How machines change the world

The Machine that Changed the World

The Machine that Changed the World, published in 1991, has been critically and

popularly hailed as the definitive source on Japanese manufacturing methods commonly called

techniques in this book as the culmination of several years of study in the field automotive

manufacture. Their research was sponsored by the International Motor Vehicle Program (IMVP)

as a part of a worldwide auto manufacturing benchmarking study. Womack, Jones and Roos

opened a window into a new way of organizing the production of goods that departed greatly

from the traditional American method of mass production. They revealed that a new method of

optimizing a whole production system, from suppliers to sales, could offer great advantages

over mass production techniques.

In order to establish a context for discussing lean production, the authors first discussed

the details of the two main non-systems techniques of manufacturing, craft production and mass

production. This story starts with old world craft production, which established its dominance in

Europe in the years preceding the industrial revolution. In that time, finely skilled craftsmen with

general tools made products to exact customer standards. Standardized parts were not

available in large quantities to enable large or efficient production runs. Products, especially

complex ones like automobiles, required much customization and fitting by craftsman in order to

maintain function and quality. As a result craft production was had very low efficiencies and

resulted in only small numbers of consumer products entering the upper classes.

Henry Ford’s assembly line methodology revolutionized production in the early 20th

century by introducing mass production to the manufacturing world. Unskilled workers

assembled large numbers of standardized parts into automobiles in a series of short tasks.

Productivity under Ford’s mass production increased substantially beyond what was obtainable

through craft techniques. Ford’s methods quickly overwhelmed craft producers because unit

costs fell rapidly with the increased productivity. As costs fell craft producers could no longer

compete.

One of the most important aspects of Ford’s ideology was the high level of division of

labor. Workers performed assembly, while industrial engineers and management personnel

handled line organization and optimization. Diversification and division of labor went beyond the

assembly plant as well. Internal to the automotive firm, separate departments designed

vehicles, engineered parts and created marketing strategies. Many times these separate

entities had conflicting goals leading to corporate infighting. Similar conditions prevailed

externally as well, division of labor resulted in very independent supplier firms, manufacturing

sites and dealerships. Each of these players had separate goals with respect to the flow of

parts, vehicles and customers through the supply chain. Again, this created adversarial

conditions similar to the political infighting witnessed within the auto manufacturer. Ford’s

contemporary, Alfred Sloan at General Motors, created management structures to handle the

diverse interests within a large manufacturing company. Each division of the automotive chain,

including engineering, components, assembly and sales, was managed in such a way to

provide an optimal level of performance for the whole company.

Managing the large manufacturing operations associated with automobiles remained

complicated despite the management techniques suggested by Sloan. Often times, there was

little or no communication between divisions, departments and even between workers. Each

division, group or worker concentrated on producing their parts to the required productivity and

quality with little regard to the interests of their surrounding divisions. There were several

problems with this lack of coordination and communication. Large buffer inventories were

required between manufacturing operations (and between suppliers and the assembler and

even engineering departments) due to differing running rates. These buffers were needed in

order to maintain manufacturing flow. Quality problems hidden in these buffers were often

discovered at the end of the assembly line requiring large amounts of rework. On the

engineering side, product design decisions were made with little regard to manufacturing.

Design changes often resulted in products that were very difficult to build. Communication

between sales and manufacturing was also disconnected. Assembly of vehicles was not

coordinated with sales resulting in large inventories of vehicles on dealer lots that customers did

not want. These problems of communication were of little concern however, because all

producers in the United States worked with similar practices. Mass production was the standard