Miller, Jon - Introducing Gemba Keiei by Taiichi Ohno

Introducing Gemba Keiei by Taiichi Ohno
By Jon Miller - November 13, 2004 3:07 PM
Taiichi Ohno is one of the founders of TPS along with Shigeo Shingo and members of the Toyoda family. Three of Mr. Ohno's major works on the Toyota Production System and kaizen have been translated into English. They are 'The Toyota Production System', 'Just In Time for Today and Tomorrow', and 'Workplace Management' (Gemba Keiei in Japanese). The first is still in print and available and on the reading list of many Lean Managers. On our last kaizen study mission to Japan I was fortunate enough to pick up a recently reissued copy of Gemba Keiei from JMAM, the publishing arm of JMA. It is an excellent book for anyone interested in kaizen, Toyota Production System, and the original Lean thinking of Mr. Ohno. This book and Taiichi Ohno's thoughts on kaizen and TPS have previously been capably translated by Andrew Dillon and published by Productivity Press. Unfortunately Gemba Keiei has been out of print for many years and is exceedingly difficult to obtain today. The following series of blog entries on Taiichi Ohno's book Gemba Keiei is not an authorized translation. As I re-read this book in the original Japanese, I will summarize the nuggets of wisdom from each chapter in Mr. Ohno's book. A few words about the title of the book. Gemba means "actual place" or "workplace" and in Ohno's case this is the factory. The second part "Keiei" (pronounced K-A) means 'managing' as in 'managing a business' or 'running a business'. As opposed to the word 'kanri' which is used for managing or controlling people or processes. So the word 'keiei' means to manage or run a business or an enterprise. A person who does "keiei" is a business owner or a senior executive, while a person who does "kanri" is a manager or supervisor. It is an important distinction' that I feel is lost in the English title "Workplace Management". I believe that this book was written not only for the Lean Manager or Kaizen facilitator but for the business owner, the person who does "keiei" of their business. Ohno comments in the foreword that he was asked to write about "gemba no keiei" or "running a manufacturing company" as I understand it. Mr. Ohno's experience is based on manufacturing, but his insights on kaizen and effective management practices at the gemba transcend the factory floor. 'Gemba Keiei' is Ohno's essential philosophy on how to run a business through focusing on kaizen in the workplace. Gemba Keiei is written in a very disarming style, in the original Japanese it is almost conversational. Mr. Ohno does not use the formal or 'polite' language that would be the norm, but rather writes as he speaks firmly and directly, as if he is speaking to the reader as one of his students. My goal is to summarize one chapter per week and post it in this weblog. There are 37 short chapters in this book so I hope to share as much of Ohno's wisdom on TPS and kaizen as I am able to receive from this book in the next 37 weeks, and complete this project before the September 2005.
Introducing Gemba Keiei by Taiichi Ohno Jon Miller
Comments
What exactly does Gemba mean? The culture of your work place? Posted by: kwilliamson - December 15, 2004 1:46 PM Gemba is a Japanese word literally meaning "actual place". In Lean terms it is the place you add value in your workplace. For manufacutring the Gemba is the factory. For healthcare the Gemba would be the operating room or the place where you are providing care. For a cable TV company, the Gemba is the home where you are installing cable and where the service is used. For a policemen, the Gemba is the beat they walk. The idea of the Gemba is to focus improvement activity at the place where people do the work that adds value to the customer, based on actual observed facts. Posted by: Jon Miller - December 15, 2004 3:05 PM Is there a link between Gemba kaizen and HRD personnel in an organisation? Posted by: nidhi - March 5, 2006 11:54 AM Yes Nidhi, there is. Here is the link to an article in response to your question. Jon Posted by: Jon Miller - March 13, 2006 8:44 PM Dear Jon, It is correct how you explain "genba" meaning. "genba" is for Japanese the place or scene things happend, for example the scene of murder. "genba" also is parts of San Gen Syugi (Three Actual Principal) which is structured genba, genbutsu and genjistu (actual place, actual thing and actual phenomenon) and is very popular in Japan. Posted by: tetsu sugiura - November 16, 2006 7:04 PM
Taiichi Ohno's Book "Workplace Management" Returns to Print in 2007

By Jon Miller - November 1, 2006 7:29 AM
Almost two years ago I set out to read Taiichi Ohno's recently reissued book Gemba Keiei (Workplace Management) in Japanese and summarize one chapter per week. My goal was to have all 37 chapters posted here by September 2005. Well no plan goes according to plan and here we are two years later and still five chapters away from that goal. I wondered what I would do to get my weekly Ohno fix after finishing this project since unlike Shigeo Shingo, Taiichi Ohno did not write many books. To be exact, Ohno did not actually write any books, as The Toyota Production System and Just in Time for Today and Tomorrow were both ghost-written (Toyota Production System) or co-written (Just In Time) by Setsuo Mito. We learned that Gemba Keiei was actually the transcript of a series of interviews rather than a text Ohno wrote, which explains a lot about the warm and familiar tone of the book. More on that later. We are happy to announce that Taiichi Ohno's Book "Workplace Management" will return to print in 2007. Gemba Research LLC has obtained the translation and publishing rights for this classic. We will make this book available again to students of kaizen, the Toyota Production System, Lean manufacturing and other brands of continuous improvement. I want to give special thanks to the team from Gemba's Japan office for all of their hard work in making it possible to bring Taiichi Ohno's Workplace Management back in print in 2007.
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Taiichi Ohno (1912 - 1990) was the architect of the Toyota Production System. Most of what is known as Lean manufacturing today traces its origin through Taiichi Ohno and the work done at Toyota during and immediately after his tenure there. Taiichi Ohno's book Gemba Keiei (Workplace Management) is a delight because not only does it explain some of the ideas and tools that make up the Toyota Production System, it gives context to the development of some of these ideas, and the basic values and philosophies that underly them. Without the polish of a ghost-writer, the book has the feeling of a raw gem, one that requires that you stare long and hard into it before you can appreciate its true beauty. Check back here for progress on the translation, details on how to pre-order your copy of Taiichi Ohno's book, and news on other books that we will publish.
Workplace Management Pre-Orders and Publication Update!

By Jon Miller - December 21, 2006 3:46 PM
December 14, 2006 - Mukilteo, Washington U.S.A. Here is an update on the publication of Workplace Management, Taiichi Ohno's classic book about how Lean manufacturing (the Toyota Production System) was developed at Toyota Motor Corporation between 1950 and 1989. As things are proceeding we hope to have it ready to go to the printer for batch production on February 1st, 2007. With their quoted lead-time of one month, we should be shipping in early March 2007. It pains me to go the batch route but the printer would not take us up on our offer to exchange our SMED consulting services for a smaller run size. We may bite the bullet and do a smaller runs on-demand in the future but the plan at this moment is to run a batch of three thousand books. If enough of you buy the book, this will not be overproduction. See below for information on how to order, and other book details. ---------------------------------------------------------------------------------------------------------Workplace Management Author: Taiichi Ohno Translation by Jon Miller ISBN: 978-0-9786387-5-7 180 pages, hardcover Publisher: Gemba Press Expected publishing date: March 1, 2007 Price: $47.95 Description This classic work by the founding father of the Toyota Production System returns to print in a new translation. Ohno delivers timeless lessons on how to effectively manage your gemba the actual place or work. He relates stories from across his nearly 40 years of struggle to establish the Toyota Production System as both the mindset and the supporting behaviors of constant improvement. In the books 37 chapters, Ohno covers a broad range of topics and lays out the fundamental philosophy of kaizen (continuous improvement) that has made Toyota the most successful automobile manufacturer today.
Introducing Gemba Keiei by Taiichi Ohno Jon Miller To place your order, please call Kaizen Products at 1-877-GO-KAIZEN (1-877-465-2493), email sales@KaizenProducts.com or place your order by credit card at our online store www.KaizenProducts.com Order your copy of Taiichi Ohno's Workplace Management today.
Translation for Taiichi Ohno's Workplace Management is Complete, Part 1

By Jon Miller - January 25, 2007 9:11 PM The translation for Taiichi Ohno's Workplace Management is complete! One week behind original plan, but we are on track for a ship date in early March. Here are a few excerpts of the wisdom and insight of Taiichi Ohno I thought you might find enjoy: Chapter 9: Reduced Inventory, Increased Work in Process Just as in the example of the press earlier, the calculation tells you that it costs less to produce 10,000 than to produce 1,000 pieces so they keep the machine fully utilized. Then they run out of places to put things. They have no space unless they build a warehouse, so they build a warehouse. Once they have a warehouse they will keep building parts they will not sell just because their calculations tell them they are producing the parts at a low cost. Eventually as both the variety and volume of parts increase, they build racks in the warehouse to hold these parts. And now the moment weve all been waiting for, they install a computer system that will retrieve these parts from the warehouse without error, at the push of a button. Why do they go to such lengths to add cost to the parts they think they made so inexpensively? Chapter 14: Do Kaizen When Times Are Good I will say this again: the only way to generate a profit is to improve business performance and profit through efforts to reduce cost. This is not done by making workers slave away, to use a bad expression from the olden days, or to generate a profit by pursuing low labor costs but by using truly rational and scientific methods to eliminate waste and reduce cost. I think this is the most important work that industrial engineers can do. Chapter 19: Toyota Made the Kanban System Possible What I was particularly worried about was the support of upper management for such a risky, unproven approach that was off the beaten track. They should have been too afraid to give permission, but I think one of the big forces behind the development of the Toyota System is the fact that Chairman Eiji Toyoda and the late Advisor Shoichi Saitoh let me try this to my hearts content. If I had not been at Toyota Motor Company, I think another company would never have let me try this, so Toyota made the completion of this system possible. Today it is called the Toyota System but I think it was around 1961 or 1962 that this name was adopted. Before that since it was so risky and we were afraid that one mistake could lead to the company going out of business, so we had called it the Ohno System. Order your copy of Taiichi Ohno's Workplace Management today.
Translation for Taiichi Ohno's Workplace Management is Complete, Part 2

By Jon Miller - February 3, 2007 11:08 AM The translation, layout and pre-production for Taiichi Ohno's Workplace Management has been completed. This week we mailed out 10 review copies to a diverse collection of authors, teachers and implementers of the Toyota Production System. We are very thankful for their help and we will post their review and feedback here as we receive them. Here is a bit of insight from chapter 23 of the book titled "How to Produce at a Lower Cost." While talking about the challenge faced at Toyota in the early days to reduce the cost of
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller vehicles as much as possible, Ohno clears up a misunderstanding with what is known as Just in Time. One of the main fundamentals of the Toyota System is to make what you need, in the amount you need, by the time you need but to tell the truth there is another part to this and that is at a lower cost, but that part is not written down. That may be why people misunderstand and think we go home when we've produced the quantity needed for the day. The Toyota System is to make what we need in the amount we need, at a lower cost. Another way of saying this is that even if you make what you need, when you need it in the quantity needed, if you do this at a higher total cost it is not Lean. Copying the Lean tool is meaningless unless you first understand and emulate the underlying values or mindset. It may seem obvious, but I think "this is another thing everyone gets wrong" as Ohno likes today. As it stands today, we will miss our ship date by about two weeks and our new target date is March 14, 2007. Updated details, chapter titles, etc. are here. We will deliver what is needed (the wisdom of Taiichi Ohno) but not when it is needed, or in the quantity needed, unfortunately. As for how to produce at a lower cost, that's also an area for hansei. We have a long way to go at Gemba Press towards becoming a Toyota-like printing operation.
Contents
Foreword Chapter 1: The Wise Mend Their Ways Chapter 2: If You Are Wrong, Admit It Chapter 3: Misconceptions Reduce Productivity Chapter 4: Go See What Didnt Work with Your Own Eyes Chapter 5: Misconceptions Hidden within Common Sense Chapter 6: The Blind Spot in Cost Calculation Chapter 7: Dont Fear Opportunity Losses Chapter 8: Limited Volume Production is to Produce at Low Cost Chapter 9: Reduced Inventory, Increased WIP Chapter 10: The Misconception that Mass Production is Cheaper Chapter 11: Wasted Motion is Not Work Chapter 12: Agricultural People Like Inventory Chapter 13: Improve Productivity Even with Reduced Volumes Chapter 14: Do Kaizen When Times Are Good Chapter 15: Just In Time Chapter 16: Grandpa Sakichis Jidoka Idea Chapter 17: The Goal: Improve Productivity Ten-Fold Chapter 18: Supermarket System Chapter 19: Toyota Made the Kanban System Possible Chapter 20: What I Learned About Forging Changeover from Toyota do Brasil Chapter 21: Rationalization is Doing what is Rational Chapter 22: Shut the Machines Off! Chapter 23: Producing at the Lowest Possible Cost Chapter 24: Fight the Robot Fad Chapter 25: Work is a Game of Wits with Subordinates Chapter 26: There Are No Supervisors at the Administrative Gemba Chapter 27: We Can Still Do a Lot More Kaizen Chapter 28: Wits Dont Work Until Feel the Squeeze Chapter 29: Become a Reliable Boss Chapter 30: Seiri Seiton Seiso Seiketsu Shitsuke Chapter 31: There is a Correct Sequence to Kaizen Chapter 32: Operational Availability vs. Rate of Operation Chapter 33: The Difference Between Production Engineering and Manufacturing Engineering Chapter 34: The Pitfall of Cost Calculation Chapter 35: The Monaka System Chapter 36: Only the Gemba Can Do Cost Reduction Chapter 37: The Standard Time Should be the Shortest Time Afterword About the Author About the Translator Glossary Index
Chapter 1: The Wise Mend their Ways

