like

t o a s k t h e a u t h o r s o m e q u e s t i o n s o n t h i s s e c t i o n of t h e 1. D o the m i l l s w h i c h supply the steel belong to the p a r e n t c o m p a n y as the 2. shipyard?

F i g . 13 i n d i c a t e s t h a t a 1 2 , 0 0 0 t o n b u l k c a r r i e r i s t h r e e m o n t h s on the b u i l d i n g b e r t h a n d then a f u r t h e r t h r e e m o n t h s outfitting. B e a r i n g i n m i n d the t i m e r e q u i r e d f o r ' s t e e l a s s e m b l y ' , the o u t f i t t i m e a p p e a r s l o n g i n v i e w of t h e a m o u n t o f ' a d v a n c e d o u t f i t t i n g ' i n d i c a t e d i n F i g s . 3 , 4 , 5, 6 & 7. C o u l d M r . T a k e z a w a e x p l a i n w h y t h i s s h o u l d b e ? I w o u l d a l s o be i n t e r e s t e d to k n o w what t i m e i s r e q u i r e d f r o m d a t e of c o n t r a c t t o d a t e of d e l i v e r y f o r a 12, 0 0 0 t o n b u l k c a r r i e r a n d w h a t t i m e e l a p s e s b e t w e e n d a t e of c o n t r a c t and m a t e r i a l s t a r t i n g to be p r e p a r e d i n the shops for unit assembly. industry 7 the m o s t reason has the f o r e i g n

Is s o m e p r e l i m i n a r y s o r t i n g c a r r i e d o u t at the s t e e l m i l l s , in o r d e r to d e l i v e r i n 5-day batches ? T h i s w o u l d m e a n that, w h e r e a s the s t o c k l e v e l i n the s h i p y a r d w o u l d be r e duced, there w o u l d be a c o r r e s p o n d i n g i n c r e a s e i n finished s t e e l h e l d at the s t e e l m i l l s . C a n y o u g i v e t h e p e r c e n t a g e of s t a n d a r d p l a t e s a n d tions used? sec-

3.

O f a l l the r e a s o n s f o r t h e s u c c e s s of t h e J a p a n e s e l i s t e d by M r . T a k e z a w a , I c o n s i d e r n u m b e r s 2, 6 & i m p o r t a n t . I f e e l , h o w e v e r , that one v e r y i m p o r t a n t been omitted, namely finance. Without this facility

4.

W i t h the 5 - d a y d e l i v e r y p e r i o d , the a v e r a g e s t o c k l e v e l c o u l d be r e d u c e d t o 5 - d a y s s u p p l y . Is t h e s h i p y a r d working towards this goal? 439

1fii>Bf-l)ii

Kh.rtVm-.-M

MANAGEMENT Author's Reply 1.

CONTROL

IN

SHIPBUILDING

IN

JAPAN r a t e , c a u s e d b y i n s u f f i c i e n t a m o u n t of w o r k w h i c h i s b e l o w construction capacity. (c) L a c k of c o - o p e r a t i o n w i t h t h e m a n a g e m e n t o n t h e p a r t of the

R e p l y to questions c o m m o n to M e s s r s . W. M u c k l e ,

K . G. E v a n s , B. Baxter, M . H . C h a m b e r s , J . A . Teasdale and K . A . Slade. 1.1 T h e b r e a k d o w n c h a r t g i v e n i n F i g . 16 i s m a d e o n the

labour union members. (d) cost. H o w e v e r , we a r e not quite c e r t a i n as to w h e t h e r the reasons have any reality or 3.2 not. 30-year above U n f a v o u r a b l e e f f e c t s of a l o n g c o n s t r u c t i o n p e r i o d u p o n

a c t u a l d a t a c o n c e r n i n g t h e n u m b e r of u n i v e r s i t y g r a d u a t e s i n the t o t a l e m p l o y e d i n s h i p b u i l d i n g d e p a r t m e n t s of f i v e s h i p y a r d s of t h e M i t s u b i s h i H e a v y I n d u s t r i e s , L t d . , w h i c h r e v e a l s t h a t t h e r a t i o o f u n i v e r s i t y g r a d u a t e s t o t h e t o t a l e m p l o y e e s of t h i s c o m p a n y d o e s not d i f f e r m u c h f r o m that of o t h e r m a j o r yards in Japan. A l s o , t h e r a t i o s of n a v a l a r c h i t e c t s , m e c h a n i c a l e n g i n e e r s e l e c t r i c a l e n g i n e e r s a r e a l m o s t the s a m e a s t h o s e of the national average. 1. 2 In J a p a n , at p r e s e n t , we have seven u n i v e r s i t i e s offering other given and ship-

T h e a p p r o x i m a t e a v e r a g e m o n t h l y s a l a r i e s of a

old shipyard manager, draughtsman, foreman, plater and welder a r e shown i n F i g . 20.

Job classification shipyard manager draughtsman foreman

Approximate average monthly salary approx. " " " " 120 63 75 63 63

c o u r s e s on s h i p b u i l d i n g e n g i n e e r i n g w h i c h s e n d out about 300 g r a d u a t e s a n n u a l l y to s h i p b u i l d i n g c o m p a n i e s a n d a l s o firms, government shipbuilding business. (These figures a r e the s a m e as offices and l a b o r a t o r i e s concerned with the

b y D r . H . S h i n t o of I.H.I.) In a d d i t i o n to t h e s e e m p l o y e e s , m a n y u n i v e r s i t y graduates engineer-

having majored in mechanical engineering, electrical

plater welder F i g . 20.

ing and other courses are also employed by Japanese shipbuilding c o m p a n i e s e v e r y year, and they w i l l be t r a i n e d i n p l a n n i n g o r f i e l d w o r k to b e c o m e c o m p e t e n t trators. engineers or adminisemployincrease in 3. 3 F o r s o m e t i m e t o c o m e , t h e n u m b e r of t h e s e

ments w i l l either m a i n t a i n the present l e v e l or may the n e a r future. In a n s w e r i n g M r . E v a n s

1

A v e r a g e monthly s a l a r i e s , including fringe benefits, p a i d t o t h e m a j o r s h i p y a r d w o r k e r s a t t h e e n d of 1966. orders How-

it s l i g h t l y a n d it i s not l i k e l y that the n u m b e r w i l l d e c r e a s e

G e n e r a l l y speaking, when an e n t e r p r i s e has few

on hand, its management q u e s t i o n s , I w o u l d l i k e to s t a t e that convinced,

t e n d s to go i n t o c u t - t h r o a t c o m p e t i t i o n

f o r t h e a c q u i s i t i o n of o r d e r s , e m p l o y i n g u n f a i r t a c t i c s . o n l y to the s h i p b u i l d i n g c o m p a n i e s i n the f o r m of the o w n e r s i n t h e f o r m of r e c e i v i n g s h i p s o f a p o o r or delay in ship delivery.

