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New Product Introductions and Activation of Shop

Floor Organizational Communication

Article  in  Annals of Business Administrative Science · May 2017

DOI: 10.7880/abas.0170313a

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 ADVANCE PUBLICATION
Annals of Business Administrative Science
http://doi.org/10.7880/abas.0170313a
Received: March 13, 2017; accepted: April 26, 2017
Published in advance on J-STAGE: May 12, 2017

New Product Introductions and

Activation of Shop Floor
Organizational Communication
Nobuyuki INAMIZUa) and Mitsuhiro FUKUZAWAb)

Abstract: In the Japanese electrical and electronics industry,

examples abound of factory managers proposing and introducing
new products for production in factories that have retained their
competitiveness. In other words, adding new products activates
shop floor communication. This research uses data from a survey
to analyze the “openness” (kazetōshi, which literally means
"ventilation" in Japanese, is an indicator of communication activity)
of the shop floor organization. This analysis, while not revealing a
correlation between openness and quality, cost, delivery, and
flexibility (QCDF), does reveal a positive, significant correlation
between openness, the “number of new product introductions,”
and “new product proposal/development.” In reality, factories in
which the latter two factors had a greater presence had good
openness. This suggests that factory managers’ actions and

a)
Graduate School of Economics, University of Tokyo, 7-3-1 Hongo, Bunkyo-ku, Tokyo, Japan,
inamizu@e.u-tokyo.ac.jp
b)
Faculty of Economics, Seikei University, 3-3-1 Kichijoji-kitamachi, Musashino-shi, Tokyo, Japan,
mfukuzawa@econ.seikei.ac.jp
A version of this paper was presented at the ABAS Conference 2017 Winter (Inamizu & Fukuzawa,
2017).
© 2017 Nobuyuki Inamizu and Mitsuhiro Fukuzawa. This is an Open Access article distributed under
the terms of the Creative Commons Attribution License, which permits unrestricted reuse, distribution,
and reproduction in any medium, provided the original work is properly cited.

1
 Inamizu and Fukuzawa

policies of proposing and adding new products help to activate

shop floor organizational communication.

Keywords: new product introduction, organizational

communication activation, electric and electronics industry

Introduction
This research suggests that in Japanese factories, factory
managers’ actions and policies of proposing and adding new
products activate the shop floor organization, in particular its
communication.
As a general trend since the 1990s, Japanese manufacturing sites
have been in a predicament. Despite this, factories that have
maintained competitiveness and have active shop floors do
exist. Japan’s electric and electronics industry serves as a microcosm
for this situation.
So then, what are the traits of competitive manufacturing
shop floors and their respective organizations? Let’s take as an
example interview-based surveys in the electric and electronics
industry that were conducted as part of the work of Shintaku,
Inamizu, Fukuzawa, Suzuki and Yokozawa (2014). In these surveys,
they found that one trait of competitive factories with active
shop floors was their predilection toward reaching out to
headquarters (or even other companies in some cases) to acquire the
capability and to bring to fruition the manufacture of new products
(in their parlance, “a factory with marketing and sales”).
With that as the background, this research utilizes data from
questionnaire surveys to analyze the relationship between new
product additions and shop floor organizational activity, focusing on
active communication. The results of this analysis, while not

2
 New product introductions and activation of shop floor organizational communication

revealing a significant relationship between “openness” (kazetōshi,

which literally means “ventilation” in Japanese, is an indicator of
communication activity) and quality, cost, delivery, and flexibility
(QCDF), did reveal a positive, significant relationship between
openness, the “number of new product introductions,” and “new
product proposal/development.” It was also found that factories that
had superior levels of new product additions and
proposal/development had good openness. This suggests that factory
managers’ actions and policies of proposing and adding new
products activate shop floor organizational communication.

Cases of New Product Introductions by Japanese Factories

First, with regard to the traits of competitive shop floors and their
organizations in the electric and electronics industry, let’s examine
“factories with marketing and sales,” or factories that propose and
develop new products, a phenomenon brought to light by Shintaku et
al. (2014). These factories “do not solely conduct operations assigned
to them from their respective headquarters, but think and act on
their own, conducting marketing and sales-like activities with their
headquarters and even with other companies in order to acquire new
work.” Shintaku et al. (2014) cite the following example. Among the
factories that they surveyed, they encountered one, which we call
Factory A, that had been in danger of closure on several occasions
since the 1990s because of changes in the products manufactured at
the factory that were driven by headquarters. Factory A had, to evade
this danger of closure, utilized its firm’s technological specialties to
lobby the development division at headquarters, beginning with
product planning, to acquire more work for the factory. Besides, the
factory head, who was also a marketing and sales unit head, took
great efforts to acquire new work from external companies in fields in
which the factory could leverage the company’s technological
3
 Inamizu and Fukuzawa