Taiichi Ohno begins the chapter by saying that he doesn't believe it's easy to influence people on the Gemba to change. In order to get people to do kaizen, you need to convince them and help them understand. How are people convinced? There has to be some sort of reasoning behind what you are saying, and you have to confident that what you are saying is right. How can you be confident that you are right? There is an expression that says "even a thief speaks truth a third of the time." So you can assume that you (an average person) is right half of the time. Ohno reflects on his days in junior high school studying the classics, such as the Analects of Confucious. He quotes two of Confucious sayings "A Wise man mends his ways" (literally, the wise change their spots like a leopard) and "Wise man, do not hesitate to reform yourself". If a thief is right a third of the time and an average person perhaps half of the time, a wise man is right perhaps only 70% of the time. If you insist that you are right without being reasoning it through, you will not be able to convince people. Another saying is "Give orders in the morning, change them by evening". This is usually given as an example of bad leadership, one who changes his mind. Ohno says that as a manager you in fact should change orders given in the morning, by evening time. After all, even the wise men mend their ways. Ohno goes on to say that you shouldn't give half-baked orders and then change your mind on a whim. Rather, give direction and go see if was effective. If it was not effective, admit by evening that you were wrong and change tactics. Some countries treat long-standing laws as unchangeable, even if they don't stand up to the logic or the needs of today because of respect to tradition or authority. Ohno says that you mustn't operate your factory in this way, saying "it's law" and certain things can not be changed because they have always been that way. Ohno goes on to make the point that engineers have a reputation for being stubborn or hard-headed. Engineers would be well advised to pretend their are "the wise" and "change their spots like leopards" and reform their ways when they are wrong. Ohno links the ability to convince and influence others to the ability to be frank and humble, to admit to those who work for you (or to the people on the Gemba) that you were mistaken. If you fear admitting you are wrong then this feeds a vicious cycle where it becomes harder and harder to admit your mistake, and in the end you lose credibility and are unable take back the bad orders you gave your troops this morning. In order to convince people to change, and to do kaizen, you must first accept that we are all human and wrong half of the time. As a manager leading change, you are wrong half of the time, and the people who work for you are wrong half of the time, but also have something worth listening to half of the time. If this is not done, people will not respect you and listen to you. Humility, in Ohno's opinion, is an important factor in being able to convince people to do kaizen. The way people are persuaded to do kaizen is if you first humble yourself. When you are wrong, be willing to admit it, and others will be more willing to accept your ideas. Try it, and if it doesn't work, try something else. Approach the act of teaching with humility and be quick to admit when you are wrong and others will learn from you.
Comments
Taiichi Ohno was influenced by Zen Buddhism, correct? Does the influence of Christianity in Western Culture possibly play a role in its seeming inability to accept some facets of the
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Toyota Way? The quote prefacing Chapter 15 in "The Toyota Way" states, "Until Senior Management gets their egos out of the way and goes to the whole team and leads them all together...senior management will continue to miss out on the brain power and extraordinary capabilities of all their employees". A culture such as ours with a background steeped in Christianity which values the salvation (importance) of the individual (ego) may have a hard time letting go of that ego. However, a culture such as Japan's may be able to accept these ideas more easily. Not to say the Western mind can't find salvation in this new Way (because it is starting to now), but could this possibly be a barrier (not Christianity, but the celebration of the individual ego)? Posted by: Isaac Curtis - April 13, 2006 10:30 AM That's a very interesting observation. I don't know how much Ohno was influenced by Zen Buddhism. I have read that the Toyoda family are Nichiren Buddhists for what that's worth. American culture certainly does place a high value on individualism, which can strengthen ego and weaken humility. The Bible does say "Blessed are the meek: for they shall inherit the earth". Christ's life was about sacrifice and service, which are acts of humility. It may be as much a matter of America's history of rugged individualism and Westward expansion as difference in religion. Posted by: Jon Miller - April 14, 2006 7:57 AM
Chapter 2: If You Are Wrong, Admit It

In the second chapter Taiichi Ohno continues to gently lecture senior managers. He begins by answering the question of based on his earlier assumption "Why are we wrong half of the time?" by saying that our thinking is wrong. The word he uses to explain this is "misperception", "delusion" or "illusion" as in "optical illusion". Essentially, we are wrong when we believe in something that is wrong. Here Ohno uses the example of two lines of equal length. Place horizontally and in parallel (as in the = sign) these lines are cleary the same length. Placed perpendicular (like the letter T upside-down) one line looks clearly longer. Try it! It's a great demonstration of how we can believe in something that is wrong (misperception). So how can you tell by just looking when two are the same length and when one is longer? You can't. Sometimes in this world it's better to just try it. Take the line and move it and you will see. Take two matches and demonstrate this to your kaizen team and it will drive home the importance of the 'just do it' mentality. Ohno says that these illusions or misconceptions are very common. When they are our ideas or beliefs rather than measurable lengths of match sticks, it is harder to work it out by explanation. You just have to try it and you will often find that the opposite of your belief is true, and that you are wrong. If you give your troops ten commands and half of them are 'misconceptions' or wrong, then you have to do as Confucius says and 'mend your ways'. Admit it. Give new orders. Save your troops. Win the war. Ohno makes the point that the best way for workers on the Gemba to see that the current way of working is wrong (not as Lean as it could be) is to have them try many things hands on. The following paragraph contains an important thought that is too often missing from kaizen efforts today. When you give the order for people to try something different, follow up. Go to Gemba and see if you were right or wrong. If it is not working, apologize and admit that you are wrong. That way, your workers will find it easier to admit that they are wrong. By seeing that their leaders are willing to correct their mistaken beliefs based on observed evidence, others will be more willing to try things and change their beliefs. Ohno places the key to being able to persuade people to change on the freedom to admit that you are wrong half of the time. By being able to say "See, I was wrong. Now try something else" it actually encourages people to cooperate with you and help you. This is contrast to the traditional following of orders, right or wrong, which eventually erodes confidence and willingness to blindly follow. Without misperceptions or wrong beliefs there would be no need for persuasion. Ohno observes that the more that someone is an intellectual, the more misperceptions he or she is likely to have. Although Ohno does not explain this belief, I would venture that it is because people who have amassed great amounts of knowledge have probably had less chance to go to Gemba and "try it out" to see if what they believe is actually true. If you fancy yourself a Lean thinker go ahead and test your beliefs the next time you think you are right. If you are wrong, admit it. Make Mr. Ohno proud.
Chapter 3: Misconceptions Reduce Productivity

By Jon Miller - August 5, 2005 10:12 PM
In this chapter Taiichi Ohno illustrates the idea that "misconceptions reduce productivity" by telling several stories from the Gemba at Toyota. The point Ohno makes in this chapter is that demonstrating the superiority of one piece flow is a simple thing, yet it something rarely seen on the Gemba. In the first story Ohno wanted to show that inspecting one at a time was quicker and took less work than inspecting in batch. "Try it one at a time" Ohno says. "No, this way is faster" replies the inspector. After trying one at a time, the inspector completed 5,000 pieces in regular hours, rather than requiring overtime as the batch method did. People have the misconception that picking up 20 or 30 pieces and lining them up on the table and inspecting them all at once is faster. Once you try it, and you see it's easier, quicker, and less tiring to do one at a time people lose their misconception. Ohno recognizes here that there may be an objection from the worker due to the lost overtime pay. Ohno tells another story from Toyota of a process to machine a hole in bar stock, shortly after the WWII (likely the late 1940s or early 1950s). The machine operator was hand feeding the machine even though the machine had automatic feed machine. The young machine operator proudly tells Ohno that he is making 80 pieces per day. When asked why the operator didn't just start the machine and let it run on automatic feed, the operator replied "I think it's faster to operate it manually." The reasons given were that since automatic feed was faster the tool wore down quicker, resulting in defective products. Manual feed let the operator have a better feel for the wear on the tool. "How long does it take to make a hole?" Ohno asked. "Thirty seconds." The young operator replied. "That's 120 pieces per hour." Ohno pointed out. The young operator was silent. There were 7 working hours per shift in those days. The operator was only producing 80 pieces, when at 30 seconds per piece he could have done that in 40 minutes. Ohno points out "You should put in more than one hour's work per day." The young operator protests that he is working hard. Ohno's point is that the worker thinks he is working productively (working hard) when he is not at all productive (high value added output). The manual process takes 30 seconds. The operator is working hard. The automatic process takes 40 seconds. The operator has the misconception that it is faster. But it is less productive at the end of the day. This is because after making 3 pieces by hand the tool is hot and begins to dull. So the operator takes the tool to the grinder to sharpen it. Then he makes 3 more parts at 30 seconds per piece. The cycle repeats. The operator thinks this is productive work. Ohno demonstrates how you can produce 80 pieces more productively. You need one part every 5 minutes to produce 80 in 7 hours. By using the automatic feed and making one piece every 40 seconds, you can let the machine run, let the tool get hot, cool naturally for 4 minutes, and run the next piece with no grinding needed. You can use the same tool for 30 or even 50 pieces without regrinding. The grinding wheel is a shared resource. Not every operator has one. So when the young operator goes to regrind the tool there are 5 or 6 people standing there and waiting. A different lathe operator runs parts as fast as he can, then goes to regrind his tool also. So this results in a wait, and in the end you average only 2 parts every 10 minutes, even though you think you can make one piece every 30 seconds. In the same way Ohno explains that some operators will place 10 or 15 parts on a drill press, drill them, and take the parts off and put them in a box. Then the next parts are loaded, drilled, unloaded. There is a lot of wasted motion and even though these workers think they are doing skilled, productive work, in the end they are less productive.
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller These stories are great demonstrations of the wastes (waiting, motion, transportation) associated with working in a batch and queue method. The chapter also demonstrates how people have the misconception that batching is faster. This misconception is alive and well today. With the spread of Lean manufacturing and knowledge of the Toyota Production System, more people are implementing one piece flow. Yet there is still too much focus on local optimization (making things as fast as you can through one process) instead of overall optimization (making things as fast as you can through the whole process). Look for examples of misconceptions that reduce productivity at your own company and use them to educate people about Lean transaction and Lean manufacturing, as Taiichi Ohno does in this chapter.
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Chapter 4: Go See What Didn't Work with Your Own Eyes

Taiichi Ohno starts this chapter by pointing out that it's relatively easy to convince the people on the Gemba (factory floor) by having them try the new way and see that is better than another way, but that this is harder to convince managers, senior managers, and supervisors. In disagreements between managers each side thinks they are right. If the managers don't believe that the new way is better than the current way (the way they know or think is right) then they won't support it. If they don't support it then the people in the factory won't try it and this limits you ability to make gains in productivity through kaizen. Ohno says that managers have differing ideas or points of view they should try one way for a day and another way on the next day. Let the results show which is the better idea. Each side should try as hard as they can to demonstrate that their way is better. They should pursue their ideas with conviction. Taiichi Ohno says that this type of conviction is not the same thing as being stubborn and unwilling to change your ideas. If you believe yours is a good idea, try it and see if it works. There may be some things that don't quite work, but there will also be some benefits. Go see what didn't work with your own eyes, says Ohno. Taiichi Ohno scolds managers just for listening to reports and saying "So it didn't work after all" rather than seeing the new idea in action with their own eyes and verifying if it works or not, and why. Here Ohno uses a very important phrase. Most people trying to implement Lean manufacturing or Lean transactions have met the objection of "We tried it before and it didn't work" at least once. Ohno says "I didn't see that failure for myself. Please try it again so that I can verify it." He uses the example of the regrinding of the cutting tools from Chapter 3 as an example. The manager in this case said "We tried centralizing regrinding during the war and it didn't work." Ohno says to the manager, "I wasn't there to see it. Let me see it fail again. If I understand why it failed then I'll accept your answer." When Ohno observed the trial, the system worked and he theorizes that the Toyota managers didn't try hard to make centralized regrinding succeed because the army procurement made them do it during the war. Ohno does say that while observing the trial of the new method there were many things that had to be worked out. People knowledgeable in grinding, the metals involved, the machines used, the angles of the tools, etc. had to be consulted so that standards could be established. Taiichi Ohno says that by using a kaizen process like this you can establish standards that allow anyone to perform a process that in the past was limited to specialists and experts. In today's world, this is why it is so vitally important for Lean initiatives to always empower and involve the "experts" - the workers themselves - in the changes. The kaizen event process is an excellent way to make rapid change happen while making sure there is ownership in the changes. This is an effective way to take the ideas and experience of a larger group of people can be used to solve problems that arise. Taiichi Ohno ends the chapter by saying "That was in days immediately after the war. I don't think people do things that way anymore." It's hard to tell if he is being sincere or not. I suspect he is being ironic, as I'm sure he met many people still had the same bad habits in the days when he was writing this book. In my experience, even today there are still plenty of organizations full of people who do not "go see" to understand what didn't work. People prefer to debate in a comfortable office,
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller sixty years since the war, and 23 after Taiichi Ohno first penned those words. That is why Gemba Kaizen and learning by seeing and doing is so effective in helping people change how they work.
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Chapter 5: Misconceptions Hidden within Common Sense

By Jon Miller - August 20, 2005 12:25 AM
This is a short chapter. The chapter seems to act as a thematic bridge. Taiichi Ohno begins by talking about the importance of making a mindset shift in order to achieve breakthrough kaizen results, and ends the chapter by talking about the misconception of economies of scale. In the chapters following this one Taiichi Ohno argues against large volume production based on equipment utilization, traditional cost accounting, and local optimization. He introduces that theme by saying This is not common sense. Get ready for a different way of thinking. When a misconception becomes accepted as common sense progress stops, says Taiichi Ohno. For example there may be a way of doing things that is not great but is low risk so that becomes the accepted norm. Even if the rewards are small, if the risk is small then this is often the preferred method under "common sense". Ohno argues for a change of mindset "to go beyond common sense". He says that it's better to go after the big reward, recognizing that there may also be big risks. These big risks simply need to be counteracted. It takes courage to step outside of common sense, but this is the way "to go beyond". Whether it's top management, middle management, workers, or labor union representatives, people tend to accept common sense, even if it is wrong. People may think a certain method is the best, or even know that it is not but accept that it can not be changed. If you do kaizen based on an extension of your current thinking, your results will be limited to 10% or 20% improvement. Ohno says you have to turn your thinking upside down. To find a new path to success, a mindset revolution is required from everyone in the organization. This is particularly true when implementing one-piece flow. People think its common sense that making a large batch of parts is quicker than working on one piece at a time. In fact, traditional cost accounting will tell you that after a changeover it's cheaper to run 10,000 pieces on a press instead of 1,000 pieces. It's no wonder that misconceptions hide within "common sense". At the closing of the chapter Taiichi Ohno relates the story of a question he once received. "If Toyota was able to reduce changeover times on a press from 1.5 to 2 hours down to 10 minutes, why not produce a 20,000 piece run instead of a 10,000 piece run?" The argument was that now that you have more available press time you should produce more in the time saved through SMED and quick changeover kaizen. Ohno ends by saying that this is such a different way of thinking so that giving a direct answer to this question would have been useless. Yes, that may be what the arithmetic says... was Ohnos answer.
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Chapter 6: The Blind Spot in Cost Calculation