'the s e c o n d b i g g e s t f a c t o r i n J a p a n ' s s u c c e s s , I a m ates i n her shipbuilding industry. ' 1. 3

e v e r , c o m p e t i t i o n of t h i s s o r t w i l l do m o r e h a r m t h a n good, not acceptance of o r d e r s at a n u n r e a s o n a b l y l o w p r i c e , but a l s o to s h i p performance

i s that J a p a n h a s a s u f f i c i e n t n u m b e r of a b l e u n i v e r s i t y g r a d u -

T h e e d u c a t i o n to be g i v e n to u n i v e r s i t y g r a d u a t e s i n the sciences. have these

s h i p b u i l d i n g a n d e n g i n e e r i n g d e p a r t m e n t s i s n a t u r a l l y of a nature m a i n l y r e l a t e d to s h i p b u i l d i n g o r e n g i n e e r i n g majored either i n law, economics or business graduates are sent overseas special purposes. T h e m a j o r i t y of a d m i n i s t r a t i v e g r a d u a t e s a r e t h o s e w h o M o s t of these a r e educated i n J a p a n , but i n a few c a s e s

W e b e l i e v e that the e n t e r p r i s e i s entitled to a p r o p e r

amount

of p r o f i t s a n d t h a t t h e r e i s n o o t h e r w a y b u t to r e l y u p o n the m u t u a l c o - o p e r a t i o n of t h e s e n s i b l e p e o p l e c o n c e r n e d b o t h i n shipbuilding and shipowning enterprises, and without such o p e r a t i o n the i n d u s t r i a l p r o g r e s s achieved. 4. R e p l y to questions c o m m o n to M e s s r s . M. H . Chambers coof t h e c o u n t r y c o u l d n o t b e

management.

for an advanced education for

1.4 It a p p e a r s t h a t t h e u n i v e r s i t y e d u c a t i o n i n J a p a n i s o f a s t a n d a r d n e a r l y a s h i g h as the one i n the U n i t e d K i n g d o m , J a p a n e s e u n i v e r s i t y d e g r e e s c o r r e s p o n d i n g to the H i g h e r National C e r t i f i c a t e s i n the United K i n g d o m . However, a c c u r a t e c o m p a r i s o n of t h e a b o v e i s n o t k n o w n . 2. 2.1 R e p l y to M r . K . G . E v a n s We f i r m l y believe that 'one c o m p a n y - o n e union' system

and Hotchkiss. 4.1 It i s n e e d l e s s t o s a y t h a t i n t h e J a p a n e s e s h i p y a r d s n e t w o r k a n a l y s i s i s w i d e l y u s e d , not only f o r d e s i g n i n g a n d a d m i n i s t r a t i o n i n m a t e r i a l s d e p a r t m e n t s , but a l s o for the p l a n n i n g and production c o n t r o l i n the h u l l and outfitting departments. T h i s i s the r e a s o n w h y a d v a n c e d outfitting i s b e i n g c a r r i e d out s m o o t h l y i n the s t e e l w o r k and outfitting stage. 4. 2 O u r S M A C C system, which is based on network analysis, outfit-

i s o n e of t h e m o s t i m p o r t a n t f a c t o r s i n o u r s u c c e s s i n t h e s h i p b u i l d i n g i n d u s t r y , though it m a y not be the s t r o n g e s t a n d the only factor i n our great achievement.

i s u s e d , a t p r e s e n t , o n l y f o r t h e c o n t r o l of s t e e l w o r k , a n d a s t u d y i s b e i n g m a d e on i t s a p p l i c a t i o n t o t h e c o n t r o l of ting work. I a m s u r e that it w i l l be c o m p l e t e d w i t h i n t h i s y e a r .

2. 2 T h e m e m b e r s of J a p a n e s e l a b o u r u n i o n s a r e f u l l y a w a r e of t h e f a c t t h a t t h e s e c u r i t y of t h e i r l i f e c a n n o t b e a s s u r e d w i t h o u t p r o s p e r i t y of the c o m p a n y to w h i c h t h e y b e l o n g . Therefore, they a r e quite w i l l i n g to c o - o p e r a t e w i t h the m a n a g e m e n t i n c a r r y i n g out v a r i o u s r a t i o n a l i s a t i o n p r o g r a m m e s f o r the i n c r e a s e of p r o d u c t i v i t y .

3.

R e p l y to M r . B . B a x t e r
0

3.1 It s e e m s t o u s t h a t 1 0 t o 1 5 7 o f t h e e x i s t i n g d i f f e r e n c e i n shipbuilding cost between J a p a n and the U n i t e d K i n g d o m m a y p r o b a b l y be a t t r i b u t e d to the f o l l o w i n g r e a s o n s : (a) H i g h e r w a g e r a t e s a n d l o w e r e f f i c i e n c y of the w o r k e r s w h i c h are generally c o n s i d e r e d prevalent i n the U n i t e d K i n g dom shipbuilding industry. (b) U n f a v o u r a b l e e f f e c t s o n c o s t s of e s t a b l i s h m e n t charge

4. 3 A s y o u have a l r e a d y p o i n t e d out, the outfitting, s t e e l d r a w i n g s a n d m a t e r i a l s s h o u l d be m a d e a v a i l a b l e at the t i m e of c o n s t r u c t i o n i n o r d e r to c a r r y out s m o o t h l y the a d v a n c e o u t f i t t i n g s y s t e m . It i s t h e r e f o r e e a s y t o a p p l y i t to s e r i e s o f i d e n t i c a l s h i p s but, i n the c a s e of o n e - o f f s h i p s , one w o u l d f i n d it m o r e advantageous to delay steel w o r k u n t i l the d r a w i n g s f o r t h e o u t f i t t i n g w o r k a r e c o m p l e t e d . It i s i n t e r e s t i n g t o n o t e that 'advance outfitting s y s t e m ' i s c a l l e d 'delayed steel w o r k s y s t e m ' , w h i c h i s a good description. Recently, it has also been c a l l e d ' s y n c h r o n i s e d s y s t e m f o r h u l l a n d o u t f i t t i n g ' . F i g . 21 i s a r o u g h d i a g r a m of t h e s t a n d a r d p r o c e s s i n t h e M i t s u b i s h i Heavy Industries Y a r d . The diagram shows a m a r k e d differe n c e i n t h e c o n s t r u c t i o n m e t h o d of t h e J a p a n e s e a n d E n g l i s h s h i p y a r d s . I n t h e J a p a n e s e s h i p y a r d s p l e n t y of t i m e h a s b e e n a s s i g n e d to the p e r i o d f r o m the c o n t r a c t t i m e to the b e g i n n i n g

MANAGEMENT of s t e e l m a r k i n g o r k e e l l a y i n g , a n d d u r i n g t h a t p e r i o d t h e drawings and m a t e r i a l s necessary for steel and outfitting are obtained for a t h o r o u g h detailed planning f o r the p r o d u c t i o n c o n t r o l , w h i l e i n the E n g l i s h s h i p y a r d s the p e r i o d a p p e a r s to be not q u i t e l o n g e n o u g h f o r s u c h p u r p o s e s . I w o u l d l i k e to pay m y r e s p e c t to M e s s r s . C h a m b e r s a n d H o t c h k i s s f o r t h e i r c o r r e c t u n d e r s t a n d i n g of t h i s difference.

CONTROL

IN

SHIPBUILDING

IN

JAPAN

tive i n d e t e r m i n i n g the p r o p e r operation, the product m i x i n g , investments and personnel planning, i s gradually being adopted i n t h e i n d u s t r y f o r t h e r a t i o n a l i s a t i o n of t h e w h o l e s h i p b u i l d i n g industry. 5. 5 I have a l s o r e a d the 'Geddes R e p o r t ' w i t h great i n t e r e s t a n d a g r e e d e n t i r e l y w i t h e a c h i t e m of ' F a c t o r s S u b j e c t t o t h e I n f l u e n c e of M a n a g e m e n t ' i n t h e c l a u s e u n d e r t h e h e a d i n g

MOlllTH

~T

18 i 17

i 16 ! 15

i 1 4 j 13

! 12

S E T T L E jOF SETTLE|0F S E T T L E 'OF START START START START START START STA^T

PRINCIPAL

PARTI6uLAks

SPECIFICATIONS (tONT(lACf PURCHASE OF OUTFITTING COMPI PRjOFIlj,:

OF OF

ISSUE! OF CONSTRUCTION j)F IjARGlj] PJIPES HULL|STEEL

CjF P l j l R C H A S E OF

CASTINGS

PlJRCHftSE p F bF

OF P U R C H A S E

O F R J C E I V I NG, O F H U L L OF R E C E I V I N G OF PIPES

STfEL

F i g . 21.

