Structural Reforms Designed to Reinforce Our Business Foundation
Chinese Subsidiary Wins the Deming Prize

- Komatsu Shantui Construction Machinery Co., Ltd. -


We established Komatsu Shantui Construction Machinery Co., Ltd. (KSC) jointly with Shandong Shantui Construction Co., Ltd. in Shandong Province, China in July 1995. KSC has grown into China's leading construction equipment manufacturer, supplying medium-sized hydraulic excavators today.

In June 2010, KSC embarked on an all-involved Total Quality Management (TQM)* project, including the president, in order to strengthen its workplace capability, a core of The KOMATSU Way, which calls for continuous, self-determined improvement efforts. To obtain an objective assessment of the results, they took on the challenge of the Deming Prize, an internationally reputed TQM standard, and won the Prize in November 2013.

*TQM: Systematic activity designed to help achieve organizational goals by managing the entire organization efficiently and effectively to accomplish the objectives of Quality, Cost and Delivery of products and services.

Komatsu Shantui Construction Machinery

Introducing TQM

Many KSC employees had not even heard the term TQM itself before the project began. Therefore, the TQM Division started the project by fostering mutual awareness of problems as a practical method of introducing TQM. Basic Quality Control (QC) education also addressed the importance of becoming aware of problems. All employees with one full year of employment at KSC enrolled in this program.

At the same time, they trained QC instructors who were chosen from all departments. To improve manufacturing skills, they established the Technical Training Center in Jining, where they made focused efforts to train instructors in the areas of assembling, welding, painting and inspection with help from their Mother plant in Osaka. Now that their in-house training is over, these instructors are also training instructors of a Komatsu Group company and their suppliers in Jining.

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    Assembly line for hydraulic excavators at KSC

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    Technical Training Center in Jining


  • KSC was able to generate more-than-anticipated results in the areas of quality, costs and delivery as a result of developing the TQM-based operation. For example, in the process of solving problems, employees needed to collaborate with other employees engaging in processes before and after their own and solve problems. TQM Division spent a lot of time and effort to anchor an orientation toward customers among all employees, an ultimate end-process.

    On the shop floor, all employees thoroughly understood the Three-Gen Principle, i.e., Gemba (actual workplace), Genbutsu (real things) and Genjitsu (real situation). Today, when problems develop, they scientifically collect data from a multitude of angles to identify the cause(s) in line with the objective(s), and analyze data by applying a variety of tools.

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    An employee explains the quality control system to President of KSC, who plays the role of a Deming Prize assessor.

Most importantly, workplace capability, i.e., employees taking the initiative to engage in continuous improvement of respective workplaces, is being rooted at this plant in China.

Liu Fangchang, who worked on the TQM project at KSC and became president in April 2013, remembers very clearly the following words of a Japanese expat who was in charge of the project: “Finding no problem is a big problem itself. ” He adds, “His words have been very helpful for me to keep an awareness of potential problems all the time. Unless we face reality with an awareness of problems, we won't be able to identify problems. I also feel that a climate of thinking first about the benefits for customers is being anchored at KSC.”

Today, KSC is making further efforts to train manufacturing engineering and purchase staffs as well as suppliers by focusing on cost improvement, while receiving instructions from the Osala Plant, their Mother plant.

  • Interview

    Quality and Reliability in The KOMATSU Way and customer orientation of TQM say the same thing in different words.

    Liu Fangchang, President, KSC

  • Interview

    We began the project, when I had no idea about TQM myself.

    Zhu Lei, Manager, TQM (Total Quality Management) Division, KSC