By Jon Miller - August 25, 2005 10:14 AM
Let's start off with a bit of background on the Toyota Production System (TPS) and what has come to be called Lean manufacturing in the West. One of the pillars of TPS as envisioned and developed by Kiichiro Toyoda, Taiichi Ohno, and Shigeo Shingo is the idea of Just in Time production. This is not the same as the "just in time inventory" fad of the 1980s which for the most part left bitter memories of failed implementations and lingering beliefs that "we are different" or "it won't work here". Just in Time is the design of production activity to be closely synchronized with customer demand according to the three principles of Takt Time, One-Piece Flow, and Downstream Pull. One of the major goals of Just in Time is to prevent the mother of the 7 wastes overproduction - by making only what the customer needs, when they need it, in the right amount. Taiichi Ohno began implementing TPS in the machining area of Toyota. Toyota in those days was working in a very traditional manufacturing way. The machining processes were vertically optimized in mass production mode. This resulted in the typical evils of batch & queue including low productivity, high inventory, and defects. Taiichi Ohno begins the chapter by saying that there is a misconception in the minds of people who calculate cost. They believe costs can be lowered on the basis of volume produced without considering the actual customer demand. One of the challenges with kaizen and implementing Just in Time production is that traditional accounting rewards high equipment utilization, absorption of cost, and counts inventory as an asset. These things are in fact examples of overproduction (waste) that is driven in part by how we calculate cost. Ohno says "Make only as much as the customer will buy. Don't make things the customer won't buy" but the cost accountants reply "What are you talking about? Of course it's cheaper to make 20 than to make 10." Ohno recognizes that in terms of simple math what the accountants say may be true but says the reality of costs is not so simple. Here he introduces the famous three equations for cost. Mathematically they are the same. They are very different in terms of the point they bring across. The equations are: 1) Price - Cost = Profit 2) Profit = Price - Cost 3) Price = Cost + Profit At first glance these all appear to be the same. Equations 1 and 2 are identical, only flipped horizontally. Equation 3 simply adds cost to both sides of the equation and is mathematically identical. However Taiichi Ohno stresses that the thinking behind each of these equations is fundamentally different, and that is something difficult for cost accountants to understand. In the case of equation 1 the market is competitive and the price is set by the customer. If the market will bear a $1.25 selling price and your cost is $1.00 per unit then your profit will be $0.25. In the case of equation 2 you need to make a certain profit, let's say $0.25 per unit. So here you have to increase the value and increase the price so that if your cost is $1 you can now sell it for $1.25. You gold-plate it if you have to, says Ohno. If you can't reduce the cost you have to increase the value so you can increase the price and get a better profit margin. Taiichi Ohno illustrates this using a story from 1974 - 1975. An economist asked him why Toyota only sold cheap cars to the United States. Why not sell high value-added luxury cars that cost 10 times more, but only sell 1/10th as many?
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller In the case of equation 3 the math may be the same but the underlying thinking is different, says Ohno. If $0.25 is a fair profit and the cost per unit is $1, then you may set the selling price at $1.25. However if the customer can purchase the same thing elsewhere at $1 then you can not set the price this way. This is typically something that governments will do to set prices in order to insure a "fair" profit to the producer, but markets (where customers make the choice) typically do not behave this way. This is the classic "cost plus" (equation 3) of U.S. government contracts. In these cases often you must pass on the cost savings to the government when the contract is renewed. If your profit is $0.25 and your cost has been reduced to $0.50 through kaizen the new selling price to the government is $0.75. This is good for the taxpayer perhaps, but still not so marketdriven. Taiichi Ohno clearly states that he prefers equation 1. This is the only equation that allows for an increase in profits based on cost reduction. If the selling price remains at $1.25 and your cost is reduced as a result of kaizen to $0.75 now you can take a fair profit of $0.50. "Costs do not exist to be calculated. Costs exist to be reduced." Out of all of Taiichi Ohno's famous quotes, this one is my favorite. Even after seeing these three equations explained many times by my teachers and reading Ohno's explanation in the original Japanese it's easy to get tangled up in the math and confused. The most useful way to understand this perhaps is that 3 is the "cost plus" approach and that 2 is the "price plus" approach, and 1 is the "cost minus" approach. Most of us do business in a "cost minus" market. Even if you don't there's no harm in remembering that costs exist to be reduced.
Comments
"Costs do not exist to be calculated. Costs exist to be reduced." This sentence means that the owner of company must focus on how to reduce the cost, rather than how to calculate the cost. Right? Posted by: Yingming Zhang - December 29, 2006 2:08 AM That's correct. Ohno says it's more important to do kaizen to reduce cost than to use cost calculation to make decisions about the business. These decisions based on cost calculations can be false because of pitfalls (assumptions) of cost calculation that is based on economies of scale or forecast volumes. Posted by: Jon Miller - December 29, 2006 7:58 AM
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Chapter 7: Don't Fear Opportunity Losses

By Jon Miller - September 4, 2005 7:29 AM
While the point of this chapter is clear (see the title) it is not as well illustrated by examples as some of the previous chapters. The message here supports the message of the following chapter on limited volume production. Taiichi Ohno starts by talking about the difficulty of doing production preparation when sales volumes are not known. Forecasts are always wrong. If we had the skills to forecast sales accurately we might as well try our luck at the tracks instead, he says. Even with small run production and market testing it is hard to know what will strike the fancy of consumers. Taiichi Ohno explains the two types of losses using the example of how the pre and post oil shock Japan perceived them. Prior to the 1973 oil shock, Japan was on a steep growth curve and manufacturers could sell whatever they could produce. If you didn't have the people or the equipment, you lost the sale and this was "opportunity loss". Ohno calls this a misconception that should not be confused with "actual losses". Taiichi Ohno uses the expression "The fish that got away looks bigger" to explain how people can confuse actual losses with opportunity losses. People fear the missed opportunity of not being able to sell more products because the sales forecasts were wrong and the production preparation was not done to enable higher production volume. Flexibility and scalability are two very important characteristics of the Lean manufacturing approach to designing equipment and ramping up through the Production Preparation Process (3P). While traditional manufacturers will buy equipment from a catalog or work with integrators to set up production lines that are capable of the highest volumes forecast, this comes at a higher cost and is driven in part by the fear of "opportunity loss". The Lean manufacturing approach is to build a small, low-cost, scalable model that can be rapidly expanded or shrunk depending on actual sales. This is one of the reasons why smaller one piece flow cells for machining, assembly, etc. are preferred to large high speed lines. The opportunity loss is different from the actual losses incurred when designing, purchasing, and running equipment that is less effective than needed or has excess capacity. Equipment that avoids opportunity loss often creates the actual losses of overproduction in an effort to absorb investment costs. Taiichi Ohno writes as though this was not the way things were done in the days when he was trying to convince people not to fear opportunity losses. Although it is not stated in the chapter, Toyota's scalable and flexible approach to production preparation is a relatively new development in TPS, possibly even after Ohno's time. The last paragraph of the chapter is one long awkward sentence. There's no evidence of an editor's touch here. It took several readings for it to make sense, and in fact it only makes sense in the context of the following chapter which talks more about limited volume production. Ohno's concluding thought (edited and abridged) is that "We (Toyota) are persistently thinking about cost reduction but this single mindedness about cost reduction can lead to misconceptions when the market growth is slow or stopped." He is saying that the thinking of how to kaizen the cost in low and limited volume production must be different from the mass production approach. Today Toyota spends a lot of money on market intelligence and even then they admit that their forecasts are always wrong, practically speaking. Do you know anyone on a waiting list for a Prius? The forecasts were wrong. Or perhaps Toyota is not afraid of opportunity losses, preferring to under-produce and catch up later rather than fill dealer lots with vehicles that dont sell and then having to sell using large incentives and 'employee pricing'.
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Chapter 8: Limited Volume Production is to Produce at Low Cost

By Jon Miller - September 30, 2005 5:46 AM
The title for this chapter is awkward in English. It comes from the problem of trying to translate the nuances of Japanese words that have the same sounds but different meaning due to an intentional replacement of one of the kanji (Chinese characters) to create a new word. Taiichi Ohno uses the term "genryou production" in the title of this chapter, meaning "limiting the production volume to just what the customer needs" as in the opposite of overproduction, one of the 7 wastes. This is in unlike the "genryou" which simply means "reduced volume" or "lower volume" contrasting traditional high volume production to decreased production volumes. You could say that Ohno's meaning is to limit intentionally, as opposed to production being reduced involuntarily by market conditions. There's a lot of this type of word play in Japanese and you will find quite a bit of it in Japanese Lean lingo also. For example, "jidoka" means "automation" but there's also jidoka (replace the 'do' with a slightly different kanji) which means "autonomation" or "autonomous working" and indicates the ability of machines or people to work intelligently and stop the process when errors are detected. This jidoka was coined by Sakichi Toyoda when he invented his automatic loom and jidoka today is a pillar of TPS. Taiichi Ohno uses the meaning for the new "genryou (limited) production" in order to make his point in this chapter. While it is easier to reduce costs when you have high volume production and can benefit from economies of scale, when you are faced with "limiting volumes" or making just what the customers want, cost reduction is a lot harder. If the customers will buy 10,000 units, you have to reduce cost at that volume even though the cost per unit would be cheaper if you produced 15,000 units. It may be true that the cost per unit is less to produce 15,000 but the company is less profitable if you make 5,000 pieces that do not sell right away because you create the wastes of transportation, inventory, motion, defects, etc. to manage the extra units. Even if your customer demand is growing to 11,000 units for instance, Taiichi Ohno says it is important to limit production to 11,000 and to do kaizen to reduce cost at this limited volume. The first "genryou" is also used when boxers try to eat less in order to "make weight" so they can fight in the lower weight class. Ohno uses this as a metaphor for how companies must be careful when they are doing this traditional "genryou" by "dieting" in order to become Lean and more competitive. If done well, you cut out the fat and you are more fit. If done poorly, this can result in less muscle and energy, losing the fight for both the boxer and for the company doing "genryou" (weight loss or Lean). The lesson for today is to use Lean and kaizen not as a downsizing tool (reduced volume through outsourcing or reductions in staff) but as a way to make the organization more fit (enabling limited volume or JIT production).
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Chapter 9: Reduced Inventory, Increased WIP

By Jon Miller - October 12, 2005 2:46 PM
"We reduced inventory" the manager of one company told Ohno, hoping for praise. This was raw material inventory so Ohno asked "Won't the lack of raw materials cause problems for production?" "Not at all" came the reply. Going to the factory Ohno sees increased work in process (WIP) inventory. They had reduced raw material inventory by turning it into WIP. Convenient for manufacturing perhaps, but bad for business. Taiichi Ohno argues that raw materials should not be considered inventory. He is very direct about this and my first reaction was "?" since raw materials are still clearly inventory. He says that if you know the price of the materials will go up, you might as well buy extra while it's cheap. Taiichi Ohno is recommending commodity speculation. Perhaps in the days of continuous growth in the Japanese automotive industry (or the days of high steel prices due to demand from Chinese manufacturing) this is sound advice. He goes as far as to say that excess raw material inventory really doesn't have an affect on the running of manufacturing company. Raw material inventory is clearly still inventory so perhaps he is taking an advanced position. I think he means that you shouldn't focus on reducing raw material inventory when doing kaizen since there are usually bigger fish to fry. Reducing raw materials is usually low impact kaizen, and not a big challenge in Lean manufacturing. Changevoer time reduction through SMED and setting up kanban systems helps do this. Taiichi Ohno continues with his theme of eliminating overproduction. He says it is easy for a factory to take the raw materials and produce WIP inventory to keep idle machines running, to let fast machines run at top speed rather than waiting for a pull from the downstream process, falling into the traditional accounting trap that high utilization and equipment efficiency means low cost. "We don't produce what we are not selling" says Taiichi Ohno. Let your machines be idle rather than run under the delusion that high utilization lowers cost. When you overproduce this uses extra energy, more wear and tear on the machine, extra raw materials and racks for their storage. Then comes the computerized inventory management system to show you where you have put all of that inventory that you produced at such a low unit cost. Ohno points out the irony of this by asking with a touch of sarcasm "Why add cost in this way after working so hard to achieve low cost production?" Ohno has taught us that overproduction is the worst of the 7 wastes of Lean manufacturing. The unstated lesson here is that the presence of raw materials is the evidence of a lack of overproduction. Taiichi Ohno closes the chapter by warning against making process flow decisions based on unit cost calculations. Ohno was faced with the argument, 'If a factory worker transports materials, this cost is part of the unit cost. If a logistics company transports materials, this is general overhead. We'll take care of reducing overhead if you will take care of reducing manufacturing cost.' This is a big mistake, says Ohno. There is no way to know how much this type of process will actually cost you. In fact as you fail to reduce overhead cost this drives the wrong decision even further. Is Ohno directing these last comments towards Toyota? This book was written in 1982. That's about two-thirds into of Toyota's 55 year process of developing TPS and doing kaizen. It's speculation, but he may be giving us a very interesting glimpse into the Lean implementation challenges of those days. He may be showing us a TPS that was maturing, wrestling with integrating software tools and traditional cost accounting methods, much as many companies are today.
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Chapter 10: The Misconception that Mass Production is Cheaper

