The Dutch, Coffee, OEE and Japanese Management…

 The Dutch’s Role in the Spread of Coffee Trade and TPM

In 2003 Starbucks opened a brand-new roasting plant in Amsterdam (Westpoint) in the Netherlands.  For many partners this was a puzzling move since we don’t have any Starbucks stores in that Country…yet.  However, in addition to facts such as an excellent business climate, highly-skilled workforce, and other factors, when looking at the history of coffee trade, it makes a lot of sense.  Where you aware of the role the Dutch played in spreading coffee, and its trading through the World?  If not, we invite you to join us for a brief overview of this fascinating drama…

    The Arabs initially controlled coffee trading because they had a monopoly on coffee growing and production.  As you know, coffee’s origin is usually traced back to the Arabian Peninsula, specifically to what is know today as Yemen.  The United Easterly-Indian Company (De Verenigde Oost-Indische Compagnie – see logo) organized a trip to Aden (at the Wave of Aden, between the Red Sea and the Arabic Sea) and achieved two years later a break-through on that monopoly by smuggling a coffee plant from the port of Mocha (circa 1690) and being the first to cultivate commercially in the islands of Sri Lanka and Java (hence the nickname)

      By the end of the 17th century/beginning of the 18th century, Amsterdam had become the world’s center for coffee trade.  The coffee-cultivation on Java was after time larger than in Arabia.  Over time, even some coffee plants were brought to Amsterdam, and cultivated and nurtured in nurseries.  In the early 1700’s, Amsterdam’s major gave the French king, Louis XIV, a young coffee plant for the Royal Botanical Garden in Paris.  The French wanted – then the largest coffee drinkers of all Europe – to produce coffee themselves instead of buying the coffee beans from others, and would take even bolder steps to make that happen.

At some point, a French naval officer (circa 1713) left on duty for the Caribbean islands, not without smuggling a cutting from the Dutch mother plant.  This is how coffee reached the island of Martinique (a French overseas department to this day), and it is believed that up to 90% of world’s coffee can trace its origin to that one Dutch cutting.  As you know, later on, while settling a dispute between the French and Dutch Guiana (Northern South America), a Portuguese officer, yet again smuggled some coffee seeds into what is today Brazil…

Sometime in the late 20th Century, a Dutchman by the name of Alfred Peet opened (in 1966) a specialty coffee shop in Berkeley, CA where he employed some young men who eventually opened a little coffee store in Seattle’s Pike Place Market (in 1971) called Starbucks.  Those folks, hired a young marketing executive in 1982 named Howard Schultz, and as they say, the rest is history…

Reference: Bataviawerf National Centre for Maritime History

The Dutch’s Role in the Spread of TPM -Japanese Production Management

You may have asked yourselves; what was that previous article about.. the spread of coffee trade…? When Starbucks opened in 2003 a brand-new roasting plant in Amsterdam (Westpoint) in the Netherlands, a Japanese-Dutch-American connection was established…

OEE from Japan to Europe

Did you know that in a sense it where also the Dutch that helped TPM and OEE to spread from Japan to Europe?

In the beginning of the 80s the biggest Japanese investment ever done outside of Japan sofar was in Holland; Four factories of Fuji Photo-Film where build on a blue print of the Japanese Fuji plants, including the Japanese production systems and organization. In Japan Fuji was, after Denso Electric, the second company to receive (in 1974) the prestigious Deming Award by the Japanese Institute of Plant Maintenance (JIPM). Most of JIPM’s knowledge on TPM, particularly in process industry, has been developed in the Japanese Fuji sites.

For the first Fuji plant outside Japan, the first production director was Steven Blom, (yes, the founder of Blom Consultancy) who had to discover that the Dutch where not similar to the Japanese… At the point where the Japanese where willing to accept this, Fuji’s president made a wise decision and ordered Blom not to build a Japanese factory in Holland, but a Dutch factory based on Japanese principles. This was the first time in history that on a large scale Japanese production techniques where implemented in a western society. The following basic principles applied by the Japanese changed the Western manufacturing community forever: – Fuji works Absolutely Zero Defect – Fuji works with local suppliers – Fuji demands zero defects from its suppliers AND at best price… – Fuji helped it selves by helping its suppliers to become zero defect.

In this way European companies already very early got acquainted to the Japanese way of thinking and manufacturing. In the 80’s word of success spread rapidly and companies outside the Fuji-circle started to show interest as well. One of the nowadays most experienced implementers of TPM is food- health & Body care multinational Unilever. They came on the TPM track when their vice president operations mr. Chadha met Steven Blom and got fascinated by the Japanese approach of manufacturing. Mr. Chadha decided to hire expertise from JIPM for he knew they had the same source of the TPM knowledge.

Norman Bodek’s Productivity Press

In 1988, an American named Norman Bodek initiated the translation of a Japanese book about TPM; the beginning of a series of translations that now became accessible to the Western world through Normans publishing company Productivity Press. Until today Productivity has the largest collection quality books on the subject.

In this book about TPM, the original author, Mr. Seiichi Nakajima, mentioned the two basic success factors for creating higher equipment effectiveness: Measuring the losses through Overall Equipment Effectiveness (OEE) and continuously improving it with multifunction shop floor teams, called Small Group Activities. Although he pointed out the OEE as a crucial measure, he only described the basic algorithm, and for years many people struggled to find out how to apply it in an effective way.

How Fuji in the Netherlands drove improvement

In those days, many people in Europe -more than once forced by Fuji’s pressure to deliver zero defect on demand- started to read those books and requested help from Fuji in the Netherlands. In the beginning of the 90’s Steven Blom decided to become full time dedicated to distribute the unique knowledge about implementing Japanese production techniques in a Western manufacturing company.

From day one, Blom used OEE and SGA as the primary improvement drivers, laid out on solid foundations like 5S workplace organization, autonomous maintenance etc. As far as we know this was the first time OEE was implemented on a large scale in various types of manufacturing, using it as a primary driver for improvement. In the mid- 90’s Blom’s consultants developed dedicated spreadsheets etcetera for every individual piece of equipment to register and report OEE. A new Blom consultant –Arno Koch– with an IT background, being a firm believer of the existence of common denominators in every type of problem, process or structure, challenged Blom that it should be possible to have one OEE Tool to serve any type of OEE registration. Although nobody believed this would be possible, he decided to prove his statement and started to develop the ‘OEE Toolkit’, baring in mind it should be a complete package to serve the needs of any team in any type of manufacturing environment and being completely supportive to the Japanese approach of improving equipment effectiveness.

Since making OEE spreadsheets was not the most favorite job to the other consultants, they where most willing to test and challenge this new product. Customers where most happy with it since now OEE implementations where from the beginning focused on how to use the loss-information rather than how to get it…

By a co-incident the president of Productivity Inc. in Portland OR heard about those developments and contacted Blom with the request whether it would be possible to publish this package worldwide. For years Productivity had struggled with a dilemma; in the books they published OEE was promoted as a basic loss-identifier, but there was nothing published about how to implement and use it. So in 1997 the Dutch consultant Arno Koch flew abroad, carrying the package in his suitcase, which became published worldwide in 1998. After he had trained Productivity’s staff, in 1999 ‘OEE for Operators’ was published, the first book dedicated on OEE and part of the Shingo Price winning shopfloor series.

When Starbucks’ Amsterdam site achieved major successes in their improvement strategy by using TPM and OEE the link back to the US was established. After all, it’s a small world!

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