Internationalization and Localization of the Kyoryoku Kai: The Spread of Best Practice Supplier Development

The article reviews how lean production can be taken into supplier bases in both Japan and the West. The exemplar supplier network as demonstrated by Toyota and Hitachi in Japan are seen to be the result of a lengthy process whereby all members of the supplier network, both direct and indirect sources, have been developed to be world class. The most important factor exhibited by the Japanese in building these inter‐company relationships and creating a world class supplier base is the Kyoryoku Kai or Supplier Association. These Kyoryoku Kai have been utilized to spread the types of innovative strategies, work practices and manufacturing techniques synonymous with large Japanese final assemblers throughout the extended supplier network. However, until very recently the Kyoryoku Kai has not been seen outside Japan. The paper explores why this is the case and how this is beginning to change by reviewing some pioneering ventures in Europe. Further, a four stage model for internationalization of the Kyoryoku Kai is proposed, designed to help companies steer a course towards the creation of their own world class supplier networks.