By Jon Miller - October 28, 2005 7:37 AM
"Another example of a misconception that becomes common sense," Taiichi Ohno begins "is the idea that mass production is cheaper so that by the same logic low volume production must cost more. I have seen many factories but very few examples where mass production reduced the cost. In most cases increasing production volumes resulted in higher costs." Very interesting. I like to think that I 'get it' when it comes to TPS and kaizen, but I struggled with that Ohno is saying here. But let's continue. Ohno doesn't argue with the fact that if your capacity is 10,000 per day then the piece price will be less on a day when you have orders for 10,000 compared to a day when you have orders for 8,000. Taiichi Ohno argues that when you attempt to go beyond 10,000 per day the cost actually gets higher. The maximum capacity of a workplace is finite. Taking the example of a press, the lowest cost to produce may be at 1,000 units per hour. Increasing production to 1,200 per hour with these assets may not result in a lower cost. A 20% increase doesn't justify adding equipment, so you work overtime. Overtime premiums can be 30% to 40% (says Ohno). The union will complain if you work too much overtime, so you need to buy another machine, which is initially run at less than full capacity until you have more orders, increasing cost. The comment about the union needs some explanation. In Japan very few companies run a graveyard shift. Most run on one or two eight hour shifts. Part of this is because in the cities the trains and public transportation don't run 24 hours so you can't get people to and from the factories. Another reason is that many factories employ housewives on a seasonal or temporary basis. They expect to be able to go home and take care of their school age children in the evenings. Too much overtime and it starts to affect the quality of life, and the labor union is there to keep that from happening. Back to the misconception. This is the case when your volumes are increasing, says Ohno, but what about when your volume are declining? You can do SMED to kaizen your changeover times from 60 minutes to 10 minutes. This allows you to do multiple changeovers per hour and run smaller quantities of a wider variety of products. If you can produce 50 pieces per hour of product A (the example he gives for monthly demand), then change quickly and produce B, C, D, E, F, etc. then you can produce a mix of products at a low cost. Although he doesn't name it, he is talking about Heijunka. Ohno argues that since you did kaizen to cut changeover times, the 50 minutes of production time (60 minute changeover before kaizen - 10 minute changeover after kaizen = 50 minutes press time) actually costs nothing. This is an accounting headache, says Ohno, but just don't use this time to run a larger lot of parts in the false belief that this lowers cost. Ohno concludes: "As long as there is a perception in the market that a low volume product should cost more and you can charge a premium for this. If you can produce it cheaply through SMED, take advantage of this profitably cost accounting may lead you to believe that a certain product is profitable or that it is not. Products that could be sold profitably are not, and others are sold at a loss due to this misconception. This is a widespread phenomenon that is present no only in the automotive industry but in others."
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Chapter 11: Wasted Motion is Not Work

In this chapter Taiichi Ohno talks about the importance of training your eyes to see the difference between wasted motion and value added work. Another theme is the way the words you use affect how you think and behave. An English example of this may be the difference between saying "it broke" instead of "I broke it". He gives several examples from Japanese and Chinese. The Japanese use Chinese ideograms as part of their writing. These have different pronunciations originating in Chinese. Thus the ideogram "to move" or "ugoku" can also be read "do" (as in the sound Homer Simpson makes). The ideogram "to work" or "hataraku" has nearly the same ideogram and exactly the same pronunciation of "do". To digress for a moment, the dual meaning of "do" is where the clever idea of using jidoka to mean "autonomous working" as in "intelligent automation" or "stop the line" and "built in quality" instead of just "automation" originated. The jidoka which is the pillar of TPS uses the "to work" while the jidoka of "automation" means "self-moving". Unfortunately it does not translate very well. Ohno makes a humorous comment about how in the local dialect of Koromo City the Japanese word "move" which is "ugoku" was used interchangeably with "hataraku" or "work". The translation is a bit awkward, but for instance "She's moving a lot" might mean "She's getting a lot of work done". Koromo City changed its name to Toyota City. As a result of building the Toyota factories in this city where "to move" means "to work", Toyota people think motion is work and Ohno struggled to convince people that this was wrong. Human motion is only work when you add your wits to what you are doing, says Ohno. Taiichi Ohno says the only time motion equals work is when animals in the zoo such as bears, elephants, and monkeys move around and attract visitors. You can charge admission. If the bear is tired and there are no visitors, let the bear rest. Otherwise it is wasted motion. Even the motion of elephants doing tricks is motion plus human wits, Ohno points out. The important thing is for team leaders and supervisors to be able to distinguish what is wasted motion and what is work. They need to train their eyes to identify how the movements are related to the work being done. Taiichi Ohno gives the example of a machine making parts and a worker carefully stacking them in rows five high. The job of a supervisor is to say "Stop it. That's waste." Ohno gives another Toyota City dialect example of language affecting how you think and behave. When Ohno toured area factories the managers would often use an expression similar to "it was produced" in a passive past tense, rather than saying "we made it" in an active way. The first implies that it happened as a result of some moving about, while the second is a much more deliberate and intentional action. Whenever Ohno challenged people by asking "Which is it? Did it get made or did you make it?" people generally could not reply, since in either case it was overproduction and they would have to admitted either that they have no control over their factory or that they overproduced knowingly. Production Control people of this type who can't or don't limit overproduction should hang their head in shame, says Ohno.
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Chapter 12: Agricultural People Like Inventory

By Jon Miller - November 25, 2005 10:05 AM
Taiichi Ohno makes an interesting connection between the Japanese as historically an agricultural people and the fact that Japanese manufacturers seem to like inventory. Farmers growing rice are at the mercy of the weather. There are droughts and there are typhoons so its best to grow and harvest as much as possible and store it away for a bad season. Today the world is industrialized and modern science and technology has lessened the impact on crops. Ohno asks why industries still behave as if they were farmers affected by the weather. Ohno admits that even as he scolds people for overproducing in good times because in bad times machines break down and people don't show up for work, something of the "agricultural mind" remains in him and he also wants to have some extra just in case. Hunters eat what they kill. When you are hungry, you kill one pheasant and eat it. Farmers might kill a pig, but they will not be able to finish the whole pig so they will have to figure out how to store it. So they develop storage techniques and inventory management skills, says Ohno. Next Taiichi Ohno makes what I think is a very insightful comment. In essence he says "Inventory control is much more popular than production control." Inventory control sells more books than production control. It's easier, and perhaps more fun to be skilled at managing things that somehow got made, rather than managing the process of making things. Let's think about this. Inventory Management is big business. Today there are a lot of major firms in the logistics, warehousing and distribution business. When is the last time you hear of a global Fortune 1000 Production Control business? A lot of companies make material handling and storage equipment. Who makes production control equipment? Inventory control software is dime a dozen but we're just starting to see usable production control software tools in the last few years. This might be a topic to delve into deeper at some point in the future, but for now, back to Gemba Keiei. Taiichi Ohno continues the comparison between farmers and manufacturers with regards to inventory. During Ohno's childhood the expression "good harvest poor" or "bumper crop poor" meant the prices for crops were pushed down due to an oversupply resulting from a good harvest. Farmers made less money as a result. Price controls on rice in Japan keeps prices relatively constant regardless of oversupply. It is not purely a market based commodity. Ohno points out that this results in rising prices for rice as the farmers use cost accounting and the "cost + profit = price" equation to set the selling price of rice. Costs don't exist to be calculated, Ohno reminds us, and points out that this type of thinking seems to have spread beyond rice farmers all across industry in Japan.
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Chapter 13: Improve Productivity Even with Reduced Volumes

By Jon Miller - February 24, 2006 9:27 PM
Taiichi Ohno pulls a lesson for Lean manufacturing out of the rice farming situation in the early 1980s in Japan. The government of Japan paid farmers to decrease the area used to cultivate rice in order to limit overproduction of rice. While it might seem like a good idea to reduce overproduction, the political reason for this was to sustain the artificially high price of rice, maintain the income of farmers, and get the vote of the farmer for the politicians supporting this policy. Until not too long ago, the votes of farmers weighed more than that of city dwellers. Taiichi Ohno points out the uselessness of this policy. When Japanese farmers were told to reduce cultivation area by 10%, they became 10% more productive and produced the same amount of rice over a smaller area. The policy of the Department of Agriculture, Forestry and Fisheries stated that less area should be used to grow rice, but it did not state that the production output should be reduced. The farmers planted the rice seedlings more densely in a smaller area, resulting in higher yields per acre, and the same output. The ingenuity of doing more with less is the essence of kaizen. Taiichi Ohno says people, whether in agricultural ministries or in industry, think the same way and use bad arithmetic and do not value productivity (rice produced per acre) instead measuring only utilization (cultivated acreage). When manufacturing companies restructure and get rid of older, underutilized machines they are often replaced by newer machines that produce more. Taiichi Ohno says that this is not productivity improvement. Taiichi Ohno says its important to think more deeply about productivity. Its a mistake to think that your current productivity is the best. Its also important to get rid of the idea that unit cost is reduced when you increase production volume. Taiichi Ohno argues for cutting the link between increased production volume and productivity. In other words, increasing output by 10% with the existing people, or adding 10% more people and getting 20% more output is not the right way to think about productivity. How can companies improve productivity when their volumes decrease? "In Japan we can't get rid of people" when volumes go down, says Taiichi Ohno. This is no longer true, but 20 years ago the system of lifetime employment was still in place. Taiichi Ohno may have been most concerned about the era of decreasing production volumes that Japan was coming out of at the time he wrote this. Japan industrialized and grew very rapidly, then was shocked with declining volumes and was forced to adjust from mass production to high mix low volume production. This cycle has repeated itself at least once since the 1980s, most recently with high volume work going from Japan to China and the low volume, complex work remaining in Japan. Taiichi Ohno gives examples of how to improve productivity (although in fact they are cost reduction ideas) when production volumes go down by 10%. If 10% less machine capacity is needed, reduce the machine speeds by 10%. Says Ohno, "It is commonly said that increasing machine speed by 10% increases energy consumption by 20%, and reducing speed by 10% saves 20% energy consumption." Since there is a exponential (rather than linear) relationship for variable torque motors' speed and power consumption, reducing by 10% should save much more than 10%. The math may not be exactly right, but the idea is correct. Continuing on the assumption that labor cost is fixed, Ohno suggests that when production volumes are reduced you can use people to transport materials on carts by hand instead of using forklifts. This would save fuel, wear on the tires, etc. Instead of pallets, transport smaller quantities so that people can move them by hand. If you are using electricity to run an air compressor to provide air for pneumatic chucks, shut it off. Let the people use a turn a wrench to close the chucks by hand.
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Shut it all off, go back to basics and save money, says Taiichi Ohno. Look for kaizen idea in the smallest, most unlikely places. It might sound primitive, or even impractical, but these are the musings of Taiichi Ohno, one of the great masters of kaizen, on how to improve productivity even with reduced volumes.
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Chapter 14: Do Kaizen When Times Are Good

By Jon Miller - March 8, 2006 7:02 AM
In this brief chapter Taiichi Ohno emphasizes the need to do kaizen in order to be ready to compete with lowest cost production. When production volumes decrease, one strategy is to produce products with higher value added and higher margins. This strategy of moving upmarket does not always work, so you need to prepare by doing kaizen to lower costs, says Ohno. This message is very relevant today. Toyota is very active in doing kaizen even as they reach record profits and production growth. Not only that, according to a March 7, 2006 Automotive News article Toyota will compete with the Chinese automobile manufacturers by offering lower cost automobiles starting in 2010. Toyota appears to have learned Taiichi Ohno's lesson to "do kaizen when times are good". Taiichi Ohno says that if you wait to do kaizen until business is slow, then you are forced to spend money just to reduce costs and become competitive. You spend money on your Lean manufacturing efforts when your margins are getting smaller and this takes your attention and cash at a time when you need it most to run the business. So do kaizen when times are good, and be ready for the eventual slow times. When the economy is strong and you have a lot of business, you can cut costs effectively. If you try to lose weight when you are starving, you will not drop fat but muscle, and become weaker. When you are cutting people because you have no breathing room to cut costs, this is not true cost reduction or kaizen. The most important thing is to do kaizen when times are good, says Taiichi Ohno. Doing kaizen when business is good can be difficult, because the numbers show that your financial performance is good. Why do what is difficult (changing people's behavior through kaizen) when you can do more of what you are doing now - the same things that are making money today? This is the big mistake companies make. Taiichi Ohno says that companies have a responsibility to maintain employment and make a profit. The only way to do this is to reduce cost. Costs are reduced by scientifically reducing waste from every process. "I think this effort is the most important job of Industrial Engineering" says Taiichi Ohno. Taiichi Ohno uses a Japanese proverb similar to "An empty sack cannot stand upright" to express that it is very difficult to make good decisions and do kaizen to cut costs the right way when your business is struggling. By the same token, it is easier to do kaizen the right way when times are good. When you are poor and struggling to make ends meet it is hard to think beyond today. The lesson from Taiichi Ohno in this chapter is very clear. Avoid the trap of becoming comfortable with your success, and do kaizen when times are good.
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Chapter 15: Just In Time

By Jon Miller - March 16, 2006 10:27 AM
In this chapter Taiichi Ohno discusses just in time but spends very little time on how material and information flows in TPS and most of his time wondering about the origin of the English phrase. Toyota Production System has two pillars: autonomation (jidoka) and just in time but I realized only recently that just in time is a created term. Taiichi Ohno proceeds to explain his theory that Kiichiro Toyoda took the English words and made a unique expression based on Japanese thinking. As a native English speaker I think hes off base on this theory but his thought process is interesting. Taiichi Ohno writes: According to people from countries where they speak English such as America and England the correct phrase is exactly on time. The phrase just in time does not actually exist. He cant be blamed for this misconception. This chapter was written in 1982. Then, as now, it is not rare for English teachers in Japan have dubious credentials. With his limited English Taiichi Ohno continues to explore the nuances of timing, in time and just. He likens the use of just in the phrase just a moment to the Japanese chotto which means a little. Whether being in time or asking someone to wait, they key idea is that you are waiting only a little or you are on time only a little and not too much. Taiichi Ohno says the better word in Japanese is chodo which means just as in I just made it or just barely. In other words, if you need material delivered after lunch it should be delivered just around lunch and not in the morning or the day before. That is still in time but not just in time. He clarifies the misconception by some English speakers who observe Toyotas Just in Time and think exactly on time places an unreasonable burden on suppliers. Taiichi Ohno says that if a delivery is needed for use at 1PM, an 11AM is delivery is OK but a 9AM delivery is not OK. A deliver 2 hours in advance of the time of use allows for 1 or 2 hours of inventory so that by the time the line is empty the new material will be available. Just in Time at Toyota is not about holding suppliers to a 5 or 10 minute exactly on time delivery window and punishing suppliers if they fail. Taiichi Ohno ends the chapter believing that just in time is not real English and that Kiichiro Toyoda invented the phrase to better express the Japanese concept the chodo on time. Toyota history credits Kiichiro Toyoda with adding just in time to the development of the Toyota Production System in the 1930s. It was Taiichi Ohno, with the help of Shigeo Shingo, who made Just in Time into what it is today, built around the three elements of Takt Time, One Piece Flow and Downstream Pull. Kiichiro Toyoda had the vision, Taiichi Ohno built the framework and Shigeo Shingo worked out the details to make JIT a reality. We are ever grateful. As a matter of interest Jules Styne wrote a song called Just in Time for the musical Bells Are Ringing in 1956. Thats the same year in which Taiichi Ohno visited the U.S. on his study mission. Its probably safe to say Ohnos trip to the U.S. didnt include a visit to the Broadway show.
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Chapter 16: Grandpa Sakichi's Jidoka Idea