strengths.
Another example comes from a factory—called Factory B—whose
core business was transferred to its parent company consequent to
business restructuring. In return, Factory B was handed work under
the group’s scanner business, a mature, relatively small-scale
business. However, Factory B took initiatives to develop mechanical
and IT technologies, developing new scanners and expanding their
sales scope. Consequently, the products that they were able to
develop were ordered en masse by the world’s financial and
government institutions, and they have now gained the top position
in global market share.
Factory B’s group had also been producing scanners at Chinese
factories. However, disasters, flooding, and political risk in China
meant that distributed production was necessary. Factory B
volunteered to become a producer under that distributed system,
communicated with molded piece manufacturers and other
transaction partners, presented manufacturing costs in China, and
negotiated intensively to cut costs and was finally able to succeed in
winning business from Chinese factories.
How then do these actions taken by factory managers impact the
manufacturing shop floor? In this research, we conduct quantitative
analysis on manufacturing shop floor activation, particularly in
communication.

Method
The data used in this research was acquired through questionnaire
surveys that were conducted with Japanese businesses and factories
in the electric and electronics industry between December 2013 and
January 2014. 1 Three surveys were used on the basis of the

1 See Inamizu (2015) and Fukuzawa (2015) for other research based on these
4
 New product introductions and activation of shop floor organizational communication

respondent’s position in the organizational hierarchy. The

respondents for each are as follows:

1) Study A: Business/Factory Survey

For factory heads, administrative managers, and others who
understand the overall state of the factory/business
Respondents: 97 businesses (of the 163 businesses targeted,
response rate 59.5%)
2) Study B: Leadership Survey
For workplace leaders of manufacturing lines at the
businesses/factories applicable to Study A
Respondents: 354 people (of the 446 people targeted, response
rate 79.4%)
3) Study C: Worker Survey
For persons working under workplace leaders applicable to
Study B
Respondents: 3,116 people (of the 3,990 people targeted,
response rate 78.1%)

The indices used in this research are as follows:

1) Indices on competitiveness
Study A asked respondents regarding factory
competitiveness. Here, competitiveness includes QCDF and other
items related to innovation as suggested in the previous examples
(Bhamu & Sangwan, 2014; Bozarth, Warning, Flynn, & Flynn,
2009; Fujimoto, 1999, 2003, 2012; Holweg, 2007; Holweg & Pil,
2004; MacDuffie & Pil, 1995; MacDuffie, Sethuraman, & Fisher,
1996; Schroeder & Flynn, 2001; Shah & Ward, 2003, 2007;
Turkulainen & Ketokivi, 2012; Womack, Jones, & Roos, 1990).
In particular, Study A asked respondents to comparatively rate
their own factory versus rival factories within the same company

same surveys.
5
 Inamizu and Fukuzawa

Table 1. Mean, S.D., and correlations of the items of competitiveness

Mean S.D. A1 A2 A3 A4 A5 A6 A7 A8 A9
A1: Customer satisfaction 4.07 .966
**
A2: External defect ratio 4.16 .987 .876
A3: Production cost 1.83 1.195 -.161 -.331 **
**
A4: Productivity 3.90 1.014 .585 .496 ** .016
**
A5: Delivery 3.85 .833 .567 .496 ** .033 .515 **

**
A6: Flexibility 3.78 1.054 .418 .263 * .150 .430 **
.521 **
**
A7: # of new product introduction 3.59 1.295 .303 .241 * .048 .259 *
.213 * .238 *

**
A8: Development of unique production techno 4.22 1.066 .530 .544 ** -.243 * .411 **
.210 * .304 **
.537 **

**
A9: Mass production start-up 4.17 .979 .484 .345 ** -.037 .333 **
.428 ** .357 **
.528 **
.577 **
**
A10: New product proposal and development 4.13 1.086 .418 .427 ** -.171 .397 **
.321 ** .319 **
.671 **
.800 ** .654 **

N = 82, ** p < 0.01, * p < 0.05, + p < 0.1

that handled the same products for the following ten items in the
most recent year (from October 2012 to the end of September 2013),
using a five-point scale for all items:

A1: Customer satisfaction

A2: External defect ratio
A3: Production cost (e.g., labor, materials)
A4: Productivity (e.g., man-hours per item manufactured)
A5: Delivery (e.g., the number of days from customer order to
delivery)
A6: Flexibility in altering production models/volume
A7: Number of new product introductions (per year)
A8: Development of unique production technology (e.g., production
refinement, faster processing)
A9: Rapid mass production startup
A10: New product proposal and development

Table 1 presents the key statistics for these items.