Standard m a s t e r schedule for new building (70, 0 0 0 - 1 2 0 , 000 tons d.w. t a n k e r ) .

5. 5.1

R e p l y to M r . R . V a u g h a n In the J a p a n e s e s h i p b u i l d i n g i n d u s t r y , ' P E R T ' i s u s e d departit

m o s t e f f e c t i v e l y i n t h e d e p a r t m e n t s of d e s i g n i n g , m a t e r i a l s , h u l l , o u t f i t t i n g a n d f o r t h e p r o c e s s c o n t r o l s of t h e s e ments. p o s s i b l e to m a k e the m o s t u n i f o r m a n d e c o n o m i c The S M A C C system is also used, which renders

man-hour deal

a l l o c a t i o n to the w o r k i n a l l s t a g e s of h u l l a n d outfitting, e l i m inating unnecessary work, thereby contributing a great 7044 type c o m p u t e r s a r e b e i n g f u l l y u s e d . 5. 2 yards. T h e m a j o r s h i p y a r d s i n J a p a n a r e g o o d c u s t o m e r s of T h e r e f o r e , the r e l a t i o n s between the two a r e very willof the t o w a r d s c o s t c o n t r o l . In the w o r k of the S M A C C s y s t e m , I B M

' A n a t o m y of C o m p e t i t i v e n e s s ' of A p p e n d i x - N . T h e r e f o r e I have quoted these i t e m s i n m y paper, ' E l e m e n t s that m a k e Shipbuilding E n t e r p r i s e C o m p e t i t i o n ' . In the Japanese s h i p b u i l d i n g i n d u s t r y , h o w e v e r , we h a v e not yet s u f f e r e d f r o m l a b o u r s h o r t a g e s o b a d l y a s t o e n g a g e i n a b a t t l e of e n t i c i n g w o r k e r s f r o m other companies by offering unreasonably high wages. T h e a d j u s t m e n t s of l a b o u r s u p p l y a r e b e i n g m a d e i n J a p a n t h r o u g h a l i a i s o n a n d c o - o p e r a t i o n by the national l a b o u r u n i o n a n d a l s o t h e A s s o c i a t i o n of S h i p b u i l d i n g I n d u s t r i e s , a n a t i o n w i d e o r g a n i z a t i o n o f s h i p b u i l d i n g e n t e r p r i s e s . It i s t h e r e f o r e m o s t u n l i k e l y that they w o u l d r e s o r t to a n i n o r d i n a t e m e t h o d of a c q u i r i n g m a n p o w e r a t t h e p r e s e n t t i m e . T h i s i s t h e r e a s o n w h y I have i n t e n t i o n a l l y e l i m i n a t e d the c l a u s e s , 'no undue b i d d i n g u p f o r l a b o u r ' . If s u c h a b i d d i n g f o r l a b o u r i s b e i n g c a r r i e d out i n the U n i t e d K i n g d o m o r other c o u n t r i e s , t h i s p r o b l e m s h o u l d n a t u r a l l y be t a k e n u p a s one of the i m p o r t a n t f a c tors.

s t e e l m i l l s , b e c a u s e of t h e l a r g e v o l u m e of w o r k i n the s h i p friendly, although there is no s p e c i a l f i n a n c i a l r e l a t i o n s h i p w i t h t h e e x c e p t i o n of o n e c o m p a n y , a n d t h e s t e e l m i l l s a r e ing to c o - o p e r a t e progress 5. 3 i n t h e s u p p l y of s t e e l f o r t h e m a i n t e n a n c e of t h e w o r k i n t h e s h i p y a r d s . during these

T h e i n v e s t m e n t s i n the dock b u i l d i n g p r o j e c t s

1955 to 1966 w e r e r e l a t i v e l y s m a l l i n a m o u n t b e c a u s e investments were made

m o s t l y i n b u i l d i n g the d o c k s at f o u r

6.

R e p l y to M r . J . A . T e a s d a l e

s h i p y a r d s : I. H . I . Y o k o h a m a , M . H . I . N a g a s a k i , M i t s u i - C h i b a a n d H i t a c h i - S a k a i D o c k y a r d s . A p a r t of the d o c k b u i l d i n g i n v e s t m e n t i s i n c l u d e d i n the c o n s t r u c t i o n c o s t f o r b u i l d i n g berths and outfitting quays. H o w e v e r , t h e a m o u n t of t h e d o c k several b u i l d i n g i n v e s t m e n t s i s expected to i n c r e a s e g r e a t l y i n the future, b e c a u s e s i n c e 1966 they have s t a r t e d to b u i l d tankers. 5. 4 I n d u s t r i a l d y n a m i c s has been p a r t l y u s e d i n the J a p a n e s e s h i p b u i l d i n g i n d u s t r y for the l a s t few y e a r s but it has not yet found wide application. L i n e a r p r o g r a m m i n g , w h i c h i s effecs u p e r d o c k s f o r t h e c o n s t r u c t i o n of 300, 0 0 0 t o n s d.w. m a m m o t h

6.1 T h e f u n c t i o n a n d m i s s i o n of c r e a t i v e d e s i g n i s d i f f e r e n t f r o m t h o s e o f c o m m u n i c a t i o n d e s i g n . It i s n e e d l e s s t o s a y that the c r e a t i v e d e s i g n d e p a r t m e n t , i n p r i n c i p l e , s h o u l d be f a r m o r e i m p o r t a n t a n d p o w e r f u l i n function than the c o m m u n i c a tion d e s i g n department, the so c a l l e d p r o d u c t i o n d r a w i n g office. W e t h e r e f o r e staff the c r e a t i v e design d e p a r t m e n t w i t h the best g r o u p of u n i v e r s i t y g r a d u a t e s w e h a v e i n o u r c o m p a n y , a n d have t h e m engaged i n new development and design i n close c o o p e r a t i o n w i t h the best g r o u p i n the l a b o r a t o r y . In a d d i t i o n to the d r a w i n g office, c o s t c o n t r o l department, a n d plan and production department, we have the a d m i n i s t r a t i o n 441

MANAGEMENT

CONTROL

IN

SHIPBUILDING

IN

JAPAN 7. 4 The manpower productivity i n J a p a n m a y be slightly if

l o w e r t h a n t h a t of t h e b e s t E u r o p e a n s h i p y a r d s . H o w e v e r we c o m p a r e the a v e r a g e values, o u r m a n p o w e r seems European shipyards. 7. 5 t o b e a l m o s t t h e s a m e a s t h a t of t h e h i g h l y

productivity efficient

It i s t r u e t h a t t h e b u i l d i n g c o s t c a n b e r e d u c e d b y a n u s e of t h e b l o c k c o n s t r u c t i o n f o r c a r g o it i s not u s e d e x t e n s i v e l y liners. re-

extensive yards.

d e p a r t m e n t a s a c o - o r d i n a t i n g o r g a n of t h e d e p a r t m e n t s m e n t i o n e d a b o v e . T h e a d m i n i s t r a t i v e d e p a r t m e n t i s a c e n t r e of c o m m u n i c a t i o n loops, w h i c h i s r e s p o n s i b l e for feeding b a c k to the c r e a t i v e d e s i g n t e a m s u c h i t e m s a s t h e a p p l i c a t i o n of t h e n e w t e c h n i q u e s t o t h e a c t u a l p r o d u c t i o n , t h e s a l e s a c t i v i t i e s of the p r o d u c t s n e w l y developed by that t e a m , a n d the new k n o w ledge and experience gained i n the field. T h e r e f o r e , the a d m i n i s t r a t i o n d e p a r t m e n t i s a l s o staffed w i t h the best p e r s o n nel i n our company. 7. 7.1 R e p l y to M r . M . R . H a r g r o v e There are various standards regarding tolerance ranges pre-