By Jon Miller - March 23, 2006 5:09 PM
I really enjoyed this chapter for a couple of reasons. First, Ohno uses the old-fashioned honorific for grandpa or old man when referring to Sakichi Toyoda in the title. Theres a certain warmth there and a reminder that born in 1912, Taiichi Ohno had the sensibilities and values of an earlier era. Second, Ohno spends a paragraph talking about his schooling and early days working at Toyoda Boshoku (textiles) making thread, and later in the chapter how he came to first work at Toyota Motor Company. Of his first years out of school, he says In these days they made you work for three years on the shop floor before they would give you a job as a section manager. Hes actually complaining (!) though probably in fond memory, about being a trained engineer who was sent to work out on the gemba. This experience must have been formative for Ohno. He tells of how he joined Toyoda Boshoku (thread manufacturing) after graduating from an industrial high school (equivalent of a polytechnic school) in mechanical engineering. Toyoda Boshoku was located next to Toyoda Loom Works. Ohno says he became aware later what a significant invention the automatic loom (the origin of jidoka) was, admitting that at the time he was young and did not realize it. Taiichi Ohno is surprisingly critical of how jidoka was used at Toyoda Loom Works, but for good reason. People took this great invention and misused it. He says that just like the conveyor belt at Ford the automatic loom improved productivity tremendously by automating work that was done previously by hands and feet. The most important difference between automation and Sakichi Toyodas jidoka (autonomation) was that the machine ran automatically and stopped when the thread broke or ran out. The key is that this prevents the automatic loom from producing defects. This concept of built-in quality is what made this invention unique. However, people at Toyoda Loom Works saw only that this made it easier to make people run to the machines that were stopped so they could get them running again, improving productivity. The same was true for machines with built-in jidoka mechanisms at Toyoda Boshoku. Their main goal was to increase output. In Taiichi Ohnos thinking they should have used the opportunity to learn why the thread broke and stopped the machine so that they could prevent this defect in the future. Taiichi Ohno concludes that in those early days Grandpa Sakichis jidoka idea was misused to make people work harder so that performance would improve. Toyoda Boshoku was merged into Toyota Motor Corporation during World War II and then spun off again after the war. I didnt make automotive parts during the war. I made airplane parts. Says Ohno. He spent a year making brass pipes used to cool oil in airplanes. He was made Section Manager of final assembly in the main automobile factory in February 1945. Taiichi Ohno explains how Grandpa Sakichis jidoka idea affected him by saying, The way Toyota produced automobiles was the same [as Loom Works] and very labor-intensive. I realized we needed to use jidoka better and to think of ways to produce more with the people we had. Andon lamps, pull chords and the culture of stop and fix to build in quality at Toyota today are all evidence that Taiichi Ohno succeeded in this.
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Chapter 17: The Goal - Improve Productivity TenFold

By Jon Miller - April 2, 2006 10:00 PM
Taiichi Ohno recounts when he first learned in 1937 that the American worker was 9 times more productive than the Japanese worker. Taiichi Ohno heard this from a Mitsubishi Electric factory manager who had recently returned from a tour of Germany and America. The 300 person factory in Germany had three times the output of a Japanese factory. The American factory that the factory manager had visited had three times the productivity of the German factory. The American factory was therefore was 9 times more productive than the Japanese. In those days Japanese used production equipment built in America or Europe. The difference in equipment immediately after World War II may have caused a large gap in productivity, but this was before World War II when the Japanese had heavily invested in foreign technology. One can imagine Taiichi Ohno scratching his head, thinking There must be another reason. The GHQ of the American occupying forces announced that American productivity was 8 times greater than Japanese productivity. Since this number was an average across industries, and American automobile manufacturing is a leading industry they must be more productive, thought Ohno, and concluded that the goal was to improve productivity ten-fold. How can we possibly improve productivity ten-fold? It was this question over many years that drove Taiichi Ohno to develop the Toyota Production System. At that time (and perhaps even now) no one was approaching productivity improvement with a goal of 100% to 1000%. It was not as if you could go to see Ford and GM and copy what they were doing and catch up right away. Taiichi Ohno says, We needed to totally change our thinking. That was the spark that led to the Ohno System. Back in those days the final assembly factory at Toyota had a conveyor. The old-timers in the assembly section all had been taught by Kiichiro Toyoda that just in time was the best way for parts to assemble. However in reality the parts were delivered when completed, so that engines would be brought to the assembly when they had been built, but there would not be enough steering wheels. As a result there was an intermediate warehouse with lots of parts but not much that you could assemble into a finished automobile. The production signal was not managed so each department would build and deliver on their own schedule. It was not until the 17th or 18th of the month that the final assembly would have enough to begin putting cars together. They did 30 days work in 10 days, so they needed 3 times as many people. If heijunka could be used to smooth out the mix and volume of production perhaps one-third of the people could do the same work, thought Taiichi Ohno. By producing and delivering parts just in time so that parts needed arrived when they were needed it was actually easy to improve productivity by 300%. After that was done, looking more carefully at the process and finding ways to do kaizen, it was not hard to increase the productivity to 500% improvement from the beginning. Taiichi Ohno explains that the workers in the assembly area felt they were being worked harder, but that this was a misconception. Assembly work is very labor intensive and when one-third of the people achieved the same output they concluded they must be working harder. In fact the assembly line was often stopped as there were no parts to assemble. People tended to keep busy doing other things. People confused motion with work. This is common even today. One of the quirks of the Japanese language is that many times subject of the sentence or the verb can be left out. It is up to the reader to fill in the blank or understand from context what is being said. The title of this chapter does not make it clear whether the goal was or the goal is to improve productivity ten-fold. You have to answer that question for yourself.
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Chapter 18: Supermarket System

Taiichi Ohno starts out the chapter not quite having left the themes of his last two chapters behind. He describes how the jidoka idea that came from the Toyota textile business led to one operator running 20 or 30 machines. This thinking was transferred to the automotive side of Toyota's business, resulting in one machine operator running more than 10 machines toward the goal of ten-fold productivity improvement. Taiichi Ohno gives credit to this concept being the very foundation of the Toyota Production System. At this half-way point in the book I am convinced that this book is not one he intentionally set out to write about what is "Workplace Management" but instead a collections of the ideas, stories and wisdom of Taiichi Ohno. These "chapters" were probably titled by an editor at JMAM who read through the chapters, found the theme and gave each chapter its title. Or maybe it's just that one page from the previous chapters was accidentally slipped into this one. The second paragraph in the chapter abruptly begins discussing the origin of the supermarket system at Toyota. "Back in 1951 or 1952, one of my classmates who was the first one of us to go to America brought back many color photographs which he showed us in a slideshow." The supermarket was such a novelty that Ohno's classmate had taken several pictures of them. Ohno was struck by the efficiency of having people walk around with their own shopping carts to pick what they wanted and then go to the check out lady when they were ready to buy. When Toyota began doing downstream pull in 1952-1953 they called it the supermarket system. "Rather than call it the Ohno System or the Ohno Line, calling it the Supermarket System made people accept it easier. Japanese were suckers for anything with an English name in those days." People also saw that the idea of customers getting what you needed when you needed it was exactly like the just in time concept. The downstream process could take only as much material as they had money to buy or only as much as they had a place to store it. This was the most economical and productive method, according to Ohno. Traditionally groceries were either delivered to your home or bought at a produce stand supplied by another distributor. This might seem convenient for the customers but it actually raised the cost, says Ohno. For example, the tofu maker would make fresh tofu and walk around with his cart blowing his flute to let people know it was available. The tofu was very fresh and delivered to your door. However if tofu was very popular in your neighborhood that day then he might run out before you could buy any, and your miso soup would be without tofu. This was not so convenient for the customer. Customers drive to the supermarket when they want to buy something. This may seem to be less customer-focused than the direct delivery to the home. However in fact people who wanted two leeks would have to buy an entire bunch of leeks. To make it worth the delivery person's effort they would also order a daikon radish. So customers ended up buying more and spending more than they needed right now and this was less economical. Taiichi Ohno relates this to the factory. Often the producer (upstream) process delivers parts downstream and thinks they are providing a service when in fact they are pushing material and making the assembly area less efficient. Ohno says that converting from push to pull can easily triple productivity. Just in time (takt, flow, pull) lets you know what you need to produce, since what the next process takes away is what they need.
Comments
I have to laugh out loud at the irony of Japanese workers being "suckers for anything with an English name." I thought that was a phenomenon unique to American managers! Posted by: Andy Wagner - April 8, 2006 6:49 PM
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Chapter 19: Toyota Made the Kanban System Possible

In this chapter Taiichi Ohno explains the origin and the conditions that resulted in the development of the kanban system at Toyota. In the beginning the machining process upstream would replenish what the assembly process downstream used. The kanban card was used as a production instruction ticket. It was still upstream push, based on a kanban order card. The machining processes faced challenges of large lot sizes and long lead-times in order to respond to the downstream pull. Machine changeover times kept the process from being responsive. In order to deliver just in time - the quantity of what the customer wants when they want it - single minute changeovers became necessary. Back in those days single minute changeovers were not a reality. Nobody was doing it. The workers did not believe it was possible. It seemed even illogical and risky, not something that responsible management would permit a factory manager to experiment with. Today we have many success stories of Lean manufacturing and SMED is a standard part of the curriculum of many industrial engineering or operations management programs. Even today people fear change and think single minutes is impossible. Imagine what Ohno must have felt like 50 years ago trying to do something that had never been done. Taiichi Ohno says that he was scared, and that many people thought that his efforts could lead the company to bankruptcy, but that he was convinced that this was what was needed for Japanese automobile manufacturing to turn a corner. Until 1961 or 1962, the Toyota Production System was not named as such. It was the Ohno System. This is because it was a risky experiment, and Ohno's name was on it, not Toyota's. At the same time Taiichi Ohno fully credits the Toyota executives for having the courage to support his efforts. Before the oil shock in 1973 productivity improvement was relatively easy because the industry was living in the world of mass production. Toyota only had to increase output with the same people in order to improve productivity. Several chapters of Gemba Keiei are dedicated to the discussion of "reduced volume production" and its challenges. This is because that is the world in which the Toyota Production System was born. The thinking behind Just in Time led to the development of the kanban system. In those days (and still at many companies today) the "common sense" was for the producer process to deliver the parts downstream. By reversing this so that the downstream process had to go get the parts they wanted, Just in Time was achieved. "There was nothing difficult or challenging about this" says Ohno. It was just turning common sense around. In those days people thought Just in Time was an ideal, and not something that could be achieved in practice. This was common sense. Ohno says that he turned this common sense around because it was part of his personality to look at things from different perspectives. He was often scolded as a child for this, but it helped him go beyond common sense and see things differently. Taiichi Ohno says that being the final assembly manager was good education for him because it allowed him to see the folly of the push production system from the final point downstream. Various departments would proudly say they achieved their monthly targets for engines, frames, etc. but without enough steering wheels Ohno's assembly lines couldn't build cars. The upstream push into the warehouse was not helping Ohno run the assembly lines, so he went beyond common sense and took a backwards look at the situation, arriving at downstream pull. Ohno started working on the Kanban system in mid 1950s. Back then he was in charge of final assembly, machining, and stamping factories. Another manager was responsible for
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller forging, casting and heat treating. This limited the kanban system to operate between assembly and machining and also assembly and stamping. Only in 1962 when all departments were placed under Ohno was the Motomachi factory able to run a complete kanban system. It was not easy to ask another manager to manage their production according to a kanban system, so the kanban system developed one section at a time. The suppliers were included in the kanban system at the very end "to minimize confusion to our suppliers". Ohno gives an example of another Toyota manager who caused problems for a supplier who was forced onto a kanban system even before the Motomachi factory at Toyota had succeeded with kanban. Ohno makes a strong statement that you should not implement a kanban system with your suppliers before you have successfully implemented the kanban system in-house. This is advice that is seldom heeded today. This somewhat explains why my Japanese teachers, themselves students of Ohno, insisted to American companies that they should not rush to implement kanban. You are not ready they would say. Years before kaizen and Lean manufacturing was properly understood (are we there yet?) kanban was a buzzword in U.S. manufacturing, and misunderstanding of kanban systems persist today. It seems not a week goes by when a press release touts one or another software vendor as the market leader in digital kanban for advancing Lean manufacturing implementations. I fear that few of these are much more than a way of coercing suppliers to submit to a supply chain scheme that burdens them with inventory management. Almost none of these firms sell software that enables production kanban and withdrawal kanban in-house. Too few of these software companies could show you an implementation site where production kanban triggered production upstream and withdrawal kanban were used for downstream pull. Even fewer could show you sites where kanban is used as a tool of continuous improvement, instead of a supply chain hammer with dubious long-term benefits. Technology is a wonderful thing, but it's important to understand the thinking behind the process that is being automated or digitized. The same can be said for the kanban system.
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Chapter 20: What I Learned About Forging Changeover from Toyota do Brasil
By Jon Miller - May 3, 2006 6:18 PM
Taiichi Ohno begins the chapter by saying In order to achieve Just in Time you need to solve your changeover problems and reduce lot sizes. Forging processes are the most difficult. This chapter should really be titled Toyota Learned How to Do Forging Changeovers in Brazil. Its an interesting story. Taiichi Ohno continues to describe what happens in a forging process, such as heating the metal, placing it in the die and hitting it. The combination of the right amount of heat, the right amount of metal, the right amount of time and dealing with the scale that results from oxidization all make die adjustment in a forging process challenging. Because this adjustment is done by trial and error with two or three parts hit and the process adjusted, it takes a lot of time to changeover a forging press. Forging processes had the longest changeovers at Toyota and this caused Toyota to produce large lots of parts at the forging process. Back in those days at Toyota do Brasil we had installed one forging press so that we could bring all of our forging work in house Taiichi Ohno tells us. This one press had to make more than 60 different forgings. They had only one press because they only build 2 or 3 automobiles per day. It was the smallest automobile company in the world, according to Ohno. Because of the extremely low volumes, no other forging supplier would make the parts for Toyota. Forgings are typically ordered in 2,000 or 3,000 piece orders due to the long changeover times. This would have been many months of inventory at volumes of 2 or 3 cars per day. Toyotas solution was to install a forging press and make all 60 parts internally. According to Ohno, the rule was that you couldnt make more than 10 of any single part at a time. If changeovers took one hour, you would run out of time very quickly in a day doing changeovers because the runs were so short. So the first target was a 15 minute changeover. If the changeover was 15 minutes and the run time was 15 minutes, you could make two different parts each hour. By that math you could make 16 different forgings in an 8 hour day, and cycle through all 60+ forgings each week. For those of you struggling with kanban quantity reduction, heijunka or how to satisfy a wide variety of customer demands at low volumes, Taiichi Ohno just gave you the answer. Ohno notes that while attempts to cut forging changeover times at Toyota in Japan would have been strongly resisted, Brazilians were more willing to listen to a Japanese instructor with a mustache who sounded like he knew what he was talking about. With the efforts of the Brazilian workers at Toyota and the suggestions from Taiichi Ohno such as external changeover and using guides on the dies they were able to reduce the changeovers to less than 10 minutes. Their efforts were so successful that one forging press was able to make more than 60 different parts and never cause part shortages. Several Japanese employees were sent to Brazil to learn about forging changeover from the Brazilians. As a result changeover reduction at Toyota in Japan became much more active. Taiichi Ohno says that casting changeover reduction is not nearly so difficult, and goes on to describe the steps in a casting process. Because the volumes were so much higher at Toyota in Japan they did not have the same sensitivity to long changeover times and the need for lot size reduction. Casting runs of 2,000 or 3,000 were considered acceptable. In the case of casting also, Toyota do Brasil came up with innovative ways to reduce changeover time.
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Taiichi Ohno gives a lot of credit to Toyota do Brasil as being a good model plant or test case for implementing high mix low volume Toyota Production System. At Toyota in Japan the volumes were so high that many lines were dedicated and practically no changeovers were done. When Ohno says Toyota do Brasil may be doing TPS better than any other Toyota factory he seems to be saying that true TPS is high mix, low volume and when you have high volumes and you do not need to implement SMED, you are not really doing TPS. Ohno notes that when volumes are so much higher, companies can still turn a profit because of sheer volume, without needing to reduce cost and that the amazing thing was that Toyota do Brasil was profitable even as a high mix low volume automobile manufacturer. Toyota Production System is an approach that really ought to be used for mid-sized companies since it will be most effective due to the fact that they will have lower volumes and more variety. TPS may not exist today had Toyota been a high volume manufacturer in the early days when Taiichi Ohno was helping to develop it. Put on your fake mustache. Fly to an overeas factory. They may be more willing to listen and try kaizen. Then your home office can learn TPS from them.
Comments
sir please send me detail of qdcs Posted by: virender vashist - August 1, 2006 1:19 AM Hello and thank you for your question. What we mean by SQDC is Safety, Quality, Delivery and Cost. That is how kaizen should be focused in order to insure that the process is safe, capable of producing good quality, ontime and at lowest cost. The cost is very important but it is last in consideration because too often people forget the other three in blind pursuit of lowest unit cost, making overall cost higher. Also, reducing SQD should result in reduced cost if done correctly. Posted by: Jon Miller - August 1, 2006 7:47 AM
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Chapter 21: Rationalization is Doing What is Rational

