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REGARDING NONCONFORMING FINAL VEHICLE INSPECTIONS AT NISSAN'S PLANTS IN JAPANREGARDING NONCONFORMING FINAL VEHICLE INSPECTIONS AT NISSAN'S PLANTS IN JAPAN

The following is a report on nonconforming final vehicle inspections at Nissan’s plants in Japan, describing the history of the issue, including causes and background factors, and countermeasures that have been implemented to prevent recurrence.


History of the IssueHistory of the Issue

On September 18, following an on-site investigation of the Nissan Shatai Shonan Plant by the Japanese Ministry of Land, Infrastructure, Transport and Tourism (MLIT), Nissan was informed that some final inspectors in training were not only performing part of the final inspection (kanken) process but also using registered final inspectors’ name stamps to certify kanken forms. Similar examples of nonconforming implementation of the kanken process were found to be taking place at five vehicle manufacturing plants: Oppama, Tochigi, Nissan Motor Kyushu, Nissan Shatai Shonan and Nissan Shatai Kyushu (but not at Auto Works Kyoto).

The company promptly took countermeasures to ensure that the kanken process was performed according to regulations and to prevent recurrence of the issue. Additionally, Nissan asked a third party to conduct an investigation in order to develop comprehensive measures to ensure that the issue would be thoroughly resolved.

Despite these actions, by October 18 third-party and internal investigation results had shown that, at the Nissan Shatai Shonan, Oppama, Tochigi, Nissan Motor Kyushu and Nissan Shatai Kyushu plants, unregistered inspectors were still performing part of the kanken process, and the kanken process itself had been changed without those changes being formally notified to MLIT.

The third-party investigation further revealed the following:

  • Nonconforming kanken had been the norm for a number of years.
  • The process to register final inspectors did not follow the internal registration and training standards at each plant.
  • Improper responses to regular audits by MLIT and others, and to the company’s own internal audits, had become the norm.
  • One of the kanken tasks was not being performed.

The company accepted the findings of the third-party investigation, including its analysis of causes and background. On November 17, the company submitted a report to MLIT summarizing the results of its investigation, the causes of the issue and countermeasures to prevent recurrence.

Causes of the Kanken IssueCauses of the Kanken Issue

Reduced awareness of the kanken: At all levels of the company, from executives and managers to plant supervisors (foremen and general foremen or “kakaricho”), there was a severe lack of awareness of the seriousness of noncompliance with kanken standards and regulations. Although many final inspectors, including foremen, were aware that assigning unregistered inspectors to the kanken was against Japanese regulations, they nevertheless allowed final inspectors in training who they judged to have reached a certain level of competence to perform kanken unassisted. Meanwhile, management at plants and headquarters was not aware of the nonconforming kanken and did not have visibility of day-to-day operations. It is fair to say that lack of mindfulness of the kanken system among management at headquarters contributed to a reduced awareness of standards on the shop floor.

Shortage of final inspectors: Management at plants and headquarters did not take the special responsibilities of final inspectors into account in their staffing management. It was not recognized that a number of months were required to train and register a final inspector, or that final inspectors were necessary to train and supervise the trainees. The recovery of domestic car manufacturing left the company with an overall shortage of kanken staff that lasted for several years.

Disconnect between standards and the reality of the kanken line; unclear standards: The content of the internal registration and training standards, such as the period required for educational assistant work, did not match the reality of the kanken line, making the rules appear unreasonable. This gave some inspectors a sense of justification for their actions on the grounds that such actions were necessary under the circumstances.

Additionally, the written standards contained no clear prohibition against involvement in kanken by final inspectors in training, and written standards were insufficiently detailed regarding the training and registration of final inspectors. This led to “unwritten rules” being created, which in turn may have caused the written standards to be taken less seriously at plants and to have failed to function as unambiguous standards.

Inconsistencies between standard operation manual and kanken sheets: At the Oppama, Tochigi, Nissan Motor Kyushu and Nissan Shatai Kyushu plants, when the standard operation manual (which summarizes the details of the actual work performed) was updated according to changes in the inspection process, inconsistencies arose between the standard operation manual and the kanken sheet. As a result, in addition to the kanken performed by unregistered inspectors, certain kanken tasks were not performed. At each plant, there was no specific rule to determine who needed to notify whom when a revision was made to the standard operation manual and no specific work flow to reflect the change on the kanken sheet. As a result, there is a high probability that process change procedures were not performed correctly.