B l o c k c o n s t r u c t i o n i s now u s e d b y s o m e of the J a p a n e s e s h i p However, because it quires large cranes having a considerable lifting capacity, cranes.

w h i l e the m e d i u m - s i z e d s h i p y a r d s , w h i c h u s u a l l y c o n s t r u c t the c a r g o l i n e r s , a r e not w e l l e q u i p p e d w i t h s u c h l a r g e The large c o n s t r u c t i o n of s u p e r t a n k e r s . s h i p y a r d s h a v i n g s u c h c r a n e s a r e too b u s y w i t h the

of t h r e e - d i m e n s i o n a l b l o c k a s s e m b l y i n s h i p h u l l c o n s t r u c t i o n , but the s t a n d a r d w h i c h i s g e n e r a l l y u s e d i n J a p a n at the Standard (J.S.Q.S.). The tolerances for sent t i m e i s the one adopted by the J a p a n Shipbuilding Q u a l i t y three-dimensional These b l o c k d e t e r m i n e d by the J . S . Q . S . a r e shown i n F i g . 22. sultation between

8.

R e p l y to M r . A . B . H o t c h k i s s

figures a r e subject to the m i n o r modifications by m u t u a l c o n s h i p y a r d s a n d s h i p o w n e r ' s s u p e r v i s o r at the t i m e of the a c t u a l c o n s t r u c t i o n .

8.1 T h e a v e r a g e p e r c e n t a g e of t h e a s s e m b l y at t h e p o i n t of l a y i n g t h e f i r s t u n i t i s a b o u t 6 0 t o 6 5 % of t h e m a n - h o u r c o n s u m p t i o n of t h e s t e e l w o r k . 9. 9.1 R e p l y to M r . J . M . Girling to skills.

Tolerance

in millimetres

I do not k n o w w h e n a n d h o w the d e c i s i o n s w e r e m a d e people and their

i n c r e a s e t h e n u m b e r of t h e m a n a g e m e n t

in length Block with plane surface 6 8

in breadth 6 8

in bending and distortion 20 20

S i n c e t h e J a p a n e s e p e o p l e a r e v e r y k e e n o n t h e e d u c a t i o n of t h e i r y o u n g e r g e n e r a t i o n , w e h a v e a l a r g e n u m b e r of u n i v e r s i t i e s t h r o u g h o u t J a p a n , w h i c h s e n d out a n n u a l l y m a n y to be e m p l o y e d by the e n t e r p r i s e s . These university through w i l l be b r o u g h t u p to be s k i l l e d m a n a g e m e n t on-the-job training i n their own fields. m e that the m a n a g e m e n t comes t r o l l e d i n n o v a t i o n a s a r e s u l t of t h e 10. 10.1 graduates graduates rigorous to conby the

Block with curved surface 3-D B l o c k with plane surface 3-D Block with curved surface

Therefore,

it s e e m s

f i r s t , to be f o l l o w e d former.

20

25

R e p l y to C o m m a n d e r T . B . W i l s o n S i n c e the c o m p a n i e s w o r k i n g f o r the s h i p y a r d s have our for conso

far been co-operating with us very well and delivering o r d e r s p u n c t u a l l y , t h e r e i s no q u e s t i o n of f i n e s i m p o s e d F i g . 22. Tolerance table for block a s s e m b l y i n ship hull delayed delivery. construction. t r a r y to the b u s i n e s s m o r a l s o n the p a r t of t h e s e w h i c h m a y be c o n s i d e r e d to be the s e v e r e s t ment.

H o w e v e r , if t h e r e s h o u l d be any conduct

companies, punish-

we w o u l d d i s c o n t i n u e to p l a c e o u r future o r d e r s w i t h t h e m , I n the c o n s t r u c t i o n of s u p e r t a n k e r s r a n g i n g f r o m 120, 0 0 0 tons d.w. to 200, 000 t o n s d.w. a p i e c e of t h e b l o c k often w e i g h s 2 0 0 - 2 5 0 tons. H o w e v e r , if w e m a i n t a i n the a c c u r a c y l i s t e d above f o r these b l o c k s , t h e r e w o u l d be no t r o u b l e w o r t h m e n t i o n i n g at t h e t i m e of e r e c t i o n . In t h e c a s e of d i f f i c u l t i e s , h o w e v e r , w e w o u l d do the f a i r i n g f o r the adjacent b l o c k b e f o r e the e r e c t i o n a n d c a r r y out t h e t r i m m i n g of t h e b l o c k butt c o m p l e t e l y b y b u r n e r s , a n d a s a r u l e , t h i s has p r o v e d to be a s a t i s factory process. possible

10. 2 In J a p a n e s e s h i p y a r d s , s h i p s f o r d o m e s t i c u s e a r e a l l m a d e of h o m e - m a d e m a t e r i a l s , but i n the c a s e of s h i p s f o r e x p o r t , w e a r e often r e q u e s t e d by the s h i p o w n e r to u s e i m p o r t e d m a t e r i a l s o r m a t e r i a l s s u p p l i e d by the s h i p o w n e r . S o m e e x amples are life saving equipment, emergency generating sets, feed-water pump de-oilers, viscosity meters, logs, r a d a r and radio equipment, and galley equipment. Generally speaking, t h e c o s t of t h e s e i t e m s c o m p r i s e s a b o u t 2 - 5 % of t h e t o t a l m a t e r i a l cost p e r s h i p . S o m e t i m e s we a r e c o m p e l l e d to u s e f o r e i g n m a d e e q u i p m e n t at t h e s t r o n g r e q u e s t of t h e s h i p o w n e r s , but it i s c o n s i d e r e d a s a s p e c i a l c a s e . A l l the w o r k r e l a t e d to t h e s e m a t e r i a l s h a s b e e n c a r r i e d out i n the J a p a n e s e s h i p y a r d s a n d h a s n e v e r been done o v e r s e a s . 11. R e p l y to M r . A . F . W a r n e r

7. 2 B y t h e i n t r o d u c t i o n of t h e l a r g e d e c k h o u s e o u t f i t t i n g s y s t e m o n t h e g r o u n d w e n o t o n l y c a n s a v e a b o u t 1 0 % of t h e m a n h o u r s a s c o m p a r e d w i t h t h a t of t h e s m a l l d e c k h o u s e b l o c k o u t f i t t i n g , b u t a l s o e x p e d i t e the p r o g r e s s of w o r k a n d i n c r e a s e t h e s a f e t y r a t e . W e c a n a l s o e l i m i n a t e t h e d a n g e r of d a m a g i n g t h e v a r i o u s o u t f i t t i n g e q u i p m e n t at t h e t i m e of e r e c t i o n a n d f a i r i n g of d e c k h o u s e b y t h e i n t r o d u c t i o n of t h e s y s t e m , w h i c h , i f o n c e c a r r i e d out, c a n be o p e r a t e d m u c h m o r e s m o o t h l y t h a n e x p e c ted. 7. 3 Progress i s being made e v e r y y e a r i n the technique of

p r o c e s s i n g the s t e e l m a t e r i a l s at the s h i p y a r d . T h e E . P . M . s y s t e m , w h i c h w e a r e u s i n g at p r e s e n t , h a s b e e n f a s t e r a n d m o r e a c c u r a t e l y at l o w e s t p o s s i b l e introduced plates w i t h t h e p u r p o s e of m a r k i n g a l a r g e q u a n t i t y of s t e e l cost.

