Toyota's Shared-Parts Strategy | IndustryWeek

"Toyota said the move, aimed at cutting development costs by 20%, would start with mid-sized, front-wheel-drive vehicles this year. It wants half of vehicles it sells globally by 2020 to fall under the new platform strategy."

Source: www.industryweek.com

Michel Baudin's comments:

Specifics are trickling out about Toyota's plans. It seems that they want to make more different products from fewer components and have plants that are competitive even at low volume.

Readers' comments on the idea of having fewer platforms and more common parts are focused on the risk of extensive recalls, and the way such recalls can wipe out any savings achieved by the strategy.

It really is a matter of degree and of execution. Having fewer dashboard options might reduce the attractiveness of your products, but using fewer types of proportioning valves will not. Also, it is easier to ensure not only availability but quality as well for fewer components, making recalls less likely.

With regards to volume in a given plant, Toyota's strategy seems a continuation of their work on the Global Body Line, in which the same infrastructure and fixtures could be used for robotic welding at high volume and manual welding at low volume.

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Toyota Unveils Revamped Manufacturing Process | Yoko Kubota | Wall Street Journal

"Toyota broke a two-year silence on a revamped manufacturing process—built on sharing components among vehicles—that it says will produce half its vehicles by 2020 and slash costs. But its unveiling follows a path blazed in recent years by German rival Volkswagen AG—a reversal for the Japanese pioneer, whose production system was for decades seen as the gold standard, giving the world such manufacturing concepts as 'just-in-time inventory' and 'continuous improvement.'"

Source: www.wsj.com

Michel Baudin's comments:

Other than that Toyota has a plan, the article does not directly reveal specifics. As several readers pointed out in their comments, sharing components across models is not a new idea and is not risk-free, even if executed perfectly, as it reduces the differences between your standard and luxury models in ways that customers may notice.

The most revealing parts of the article, to me, are (1) the reference to VW, and (2) the keyword "modular assembly." I don't believe that Toyota has borrowed much from VW since the look of the 1947 Toyota SA, a dead-ringer for the already dated but yet to be successful beetle.

Modular assembly sounds self-explanatory but it isn't. It is a specific approach to assembling cars brought to VW by former GM purchasing executive Jose Ignacio Lopez in the 1990s, in which up to 90% of the work traditionally done in a car assembly plant is done by suppliers and all that remains is the final assembly of large subsystems.

The Porsche plant in Leipzig, for example, does not stamp, weld, or paint car bodies. It receives them ready to assemble, in a spotlessly clean facility that customers are encouraged to visit.

Porsche-Leipzig

The Porsche plant in Leipzig

The whole site is in fact dominated by its visitor center, complete with a fine-dining restaurant overlooking the plant and where new buyers can receive an hour's worth of training on their new cars on the test track. In the same spirit, VW has set up an assembly plant in downtown Dresden, with glass walls to enable passers by to watch cars being assembled.

Modular assembly was used by GM in Lordstown, OH, in 1999, and then by VW in Spain, and by DaimlerBenz for the Smart in Hambach, France . At the time, Toyota evaluated the concept and passed on it. Apparently, Toyota's production leaders changed their minds.

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Buy More Robots? | Adams Nager | IndustryWeek

"More robots means lower unemployment and better trade performance. [...] The United States does not lose jobs because there is not enough work to be done but rather because U.S. industry is not competitive with foreign producers. More robots will help fix this."

Source: www.industryweek.com

Michel Baudin's comments:Really? If you are not competitive, just buy more robots! But wait... Haven't we heard this before? Isn't it what GM did in the 1980s? Under Roger Smith's leadership, from 1980 to 1989, GM spent about $40B on robots, and this investment didn't make it competitive.

It doesn't mean robots are bad, only that they are not a panacea. Toyota's Global Body Line is designed to use welding robots where they are justified, and manual welding where not, using the same fixtures.

In an auto parts plant in Japan, I remember seeing a machining cell with old machines served by robots. A few yards away were new, automated lines that didn't use robots.

It looked very much as if the old cell with new robots was the result of incremental automation, and that the lessons learned had been applied in the design of the new lines.

Robots are tools. If you know how to use them, they will help you; if you don't, buying more is just a waste of money.

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1934-Model-A

Origin of One-Piece Flow at Toyota | Chip Chapados | LinkedIn

According to Chip Chapados, the concept of one-piece flow emerged from the need to rapidly detect defects in engine castings when Kiichiro Toyoda was reverse-engineering a Chevrolet engine in 1934, and it was originally called "one-by-one confirmation."

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Does Historical Accuracy Matter?

Cuckoo clock from the Black Forest

The most famous line in The Third Man is Orson Welles's addition to the script:

"In Italy for 30 years under the Borgias they had warfare, terror, murder, and bloodshed, but they produced Michelangelo, Leonardo da Vinci, and the Renaissance. In Switzerland they had brotherly love - they had 500 years of democracy and peace, and what did that produce? The cuckoo clock."

65 years later, Paul Krugman opened his editorial in today's New York Times with:

"Ah, Switzerland, famed for cuckoo clocks..."

With all due respect to Paul Krugman, I believe this fame came from the movie, because cuckoo clocks are not from Switzerland but from the Black Forest region of Germany.