Distance between shop floor and management: There was a distance between workers on the shop floor conducting the kanken and management at plants and headquarters. This made it more difficult for management to identify and resolve the issue. Management did not realize that nonconforming kanken had become the norm or that there was a shortage of final inspectors causing nonconforming kanken. Furthermore, final inspectors did not notify management of the shortage of final inspectors and ask for improvements.

Nissan has a culture of respecting the independence of its plants and emphasizing the ability of the shop floor to come up with creative solutions to resolve issues and achieve their goals. This could have led to shop-floor employees feeling that they must resolve issues and achieve the goals set for them no matter what, or managers expecting employees to reach their goals through creative solutions on the shop floor. This way of leaving issue resolution up to the shop floor may have helped create the distance between the shop floor and management.

Countermeasures to Prevent Recurrence and Implementation StatusCountermeasures to Prevent Recurrence and Implementation Status

The countermeasures to prevent recurrence reported to MLIT on November 17 were divided into 10 categories containing 53 countermeasures in all. An additional 3 countermeasures were added during the implementation process, for a total of 56 countermeasures in the following 11 categories:

  1. Correction of the kanken line layout and operation
    Measures to restrict access to the kanken by employees other than final inspectors, including ensuring that final inspectors are identifiable at a glance
  2. Revision of final inspector registration criteria and training standards
    Measures to revise the length, content and examination procedures in the final inspector training process in order to improve the final inspectors’ understanding and allow work to be performed appropriately
  3. Improved final inspector staffing management
    Measures to ensure that staffing management takes into consideration the particular requirements of final inspectors
  4. Improved kanken operation and management
    Measures to define a process for change control and maintain the kanken process as notified to MLIT
  5. Measures to correct understanding of the kanken
    Measures to correct employees’ understanding of the kanken through re-education on compliance and standards regarding the kanken
  6. Monozukuri from the users’ standpoint
    Measures to ensure that the kanken is conducted from the users’ standpoint
  7. Improved audits
    Measures to enhance audit systems and procedures and ensure that audits function effectively
  8. Closing the gap between the shop floor and management
    Measures to eliminate the distance between the shop floor and management, including improving communication between management at headquarters and shop-floor supervisors and creating systems to incorporate input from the shop floor into operational decisions at plants
  9. Enhanced organization
    Measures for implementing better communication between headquarters and plant management and better collaboration between the plant quality assurance management, shop-floor supervisors and inspectors
  10. Countermeasure progress reporting and further embedding
    Measures to construct a follow-up system to track implementation and progress of countermeasures by management and to ensure that countermeasures are fully implemented
  11. Additional measures
    Measures added after the November 17 report: “Define rules for delegation,” “Revise Alliance Production Way” and “Improve workplace environment at plants.”

Since November, progress on implementing the countermeasures to prevent recurrence has been reported monthly at the Executive Committee, with management providing the direction necessary to ensure full implementation of all countermeasures. Open and effective discussion among management has taken place regarding such matters as kanken staffing, final inspector training and audit system structure, and the entire company is working hard together on countermeasure implementation.

Additionally, on March 9, the implementation status for the 56 countermeasures across 11 categories was reported to MLIT as follows. Reports will continue to be made regularly to MLIT and will be made available on the company website.

Progress made to date on the 56 countermeasures in 11 categories:

A) Measures fully implemented by the November 2017 report 10
B) Measures fully implemented since the November 2017 report 24
C) Measures for which planning is complete and implementation is underway 15
D) Measures for which planning is underway 7 (including additional 3)

The kanken system is a standard based on Japanese laws and regulations. Based on this system, Nissan carries out final inspections for Japan-market vehicles on behalf of MLIT. The kanken issue demonstrated a failure to fulfill that obligation, which in turn damaged MLIT’s trust in Nissan. Nissan takes this matter very seriously and is committed to putting safety first, promoting compliance, implementing countermeasures and making a concerted effort to regain the trust of its stakeholders.