Kapitel 1
The Revolution That Changed Manufacturing Forever
In the late 1940s, a determined production manager at Toyota Motor Company made a startling declaration: Japanese workers could match the productivity of their American counterparts by eliminating waste rather than simply working faster. This bold claim by Taiichi Ohno would eventually transform global manufacturing. While Western manufacturers chased automation miracles and computer-integrated solutions, Ohno focused on a deceptively simple principle: "Look at the timeline from customer order to cash collection, and remove non-value-added wastes." This philosophy became the Toyota Production System (TPS), now studied by business schools worldwide and implemented by companies across industries. When the 1973 oil crisis devastated global markets, Toyota maintained profitability while competitors faltered, proving the system's resilience. Today, companies from Amazon to Zara have adapted Ohno's principles, and the book detailing his methods has been translated into over 26 languages, becoming required reading for operations managers and manufacturing engineers globally.
Kapitel 2
Born from Necessity: The Origins of Toyota's Revolutionary System
The Toyota Production System wasn't created in a laboratory or business school-it emerged from dire necessity in post-war Japan. While American manufacturers thrived with mass production of limited car models, Japanese automakers faced a fundamentally different challenge: how to produce small quantities of many vehicle types profitably in a domestic market with limited demand.
"Catch up with America in three years," declared Toyoda Kiichiro after Japan's defeat in 1945, recognizing that the Japanese automobile industry wouldn't survive otherwise. At that time, productivity comparisons suggested one American worker could do the work of nine Japanese workers. This stark reality prompted a revolutionary question: Were Japanese workers wasting effort? If so, eliminating this waste could theoretically increase productivity tenfold-the foundational insight of the Toyota Production System.
Traditional manufacturing wisdom followed the Maxcy-Silberston curve, which showed costs decreasing as production quantities increased. This principle drove American mass production, but Toyota couldn't apply it in Japan's limited market. Instead of blindly imitating American methods, Toyota developed a uniquely Japanese approach focused on making many models in small quantities without sacrificing efficiency.
The system remained relatively unknown until the 1973 oil crisis exposed its strength. While other companies struggled during the subsequent recession, Toyota maintained higher earnings. The crisis revealed a fundamental shift in global economics-the end of predictable business cycles with brief recessions followed by years of prosperity. Instead, the world entered an era of "slow growth" characterized by brief periods of expansion followed by prolonged stagnation.
This new reality made traditional mass production systems impractical. Companies could no longer rely on the simple formula that "if you make it, you can sell it." The Toyota Production System, designed specifically for producing small quantities of many varieties, suddenly became relevant not just for Japan but for manufacturers worldwide facing similar market conditions.
What's remarkable is how Toyota's system emerged organically through necessity rather than theoretical planning. Each component-just-in-time delivery, kanban cards, quick changeovers, production leveling-developed as practical solutions to specific problems. The system wasn't imposed from above but built block by block from the factory floor up, driven by the need to eliminate waste and compete with American efficiency despite Japan's resource limitations.
Kapitel 3
Just-In-Time: The First Pillar of Toyota's System
At the heart of Toyota's production system stands the revolutionary concept of just-in-time delivery-ensuring parts reach assembly lines exactly when needed and only in required amounts. This seemingly simple idea represents a fundamental reversal of conventional manufacturing logic and serves as the first pillar supporting Toyota's entire system.
Traditional manufacturing uses a "push" method where earlier processes produce parts according to schedules and forecasts, then "push" them forward to later processes regardless of immediate needs. This inevitably creates excess inventory-parts waiting to be used-which Toyota recognized as waste. Inventory ties up capital, requires storage space, can become obsolete, and most dangerously, hides problems in the production process.
After much contemplation, Ohno reversed this conventional material flow. Instead of earlier processes pushing materials forward, later processes would go to earlier ones to withdraw only what they needed when needed. This "pull" system uses kanban (sign boards) to communicate what parts are required and in what quantities.
"The later process will go to the earlier process and withdraw the needed items at the time and in the quantity needed," Ohno explains. "The earlier process produces only enough units to replace those that have been withdrawn."
Starting from the final assembly line, each process withdraws from preceding processes only what's needed, creating a synchronized chain working backward from finished products to raw materials. This approach drastically reduces management overhead while preventing overproduction.
Implementing just-in-time wasn't simply a matter of changing procedures-it required a revolution in consciousness. Traditional manufacturing mindsets valued keeping inventory as security, a cultural holdover from agricultural societies where storing rice protected against disasters. Modern industry, Ohno argued, must develop the courage to procure only what is needed, when needed, in the amount needed.