By Jon Miller - May 15, 2006 6:31 AM
The title of this chapter is somewhat awkward. By another translation you could read it as "Improvement means doing what is rational" or "Kaizen means following reason". But here Taiichi Ohno is engaging in a bit of word play. The Japanese for rationalization, in literal translation means "make it fit with reason" but it is better translated as "consolidation" or "improvement" or in today's words. Theme of the chapter is that kaizen (rationalization) is what appears quite reasonable and rational and nothing particularly spectacular. "When I was implementing the Ohno System, it was difficult to get people to understand what I was saying." Taiichi Ohno's response to people who didn't understand him ranged from "If you can't do what I say, get out of my sight" to "Just do it. Don't worry. I'll take responsibility. Ohno learned that it would take too long for his orders to go from factory manager to section manager to supervisor to team leader. Not only that but his verbal directives could change considerably because managers along the reporting chain would interpret the instructions in ways that suited them. Ohno says he began going directly to the foremen in the factory to give directives, and to go to them for direct feedback Of course the managers complained quite a bit about being bypassed but the foremen on the front lines were motivated because the factory manager came directly to them with a request to try something new. Ohno made sure that the foremen would tell their managers what Ohno had asked them to do. "This is how we educated the managers both from the top down and from the bottom up" says Taiichi Ohno. Ohno scolded the managers when they simply reported what the foremen told them. He wanted them to think for themselves and try something in addition to what Ohno had instructed. If Ohno didn't like what they tried, he still scolded them. It wasn't easy being a manager in Ohno's factory in those days. No other company was implementing the Ohno System and no one knew what it should look like. Ohno would give orders in the morning and change directions by noon if it wasn't working. He found engineers to be most stubborn and unwilling to change. The wise mend their ways so change and become wise, Ohno would tell them. There was no factory where they could go see the Ohno System. It did not exist in those days. Ohno did have his people visit Nissan to learn about their production system. He would tell them not to copy it because then they would only be as good as Nissan. They must learn from it and make things better. But people would copy it anyway, so he stopped sending them to Nissan. Before long Nissan stopped accepting tours. Ohno says that Nissan had purchased and moved a factory from the United States and American engineers had helped to set up the factory, so Nissan was probably more advanced than Toyota in those days. During the war, officer from the Japanese military would come with their bamboo spears and give orders to Nissan to produce, threatening "the Americans are coming". The bamboo spears were carried instead of more modern weapons due to the severe lack of raw materials in Japan toward the end of the war. Ohno says that Nissan was technically very knowledgeable but these experiences made them less willing to listen to the orders from other Japanese. It's a very interesting statement, considering the fact that it took Carlos Ghosn, a French citizen of Lebanese descent born in Brazil, to bring Nissan out of bankruptcy and turn them around. In 1956 or 1957 Ohno visited factories in the United States. "What they were doing was common sense. It was nothing special" he says. Visiting GM, Ford and American Motors, they all appeared to be doing what was common sense. Ohno observed that the "rationalized" or improved production lines were nothing spectacular and the more rationalized a production
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller line was, the more it looked like common sense. "When you see a factory and think 'wow!' then this is not a very good factory. When you see a factory and think 'this is common sense' and of no value to the observer, I think that may be a sign that they have rationalized rather well" says Ohno. In other words, if they make it look easy it's probably a sure sign that a lot of hard work went into it. Ohno says that it is hard for the Japanese to do what is common sense without putting up some resistance. Doing what is simple is difficult for them. "Rationalization is doing what is reasonable or rational, so there should be nothing that makes you say 'wow!'" says Ohno. He gives examples of "rational" improvements such as using the rolling motion to move a round part or putting wheels on something heavy to make it easier to move. Taiichi Ohno says "When something has been completely rationalized it should appear very simple, but people make the mistake of thinking too hard about it. Even the idea of saying 'reduce inventory and work in process' through rationalization does not make sense. If it's rational there should be no work in process. If you have two pieces when you only need one, this is not rational."
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Chapter 22: Shut the Machines Off!

By Jon Miller - May 23, 2006 7:21 AM
Taiichi Ohno starts by explaining the difference between an automatic loom working and moving or running. Working implies that jidoka prevents it from making defects. A machine running and producing defects is not a machine working. If the machine makes a defect, it should stop. The difference between automation and jidoka (autonomation) is that in the former the machine is running and in the latter it is working. According to Ohno the definition of autonomation (jidoka) is as follows: A machine that incorporates an automatic stop device is called autonomation. His schooling was in mechanical engineering at a polytechnic high school, and during a class on textile manufacturing he was taught the definition of autonomation (jidoka). For decades I believed that for a machine to work meant to have an automatic stop device, such as sensors, built in to shut the machines off says Taiichi Ohno. He explains that his polytechnic high school was near Kariya, which is the location of Toyota Loom Works. My teacher on textile manufacturing must have studied their autonomation (jidoka). There were probably no other schools teaching this definition. Ohno explains that this thinking led to the idea of having operators stop the lines manually when it was difficult or impractical to attach sensors to a manual operation. This also resulted in moving conveyors with "stop the line" pull cords and andon lights built in. He relates the story of a President of one of the companies he was instructing in kaizen who complained that Ohno would only teach them how to stop making things, not how to make things. What a simple yet powerful lesson in built-in quality! The whole point of stopping is to make problems visible. The first step is to instruct the workers when to stop the line. The idea of jidoka with built-in quality through the autonomous stop capability begins with making it easy for workers to shut the machines off. Once the workers begin to shut the machines off frequently, managers and engineers will think harder about how to prevent workers from stopping the machines. This leads to quality kaizen by reducing the reasons that workers need to stop the lines. Taiichi Ohno observes that this style of assembly line is rare in the world, and even in Japan. One of the first things that Daihatsu and Hino (Toyota group companies building trucks) were told to do was to install stop buttons on the lines. The next step was to make the lines stop without human intervention. Taiichi Ohno says that to do kaizen you have to think of ways to keep the worker from stopping the line. This is not to be confused with preventing the worker from stopping the line when they should, but rather it is to eliminate why workers would stop the line for reasons of quality, safety or inability to complete the task within takt time. In the 1950s the kaizen and cost reduction efforts at Toyota led by Ohno focused on the fundamentals of quality and safety. Quality defects are pure cost, and any improvement in quality defects led directly to cost reduction. Taiichi Ohno says When we first started doing this I used to tell the workers on the assembly lines at the Motomachi factory If you feel tired, shut the machines off! That way the team leader or supervisor would have to think of ways to prevent the worker from getting tired. That is the humanistic way to do kaizen.
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Chapter 23: Producing at the Lowest Possible Cost

By Jon Miller - May 30, 2006 9:58 PM
Taiichi Ohno starts the chapter by telling the story of when the President of Toyota, Mr. Ishida, was summoned to the National Diet and scolded by politicians for building passenger cars that were too expensive. Back then even the head of the Bank of Japan said that cars should not be built in Japan but they should be imported at a lower cost from the United States, according to Ohno. The most important thing in those days was to produce cars at the lowest possible cost. Taiichi Ohno says it was common sense in Japan in the 1940s and 1950s that Japan could not be competitive making cars. It was not their core competency, and should be outsourced, in todays language. How ironic. The focus was on improving productivity tenfold so that labor cost would be at the same level as automobiles built in the United States. Toyota could not take the high volume production path to profitability. Indeed, Toyota tried this and nearly went bankrupt in 1949-1950, says Ohno. Toyota built 1,000 cars per month but could not sell them. Their turnaround plan was to be profitable building 900 cars per month, but the Korean War came along and rescued Toyota with military orders. When President Kamiya of Toyota Motor sales gave the challenge of selling to the United States market in the mid-1950s, this required a production volume of thousands. At the time Ohno wondered How will we do it? but then reflects today we build a thousand cars in a matter of minutes. At the beginning the Toyota Production System was very effective. During the years with the rapid increase in production volumes, the Toyota Production System was unknown to the world. Only after the oil shock and the news that Toyota was still profitable did people take notice of the Toyota Production System. This was in 1973-1974. Without those challenging years, the Toyota Production System may have been much more like the American system based on monthly volumes in the tens of thousands and model changes every 3 years, and plenty of reason to make capital investment. Ohno then tells a story of a trainee from Daihatsu working at Toyota. He taught the trainee You must only produce what you need. The trainee replied But I have spare time. And we have more materials. Isnt it better to make as many as possible? No. We make only what is needed. If we only need 100, but you make 120 just because we have the materials, this is a loss to the company. said Ohno. The workers were taught to be multi-process handlers so that they could be responsible for many operations, completing a total of 100 pieces even if it took them all shift. Ohno says Once during the war, we finished our daily requirements by noon so I sent everyone home. I got into big trouble that time. Presumably the army procurement officers did not share Ohnos views on overproduction. Taiichi Ohno says the key is to produce what you need at the lowest possible cost. This means giving people a full work load through multi-process handling, rather than building more work in process and using up materials just because you have time. This is the key to producing at the lowest possible cost. One of the fundamentals of the Toyota Production System is to produce what is needed, in the right amount, when it is needed. But people often forget to add at the lowest possible cost. Taiichi Ohno admits that this last part is not written down. Many people think it just means that when youre done with the days work you go home. The Toyota Production System is
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller producing what you need, in the right amount, when you need it at the lowest possible cost says Ohno. Taiichi Ohno warns against reversing the order and putting producing at the lowest possible cost first, before what is needed, in the right amount, when it is needed. He says there are many ways to produce at a low cost, but if you dont put Just in Time first, supposedly low cost production actually costs more. Producing just what you need at the lowest possible cost is the most difficult part of the Toyota Production System and the reason people need to study Just in Time carefully, says Ohno. If you place producing at the lowest possible cost first, you may overproduce or not make enough, or not produce at the right time. If you chase the lowest cost there is no end. Combining work most effectively to minimize wasted time is the way to avoid high costs. Taiichi Ohno emphasizes that this thinking comes from reduced volume production and if you attempt to lower cost through increased volumes you are going against the grain of the Toyota Production System.
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Chapter 24: Fight the Robot Fad