O n the other hand, r e m a r k a b l e p r o g r e s s h a s b e e n m a d e w i t h the n u m e r i c a l l y c o n t r o l l e d a u t o m a t i c gas c u t t i n g m a c h i n e . However, as long as the gas cutting speeds r e m a i n as they are, we cannot i n c r e a s e p r o d u c t i o n by the r e q u i r e d amount e v e n i f w e u s e s e v e r a l t o r c h e s s i m u l t a n e o u s l y . If t h e g a s c u t t i n g s p e e d of t h e s e m a c h i n e s i n c r e a s e s b y a f a c t o r of t h r e e , we w o u l d not h e s i t a t e to d i s c o n t i n u e the u s e of the E . P . M . system.

11.1 The present l o n g - t e r m and s h o r t - t e r m bank rate. The b a n k r a t e d i f f e r s a c c o r d i n g t o the s i z e a n d c r e d i t s i t u a t i o n of the e n t e r p r i s e s a n d the n a t u r e of the b a n k s , n a m e l y , c i t y b a n k , l o c a l b a n k , t r u s t b a n k , l o n g - t e r m c r e d i t b a n k . It a l s o d e p e n d s upon w h e t h e r the money m a r k e t i s easy o r tight. T h e p r e s e n t l o n g - t e r m i n t e r e s t rate i s about 8 4% and the s h o r t - t e r m rate is about 5'84% f o r the loans made by the l a r g e e n t e r p r i s e s , b e c a u s e of t h e p r e s e n t e a s y m o n e y m a r k e t c o n d i t i o n s . H o w e v e r , i n t h e c a s e of t h e s m a l l a n d m e d i u m s i z e d e n t e r p r i s e s , the i n t e r e s t r a t e w o u l d be h i g h e r than the above.
-

B u t w h e n the c a p i t a l i s to be b o r r o w e d f r o m a bank, the e n t e r p r i s e s a r e n o r m a l l y o b l i g e d to deposit an amount w h i c h i s e q u i v a l e n t t o 15 t o 2 0 % of t h e a m o u n t of t h e l o a n s t h e y a r e going to b o r r o w . A s it i s n e c e s s a r y for t h e m , therefore, to

MANAGEMENT borrow 1 1 5 t o 1 2 0 % of t h e c a p i t a l t h e y w i l l n e e d , a n d , b e s i d e s , loans, enterprises

CONTROL

IN

SHIPBUILDING

IN

JAPAN

the i n t e r e s t for the deposit i s l o w e r than the i n t e r e s t for t h e a c t u a l a m o u n t of i n t e r e s t f o r t h e l o a n s t h e to 1"57

0

w i l l need, i.e. the a c t u a l r a t e of i n t e r e s t , w i l l i n fact b e c o m e 1 h i g h e r t h a n the i n t e r e s t f o r l o a n s , that i s the n o m i n a l A c c o r d i n g t o t h e a n n o u n c e m e n t of the B a n k of

0

f o r t h e e s t a b l i s h m e n t of t h e o i l r e f i n e r y b u s i n e s s a n d f o r t h e n e w e s t a b l i s h m e n t of f a c i l i t i e s , p r o v i d i n g f o r t h e e l i m i n a t i o n of e x c e s s i v e c o m p e t i t i o n i n t h e f i e l d . D e p e n d i n g u p o n f u t u r e e c o n o m i c developments, t h e r e i s a p o s s i b i l i t y that a Steel I n d u s t r y L a w and A u t o m o b i l e Industry L a w w i l l be enacted. (f) Shipbuilding Law

r a t e of i n t e r e s t .

J a p a n , the a v e r a g e i n t e r e s t r a t e ( w e i g h t e d a r i t h m e t i c m e a n ) of c i t y b a n k s i n A p r i l 1967 i s 6"927 . activities in Japan. 11.2 Current measures taken by the J a p a n e s e G o v e r n m e n t to It i s e x p e c t e d t h a t t h e rate w i l l t u r n u p w a r d s i n f u t u r e b e c a u s e of t h e r e c e n t economic

promote

industrial stability

W i t h respect to shipbuilding, there is the Shipbuilding L a w w h i c h h a s a s i t s p u r p o s e t h e r a i s i n g of s h i p b u i l d i n g t e c h n i q u e s a s w e l l a s e n s u r i n g s m o o t h o p e r a t i o n of t h e s h i p b u i l d i n g i n d u s t r y . In a c c o r d a n c e w i t h t h i s L a w , the G o v e r n m e n t a p p r o v e s the e s t a b l i s h m e n t of the s h i p b u i l d i n g i n s t a l l a t i o n a n d f a c i l i t i e s under the following c r i t e r i a : (1) T h a t t h e b u i l d i n g a n e w of s u c h i n s t a l l a t i o n s o r f a c i l i t i e s o r the a u g m e n t a t i o n o r e x p a n s i o n of s u c h i n s t a l l a t i o n s w i l l not r e s u l t i n the a p p r o p r p p r i a t e s h i p b u i l d i n g c a p a c i t y r e l a t i v e to J a p a n ' s e c o n o m y b e i n g e x c e e d e d . (2) That by b u i l d i n g anew, by obtaining o r renting s u c h i n s t a l l a t i o n s , o r by the b u i l d i n g anew, augmentation o r e x p a n s i o n of s u c h f a c i l i t i e s , w i l l n o t g i v e a r i s e t o s u c h c o m p e t i t o n a s w o u l d i m p a i r the s o u n d d e v e l o p m e n t of the said shipbuilding industry. (3) That the t e c h n i c a l and accounting b a s i s s h o u l d be sound. 11.3 C u r r e n t methods e m p l o y e d by the G o v e r n m e n t for the the

(a) T h r o u g h the ' L a w C o n c e r n i n g the P r o h i b i t i o n of P r i v a t e M o n o p o l y a n d S e c u r i n g of F a i r T r a d e ' , the G o v e r n m e n t h a s p r o h i b i t e d the p r i v a t e m o n o p o l y , u n f a i r c o n t r o l of t r a d e , a n d u n f a i r t r a d e p r a c t i c e s a n d p r e v e n t e d the e x c e s s i v e c o n c e n t r a t i o n of c o n t r o l b y b u s i n e s s e n t e r p r i s e s . B y r e m o v i n g t h e u n fair limitations on productions, sales, p r i c e s and technology through such means as amalgamation and agreements, as well as by e l i m i n a t i n g a l l other u n f a i r r e s t r i c t i o n s on the b u s i n e s s a c t i v i t i e s , the G o v e r n m e n t i s p r o m o t i n g f a i r and free c o m p e t i t i o n , p r o t e c t i n g t h e i n t e r e s t s of c o n s u m e r s a n d p r o m o t i n g t h e d e m o c r a t i c a n d s o u n d d e v e l o p m e n t of t h e J a p a n e s e e c o n o m y . H o w e v e r , joint a c t i o n to c o u n t e r r e c e s s i o n o r joint a c t i o n a i m e d at the r a t i o n a l i s a t i o n of t h e e n t e r p r i s e s w o u l d b e a p p r o v e d b y t h e G o v e r n m e n t . T o a c h i e v e t h e o b j e c t of t h i s L a w a ' F a i r Trade C o m m i s s i o n ' has been established. (b) E x p o r t and Import Trade Law

t r a i n i n g of v a r i o u s l e v e l s of t h e s t a f f one a s f o l l o w s , h o w e v e r , that those u n d e r the S c h o o l E d u c a t i o n L a w j u r i s d i c t i o n of t h e M i n i s t r y of E d u c a t i o n ) a r e (a)

provided, (under

excluded.

