The Irish Could Learn From the Vietnamese

Along comes a story about workers at a Nortel plant in Ireland going on strike every Monday.

The Nortel telecoms plant at Monkstown in Newtownabbey was hit yesterday by   strike action in a row over this year’s pay deal.  Unite, the trade union, said that more than 150 test technicians and shop   floor workers had taken part in a half-day stoppage. Unite regional organiser Terry Collins said the action was taken after pay   talks broke down.

What's the beef?

He said: “We have been working closely with the company over the past 18   months on ‘lean manufacturing’ and have made £3m in savings at the Monkstown   plant. “Now is the time our members are paid back for all their efforts, Unite   members will be staging a half-day strike each Monday from now on.

I could play this story several ways.  First off, at least the company didn't follow the path of so many LAME lean companies and lay off the workers when productivity improvements were realized.  But that's not really what's going on here.  If this was a true lean effort this would never have been an issue.  Real lean requires the intimate involvement of the employees, and the organization recognizes the value of that involvement and their contributions.  The return to the employees may not necessarily be financial, but whatever it is is satisfying and beneficial to the employees.  However a core component of most real lean programs is a way to share the financial success with the employees.

Coincidentally, on the same day, there was a story out of Vietnam.

Diep Thanh Kiet, vice chairman of the Ho Chi Minh City Association of Garments, Textiles, Embroidery and Knitting, estimated that workers in the garment industry have seen their living costs surge by at least 40 percent this year. But their salaries have gone up just 12-15 percent, and many find it hard to make ends meet.

So what are they doing about it, and what's the risk?

While the annual attrition rate at garment firms is 5-20 percent, Kiet said some are now choosing to return home to work instead of moving to another factory in the city. It is much easier for a worker to get by on a salary of VND1 million (US$60) in Tra Vinh or An Giang provinces than to live in HCMC on VND1.6 million ($96) a month, he said. Businesses paying workers less than VND1.5 million a month face the highest risk of losing them, he added.

That's what's happening at traditional companies.  But some are taking a different path.

Nguyen An, general director of the Saigon Garment Joint Stock Company, said businesses that can keep their employees would be the winners. His company has started applying lean manufacturing principles to cut costs and has been able to raise the salaries of workers, he said.

He's realizing a double savings: by increasing productivity and sharing that financial reward with his employees, he is able to keep those employees.  What he may not realize yet is that he has also kept the knowledge, experience, and creativity of those employees... not just the pair of hands.

Just wait until the power of those brains, empowered by a lean manufacturing effort that truly values the input of the employees, really kicks into gear!