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Oiemon Economic studies,20 (1987)
The Business Administration Technique
inInformation orientedsociety
Kenichi Murayama
1
1。Introduction
F. W. Taylor doveloped a theory of ScientificManagement that brid-
ged the get between Engineering and Economics. Nowadays industry has
achieved remarkable progress in high technology. This high technology
has a great effecton business administration. We can not consider present
management technique as being separate from the development of
technology. There is no sharp distinction between management and
technology. This is the reason why l introduce a new theory of a higher
order that enconpasses management and technology. l temporarily give
the name technology management to it. At first l want to state the
relation between technology and management. Technology management
has two aspects. One is to manage technology. Another is to use
technology in management. The way to manage technology aims at the
development of technology. We eχamine the relationships of many kinds
of technology and find a new theory of technology development. The
way to use technology in management aims at the development of
management. We eχamine the adaptation of many kinds of technology
in management and find a new theory of management development. First
of allI'd like to discuss the way to use technology in management.
2. Factory Automation and divided consumer
Factory Automation in Japan will develop to full automation which
integrates former Factory Automation (FA), Office Automation (OA).
Laboratory Automation (LA)and Marketing Automation (MA)etc‥
This development is needal to help many business administration techni-
ques. The latest development of Factory Automation, which was made
by a new marketing technique, has brought about segmented markets
and divided consumers, (the so-called BUNSHU, opposition to masses.)
General Institute of Life in Hakuhodo Incorporated found that BUNSHU
was born as a result of the marketing. They got the data from many
points of consumer observation and were quite sure of their conclusion.
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2 KENICHIMURAYAMA
The Quality of Japanese goods doesn't differ between manufacturing
companies, because Quality Control has reached a high level. Therefore
each company has made effortsto make a delicate difference in image
between their goods and other. Japanese goods became overproduction
and mature. The Japanese consumer selects goods according to delicate
differences ofimage or quality. This consumer behavior is historically
rooted in the way of the tea ceremony, the so called SADO. KONOML
the taste has been important in the tea ceremony. Individual taste is
valuable in the tea ceremory. SADO people pursue a special and profound
beauty, quiet refinement, tranquillity,namely the Japanese words YUGEN,
WABI, SABI.
3. FieχibleManufacturing System
In Japan the new the consumer looks for new varietiesof goods. That
is because the Japanese production system has changed from mass
production to diversifiedproduction. Mass production brought continuous
production and simple automatic production but effective diversified
production is difficult.So computers have been employed to help the
production system. They are Numerical Control(NC)Machines. The
N. C. Machine is given the order tape of the manufacturing process and
condition. At firstcomparatively easy machines were automated, and
after that gradually automation spread widely. Much manual works has
changed to robots for example in painting, welding, and assembly. These
robots are called playback robot.In many manufacturing fields many
robots were used, then many factories tried to integrate these automatic
machines. Thisis the FieχibleManufacturing System (FMS). FMS is
effectivein diversifiedmanufacturing. FMS is composed of NC machines,
Material handling Robots, Automatic warehouse, Machining Center with
automatic tool changer. Automatically materials are fed to machine,
transferred from machine to machine, installed to machine and removed
from machine. FMS works all day all night, and needs almost no staff
but some-times men are needed to repair machines or toolsand sharper
edged tools. Recently unmanned factories have appeared in Japan, for
example the Fanak Fuji Factory and the Narasino Factory of Hitachi
manufacturing Co. These Factories are not completely automated, and
have a few maintenance workers and indirect workers. There are 3
ways for completely automated plant.
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THE BUSINESS ADMINISTRATION TECHNIQUE IN INFORMATION ORIENTED SOCIETY
Firstis that the machine make to have intelligence.
Second is that management technique is computerized.
Third is that factorymake to unit with society.
3
4. New Production System
A high intelligence machine should have a computer as brain and
sensor, as five sensors. Product design was computerized. It was called
Computer Aided Design (CAD). CAD not only designs effective products
but is also automatically helped by Group Technology (GT). Material
Requirement Planning (MRP)controls many kind of row materials and
parts in the manufucturing process by computer. There are many
production control technipues by computer. These management techni-
ques reduce the number of control workers. Accountant and office
workers are helped by Accounting Automation(AA)and Office Auto-
mation (OA). The OKAMURA Manufacturing Co. fulfillsits accounting
work with only five clerks in spite of being a big company. Recently
many factories tried to unite FA, OA, AA. and FMS for diversified
manufacturing and Computer Aided Manufacturing (CAM)are on the
way to unit FA, 0A etc‥TOYOTA Motor Corporation developed a New
Production System (NPS)the so called Kanban (signboard)system.