2) Items on openness (Study C)

As an indicator of active shop floors, particularly communication

6
 New product introductions and activation of shop floor organizational communication

therein, we focus on openness. We generally define this term as

“the state, primarily found within companies, where there is an
environment of free communication of opinion regardless of
hierarchical rank and where there is a strong flow of
communication and information sharing.”2 With this in mind, the
four items used in Study C related to work climate are as follows.3
Respondents were asked to respond with a yes or a no (two-point
scale) to the following statements:

C1: In my workplace, there is an atmosphere in which it is easy to

make work-related requests or have work-related discussions
even with those not directly linked to my chain of
command. (Yes=1, No=0)
C2: In my workplace, there is an atmosphere in which people can
be included even if they have differing opinions. (Yes=1, No=0)
C3: In my workplace, there are intense discussions in the interest
of problem-solving that are not bound by age or rank
restrictions. (Yes=1, No=0)
C4: Many opinions are taken from the shop floor and

Table 2. Mean, S.D., and correlations of the items of openness

Mean SD C2 C3 C4
C1 .59 .493
C2 .54 .499 .51 **
C3 .43 .495 .30 ** .33 **
C4 .43 .496 .29 ** .36 ** .33 **
N=3021, ** p < 0.01, * p < 0.05, + p < 0.1

2 Translated from the entry found at http://www.practical-japanese.com

(search date 20 February 2017).
3 In drafting items related to workplace openness, this paper also references
indices related to “organizational weight,” said to indicate poor openness
(Numagami, Karube, Kato, Tanaka, & Shimamoto, 2007).
7
 Inamizu and Fukuzawa

implemented. (Yes=1, No=0)

Table 2 shows the key statistics for these four items. Cronbach’s α
is 0.69, and the simple sum of these is dubbed “openness.”

Results
In our analysis, we created a dataset that integrates the data from
Studies A and C under the framework defined by Study B. For almost
all businesses, we obtained one response to Study A, three to Study B
(meaning three workplaces responded per business), and thirty to
Study C (meaning ten persons responded per workplace, with three
workplaces selected per business). When inserting data from Studies
A and C into Study B’s dataset, the same data from Study A was
inserted for workplaces sharing the same business. For Study C’s
data, the mean values were calculated and inserted for each
workplace.
After creating this integrated dataset thus, we conducted an
analysis only on the workplaces in the top-selling business. We did
this because it allowed us to conduct an analysis limited to each
place of business’s core workplace for each core business. This is also
because when creating this dataset, since we inserted the same data
from Study A for workplaces at the same place of business, we were
able to sift through and choose one workplace at each place of
business.
The results of the process outlined above yielded 81 places of
business (factories) for analysis. Of these, there were 38 cases of one
workplace selected per place of business, 31 cases of two workplaces
selected per place of business, and 12 cases of three workplaces
selected per place of business. Therefore, the number of workplaces
for analysis totaled 136 (38×1 ＋ 31×2 ＋ 12×3). Workplaces with
missing values were excluded from the respective analyses.

8
 New product introductions and activation of shop floor organizational communication

Table 3. Correlations between competitiveness and openness

Correlations with
A1: Customer satisfaction .12
A2: External defect ratio .14
A3: Production cost -.14
A4: Productivity .06
A5: Delivery .13
A6: Flexibility .17
A7: # of new product introduction .28 **
A8: Development of unique production technolo .28 *
A9: Mass production start-up .16
A10: New product proposal and development .35 **
N = 82, ** p < 0.01, * p < 0.05, + p < 0.1

Table 3 presents the correlation coefficients between openness and

each competitiveness item. There is no visible correlation between
QCDF and openness. However, for items A7 (the number of new
product introductions) and A10 (new product proposal/development),
we can see positive, significant correlations with a 1% significance
threshold.
We then focused on A7 and A10 for the next steps of our
analysis. Figures 1 and 2 show the respective frequency distributions
of A7 and A10. Factories responding with a “5” constitute about half
of the total respondents for both figures, with a two-peak
distribution. We then split the respondents by response choice for
our next analysis—for those choosing 5, we assigned them the
“upper” group, while assigning the “lower” group for those choosing
responses 1–4.
Table 4 and Figure 3 show the results of the analysis for
determining the existence of a difference in mean openness indices
between the upper and lower groups for A7 and A10. A t-test to
determine the existence of that difference for A7 (number of new

