Lean started way before Toyota!
Now, another common misconception amongst my clients is that ‘Lean’ and efficiency improvements all started with Toyota – wrong.
Here is a very brief history of how it all came about and some would argue it started even before this!
Lean Six Sigma Overview – Lean Manufacturing
In 1910 Charles Sorensen and Henry Ford created the first moving assembly line as a way of reducing wasted motion and handling complexity in automotive assembly. Without question, the Lean system pioneered by the Toyota Motor Company has a common beginning with these early ‘work flow’ improvements. However, this common heritage led to two very different manufacturing systems: mass production and Lean production.
The objective of mass production is to maximise economies of scale through high capital utilisation. At Ford, the emphasis on flow was limited almost exclusively to the final assembly line, while subassembly processes, suppliers and distribution operated on almost independent production schedules, resulting in large batch sizes and high inventory levels. Inventory at all points was accepted as a necessary buffer to survive schedule and output instability. Quality was inspected and projected into the system through mass inspection and inventory buffers. Capital was a solution to the relentless push for capacity.
Finally, production was driven from forecasts, pushing material through the plant in anticipation of actual customer demand. The mass production system flourished in the high growth, boom phase of the automotive industry and was widely copied in other sectors.
The objective of Lean production is the elimination of waste through the efficient use of all resources. In 1945 the president of Toyota Motor Company issued an edict to the company to catch up with American three years otherwise the automotive industry of Japan would not survive. At the time, labour productivity in Japanese factories was 1/10 that of US automotive manufacturers. Scarce capital and small, highly diverse ?island? market did not support large-scale, mass production. Finding a solution to the challenge led to a fundamentally different ‘Lean Production’ system, which ultimately triumphed over mass production during the 1973-4 oil crisis. At a time of global recession and slow growth, Toyota sustained profits and grew US market share while US companies lost on both counts.