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Lean Manufacturing background
Lean manufacturing first started in Japan in the years of reconstruction after the Second World War. The Japanese industry and Toyota had the challenge of rebuilding a shattered manufacturing base without recourse to the market or the Japanese economy. This needed to be done under the severe credit restrictions imposed by the occupying forces which caused reduced sales and very limited resources to invest into the new manufacturing plant.
This seemed like an impossible task as Toyota was close to being bankrupt at the time. Taiichi Ohno, who was the company's Assembly Shop Manager at the time, took on the task of redesigning production using three constraints which he found successful in other industries in Japan:
- Build for a need
- Eliminate waste (anything which does not add value) and
- Stop if something goes wrong
Toyota also set in place three core values:
- Respect workers
- Strive for full utilisation of workers' capabilities and
- Place authority and responsibility for the work with those doing it
Lean manufacturing only permits the development of products or services of which a customer already exists. This means that organisations do not need to make estimates on the demand of a product or service, or hold stock. This rule applies to every step of the manufacturing process; every step in production should build what is needed by the next step, not produce large inventories which can sit around for weeks. Rather, Lean encourages the elimination of over-grown inventories as well as anything else that does not add value. It is important to clearly identify what the company and the customer mean by €˜value' so that time and effort is not wasted on unnecessary things and that you are not doing anything to inhibit the flow of this value. If a company is only developing what is needed at each stage it becomes easy to identify defects as they arise. Lean seeks to address the cause of the defect immediately. This is called zero-defect manufacturing and is possible because of the use of rapid-feedback procedures rather than constant and lengthy inspections.
These Lean concepts which Ohno introduced to Toyota lifted it off the ground and allowed it to grow like never before. Ohno eventually became Executive Vice President in 1975. The Western industry begun using these concepts in the 1980s.
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