By Jon Miller - June 7, 2006 8:07 PM
We only started talking about reduced volume production after the 1973 oil shock. Prior to that we could sell everything we made so cost reduction for mass production was easier. Ohno goes on to say that although many other industries learned to cut cost with reduced volumes, to this day (ca. 1982) most automotive companies still think in terms of volume and not cost. Taiichi Ohno warns against taking the short cut of using robots or automation before doing cost reduction first. I think many are using robots because it is a fad. People think they need robots to keep up appearances, not really thinking about the effect of robots on cost. Ohno continues, Were not against robots or computers, both are necessary for progress. But dont ignore the issue of how these things reduce cost. Robot manufacturers may not like my saying this. On the other hand, there is an Englishman who said that the use of robots and automation should be internationally banned around the year 2000, so perhaps you should buy them now while you can. By coincidence, there was an interview in todays Asahi newspaper (June 7, 2006) with the President Nakayama of Yaskawa Electric Corp: Q: In manufacturing sites, some workers voice concern that their jobs may be taken over by robots. How do you see the situation? A: In the near future, robots would come to take over simple labor and physically demanding work. Eventually, as aging advances and the Japanese population declines, some industries would have to be thoroughly automated with robots or else they would disappear from Japan. Still, robots cannot take over creative work and kaizen (progressive improvement) activities that Japanese companies are good at. It is important for humans and robots to coexist in harmony. Important is an understatement. We visited Yaskawa Electric Co. earlier this year. Luke writes about Yaskawa here where he describes the scene of robots building robots as surreal. This clever book may prepare you for the day robots building robots gain artificial intelligence and decide that coexistence in harmony with humans is not to their liking. Ohno admits that for sustained high volume production it makes sense to use robots, and for work that is unsafe for people robots should be used even at a higher cost. But Ohno says robots should not be used merely for the fad of modernization. Ohno tells how his students at Toyoda Gosei would say to him We can automate this process but Ohno warned them against taking the step to use robots or to automate too easily. Automation should follow the proper steps, and be driven by a need. He likens it to buying a piano just because your neighbor bought a piano, regardless of whether you have musical talent. Taiichi Ohno says the number one need for robots is to reduce cost. Following the principle of respect for people, robots should also be used to perform operations unsafe for humans even at a higher cost. He says sometimes a robot can not perform a dangerous or unpleasant task and a person must do it. However, people should not perform unsafe work because it is cheaper than using a robot. The worst use of automation is as a toy for engineers or kaizen specialists. Says Ohno. This robot created by Toyota at the exhibition hall plays a mean trumpet. A technological marvel perhaps, but hat would Taiichi Ohno say about this toy? Ohno predicts the words of President Nakayama of Yasawa Electric by saying As labor cost increases in Japan and as the population ages there may come a day when robots will replace human workers in Japan.
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Ohno ends the chapter by asking the question If the robot fad continues and we replace people with robots this is a problem. Robots dont complain or ask for raises. Using robots to reduce cost may be good for the corporation, but is it good for the whole? There must be harmony between cost saving technologies and the needs of humans, whether the "technology" is robots, outsourcing, office automation or Lean manufacturing.
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Chapter 25: Work is a Game of Wits with Subordinates

Taiichi Ohno begins the chapter In order to lead a large number of people in work, you have to be tough. But I think this is basically not a matter of giving orders or instructions, but a game of wits with subordinates. Ohno says that when you give orders or instructions to a subordinate you have to think as if you were given those orders yourself. In other words, you have to think about how you would solve the problem yourself. If you lose the game of wits, you have to admit it. Ohno says. He says that most managers give orders based on what they want. The attitude of Youre the expert, so go figure it out is not acceptable. If you dont match wits with your subordinates and try to solve the problem yourself, then when they come back and say it cant be done you can only say youre the specialists, figure it out or give up. Taiichi Ohno is saying that even as a manger who has broader responsibilities you need to have not only the awareness of the problems but the ability to think about how to solve the problems yourself. If you lose the game of wits, you have to admit it or people wont follow you as a leader. He says this is because if you give orders and offer only complaints and not ideas or suggestions when subordinates run into challenges, they will not see you as a leader. You have to think about the problem together, and struggle together to solve the problem with your subordinate, says Ohno. If you have no ideas or suggestions to give when your subordinates say I tried it but it didnt work you still dont give up but offer suggestions in this game of wits. When finally there is some progress on solving the problem, you say My suggestion was poor but you did good job thinking about it. He says what is important here is to show an attitude of respect that the subordinate will understand. In order to be a leader you need to cultivate the mind Taiichi Ohno says. But also, you need to change your attitude with some people. Everyone has a different personality. You can say the same thing and some people will respond and some will not. Taiichi Ohno says Its not easy to say follow me but when people do follow, you have a responsibility to take care of them through thick and thin. Talking about how to lead Toyota Production System implementation on the factory, Ohno recommends saying Get out of my sight if you cant do what I say but to be grateful and help these people who do follow you as much as you can. Because its not all good things Ohno says, about implementing the Toyota Production System. This is a curious chapter. It is quite short, and written in a way that forces the reader to fill in a few blanks. But Taiichi Ohnos tough but compassionate character comes through clearly.
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Chapter 26: There Are No Supervisors at the Administrative Gemba

Administrative work is done at the gemba just the same as the production gemba where we make things. The office is the administrative gemba. Taiichi Ohno begins the chapter. Gemba is a Japanese word meaning actual place. In fact it is written gen-ba but pronounced more like gemba. "Gen" means real or actual and ba means place. Gemba is the site, scene or place where it actually happens, whatever it may be. No one is watching the administrative gemba says Ohno. The production gemba is easy to see, but departments where managers work is very hard to see. People in the office may look like theyre working very hard but its impossible to know whether thats the work that is needed right now, he says. In the administrative gemba, the managers dont have the brains or ideas to be supervisors. They have manager brains. Ohno says. He is pretty blunt. I think there are no supervisors at the administrative gemba. There should be. Taiichi Ohno continues to explain that supervisors must be able to instruct and also know how to evaluate the results of work. The traditional Japanese supervisor does not supervise work. They supervise how the people work. The same mistake is made in both the production gemba and administrative gemba. Supervisors should supervise the progress of work, but they supervise how the workers are moving about. This behavior must be kaizened. I think the manager has an easier job. They can get by with just having knowledge. The supervisor not only needs knowledge but must also be able to demonstrate that they can do the work, in other words they must be able to teach. Taiichi Ohno says that there are no supervisors at the administrative gemba because the work is not visible and managers do not think the work requires supervision. Back in the days when he wrote this chapter, Taiichi Ohno was teaching kaizen and the Toyota Production System to group company Toyota Boshoku. His students at Toyota Boshoku pointed out to him how well their workers were working. Ohno told them that just because the workers hands were moving fast did not mean that they were working. The focus on how the workers were moving leads to a search for faster hands, which is not the goal. As long as you are looking at motion and not the work, you will not develop the eyes to supervise work. Taiichi Ohno compares the supervisor to a manager or coach of a baseball team. A coach needs to be able to play, but a great player may not make a great coach. Just as a coach must know the strengths and weaknesses of the players and be able to guide the team to victory, the production floor and the administrative gemba both need to develop good supervisors. The trouble is, white collar folks on a management track are rotated to new positions. So no one is really seeing the work. People work in a position for a few years and then move on. No one really sees what work they did while in that position. Ohno criticizes that managers and supervisors dont think how much more have I accomplished than my predecessor? He likens it to government bureaucrats who want to work without causing trouble for long enough to be promoted to higher positions. Managers dont evaluate whether they are getting the same work done with fewer people than the previous manager did. Even at Toyota Motor Corporation this is true. They are not good at administrative kaizen. When they do kaizen they screw it up. The managers are not
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller evaluated on the number of people working for them and the amount of work they accomplished. Do managers think my predecessor did his job with 50 people, Ill do it with 40 to themselves? He asks. Managers should evaluate their work by saying I did my job with 50 people last year, Ill do it with 45 this year but they dont. Instead they just want to make sure they get their job done from year to year. Theres no progress, but their salaries keep going up thanks to the union. Although Taiichi Ohnos focus on labor cost reduction as a focus of office kaizen activity may not be as relevant today when there are so many greater opportunities for overall cost reduction by applying Lean principles to sales, design and planning processes, it is understandable. Ohno spent many years struggling to cut costs in the factory. The lax attitude of the Toyota managers, the lack of effective administrative gemba kaizen and the non-existence of what he could recognize as supervisors in the office made him write this blunt assessment of Toyota managers and office staff, circa 1982.
Comments
Loved this, but disagree that managers see the need for admin process improvement as "common sense". In pharmaceuticals, the product requires a disproportionate amount of administrative support to ensure compliance with the extensive regulations applicable to the industry. However, administrative processes are considered less important than making the physical product, so little or no resources are devoted to 'supervising' or improving the work. However, the product cannot be released to the public without completing the adminstrative processes, too. The opportunities for improvement in this area are immense! Please keep working to spread these improvement philosophies; I think they are finally starting to get off the ground in American industries. Posted by: J. Zajac - July 5, 2006 7:13 AM
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Chapter 27: We Can Still Do a Lot More Kaizen

Taiichi Ohno starts the chapter with the surprising statement We have done a lot of rationalization on the production floor and we are near the limit. Its becoming common sense that administrative processes still need a lot of rationalization, but we can still do a lot of kaizen on the production floor. However the impact of kaizen is will get smaller compared to the effort required. Ohno observes that while getting the last one percent of improvement is hard, on the other hand heijunka (leveling the volume and mix of production) is quite effective yet people dont realize this. By focusing on the proper sequencing of assembly (final assembly) and synchronizing the production of subassemblies, you can limit overproduction and improve the efficiency of the overall system. When rationalization is focused on individual processes they may increase the output from 100 to 120 but if only 100 is needed to support the heijunka sequence of final assembly, the true kaizen would be to make only 100 using fewer resources. The important thing is to produce in sets. Says Taiichi Ohno. Although this might make the unit cost of the part appear higher, the overall cost of the product will somehow be lower. Even if you produce engines very cheaply (unit cost) if you have several month of inventory but not one of every part you need to finish assembly and ship the product, this is not effective kaizen. The role of production control is to make heijunka and set production happen, says Ohno. You can only sell the parts when you have a set that is a product says Ohno. Its a very simple idea to make only what you can sell in the amount that you can sell, but nothing is harder to do. Ohno foreshadows the need for Lean accounting when he says When you think about producing in sets you realize that overproduction is a very bad thing. But the troublesome thing is that calculations dont show this. Ohno says that you have to view overproduction (producing too much or producing too early) as a bad thing that should be the focus of kaizen. Rationalization can lead to individual process optimization so there is a limit but we can do lot more kaizen if you look at things this way. Being able to produce 20% more with effort is worth less than just making the 100 that you can sell. In fact if you have the extra capacity to make 20% that you should realize that you have too many people. When you look at administrative work from this perspective, its very wasteful.
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Chapter 28: Wits Don't Work Until You Feel the Squeeze
By Jon Miller - July 17, 2006 11:46 PM
When Im sitting in the board room I have no idea whats happening on the gemba. Taiichi Ohno begins, and proceeds to tell the story of what would happen when he was sitting in another office, Production Control. When his eyes met the eyes of a female office worker she would always pick up the phone and make a telephone call. If the person on the other end of the phone was free that may be okay, but if they were working the call is a nuisance to them. This office was a typical Japanese open office and the lady felt uncomfortable when her eyes met Taiichi Ohnos eyes, so she picked up the phone to look busy. She was not only wasting her time, she was wasting someone elses time on the other end of the line in an effort to look busy. The gemba is not the only production floor. When you observe what is happening in the office or any workplace you should notice a lot of things. A lot of managers just think it is their jobs to keep everyone from getting bored. As long as people arent bored, they wont complain. Theyre not thinking about What should we be working on now? They dont know how to use their wits to come up with good ideas. I talked about the game of wits earlier but your wits don't work until you feel the squeeze. So think how you can put the squeeze on people. When people are in difficult positions they will use their wits, because they must. How can you put the squeeze on people? You have to put the squeeze on yourself, and struggle together or you wont use your own wits either. Taiichi Ohno says that his 'game of wits' is thinking of ways to make people feel the squeeze, make them feel desperate, so that they will be forced to use their wits and come up with good ideas. When managers dont challenge their subordinates and make them feel desperate Ohno says it is often because the managers themselves dont use their wits and have no solutions. When their subordinates say "It cant be done" in response to a challenge, these managers accept this answer. Ohno says you must make people feel that saying "It cant be done" is not an option because the situation is that desperate. But as a manager you must also feel as desperate and use your wits and think about how to solve the problem. I suppose this means you have to become an attractive human being. Since there are mostly men in automotive companies, Ohno says its a question of how to be a man that other men are drawn to. Men think hard about how to attract the opposite sex, but rarely do men think about how to become attractive to other men, to become a man that other men will follow anywhere. At this point Ohno must have looked up from the manuscript he was writing, in between his work teaching kaizen and the Toyota Production System to Toyota Boshoku. He writes: The ladies at Toyota Boshoku are very charming and kind. At my age I dont do what I do to draw the attention of these ladies. But its true that whether its men or women, when people are drawn to you they will volunteer to get things done for you. As a way to become an attractive person Ohno says its important to go to the gemba frequently to make people comfortable talking to you. Its much better for the ladies to feel comfortable smiling at you when your eyes meet, rather than making a telephone call. So I guess I have to seriously think about what I have to do to keep her from picking up the phone.
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Chapter 29: Become a Reliable Boss