The just-in-time system creates a factory that functions like the human body's autonomic nervous system, automatically responding to problems. When one process stops due to a quality issue, all connected processes quickly feel the impact-there's no inventory buffer to hide behind. This immediate feedback forces immediate problem-solving rather than allowing issues to accumulate.
Implementing this system required extraordinary patience and persistence. Toyota spent nearly 20 years refining the approach, gradually expanding it from one department to the entire company before teaching it to suppliers. The system faced psychological resistance from workers accustomed to maximizing production and technical challenges like frequent setup changes. Yet Ohno persisted, convinced that eliminating waste through just-in-time delivery was the only way Toyota could compete globally.
Kapitel 4
Autonomation: Giving Machines Human Intelligence
The second pillar supporting Toyota's production system is autonomation-not simple automation, but automation with a human touch. This concept originated with Toyoda Sakichi's auto-activated loom that stopped automatically when threads broke, preventing the production of defective fabric.
"Autonomation changes the meaning of management," Ohno explains. "The intent of autonomation is to separate workers from machines through mechanisms that detect production abnormalities. This allows one worker to operate several machines, dramatically increasing production efficiency."
Traditional automation focuses on having machines replace human labor in normal operations. Toyota's autonomation instead focuses on having machines detect abnormal conditions and stop themselves, requiring human intervention only when problems occur. This fundamental difference changes how workers interact with equipment.
Toyota equips machines with automatic stopping devices, safety features, and foolproofing systems to prevent defects. When abnormalities appear-defective parts, equipment malfunctions, or worker errors-machines immediately stop, triggering visual or audio signals that alert operators to the problem.
This approach serves dual purposes: eliminating overproduction waste and preventing defective products. By stopping immediately when problems arise, autonomated machines prevent the continued production of defective items. The stoppage also creates immediate awareness of the issue, forcing immediate resolution rather than allowing problems to accumulate.
Even on manual production lines, Toyota applies this principle by empowering workers to stop production when they detect abnormalities. This authority represents a radical departure from traditional manufacturing where production continuity was prioritized above all else. At Toyota, temporarily stopping production to address problems is considered an investment in long-term efficiency.
Autonomation fundamentally changes management's role. Instead of constantly monitoring normal operations, managers focus on abnormalities and improvements. The system distinguishes clearly between normal and abnormal conditions, making problems immediately visible through visual control systems like andon boards (illuminated displays showing production status).
Implementing autonomation depends on managers giving human intelligence to machines while adapting human operations to autonomous equipment. In the Toyota system, autonomation represents individual skill while just-in-time represents teamwork-like baseball players who each master their positions but work together seamlessly.
The true power of Toyota's production line comes from the synergy between just-in-time and autonomation working together. Just-in-time creates flow and exposes problems, while autonomation provides the means to detect and address those problems immediately. Together, they form a self-improving system that continuously identifies and eliminates waste.
Kapitel 5
The Seven Wastes: Identifying What Adds No Value
At Toyota, efficiency means cost reduction through waste elimination-the only way to obtain profit in competitive markets. Ohno identified seven specific types of waste that add cost without adding value:
1. Overproduction: Making more than needed or making items before they're required. Ohno considers this the worst waste because it causes most other wastes. Producing ahead of demand requires storage, transportation, and management of unnecessary inventory.
2. Waiting: Time spent by workers watching machines run or waiting for materials, tools, or information. This represents pure waste of human potential.
3. Transportation: Unnecessary movement of materials between processes or storage locations. While some transportation is necessary, excessive movement adds no value to the product.
4. Processing itself: Unnecessary or inefficient processing steps that don't add value from the customer's perspective. This includes using complex equipment when simpler tools would suffice.
5. Inventory: Excess raw materials, work-in-process, or finished goods. Beyond the minimum needed for just-in-time operations, inventory represents tied-up capital and hides problems.
6. Movement: Unnecessary motion by workers during the course of their work. This includes reaching for distant tools, bending, or walking between operations.
7. Defective products: Products that don't meet specifications require rework or scrapping, wasting materials and labor.
Through close observation, Ohno divided worker movements into waste (needless, repetitious movements requiring immediate elimination) and work (both non-value-added and value-added). Non-value-added work includes necessary actions under current conditions, like walking to get parts or pushing buttons. Value-added work involves actual processing that changes materials or parts into products with added value.
