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Just in time
– the Toyota way
�Features
& Friends
Japan’s Toyota created a revolutionary production system based on the elimination of waste. It
changed the face of auto manufacturing — and manufacturing in general, writes Christer Karlsson,
Professor Innovation and Operations Management at Copenhagen Business School.
IN THE AFTERMATH OF WORLD WAR II, Toyoda Eiji, a
nephew of Toyota founder Toyoda Sakichi, traveled to the
United States to study car production at gm, Ford and amc
(American Motor Corporation). In a letter back to his uncle,
he wrote:
“The production system here is incredibly impressive,
but unfortunately impossible for us to do, since we lack
both the raw material and the energy needed for this production
method.”
In response, Taiichi Ohno, a production engineer at
Toyota, developed a system, called the “Toyota Production
System” or simply “Lean Production,” in which the central
idea was that everything being produced had to add value
to the product or to the customer. A process called “waste
elimination” was introduced, where eight different types of
“waste” – muda in Japanese – were identifi ed (see sidebar)
and eliminated.
The strategy was very simple. To begin with, workers
were educated in the production process for nine to 10
weeks (at the Ford factory in the u.s., in contrast, workers
In 1994 Christer Karls-
received one week of training). When the workers had sufson
was appointed
fi cient knowledge of the production process, Ohno asked
Professor in the field of
them to participate in an experiment: If they found them-
Innovation and Operaselves
not adding value to the production, they were to raise
‘‘
tions Management at
their hand. He then focused on eliminating the muda in the
the Stockholm School
area with the largest number of raised hands. Sometime
of Economics. Since
later, the test was performed again, and new bottlenecks
2004 he is Dean CBS
were found and eliminated. The process was repeated a
Executive and Profes-
number of times and eventually a phenomenon appeared,
sor Innovation, Copen-
later referred to as “Continuous Improvement,” where
The production system here
hagen Business School.
everyone involved in production began eliminating mudas
as they appeared.
is incredibly impressive, but unfortu-
The eight types of
One muda to be eliminated was storage and buffers in
muda, sources of
nately impossible for us to do, since
all areas of production. Having reduced these to a minimal
waste, in the produc- level, the concept of “just in time” was created, whereby any we lack
’’
both the raw material and the
tion process:
item at any point in the production process arrived just in
1. Overproduction time – neither too early nor too late.
energy needed for this production
2. Waiting
While the Toyota production system uses a slightly
3. Transportation
method.
larger workforce and more machinery than the traditional
4. Labor
Western model, the emphasis is on throughput: moving
5. Inventory
products through the production chain without mistakes
6. Motion
or defects as quickly as possible. Although the cost for this
7. Defective parts is slightly higher, the overall effect is that the cost for assets
8. System
is kept to a minimum, resulting in a signifi cantly higher
return on capital. �
www.haldex.com 1/2007 Haldex Dynamix 23