T h e p u r p o s e of t h i s L a w i s t o p r e v e n t u n f a i r e x p o r t p r a c t i c e s and to a c h i e v e o r d e r l y export a n d i m p o r t t r a n s a c t i o n s , thus b r i n g i n g a b o u t a s o u n d d e v e l o p m e n t of f o r e i g n t r a d e . I n a c c o r dance w i t h t h i s L a w , a g r e e m e n t s r e l a t i n g to export t r a n s a c tions by exporters and to i m p o r t s as w e l l as a g r e e m e n t s r e l a t i n g t o a d j u s t m e n t s of e x p o r t s a n d i m p o r t s m a y b e c o n c l u d e d . M o r e o v e r , the v a r i o u s b u s i n e s s g r o u p s a r e p e r m i t t e d to f o r m export a s s o c i a t i o n s to p r e v e n t u n f a i r export p r a c t i c e s by t h e i r m e m b e r s a n d t o s e e k the m a i n t e n a n c e a n d d e v e l o p m e n t of overseas markets, including research, publicity and intercess i o n i n export t r a n s a c t i o n s as w e l l as the r e v i s i o n or i m p r o v e m e n t i n t h e p r i c e , q u a l i t y a n d d e s i g n of t h e g o o d s t o b e e x p o r t e d . W i t h r e s p e c t to the s h i p b u i l d i n g i n d u s t r y , t h e r e i s the ' J a p a n e s e Ship E x p o r t e r s ' A s s o c i a t i o n ' w h i c h deals w i t h the above matters. (c) F o r e i g n Investment Law capital

P u b l i c V o c a t i o n a l T r a i n i n g Institute (under the j u r i s d i c t i o n Ministry) graduates

o f the L a b o u r

F o r the t e c h n o l o g i c a l t r a i n i n g of j u n i o r h i g h s c h o o l and p e r s o n n e l i n the m i d d l e and h i g h e r age (b)

brackets.

Resignated V o c a t i o n a l T r a i n i n g Institute

T h e s e a r e to be e s t a b l i s h e d w i t h i n p r i v a t e e n t e r p r i s e s u n d e r t h e V o c a t i o n a l T r a i n i n g L a w to p r o v i d e a t h r e e y e a r t e c h n i c a l t r a i n i n g c o u r s e f o r the j u n i o r h i g h s c h o o l graduates. (c) Vocational Training College Ministry) leaders. (organisation ( u n d e r t h e j u r i s d i c t i o n of the

Labour

E d u c a t i o n a n d t r a i n i n g of s u p e r v i s o r s a n d

(d) Japanese Industrial Training Association affiliated to the L a b o u r M i n i s t r y ) C a r r i e s out the e d u c a t i o n of m a n a g e r s respective the v a r i o u s the (e) technical skills. enterprises.

This Law recognises development

o n l y t h o s e i n v e s t m e n t s of f o r e i g n

a n d s u p e r v i s o r s of

the of

w h i c h a r e d e e m e d to c o n t r i b u t e to the i n d e p e n d e n c e of t h e J a p a n e s e e c o n o m y

and sound

It a l s o e d u c a t e s t h e t r a i n e r s

a s w e l l a s to J a p a n ' s for foreign Coun-

b a l a n c e o f p a y m e n t s p o s i t i o n . It p e r m i t s t h e r e m i t t a n c e of interest accrued from foreign investments and provides the a p p r o p r i a t e a i m i n g t o e s t a b l i s h a s o u n d f o u n d a t i o n f o r i n v e s t m e n t of capital in Japan. F o r this purpose a F o r e i g n Investment

Foreign Trade College

(under the j u r i s d i c t i o n of Industry)

the the

m e a s u r e s to protect foreign capital, thereby

M i n i s t r y of I n t e r n a t i o n a l T r a d e a n d Marine and Fisheries College M i n i s t r y of A g r i c u l t u r e a n d

( u n d e r t h e j u r i s d i c t i o n of Forestry)

c i l h a s b e e n e s t a b l i s h e d to a p p r o v e the c o n t r a c t s of t e c h n i c a l ( k n o w - h o w ) a s s i s t a n c e a s w e l l a s to a p p r o v e the a c q u i r i n g of stocks or (d) equity. Corporations

T h e s e r e p r e s e n t s o m e of the d i f f e r e n t V o c a t i o n a l C o l l e g e s (excluding those c o m i n g u n d e r the School E d u c a t i o n L a w ) . (f) Japan Productivity Centre and own-

L a w f o r t h e R e - o r g a n i s a t i o n of

T h i s C e n t r e c a r r i e s out the e d u c a t i o n of m a n a g e r s ers engaged i n business. 11. 4

T h i s l a w a i m s at r e g u l a t i n g t h e i n t e r e s t s of c r e d i t o r s , s t o c k h o l d e r s and other interested p e r s o n s with respect to jointstock corporations in extremity for which we can still have a hope of r e h a b i l i t a t i o n , thus h e l p i n g to m a i n t a i n a n d r e h a b i l i tate t h e i r b u s i n e s s a c t i v i t i e s . (e) The Petroleum Industry Law

A n o u t l i n e o f t y p i c a l p l a n of t h e p a y m e n t u s e d i n t h e

shipbuilding yards i n Japan i s as follows: (a) a-1 I n t h e c a s e of s h i p s t o be Deferred payment Time of C o n t r a c t case 57 57
o 0

exported

T h i s L a w h a s a s i t s o b j e c t t h e s e c u r i n g of a s t a b l e , l o w p r i c e d p e t r o l e u m b y r e g u l a t i n g t h e a c t i v i t i e s of t h e o i l r e f i n i n g i n d u s t r y , t h e r e b y c o n t r i b u t i n g to the d e v e l o p m e n t national economy the people. of the a n d the e l e v a t i o n of t h e s t a n d a r d of l i v i n g of a n n u a l l y a p l a n f o r t h e s u p p l y of The Council also gives petroapproval or

One year after contract Time of d e l i v e r y

57

L a y i n g of k e e l

5%

It h a s e s t a b l i s h e d t h e P e t r o l e u m D e l i v e r a t i o n C o u n -

R e m a i n i n g 807 to be p a i d o v e r 8 y e a r s i n h a l f - y e a r l y instalments Time of C o n t r a c t 57, L a y i n g of k e e l 57

0

cil, which determines

l e u m f o r the next five y e a r s .

443

MANAGEMENT Time

CONTROL of l a u n c h i n g 5%

IN

SHIPBUILDING of d e l i v e r y

IN

JAPAN 5% 12. 12. 1 R e p l y to M r . T . E . M a c k e n z i e O u r N a g a s a k i Y a r d d o e s not m a n u f a c t u r e i t s o w n close and steel. we

Time

R e m a i n i n g 8 0 % to be p a i d o v e r 8 y e a r s i n h a l f - y e a r l y instalments a-2 C a s h payment case 10% One year after contract 20% Time 40% of l a u n c h i n g 10% 20%

The m a i n steel s u p p l i e r for the N a g a s a k i Y a r d i s Iron & Steel Co. L t d . O u r relationship is very co-operate 12. 2

Yawata process.

fully i n o r d e r to m a i n t a i n the p r o d u c t i o n

T i m e of c o n t r a c t L a y i n g of k e e l T i m e of d e l i v e r y (remaining) (b) b-1