"The ratio of value-added work is typically lower than most realize," Ohno notes. "Manpower reduction means raising this ratio toward the ideal 100% value-added work."
Identifying these wastes requires scientific inquiry and continuous questioning. Ohno advocated asking "why" five consecutive times when confronted with problems to discover root causes hidden behind symptoms. Using the example of a stopped machine, he shows how this method reveals that a blown fuse was caused by an overload, which occurred because bearings weren't lubricated properly due to a defective pump shaft worn by metal scrap-the actual root cause.
Without this thorough investigation, one might simply replace the fuse or shaft, allowing the problem to recur. This scientific approach forms the foundation of the Toyota production system, leading to lasting solutions rather than temporary fixes.
The outdated formula "selling price = profit + actual cost" has no place in today's competitive market where consumers determine a product's value regardless of manufacturing costs. Cost reduction through waste elimination becomes the only reliable path to profitability.
Kapitel 6
Kanban: The Communication Tool That Powers the System
Kanban-typically a paper card in a vinyl envelope-is the operating method that makes Toyota's production system work. While often mistakenly considered synonymous with the Toyota Production System itself, kanban is actually just the communication tool that enables just-in-time production.
Ohno borrowed this concept from American supermarkets in the 1950s. A supermarket provides customers exactly what they need, when needed, in the amount needed-a principle Toyota applied to manufacturing. The earlier process in a production line functions as a "store" where the later process (customer) acquires required parts at the time and quantity needed, with the earlier process immediately producing to replace what was taken.
Kanban cards carry three types of information: pickup instructions, transfer details, and production requirements. They move information vertically and laterally within Toyota and between Toyota and suppliers. Like supermarket purchase tracking, withdrawal kanban signals what items were taken, while production kanban tells the production department what to make.
At a glance, kanban provides critical information: production quantity, time, method, sequence, transfer details, storage points, equipment needs, and container specifications. Unlike conventional production orders where early delivery is acceptable, kanban enforces strict "just-in-time" principles, completely preventing overproduction.
Six rules govern kanban use:
1. Later processes withdraw only what's needed from earlier processes
2. Earlier processes produce only the quantity withdrawn
3. Defective items never advance to later processes
4. Kanban must always accompany physical items
5. The number of kanban should be minimized
6. Kanban must be used to adapt to small fluctuations in demand
When faithfully practiced, these rules transform kanban from a simple card into a comprehensive management system. It creates immediate accountability for quality issues: since just-in-time processes have no extra inventory, defective parts immediately stop the next process, creating visible embarrassment that prevents recurrence.
Physical objects can also serve as kanban. In Toyota's main plant, carrying carts with limited capacity transport assembled engines to the final assembly line. When all carts are full, engine assembly must stop-automatically preventing overproduction. Even without physical cards, earlier and later processes can establish effective communication by agreeing on the number of carts and pickup rules.
Contrary to misconceptions, kanban is not inflexible or limited to parts processed in stable quantities. The system effectively managed balance weights for propeller shafts-one of the most challenging production scenarios where usage is highly irregular. This demonstrates kanban's remarkable flexibility even for special parts where usage seems unpredictable.
Implementing kanban requires establishing continuous production flow first. After World War II, Toyota focused initially on quality, then on producing exact quantities needed, and only after the oil crisis began teaching the kanban system to suppliers. The groundwork of creating continuous flow must precede kanban implementation-without this concept, adopting kanban is nearly impossible.
Kapitel 7
Production Leveling: Making Mountains Low and Valleys Shallow
For kanban to work effectively, earlier processes must produce only what later processes withdraw. If withdrawal is uneven in timing or quantity, earlier processes require excess capacity-a heavy burden. The greater the fluctuation, the more excess capacity needed.
Since Toyota's production system synchronizes not just internal processes but also outside suppliers through kanban, fluctuations in final assembly negatively impact all earlier processes. To prevent this, Toyota practices production leveling (load smoothing)-lowering peaks and raising valleys to create smooth flow.
"Mountains should be low and valleys should be shallow," Ohno explains, using a geographical metaphor to describe the ideal production pattern.
At Toyota's Tsutsumi plant, production leveling means different models flow alternately on the same line rather than batching them by time of day. Even when producing 10,000 Coronas monthly, they arrange them in a mixed sequence-sedan, hardtop, sedan, wagon-to minimize lot size and fluctuation.