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When Finance Runs the Factory | William Levinson | Industry Week

"Henry Ford achieved world-class results with three key performance indicators (KPIs), none of which were financial. His successors' changeover to financial metrics, on the other hand, caused the company to forget what we now call the Toyota production system."

Source: www.industryweek.com

Michel Baudin's comments:

Yes, giving power over manufacturing companies to accountants, as American industry massively did in the 1950s yielded disastrous results. The summary given in this article's lead paragraph, however, does not match the historical record from other sources.
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A summary of mistakes about Lean

In an invitation to the Lean Enterprise Academy 's Lean Summit 2014, David Brunt included the following summary of Lean since 1990:

"Early implementations focused on empowered teams and continuous improvement (kaizen) or attempts to replicate a pre-defined box of tools such as 5S, SMED, SPC and kanban. For others lean became synonymous with kaizen events - that were actually kaikaku - radically reconfiguring individual operations. For some, this led to them developing their version of Toyota’s famed Production System (TPS) including their own schematic 'house' or 'temple' of lean along with departments of continuous improvement specialists."

It is a pretty accurate account of what happened -- the only major omission being the omnipresent VSMs -- and it goes a long way towards explaining why the vast majority of these efforts failed. They were limited at best to superficial details of TPS, included elements that were not part of TPS, and misjudged implementation priorities. Let's us go through the list:

  1. "Empowered teams."  As a manager you have a team to work with. What decisions should you allow this team to make on its own? This is best subjected to the sleep-at-night test. Knowing that you are responsible for the outcome, what can you delegate to the team and still sleep at night? It obviously depends on the team. If it is a team of production operators with 10 years of TPS practice behind it, the answer will not be the same as if they are beginners. Implementations that start with empowering teams put the cart before the horse.
  2. "Continuous improvement (kaizen)." Lean, or TPS, are often described as approaches to continuous improvement (CI), when CI is in fact only one component of the system. You cannot convert a plant from mass production to Lean manufacturing by continuous improvement, because it is not about tweaking details. For example, if you have implemented cells in machining or assembly, you can make them perform better with CI, but you have to have cells first, and that is beyond the scope of CI.
  3. "Replicate a pre-defined box of tools." It can work, if your situation is sufficiently similar to the one you are copying, you really know what the tools are, and you master them.
    • SMED and Kanban are tools of TPS but often misunderstood. For example, you often see SMED used to try to increase equipment utilization instead of flexibility, and Kanban is often confused with the two-bin system or even reorder-point.
    • SPC is not part of TPS. This is so shocking to American and European professionals trained by the Quality establishment that they just inserted it back in, regardless of what Toyota actually did. The latest examples of SPC control charts at Toyota are from the 1950s.
    • 5S is part of TPS, but is mistakenly assumed easy to implement because its technical content is trivial. In fact, the absence of technical content is what makes it difficult to implement and certainly unfit for an initial project.
  4. "Kaizen events" are an American invention and not part of TPS. As Brunt points out, the name is misleading, because what they do is not Kaizen. The popularity of this method over the past 25 years and the confusion created by the name have in effect prevented Lean implementation from including the real Kaizen.
  5. "Departments of continuous improvement specialists." The creation of these departments has often made Lean implementation into a function alongside Production Control, Maintenance, or Quality Assurance, with the result of making it a professional specialty instead of part of everybody's job. It works to make a good show for outside visitors, but not for much else. This department cannot be large enough to have the capacity to do all that needs to be done. Even if it did, it does not have the authority to make the changes take root in daily operations.

These efforts failed because the approach was simplistic. Both the technical and managerial content of TPS are deeper and take a while to learn. A successful implementation, particularly is a different industry, is not based on copying tools but on understanding underlying principles and deploying them as appropriate to the new context.

VSM Pitfall: unnecessary process | Chris Hohmann

Value Stream Mapping (VSM) is probably the main analysis tool and the most used in the lean toolbox. Easy to understand and handle, VSM is the starting point of improvement workshops and kaizen eve...

Source: hohmannchris.wordpress.com

Michel Baudin's comments:

Thoughtful comments, as usual from Chris Hohmann.

However, we need to go further and question the wisdom of reducing Lean implementation to Value-Stream Mapping and kaizen events when neither tool is central to the Toyota Production System.

"Value-Stream Mapping," which is really materials and information flow mapping, is a minor tool at Toyota, used only with suppliers who have delivery problems. And "kaizen events" don't exist at Toyota.

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Toyota Cutting the Fabled Andon Cord, Symbol of Toyota Way | Automotive News

Toyota is retiring the fabled “andon cord,” the emergency cable strung above assembly lines that came to symbolize the built-in quality of the Toyota Way and was widely copied through the auto industry and beyond.

Source: www.autonews.com

 

Michel Baudin's comments:
The point of having a cord rather than buttons was that the cord could be pulled from anywhere along the line, whereas buttons require you to be where they are. It is the same reason many buses have cords for passengers to request stops rather than buttons.

Toyota's rationale for moving to buttons, according to the article, is the desire to clear the overhead space. Another advantage, not stated in the article, is that the alarm from a button is more location-specific than from a cord.

Another reason to use a cord was that you didn't have to change it when you rearranged the line, whereas relocating buttons required rewiring. But the wireless button technology has made this a moot point.

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