T h e p e r i o d of t h r e e m o n t h s r e q u i r e d f o r t h e o u t f i t t i n g of we of t h e p r e s e n t 'advanced out-

the 12, 000 t o n s d. w . c a r g o v e s s e l i s c e r t a i n l y l o n g w h e n c o n s i d e r t h e r a t e of p r o g r e s s results, 2 ^ f i t t i n g ' at t h e t i m e of l a u n c h i n g . J u d g i n g f r o m r e c e n t months s h o u l d be adequate. H o w e v e r , by delivery. out the t h o r o u g h t e s t s d u r i n g the r e m a i n i n g t w o w e e k we s e e k to e l i m i n a t e b r e a k d o w n s after 12. 3

actual carrying period,

I n t h e c a s e of s h i p s f o r d o m e s t i c C a s e of a p l a n n e d s h i p b u i l d i n g Time Time of c o n t r a c t of l a u n c h i n g 25% 25%

use

' T h e n u m b e r of d a y s r e q u i r e d f r o m t h e d a t e of t h e a n d 'the t i m e r e q u i r e d f r o m

conthe

L a y i n g of k e e l T i m e of d e l i v e r y

25% 25% Bank or Transporthe coincides been the the cases

t r a c t t o the date of d e l i v e r y '

d a t e of c o n t r a c t t o the d a t e of p r o c u r i n g m a t e r i a l s t o

com-

m e n c e the u n i t outfitting at the s h o p ' a r e s h o w n i n F i g . 2 1 . A c c o r d i n g to t h i s c h a r t , it w i l l be noted that a p p r o x i m a t e l y d a y s a r e r e q u i r e d f r o m t h e d a t e of t h e c o n t r a c t t o t h e d a t e p l a c i n g o r d e r s for the outfitting c o m p o n e n t s launching. and it is f o r e n e c e s s a r y to s t a r t about 330 days p r i o r to the date of 90 of

T h e a p p r o v a l of l o a n s f r o m the D e v e l o p m e n t t a t i o n t e n d s to be d e l a y e d , s o that i n e x t r e m e

a p p r o v a l f o r t h e c o n s t r u c t i o n b y the M i n i s t r y of p a y m e n t to be m a d e at the t i m e of the c o n t r a c t the k e e l .

there-

w i t h t h e p a y m e n t t o be m a d e at t h e t i m e of t h e l a y i n g of The Shipbuilding Industry Association has r e q u e s t i n g t h a t t h e p a y m e n t s t o be m a d e at t h e t i m e of c o n t r a c t s h o u l d be m a d e at l e a s t 6 m o n t h s p r i o r to l a u n c h i n g (2-3 b-2 m o n t h s p r i o r t o l a y i n g of keel). Develop-

13. 13.1

R e p l y to M r . K . A . S l a d e There i s no management s y s t e m that c a n enforce However, stanwithrespect various drawings.

S h i p s b u i l t by t h e i r o w n funds (those not u s i n g the m e n t B a n k funds) Time Time of c o n t r a c t of l a u n c h i n g 10% 10% L a y i n g of k e e l Time of d e l i v e r y

d a r d i s a t i o n i n a l l the s h i p y a r d s i n the c o u n t r y .

i n a p a r t i c u l a r group, s u c h as our M . H.I, we can, w i t h 10% 20% to the five s h i p y a r d s u n d e r o u r management, lay down standard, operation standard and standard manual for level and managerial 13. 2 capacity.

c o m m o n s t a n d a r d s such as, the quality s t a n d a r d , a c c u r a c y W e attempt i n t h i s way to m a i n t a i n the s a m e high t e c h n i c a l

R e m a i n i n g 50% to be p a i d o v e r 5 y e a r s i n h a l f - y e a r l y i n stalments. R e c e n t l y , i n J a p a n e s e s h i p y a r d s , the so-called a posthe a d v a n c e d outfitting i s f r e q u e n t l y b e i n g c a r r i e d out as r e s u l t of r a t i o n a l i s a t i o n . A d v a n c e d o u t f i t t i n g i s m a d e o w n e r a n d the s h i p y a r d as to the s p e c i f i c a t i o n s . a n d f u l l p r e p a r a t i o n s a r e m a d e to m e e t the other necessary Also

Japan's steel makers maintain very

close contacts with much make

the s h i p y a r d s . T o enable the s h i p y a r d s to p u r c h a s e as steel m a t e r i a l manufactured by t h e m as possible, they yards.

sible only when there i s a full d i s c u s s i o n between the s h i p a p p r o v a l of the S h i p C l a s s i f i c a t i o n A s s o c i a t i o n i s obtained

g r e a t e f f o r t s to m a i n t a i n a s t e a d y s u p p l y of s t e e l to the s h i p T h i s d o e s not m e a n that, b e c a u s e a c e r t a i n s h i p y a r d serIt m e r e l y means that a l l the shipyards has a special relationship with a steel maker, a special vice is being afforded. i n J a p a n a r e m a i n t a i n i n g t h e s a m e k i n d of a g o o d r e l a t i o n s h i p w i t h a l l the s t e e l 13. 3 makers.

requirements

of c o n s t r u c t i n g t h e v e s s e l , s u c h a s t h e b l u e - p r i n t s a n d m a t e r i a l s before s t a r t i n g the construction. prethe of F o r this purpose, i n Japanese s h i p y a r d s the v a r i o u s p a r a t o r y a c t i v i t i e s a r e s e t f o r w a r d f r o m the d a t e of c o n t r a c t t o t h e d a t e of t h e l a y i n g of t h e k e e l . The

co-operative

actual funds Conse-

T h e c o - o p e r a t i o n that r e l a t e d i n d u s t r i e s and s u b - c o n t r a c t as corpora-

d a t e of l a y i n g of t h e k e e l i s t h e r e f o r e , w e l l i n a d v a n c e its n o m i n a l date, and it i s a fact that considerable a r e spent on the p r e p a r a t i o n s for l a y i n g the k e e l .

ing e n t e r p r i s e s enjoy w i t h the s h i p y a r d s has been a c h i e v e d a r e s u l t of e f f o r t s m a d e b y the s h i p y a r d s a s p a r e n t tions, i n sending s u p e r v i s o r s and extending financial a s s i s -

quently, w h i l e there a r e no p r o b l e m s to be mentioned i n c a s e of the s h i p s d e s t i n e d f o r e x p o r t , f o r t h e c o n s t r u c t i o n of t h e d o m e s t i c ships under the s o - c a l l e d planned s h i p of b u i l d i n g t h e r e i s a c o n f l i c t of i n t e r e s t s b e t w e e n t h e s h i p owner and the s h i p y a r d c o n c e r n i n g the d e t e r m i n a t i o n required payment. t h e date of t h e k e e l - l a y i n g f o r t h e p u r p o s e of m a k i n g t h e C o n s e q u e n t l y due to the delay i n d e payt e r m i n i n g t h e s o - c a l l e d d a t e of the k e e l - l a y i n g , t h e d e l a y e d , w h i c h often r e s u l t s i n a l a c k of b a l a n c e is necessary for considerable improvements laying. 11. 5 T h e ' T r a n s p o r t a t i o n f a c i l i t i e s ' m e n t i o n e d i n the p a p e r r e f e r to s u c h i t e m s as c r a n e s , t r a i l e r s , t r a c t o r s , floating cranes, and tug boats, w h i c h are n e c e s s a r y for a shipbuilding yard.

tance over a long period, and thus contributing toward raising the t e c h n i c a l l e v e l a n d m a n a g e r i a l c a p a c i t y of s u c h prises. enter-

m e n t to be m a d e u n d e r the c o n t r a c t at t h i s t i m e i s b e i n g between Thus it made keelthe d e m a n d for funds a n d the funds a c t u a l l y spent. to be i n t h e m e t h o d of d e t e r m i n i n g t h e a c t u a l d a t e of t h e

