2.2 Introduction

In the 1980s, Toyota became the number one automotive manufacturer in the world (see Figure 2.1). In the decades since, they have experienced and sustained remarkable growth and success. How did they do it?

Toyota developed and fine-honed lean production methods that allowed them to make better-quality cars at a lower price than their American counterparts. American automotive manufacturers did not just take notice of Toyota’s success; they saw and understood their outdated methods of production were under real threat. If they wanted to remain competitive—and they did—they needed to change.

What was truly remarkable was Toyota’s response; rather than guard the keys to their competitive advantage closely, they instead opened their doors and invited the senior management teams of their competitors to come and learn from them! Companies like Ford and General Motors sent teams of executives to Japan to take advantage of the opportunity. For months, these executives absorbed everything they could and took copious notes on everything that they saw—the Kanban systems, the andon cords, the visual controls. But, when these executives went back home and attempted to implement lean programs within their own organizations, they failed miserably. What happened?

The folks at Toyota were not just being kind or foolishly giving away the keys to their competitive advantage. They were actually quite confident that their understudies from Ford and General Motors would simply not be able to do what they did. Taiichi Ohno, the author of this topic’s opening quote, also famously said, “careless imitation can be dangerous.”

While the executive teams at Ford and General Motors were careful to take note of everything they saw, it was what they didn’t see that made all the difference.

They failed to understand that lean is a philosophy, and that the cultural aspects of a lean program are just as important—perhaps even more so—than the physical aspects of a lean program. Without a healthy respect for people and a true commitment to continuous improvement, any lean effort is destined to fail. Lean systems have to be implemented intelligently—not every aspect can be copied to every application, and adaptation to the particular environment is critical. American automotive manufacturers eventually caught on, but only after losing significant competitive ground. Even armed with that knowledge, they still struggled to implement a comprehensive and lasting lean culture.

Moreover, if you think this was an issue faced only by the automotive industry, think again! Perhaps you remember Zenith televisions; their motto was “Quality goes in before the name goes on.” Or Kodak, a company that once dominated in photographic equipment and film, that eventually lost big to Japanese competitors like Canon. Lean systems can be used in almost every industry!

In this topic, we take a look at what makes lean manufacturing so powerful. We will define what lean manufacturing is, how it developed from its roots at the Toyota Motor Corporation, and the elements needed to successfully implement lean in practice. Let’s start with the big picture—just what does it mean to be lean?