9
 Inamizu and Fukuzawa

60

50

40 37

30 26

19
20

10 6
3

0
1 2 3 4 5

A7: # of new product introduction

Figure 1. Frequency distribution of A7

60

49
50

40

30

19
20 17

10
4
2
0
1 2 3 4 5

A10: New product propsal and development

Figure 2. Frequency distribution of A10

product introductions) revealed a significant difference (t = 2.278, p <

0.05). A similar t-test for A10 (new product proposal/development)
also revealed a significant difference (t = 2.807, p < 0.01). These

10
 New product introductions and activation of shop floor organizational communication

Table 4. Difference in means of openness

Lower gorup Upper group

N Mean S.D. N Mean S.D. t -value
A7:# of new product introduction 50 1.65 .724 33 2.01 .676 2.278 *
A10: New product proposal and development 39 1.57 .656 44 1.99 .727 2.807 **
Note: + p ,0.1, * p <0.05, ** p <0.01

2.5
(Communication activation)

2.01
2
A7: # of new product
Openness

1.99
1.65 introduction
A10: New product proposal
1.5 and development
1.57

1
Lower group Upper group

Figure 3. The relationships among A7, A10, and openness

results allow us to conclude that for the upper groups as relevant to

A7 and A10, openness indices are higher than they are for the
respective lower groups.

Discussion and Conclusion

In this paper, we used data from questionnaire surveys to analyze
organizational openness of shop floors in the electric and electronics
industry. The results, while not revealing a correlation between
openness and QCDF, do reveal a positive, significant
relationship between openness, the “number of new product

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 Inamizu and Fukuzawa

introductions,” and “new product proposal/development.”

First, as expressed through case studies conducted by Shintaku et
al. (2014), it is likely that proposing new products to a factory’s
headquarters and/or to other companies and the consequent
frequent introduction of new products lead to the activation of
shop floor organizations. The proposal, adoption, and resulting
introduction of new products by factory managers lead to additional
work. The outsourcing of production to overseas sites and other
similar phenomena increasingly lead to reductions in production
volumes at Japanese factories. Given this situation, additional work
would help to activate factory shop floors. Further, this new work,
being unconstrained by the usual cycles of routine work that the
factory is accustomed to, would positively impact the workplace’s
communication with not only other individuals but also other
company divisions. Consequently, it is likely that this would create a
better feeling of openness in the workplace.
Caution is necessary when considering this relationship between
the activation of shop floor organizational communication and
QCDF. Workplaces with good openness are also proactively engaged
in initiatives such as kaizen-style improvement proposals, which are
generally considered to contribute to better performance related to
QCDF and mass production startup (Koike, 2012, 2013; Koike,
Chuma, & Ota, 2001). However, the survey that was conducted as
part of this research was unable to find a significant relationship with
any of these items. Normally, the start of production of new products
would have a negative effect on QCD.4 Frequent introduction of new
products, even for a highly competent factory with an activated

4 In Table 1, we can see a positive, significant relationship in general with

A1–A10 overall. However, we do not see a significant correlation between
A7 (the number of new product introductions), A2 (external defect ratio),
and A3 (production cost). Moreover, we do not see a significant correlation
among A10 (new product proposal and development), A3 (production cost),
and A5 (delivery).
12
 New product introductions and activation of shop floor organizational communication

shop floor, could present a difficult hurdle to overcome in terms of

maintaining a superior QCD measure. Further, active
communication by itself may not be sufficient to show results in
terms of QCDF, and it is highly likely that some additional factors are
critical for the attainment of those results.
All things considered, while the proposal and subsequent
manufacture of new products may have some costs among QCDF
measures, it does improve shop floor organizational openness. We
may well be able to consider it to be quite an effective way of
activating shop floor communication.

Acknowledgements
The authors deeply appreciate the cooperation of Japanese Electrical,
Electronic, and Information Union. This work was supported by JSPS
KAKENHI Grant Number JP25380458, JP16K17158 and JSPS
Grant-in-Aid for Publication of Scientific Research Results, Grant Number
JP16HP2004.

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