13. 4 W h i l e I do not u n d e r s t a n d the p r e c i s e s u b s t a n c e of the t e r m s ' b a c k g r o u n d w o r k e r s to p r o d u c e r s ' contained i n the question, if the r e f e r e n c e i s to the p l a n n i n g o r a d m i n i s t r a t i v e s t a f f f o r p r o d u c t i o n m a n a g e r s w o r k i n g i n t h e f r o n t l i n e of p r o d u c t i o n , i t m i g h t b e s a i d that s o m e 7 t o 1 0 % of t h e 613 n a v a l a r c h i t e c t s i n F i g . 16 T e c h n i c a l (A) a r e b a c k g r o u n d w o r k e r s . T h e r a t i o i s l e s s i n t h e c a s e of m e c h a n i c a l e n g i n e e r s , b e i n g p r o b a b l y a r o u n d 5%, w h i l e i t i s s t i l l l e s s i n t h e c a s e of e l e c t r i cal engineers and others. The highest decision-making organ, w h i c h regulates and adjusts the m a n u f a c t u r i n g c o s t s and q u a l i t i e s i n the v a r i o u s e n t e r p r i s e s , r e l a t i v e to cost c o n t r o l , i s t h e t o p m a n a g e m e n t of t h e r e s p e c t i v e e n t e r p r i s e s , w h i l e t h e regulatory function between the manufacturing costs and q u a l i t y c o n t r o l i n the y a r d i s a l s o c a r r i e d out b y the top m a n a g e m e n t at the y a r d . In the J a p a n e s e s h i p y a r d s w e a r e f u l l y c o n s c i o u s of t h e f a c t t h a t ' s u p p l y i n g s h i p s of g o o d q u a l i t y p a y s off t h e b e s t i n t h e l o n g r u n . ' T h e r e f o r e , it i s o u r p o l i c y n e v e r t o p e r m i t t h e c u r t a i l m e n t of n e c e s s a r y w o r k o r m a t e r i a l f o r t h e p u r p o s e of l o w e r i n g t h e c o s t , a n d ' a l w a y s t o p l a c e a p r i o r i ty on quality before finance.' 13. 5 T h e q u a l i t y of w e l d i n g a c h i e v e d b y the g r a v i t y w e l d e r as follows: is

T h e ' I n d i r e c t f a c i l i t i e s ' r e f e r to the f a c i l i t i e s , e x c e p t i n g those m e n t i o n e d a b o v e , n e c e s s a r y f o r the b u i l d i n g of s h i p s , w h i c h a r e i n d i r e c t l y n e e d e d f o r the o p e r a t i o n of a s h i p y a r d , s u c h a s h o u s ing, schools, hospitals, clubs, transportation systems and other w e l f a r e f a c i l i t i e s f o r the p e r s o n n e l , as w e l l a s the b i l l e t s f o r t h e c r e w s of r e p a i r s h i p s a n d m o o r i n g f a c i l i t i e s i n t h e h a r b o u r .

MANAGEMENT (a) t h e r a t i o of t h e w e l d l e n g t h by the g r a v i t y w e l d e r to

o

CONTROL

IN

SHIPBUILDING

IN

JAPAN

the

N a t u r a l l y , t h r o u g h t h e d i s p o s a l of t h e p o o r q u a l i t y p r o d u c t s w h i c h f a i l e d the t e s t o r t h r o u g h m i s t a k e s i n the o r d e r of p r o d u c t i o n , the d e l i v e r y delayed. of a v e r y few products is T h i s p r o b l e m c a n be r e s o l v e d i m m e d i a t e l y by the m i l l . the sometimes either by

t o t a l w e l d l e n g t h i s about 507 . (b) (c) a n o n - d e s t r u c t i v e test for g r a v i t y w e l d i n g i s not a p p l i e d . the d e c i s i o n f o r r e p a i r w o r k to the w e l d i n g i s made by as a r u l e , but i s s o m e t i m e s superintendents. rethe

t h r o u g h a u s e of s t o c k s of s t a n d a r d i s e d s t e e l p r o d u c t s o r rapid counter-measures not e n c o u n t e r a n y g r e a t i n c o n v e n i e n c e .

foreman

r e q u i r e d by the i n s p e c t i o n

T h u s the s h i p y a r d does B a s i c a l l y speaking, as quantitatively

staff of the y a r d o r b y the s h i p o w n e r ' s (d)

t h e p r o p o r t i o n of w o r k c a r r i e d out b y g r a v i t y w e l d e r s welder.

the s t e e l p r o d u c t s u s e d by the s h i p y a r d s a r e

q u i r i n g r e p a i r a m o u n t s t o a b o u t 27 o f t h e t o t a l w e l d i n g done by the g r a v i t y 14. 14.1

length

l a r g e , it i s e a s y f o r the m i l l s to c a r r y out the l o t p r o d u c t i o n of t h e m a t e r i a l s of t h e s a m e c a t e g o r y a n d m e a s u r e m e n t , t h u s e n a b l i n g t h e m to take e m e r g e n c y m e a s u r e s without any culty. c l i n e d t h r o u g h the 5-day b a t c h e s w o u l d not n e c e s s a r i l y the a u g m e n t a t i o n of the s t o c k s o w n e d b y t h e 14. 3 The mill. is diffimean T h e fact that the s t e e l s t o c k l e v e l at the the s h i p y a r d d e -

R e p l y to M r . R. J . Johnstone There are six large s t e e l m i l l s i n J a p a n , one of w h i c h

h a s a S h i p b u i l d i n g D i v i s i o n . T h e o t h e r f i v e m i l l s do not h a v e any s p e c i a l c a p i t a l affiliation w i t h the s h i p y a r d s , although the shipyards and steel m i l l s have very close contacts with o t h e r t h r o u g h t r a n s a c t i o n s of t h e i r p r o d u c t s . 14.2 To m a k e p o s s i b l e the d e l i v e r y of s t e e l p r o d u c t s i n 5 c o m p u t e r to draw to each

r a t i o of t h e s t a n d a r d - s i z e s t e e l i n t h e p r o d u c t s

not so h i g h . T h e f i g u r e for s u c h a r a t i o w o u l d differ w i t h the different t y p e s of t h e s h i p s , but i n c a s e of a c a r g o v e s s e l i t i s

o

r o u g h l y 107 -157 o f t o t a l w e i g h t of t h e s t e e l p r o d u c t s , w h i l e
o o

the

f i g u r e w o u l d be 20%-30 / i n the c a s e of t a n k e r s o r b u l k c a r r i e r s . 14. 4 E v e n e m p l o y i n g the 5 - d a y d e l i v e r y p e r i o d s y s t e m , it w o u l d not be p a r t i c u l a r l y advantageous to r e d u c e the a v e r a g e s t o c k l e v e l of t h e s t e e l t o 5 - d a y s ' s u p p l y . T h e r e a s o n i s t h a t i f the s t o c k i s u n d u l y r e d u c e d , it w o u l d b e c o m e d i f f i c u l t to c o p e w i t h a s u d d e n l y c h a n g e d s i t u a t i o n . W e c o n s i d e r the p r e s e n t l e v e l to be s a t i s f a c t o r y .

d a y b a t c h e s , the s t e e l m i l l s do not n e c e s s a r i l y c a r r y out a preliminary sorting. We use the e l e c t r o n i c u p a 5 - d a y u n i t of t h e p u r c h a s e o r d e r s h e e t , w h i c h i s s e n t t h e m i l l , c o n t a i n i n g t h e t y p e , q u a n t i t y a n d t h e d a t e of m e n t of the n e c e s s a r y

procure-

s t e e l p r o d u c t s , to m a t c h the b u i l d i n g date.

s c h e d u l e of e a c h s h i p . T h e n t h e m i l l , u t i l i s i n g t h e p u r c h a s e o r d e r , w i l l t r y to s e n d the r e q u i r e d steel on a r e q u e s t e d

445