Most us plants aim for the longest, fastest run on parts, even though it
may mean increasing inventory carrying cost and Americans pay com-
paratively little attention to the time costs of tooling up. But the TOYOTA
plant has been able to cut its parts inventory to one hour. The Kanban
system is a production system which coordinates parts arrival with the
production process and is called the Just in time inventory in Japan.
The companies that approved of the idea organized the New Production
System Group. They were growing up quickly and became the biggest
company in each industry, for examples Misawa house company Ltd. and
World apparel Co‥ In the Kanban System the back worker is in process
direct to the front worker. They make only what is necessery and don't
leave unsold goods. The World apparel Co. introduced FA and finished
diversified manufacturing. Conventional apparel makers sold excess
supply cheeply, but NPS Group don't need such concern.
5. Value Added Network
Recently Value Added Network (VAN)became popular in Japan.
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4 KENICHIMURAYAMA
The Pharmacy Franchise Chain FHARMA organized VAN system with
around 600 stores. They got the statistics of the sales in each stores and
ascertained the best selling goods by computer net work. The Franchise
center is informed of the marketing data everyday. Because of the data,
all stores could decrease their inventories and working capital. Needless
to say their sales doubled. In addition to they can pay smaller settlement
commission of bank in a lump sum by joint signature account. This
case is an example from small business but in big business VAN has
flourished. Big retail Campanis have almost a computer network system
their stores group. Specially each store has a Point of Sales(POS)
system and they collect information of marketing by bar cord reader from
bar cord on the surface of the goods. Every day this data are collected
and relayed the center by computer network and processed by main com-
puter. It gives information on best selling goods and the combination of
goods, the place in show case, the weather or other condition etc. . The
consumer has a pattern of buying behavior to buy special combination
of goods in special place of showcase. These computer network system
makes clear the consumer buying behavior and helps increase store sales.
and make effective retail management. These information is not only
useful in retail management but also in production management.
6. Simulation
Such information linked the production system and the sales system.
This totalsystem approached to anmanned factory. Now management
information became fullin enterprise and management decision making
attained a high level. Management information system developed from
operational control to strategic planning and structured decision to
unstructured decision refer to Simon, but automatic decision making
is hard to realize in the unstructured problem. It has been caused
by difficultiesin predicting in the distant future. For this reason, the
Decision Support System (DSS)that supports decision making of top
management by computer appeared. When top management makes a
decision they get management information by computer and contract
speedy management policy with this information with the help of the
computer can not make complete policy. The Final decision will be
done by top management. The computer collectsinformation from many
branches and factories,business o伍ces, makes a financialstatement, and
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THE BUSINESS ADMINISTRATION TECHNIQUE IN INFORMATION ORIENTED SOCIETY
5
predicts future sales volume at each branch. If top management changes
the policy and the business environment changes, the computer makes a
speedy new future financial statement and management result statement.
There are many possibilities of environment. We can not try all these
possibilities, but we can use a management simulation technique to find
the most suitable policy. The Management simulation technique has
developed as to various hypothesis regarding social policies. It is hard
to simulate human psychology. So by joining many player we tried
movement of human mind. We called it Gaming Simulation. Since 1960
we have many business games and urban games. The Urban game can
simulate real society and can be used for making social policy. Recently,
home automation progressed to personal computer communication and two
way communication TV in Japan. l think that society will become united
organically; homes, stores, factories, banks etc. by computer network
systems near future.
7. Technology Development
I'd like to discuss the neχt problem in technology management.
Taylor developed scientific management as a new theory. It trans-
cended economics and engineering. Now we are beginning to need a
new theory which will transcend management and technology. Until now
technological development has been brought about by chance. But we
have become able to control technology. Technology develops by combina-
tion of elementary technology. Each technology has a typical pattern
of developing speed. We can predict something of new technology.
