How Toyota Became the World's Most Productive Automaker

Once again looking back at the first Productivity newsletters in 1981:

"Twenty years ago, Toyota began working on a radically-different system to make production totally efficient. Its goal is the maximum utilization of employees, equipment, and materials, and it depends on the intelligence and creativity of the worker." - Productivity newsletter January 1981

Amazing when I look back in retrospect what we had discovered - I only wish GM, Chrysler and Ford would have spent more time studying our early newsletter. A month later, in February 1981 we took our first study mission to Japan.

In review of that article in January 1981:

1. "More automobiles were made in Japan in 1980 than in the United States.
2. Not one European auto maker could produce as much as 20 cars per man-year of labor, Toyota was producing forty-nine."
3. Toyota's employees submitted 15.3 suggestions per worker and at GM it was only .8
4. At Toyota at an 800-ton press it took ten minutes to do a set-up while in the US it took from four to six hours.
5. Labor productivity at Toyota was twice as high as the typical US plant.
6. The Toyota Production System developed by Taiichi Ohno who wanted to find ways to eliminate waste in the manufacturing process.
7. Kanban: 1. drastically reduced inventory - Toyota keeps just three to four hourse of inventory on hand, every process viewed as part of the continuous assembly line including the vendors. Some vendors delivered parts two or three times a day. Westinghouse was studying the system and feels that it could save their company $400 million a year.
2. reduced storage space from 2,340 sq. meters to 568 sq. meters
3. improved the efficiency and effectiveness of the worker
4. improved quality - since all processes are viewed as an integral part of the assembly line, a defect in any of them will force the system to stop.
8. In the US, in conventional production systems, each process is given a production schedule, produces and sends supplies to the following process. Toyota reversed this with Kanban, and JIT; requires that each process withdraw parts from the process that precedes it.

Since JIT calls for only the necessary quantity of parts at the necessary time -- nothing more, nothing less, only the final assembly line can know exactly what the necessary quantity and timing are. Thus the final assemby goes back to the preceding process to get the necessary parts, and the preceding process produces what has just been withdrawn - all process are connected in the chain including vendors."