Toyota Production System: Mold Trading, Worker Motivation, and Quality
- Small misalignments produce defective parts.
- Larger misalignments mean pieces could be merged into molds.
Mold Trading in the West:
- Only specialists performed these changes.
- They were methodically executed.
- Cost at least 1 day of work.
- A set of presses for some parts meant the exchange of the mold would happen only once every three months.
Mold Trading at Toyota (Ohno):
- Beginning testing trade presses in the late 1940s and mid-1950s, Toyota changed the process in just 3 minutes.
- The workers themselves had to conduct the trade.
- Workers were more valued because they had to be more specialized.
Consequences of Toyota’s Template Exchange:
Cost per piece, pressed in small batches, was lower than in batch processing.
- Eliminated the financial cost of inventories of raw materials and finished parts.
- Pressing errors appeared instantaneously and were not piled up in huge inventories.
Agreement with Toyota’s Workers:
- With the departure of Kiichiro Toyoda, about ΒΌ of the workforce was fired due to financial crises and strong credit restrictions.
- Who had been guaranteed lifetime employment and constant wage value according to the time of service at every function.
With workers motivated, Ohno could reconfigure the assembly line, causing the line to stop when a worker failed to address a problem, enabling everyone’s involvement in the solution.
In the line of mass production, workers did not stop the line, leaving the solution of problems for later in the process, enabling the multiplication of failure…
Ohno’s legacy was his quest for quality in and by not performing rework at the end of the line.
Today, the yield in Toyota plants approaches 100%.
While in mass production companies, 90% is considered a great result.
These companies reserve 20% of their operational area and 25% of the total hours of work to rework errors.
Network Providers:
- Ohno gave suppliers independence of projects, requiring only the requested duties.
- He provided financial aid to its suppliers.
- He became a shareholder of its suppliers.
- He stimulated suppliers to talk to find solutions instead of hiding information.
- He discouraged competition among suppliers.
- Ohno developed the “just-in-time” supply system throughout the process: the Toyota Kanban.
Demand from Consumers:
- Reliability; the spatula and wrench are no longer helping customers solve problems with their cars.
- The market started to require multiple product segments.
- Toyota soon realized that they could charge more than competitors from mass production by guaranteeing the reliability of Toyota cars.
- 1990: Toyota offered as many models as GM despite having half her size.
- To change a product, Toyota spends half of what a company that acts as a model of mass production spends.
- Today, Japanese companies offer as many models as all the Western companies together.
- Ford and GM, the automakers, focus on their goal of a single model for each plant, while the Japanese plants transplanted to the U.S. build two or three different products.