AN INDUSTRIAL valve would not count as a sleek, trendy, high-tech gizmo like an iPod or a Kindle. It?s a bulky, clunky, iron alloy device that opens and shuts to allow, block, or control fluid flow. Valves have been around for some time, because they are vital in the food, power, shipbuilding, machinery, petrochemical, and other industries.

You seldom see one, but you know when it isn?t working: It leaks.

FVC (Furukawa Valve Co.) Philippines is this year?s Hall of Fame Awardee of the Dept of Trade and Industry Center for Industrial Competitiveness, for ?industry standards and best practices worthy of emulation by other companies.?

How does a low-key valvemaker in San Pedro, Laguna win the nod of DTI-CIC, which endeavors to boost the global competitiveness of private and public sector companies, and whose earlier Hall of Fame awardees include Dole Philippines and Manila Water Company?

FVC Phils. is a subsidiary of Furukawa Kogyo Ltd of Shiga, Japan. It started in 1994 as a production unit, making and exporting cast iron and ductile iron valves and valve parts to the parent firm, which then delivered the products to industrial customers.

The parent firm is no captive client. Fifteen rival firms supply Furukawa Kogyo from within Japan, a science-savvy and R&D-oriented environment, so FVC must compete by investing in technology and raw materials that reduce production costs and keep selling prices down. A second challenge is to reshape the valve industry?s reputation, from dirty and dangerous (because manual labor methods produce dust emissions, and a valve?s sharp edges can hurt) to healthy and environment-friendly. To clean up and mechanize production, FVC must, again, invest in technology and process improvements. Finally, a typical foundry keeps slapdash records, so defects and missed deadlines are not rigorously addressed.

Instead of muddling through (which is what many family-owned firms prefer to do), FVC chose to become more competitive. Transformation began in 2003 with the establishment of a Quality Management System.

At FVC?s helm is general manager Motoei Furukawa, grandson of the founder, who set up a factory in Nagoya in 1931 to produce iron castings, only to see it totally destroyed by war in 1945. It was rebuilt in 1957. In 1994, it branched out to the Philippines, chosen for its central location in Southeast Asia and its English-speaking skilled manpower. The Furukawa family assigned Motoei, already familiar with manufacturing operations, to build a factory from the ground up.

Motoei Furukawa?s notion of quality goes far beyond conformance to technical specifications for cast iron pipe fittings defined by the national standards institutes of the USA or Japan. In its broader, more contemporary sense, quality embodies two concepts: 1) it is total, and refers to everything?technical specs, on-time delivery, good housekeeping, waste management, employee health and morale, ethical practice, environmental protection, and customer satisfaction; and 2) it is a journey of continuous improvement, so you measure everything listed in (1) above, to know if you are getting better, and by how much. As you get better, you attract new orders and customers.

Motoei Furukawa began with an overarching vision: To be a world-class organization producing industrial valves and ferrous castings at optimum cost. He mobilized employees by forming quality improvement teams and listening to them; invested in training and equipment; sought out best practices in problem-solving, system design, and melting and molding, in Singapore, Taiwan, Malaysia and the Philippines.

What then has the quality management system achieved? Some indicators:

FVC is the first foundry in the Philippines to be certified on three standards?ISO9001 (Quality), ISO14001 (Environment Management), and OHSAS18001 (Occupational Health and Safety). The DTI also named it Model Company of the Year in 2005.

Revenues grew 14 times in 15 years, while headcount rose from 53 to 96 employees over the same period. FVC is also able to turn out new products every year new items or sizes, or using new materials to meet more varied customer requirements.

The parent firm still takes in the bulk of FVC?s output for reshipment to customers, but FVC?s marketing capability now enables it to woo, win and service clients directly, in the Philippines (which now accounts for 6 percent of its sales), Asia and Saudi Arabia. FVC?s products reach 17 countries in Asia, seven in the Middle East, four in Africa, three in Europe, and three in Latin America.

The added business has come precisely because FVC is more productive and cost-efficient, even as other foundries closed down due to the global economic downturn. Competitors are particularly vulnerable when inferior casting material and processes leave blowholes and pinholes in the finished product, which then leak or even burst, necessitating repairs and downtime.

Over the past five years, FVC?s customer complaints, rejection rates, and rework rates have dropped. Customer satisfaction ratings on quality and delivery have risen; price ratings have held steady. Gross profit rates and income from operations are higher. Employee sentiments are increasingly positive, on the way management listens to employees and handles disputes, on compensation, job security, and safety, on knowledge of company plans, opportunities to use new technology, and training relevance to job performance.

Perhaps the most impressive proof of organizational learning and prowess is that FVC is now transferring its technical knowledge and practices to the parent firm. Since December, 2009, Joel Amil, who joined the company as quality control inspector in 2003 and has since risen to process excellence manager, has headed teams visiting Japan to share and implement best manufacturing practices at Furukawa Kogyo. The child has turned teacher.