Calculating speed of computer developed a constant trend. Many tech-
nological forecast techniques can predict it. There are many technologi-
cal forecast techniques, i. e. regression analysis, eχtrapolation method,
Relevance tree method, inatriχ method, Delphi method, Scenario writing
method etc‥ The Calculating speed of computers developed in 4 steps,
i. e. relay system, vacuum tube system, transistor system, IC system. Thus
development speed was by geometrical progression. In the future the
computer will develop by garum一arsenic element, Josefson elements etc..
One development depends on many other industries. It is called techno-
logy transmission, We must study this technology transmission. Even
now we can analyze technology transmission. Every technology has many
subtechnologies. If we want to develop our technology, we must utilise
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6 KENICHIMURAYAMA
the subtechnologies related with our technology. There are some key
technologies which lay the foundations for many other technologies.
There is a difference among technology influenced with other technology.
When we want to develop one technology, we must choose an effectual
sub technology to technological policy. In Japan the semiconductor is
called the rice of industry, (Rice is the staple food in Japan.)The USA
takes semiconductors seriously and use it to play their best trump card.
However, the key technologies in semiconductor production are clean
room technology and precision printing technology, QC technique etc‥
They can't beat Japan with customs duty anly. Developing nations some
times introduced high technology in their industry. But if they hadn't
had an appropriate subtechnology, the high technology couldn't eχhibited
its effect in their industry. Korea has many modern industries, for
example steel, electrical appliances, automobiles, shipbuilding indutsry
etc・,but they must import many high technological parts, for eχample
miniature bearings, video cassette recorder heads, highly efficient engines,
robots etc‥ High technology also needs other conditions as well as sub-
technology, These are social conditions, cultural background etc.. In a
nation of cheep labor, manufacturing costs using robots are more eχpen-
sive than by ordinary machine. There is appropriate technology in each
nation. Educational condition and standardization consciousness are also
important. Precision industry needs precision material and correct motion.
High precision machine must be supplied with high precision materials,
otherwise this machine may be broken. In Japan the MITI has promoted
standardization. The MITI allows faetories which apply standardization
to put the JIS mark in their product.
8. Standardization
MITI requests many documents for standardization, for example
product standards, material standards, purchase standards, job instruc-
tions, machine maintenance perceptions, storehouse control regulations,
consumer grievance regulation, machinery regulation, process control
regulation, office work regulation, organization regulation, training
regulation, etc.. Some big companies made a room-full of standards,
instructions, prescriptions, and regulations documents. Even small com-
panies must make a desk-full of documents. All employees must memorize
the part under their charge. The MITI agent visits the factory and
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THE BUSINESS ADMINISTRATION TECHNIQUE IN INFORMATION ORIENTED SOCIETY
7
inspects products and process. Even eχecutives are asked by the agent.
For introduction of one technology we must introduce many subtechno-
logies and many management techniques. Technologically advanced
nations have tried to introduce this sort of technology to their industry.
They sometimes failed to introduce technology. There is a most appro-
priate method to introduce high technology. For that we must analyze the
relevance of each technology Management technique which has developed
from motion study through operations research to behavioral science.
We have followed the direction of objects to study small action to large
action. Recently we study corporate identity and corporate culture. In
study of introduction of high technology we must be interested in set
technology.
(ReceivedDec. 25, 1987)
Reference
[l]Wakita Hirowaki and Hitomi Katsuhito, FA and OA, Nikkan kogyo shinbunsha(Business
& Technology Press),1983.
[2]News reporter group of Business & Technology Press,New age of FA ; Nikkan kogyo
shinbunsha (Business & Technology Press)1983.
[3]Nikke, mechanical, Robot revolution;Nihon Keizai Shinbun Inc.. 1981.
[4]General Instituteof Life in Hakuhodo Incorporated, The age of BUNSHU, 1983.
[5]Hirabayashi Chiharu, χへ/adaJin and Matsuishi Izumi, Marketing Automation ;Nihon Noritsu
Kyokai, 1986.
[6]Distribution System Development Center, The front of DistributionInformation System,
Businss Inc., 1986.
[7]Ono Taiichi,Toyota Production System, Diamond Inc. 1987.
[8]Fukuda Ruji and Kimura Yukinobu, StocklessProduction, Nikkan Kogyo Shinbunsha, 1986.
[9]Sato Kimihisa, New Production System(challenge of Manufacturing Automation Prosoca),
Diamond Inc., 1987.
[10]Karatsu Hajime, Challenge of Big Manufacturing Nation Nippon, Jitsngyo no Nihon sha,
1988.
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