This fine-tuned production demonstrates that earlier processes like die press have broken from traditional mass production methods. Initially, reducing lot sizes created challenges, as conventional wisdom favored continuous punching with one die. To accommodate smaller lots, dies must be changed frequently, requiring rapid setup procedures.
Toyota reduced die change times from 2-3 hours in the 1940s to just 3 minutes by the late 1960s by eliminating adjustments and training workers specifically for quick changeovers. This required intense commitment from everyone at Toyota and its suppliers.
Production leveling responds better to market diversity than planned mass production. Diversification makes leveling more difficult, but the Toyota system can handle this challenge with proper effort. The key is avoiding dedicated facilities in favor of versatile equipment.
With the Corolla (the world's largest mass-produced car in 1978), monthly production is divided by available work days to determine daily output. On the line, sedans and coupes flow in mixed sequence rather than batches. While dedicated lines for each model would simplify leveling, space and equipment constraints make this impossible. Instead, Toyota creates flexible lines that can assemble different models in any sequence, using machines and jigs that handle minimal quantities while maintaining mass production benefits.
This approach keeps diversification and leveling in harmony while responding promptly to customer orders. It enables fine adjustments within certain limits, a crucial capability in responding to constantly fluctuating markets. Since production lines don't have detailed schedules beforehand, they adapt naturally to changing ratios of product types.
Kapitel 8
The Human Element: Teamwork and Respect for People
While the Toyota Production System is often described in terms of its technical elements-kanban cards, just-in-time delivery, autonomation-its true foundation lies in respect for humanity. This principle, passed down from Toyoda Sakichi to his son Kiichiro, shapes every aspect of the system.
Unlike American factories where workers often just watch machines, Japanese manufacturing respects humanity in the production process. The closer Toyota came to eliminating waste, the clearer they saw individual human personalities. The system recognizes that workers are not interchangeable parts but unique individuals with creative potential.
Breaking machine-shop traditions where operators were fixed to specific jobs was challenging but necessary. In 1947, Toyota arranged machines in parallel lines or L-shapes, allowing one worker to operate multiple machines along the processing route. This radical departure from the "one operator, one machine" system to "one operator, many machines in different processes" met strong resistance from craftsmen.
Standard work sheets became crucial elements of Toyota's visual control system, effectively combining materials, workers, and machines for efficient production. These sheets clearly list three essential elements: cycle time (time allotted to make one unit), work sequence (the order of operations), and standard inventory (minimum work-in-process needed).
Ohno emphasizes that standards should not be imposed from above but set by production workers themselves. He quotes Ford's warning against fixed standards that might bar progress, noting Ford's belief that standardization knowledge must come from inside manufacturing units, not outside authorities.
While Japan traditionally valued individual mastery in activities like sumo, kendo, and judo, modern industry demands teamwork over individual craftsmanship. Ohno uses sports analogies to illustrate effective teamwork: in an eight-person rowing boat, uneven effort by one rower disrupts the boat's progress; similarly in manufacturing, success depends not on individual output but on the line's total completion rate.
He compares manufacturing to a relay race where proper baton-passing is crucial for success. If an operator falls behind, others should help set up their machine, then return to their positions when the work area normalizes. This "Mutual Assistance Campaign" generates powerful teamwork despite individual differences in work speed.
A business organization functions like the human body, requiring both autonomic and motor nerves. At Toyota, they've implemented an "autonomic nervous system" that enables workers to make judgments independently at the lowest possible level-deciding when to stop production, what sequence to follow for parts, or when overtime is necessary. These decisions can be made by factory workers without consulting production control or engineering departments.
The Toyota production system is not just a production method but a management system that maximizes human creativity, utilizes facilities effectively, and eliminates all waste. It recognizes that true efficiency comes not from machines alone but from the synergy between human intelligence and technical systems.
Kapitel 9
The Legacy of Two Extraordinary Characters
The Toyota production system rests on the legacy of two extraordinary men: Toyoda Sakichi and his son Kiichiro. Their unyielding spirits and visionary thinking created the foundation for what would become a global manufacturing revolution.
Autonomation came from Toyoda Sakichi's auto-activated loom that stopped automatically when threads broke. This embodied the principle that machines must work for people through human intelligence. Sakichi's observational method-watching a grandmother weave all day until understanding the loom's operation-inspired Ohno's practice of asking "why" five times.
Sakichi was a remarkable inventor who worked independently without reference materials or formal education. He developed over one hundred patents through intense concentration and observation-"staring at an object until a hole is almost bored through it." His inventive process was deeply practical rather than theoretical, yet his designs adhered to scientific principles.
Just-in-time came directly from Toyoda Kiichiro, who grasped the automobile's potential during his 1910 American visit. Kiichiro established "Toyotaism" with five core conditions: provide cars for the general public, perfect the passenger car industry, make reasonably priced cars, recognize sales' importance in manufacturing, and establish basic material industries.
Kiichiro's mission was developing a uniquely Japanese production technique rather than simply importing America's mass-production system. "Japanese people are adept with their hands and training will be no problem. In the near future, I am certain we can make better cars for less than foreign manufacturers," he declared.
Both Toyoda men possessed extraordinary strategic vision, viewing business with a chessplayer's perspective-seeing the entire board while planning precise moves. Unlike those who get lost in details, they maintained an overview while working in production.
Sakichi's mission was "to cultivate and train the natural intellect of the Japanese people, sell original Japanese products produced by this intellect, and increase the national wealth of Japan." His auto-activated loom, developed entirely by Japanese people over twenty-five years, embodied this philosophy.
The famous sale of Sakichi's loom patent to Platt Brothers of England for 1 million yen funded automobile research, demonstrating his belief that Japan needed to develop its own creative technology rather than merely imitating foreign products. The bedridden Sakichi instructed Kiichiro to use the patent money for automobile research-"an amazing act of courage and foresight."
While Kiichiro studied American production methods, he declared in 1933: "We shall learn production techniques from the American method of mass production. But we will not copy it as is. We shall use our own research and creativity to develop a production method that suits our own country's situation."
This philosophy became the foundation for just-in-time production, representing the beginning of a uniquely Japanese approach that would evolve through what Ohno calls "dialectic evolution." When Kiichiro passed away in March 1952, just before Toyota's automobile enterprise reached full-scale operation, it was a tremendous loss. Ohno believes just-in-time was Kiichiro's dying wish to them-a legacy that would transform not just Toyota but global manufacturing.
Kapitel 10
Surviving in a Changing World
The Toyota Production System wasn't just designed for high-growth periods-it proved its true value during economic downturns. While many manufacturing systems flourish when demand is strong, Toyota's approach excels in challenging times by adapting to changing market conditions.
The 1973 oil crisis forced Toyota to reduce production for the first time since the 1930s, causing profits to plummet across Japanese industry. This revealed problems with autonomated machines that required fixed numbers of operators regardless of production volume. Even with production cut by half, machines still needed the same number of workers-a major handicap when responding to changing production needs.
Toyota's next step was to demolish the fixed-worker system by developing flexible production lines where, for example, four workers could operate a five-worker line at 80% capacity if someone was absent. This required improvements in plant layout, equipment, and multi-skilled worker training during normal times.
Fine adjustment capabilities enable automatic adaptations within certain limits, a crucial capability in responding to constantly fluctuating markets. Since production lines don't have detailed schedules beforehand, they adapt naturally to changing ratios of product types. Without this flexibility, companies might ignore small market fluctuations until forced to make dramatic production cuts months later, causing serious problems both internally and for suppliers.
While computers offer tremendous calculation power, they often provide more information than needed, faster than needed. This excess information, like overproduction, creates waste and confusion. Toyota uses computers as tools for planning production leveling and calculating parts requirements, but rejects dehumanization and higher costs they can cause. The Toyota production system applies just-in-time principles to information flow, delivering exactly what's needed when it's needed.
Ohno consistently maintained that production could be done with half as many workers, emphasizing that while many could increase productivity during high growth, few could raise it when quantities decreased. In 1966 when producing the Corolla, Toyota started with 80 workers making 5,000 units. When asked how many workers needed for 10,000 units, the engine section head answered "160 workers." Ohno yelled at him for simple multiplication rather than improvement. Before long, 100 workers were making over 10,000 units through waste elimination.
As Ohno concluded his book in the late 1970s, he expressed concern about Japan's economy facing serious international problems regarding the yen, noting that the automobile industry's recent export-driven growth had reached its limit. He urged Japanese industry to quickly abandon mass production and transition based on bold ideas, hoping the Toyota production system might become a useful tool for generating these changes.
His foresight proved accurate. The system he developed not only helped Toyota weather subsequent economic storms but became a model for manufacturers worldwide seeking to survive in increasingly competitive global markets with fluctuating demand. The principles of waste elimination, just-in-time production, and respect for human potential remain as relevant today as when Ohno first developed them decades ago.