"I never get angry at the workers. However, I will get very angry at supervisors and above." Some people say that Taiichi Ohno was not a very nice man. Ohno had a reputation for being very tough on his students, and some even call him a monster. I have never met him, but I have been yelled at by plenty of Japanese kaizen masters, and I think many of them are misunderstood. The following sentence may come as a surprise to those who label Ohno as not suffering fools well. "It's convenient for me to get angry at them when I am on the gemba. It's noisy out there, and they don't really hear what I am saying. When I yell at the supervisor on the gemba, the workers feel sympathy for them. This makes it easier for the supervisor to give the workers instruction." Taiichi Onho says that rather than taking the supervisor aside and scold them, you should do it in a public place. Preferably this is a noisy gemba so no one will hear clearly what you are saying. That way you can yell as loud as you like. Ohno is saying that for people to be relentless in their pursuit of waste reduction and kaizen, you have to scold them relentlessly. Even if the person scolded doesn't really understand why they are being scolded, the effect on the workers of seeing their boss scolded makes them more open to being instructed in the future. There is a fundamental assumption of teamwork here, as well as a clear respect for authority and seniority that may be lacking in many organizations outside of Japan. Even if you fancy yourself a Lean Master, don't try this at your factory without thinking deeply about it first. Taiichi Ohno said that when he was first promoted from supervisor to manager, his boss told him never to scold supervisors in front of their workers. Ohno says that scolding supervisor about an actual mistake may make him angry, while being shouted at in a loud voice is actually less stressful. "Even though everyone hates being scolded in public at first, I think it makes it easier for supervisors to communicate with their workers." This only works if you have a long working relationship between the supervisors and workers on the gemba. Ohno recommends that supervisors and team leaders not be changed so often. People in the factory need a reliable boss. He says promoting people from supervisor to production manager is okay because it is just an expansion of the area of supervision, but it is not so good when they are promoted and moved to another factory every 1 or 2 years. "I feel sorry for blue collar workers. They need reliable bosses. If the reliable people are frequently moved to other positions, they can no longer be relied upon." Says Ohno. "On the other hand white collar workers each think they are on their own path. They do not rely on each other. That's why when it's they hit retirement age we have to find them another place to work." This may seem like a puzzling statement, but it's one that's very revealing of how Japanese companies work. Taiichi Ohno sees the lack of reliable bosses due to the turnover of factory supervisors and managers as a contributor to low morale and low productivity. The factory loses a certain vitality when the people know that even if they work hard to support them, their best supervisors and bosses will promoted and moved to another factory and they will start all over again with someone new. This makes people think that their bosses will get promoted no matter what, so they might as well live day by day in the factory. This erodes performance in the long haul. "One time I gave an engineer who worked on the gemba some grief. I summoned him, and a lady from the office went to tell him the factory manager was calling for him. So the engineer came running to the office. I scolded him and told him that if I really needed to see him I would go the gemba. I told him if he could come running to the office to see me that means the people on the gemba don't rely on him."
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Ohno's point was that the engineer should have had so many requests for help from the people in the factory that he had no time to spare to meet the factory manager. If the engineer had time to drop his work and run to see the factory manager, the people in the factory didn't depend on him enough. Ohno gave him the following advice, "When you are out observing on the gemba, do something to help them. If you do, people will come to expect that you can help them and will look forward to seeing you again on the gemba. Eventually the workers will stop you and ask you for help in making a difficult process easier." Now I ask all of the engineers and continuous improvement people who read this: how long does it take you to walk 100 meters in your gemba? This is a good Lean benchmark. Measure it sometime and set a goal to improve it. But improving it does not mean walking faster. Ohno says: "It should take you hours to walk 100 meters each time you enter the factory. If it takes you no time at all to walk 100 meters that means no one is relying on you." When you are a reliable boss or a reliable engineer or a reliable kaizen leader and you are helping people by solving their problems and making their work easier, you will get a reputation and people will ask you for help whenever they see you. When your average walking speed on the gemba is no more than 50 meters per hours, you may have become a reliable boss.
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Chapter 30: Seiri Seiton Seiso Seiketsu Shitsuke

By Jon Miller - September 25, 2006 8:58 PM
"Seiri (Sorting) is throwing out what you don't need and Seiton (Straighten) is arranging items so that they are ready when you want them. Arranging things neatly is only Seiretsu (lining up in rows) and proper shop floor management requires Seiri and Seiton." Taiicho Ohno goes on to tell a story of when he visited a warehouse that was a mess. There was no order there and all incoming parts were stored so that even obsolete designs were kept for a long time. Ohno told them to do 2S and when he came back he found that they had done Seiretsu (lining up parts in neat rows) but they had not thrown anything out or put items in their proper place. So he scolded them. Ohno further explains the correct meaning of Seiton. The "ton" part of that word means "right away" or "immediately" and suggests that when you do the second S (Straighten or Set in order) this means it is in the place where you need it and accessible immediately. If you need to move other things out of the way to get at it, you have not done Seiton. Chances are, you haven't really done Seiri either and there's more there than you need. Ohno says that people who spent time as soldiers may have a habit of Seiretsu or lining up in rows. Ohno denies that drawing lines on the floor to mark boundaries or lines for marking height limit has anything to do with true 2S. Even at Toyota there was confusion in the beginning. They had 4S competitions (Seiri Seiton Seiso Seiketsu) once or twice per year where the areas of the factory with the best examples of 4S were given awards. But people did not understand and they lined things up in neat rows. Ohno told them this was no good since stacking things neatly or lining things up just made first in first out harder to do since it required re-stacking to get tot he first item. Seiso (Sweeping) and Seiketsu (Sanitary or Spic and span) are not the same as making things look better. "If you do Seiso and Seiketsu wrong it can cost you a lot of paint." Says Ohno. Many companies on the Lean journey today could heed these words. The true meaning of Seiketsu is to create and maintain a cleanly and sanitary workplace. Sweeping away the dust and chips on the floor of a machine shop and keeping it clean is the original meaning, but Ohno says that Seiketsu is sometimes misunderstood as "color coordination" of machines and making things pretty. Ohno explains that the idea of "clean" is not something that is the result of a janitor cleaning up after you. It is a question of attitude and of creating a healthy work environment. If your attitude is that "the janitor will clean it" you will not have a clean or sanitary workplace and it will always be dirty. Ohno goes on at length about the added 5th S of Shitsuke (Self-discipline or properly Discipline) and how it is lacking in the schooling system of today. The way Ohno talks about Shitsuke (Self-discipline) the meaning is closer to "upbringing" or the kind of discipline that comes from being properly socialized in school, a sports or military organization. After further criticizing the lack of discipline being taught in Japanese society Ohno says "Somebody needs to say these things. And the person that says them definitely has to practice what he preaches." Ohno ends the chapter with these wise words: "These days not so many people point out these things. That is the biggest problem. Discipline is taught when the senior ones scold the junior ones. This is not only in work but also between elders and youth. There must be scolding and correction, and not just talk but it must be followed by action."
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Comments
Very useful information you got here. I have heard of 5S several times but this is the first time I get to read it like a narrative. I agree with you on the last part: discipline should be imposed on the floor. Posted by: Meikah Delid - September 26, 2006 2:36 AM Disipline is not imposed. Discipline begins with management. I know of a company where the plant manager took ownership of one of the small machines on the plant floor. He was responsible for the cleaning and preventive maintenance of that machine. He demonstrated by example the principle that he wanted to instill on the factory floor. Posted by: Jack Parsons - September 26, 2006 8:19 AM Jon, When I read this chapter in the English version, I recall Onosan saying that things should basically be organized in such a way as to promote order and highlight the opportunities where kaizen could be done. Onosan seemed to imply that there should be order, but things did not have to be pretty. Is this what the Japanese version says ? Posted by: Barry - September 30, 2006 1:01 PM
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Chapter 31: There is a Correct Sequence to Kaizen

Taiichi Ohno explains in this chapter that there is a correct sequence to kaizen, and it is as follows: 1) Manual work kaizen 2) Equipment kaizen 3) Process kaizen "Manual work kaizen means thinking of better ways of using the existing equipment. Rather than making tools (equipment), it is important to think of how the work should be done." Quotes Taiichi Ohno. He points out that this gets harder as you introduce more modern, high performance equipment. Another way to say this is that it becomes easier to not think about the manual work, since the new machine seems so much faster and more efficient. At ten Japanese pages this is the longest chapter in the book. Most chapters are in the five to seven pages range. Taiichi Ohno illustrates his point that there is a correct sequence do kaizen through examples including installing robots, using a high performance camera to take photos, buying and installing machines, multi-process handing, inspection versus builtin quality and seeing the true value added portion of work. Ohno tells a story of when the Motomachi and Kamigo factories were newly built, and worker were moved to these factories they had new machines. It was actually a challenge to use these machines as effectively as the older machines which had a lot of kaizen (human wisdom) built into them. Ohno points out that it is easy to justify new buying machines that will appear to improve productivity and quality, but in fact this creates a temptation to let less experienced workers run these machines, which can create problems. One could say that we are seeing some of this phenomenon today in the many recalls of Toyota vehicles, as a result of the rapid expansion, building of new factories, buying of new machines, and employing new workers to run these new and "better" machines. Ohno points out that a very important part of doing step 2 equipment kaizen is having the skill and ability to kaizen the equipment. This comes from starting at step 1 and doing manual work kaizen, rather than simply specifying the newest machine, or relying on the machine tool manufacturer. This ability of Toyota to modify, specify, build and maintain machines on their own is an often overlooked hidden strength, one aspect of which is discussed in an interview by Art Smalley. Step 3 Process kaizen is basically the sequencing of processes into an operation so that quality is built in rather than inspected in, features are created in a logical sequence requiring the minimum changes of tools, etc. Ohno says that it is important to start with manual work kaizen, which will result in ideas for equipment kaizen, which will result in ideas for process kaizen. The reality in most companies is that these are separate disciplines and not integrated or sequenced correctly. Taiichi Ohno observes that outside of Japan the workers watch the machine while puffing on cigarettes, while in Japan the workers are made to do unimportant things just to keep busy. Multi-process handling is preferable to either of these, and that is why there is a correct sequence to kaizen that must be followed. Ohno ends the chapter by saying "Machine cycle time and manual cycle time are still mixed up, all over the world."
Comments
it was nice articles explaining kaizen. can we have all these articles in one single file, so that we can store it at one place and can avail the benefits. Posted by: pradeepsharma - October 15, 2006 10:41 PM
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller Hi Pradeep, That's an interesting request. We will have to think about it. For now please read and use the information in these articles one at a time. Jon Posted by: Jon Miller - October 16, 2006 6:35 PM Hi Jon Pradeepsharma made an interesting point and I hope you don't mind but I have already created a personal word document & file with all the interesting blog entries you have posted. Especially the comments on the chapters in Ohno-san's book. Please keep the anecdotes, comments and insights into TPS coming, I reaaly enjoy reading them and find them a useful reference and inspiration to do Kaizen Best Regards Chris Posted by: - October 17, 2006 12:53 AM Hi Chris, We do have plans to make Taiichi Ohno's book available in print again, keep checking back here for an announcment. Jon Posted by: Jon Miller - October 17, 2006 6:24 AM
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Chapter 32: Operational Availability vs. Rate of Operation

In this chapter Taiichi Ohno introduces another concept that is mixed up by people. It is the difference between operational availability and rate of operation. I introduced this concept in some depth in a previous post on this blog, and Taiichi Ohno does the same in the first few pages of this chapter. The main learning points of this chapter are the importance of preventive maintenance and other methods to improve equipment availability and to not run equipment when you do not have demand. Taiichi Ohno says in this chapter As I often say, the companies that make only the quantity needed and pursue lowest cost production will survive until the end. A quick review of the two terms: Operational availability means that equipment is available to run when needed. This is a measure of the percentage of time that you can run the machines when you want to run the machine. This is supported by kaizen through SMED (Single Minute Exchange of Dies), TPM (Total Productive Maintenance) and other methods to improve equipment uptime. You should strive for this number to be 100%. Rate of operation is the percentage of operation when the equipment is running profitably. This percentage can be greater than 100% if you run overtime because your demand exceeds capacity of regular hours. Rate of operation applies when equipment is making something that you will sell, rather than simply build in order to absorb cost based on traditional accounting. It is OK for this number to be lower than 100%. Ohno says that it is better to keep the older machines in good condition and be ready for when business picks up again so that you can be the low cost production leader. Ohno introduces a practice at Toyota Boshoku which he calls scrap and build in which the government paid companies to destroy old machines during economic downturns. This money was then used to buy the latest technology machines, presumably to make the company more competitive. This creates an illusion of a high rate of operation, though in fact it is not. Taiichi Ohno clearly warns that an apparent high rate of operation can be the result of a keep the machine running mentality driven by the need to absorb depreciation cost. The old machine, if well-maintained, could have a high operational availability (able to run when needed) and yet these new machines at Toyota Boshoku were run a lot, causing overproduction. The rate of operation was not high, because the machines were run when parts are not needed. Ohno goes slightly off track at the end of the chapter and makes a surprising statement. First he warns against measuring productivity in terms of direct labor only. Labor productivity may improve but this is only a small part of the overall labor cost (direct and indirect) when there is automation advances. When management and administrative salary raises are given based on direct labor productivity improvement, this raises the costs a lot. What's so odd is that Ohno ends the chapter by saying "It is difficult enough to raise direct labor productivity by 10%. Raising the productivity of all people in the company by 10% is impossible." He is probably sending a message to the managers at Toyota Boshoku for making a decision that he did not approve of, but his statement goes against both Ohno's philosophy of kaizen and my direct experience with doing kaizen in the office to hear him say that it is impossible to improve productivity by 10% across all areas of a company.
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Chapter 33: The Difference Between Production Engineering and Manufacturing Engineering
Taiichi Ohno begins the chapter by saying "We think of production engineering and manufacturing engineering as distinct things. We distinguish manufacturing engineering as the work to determine the method of manufacturing and production engineering as how to actually accomplish that method of manufacturing." Ohno uses the example of a scissors to make this distinction. The work of manufacturing engineering is to think of how to use a scissors to cut things effectively, while it is the work of production engineering to recommend the right type of scissors for the cutting to be done. In some cases production engineering will research and develop the appropriate scissors. Without manufacturing engineering however, the scissors could not be put to proper use. The literal translation of the title of this chapter (see above) could also be The Difference Between Industrial Engineering and Manufacturing Engineering. Production Engineering in Japanese is also translated as Industrial Engineering, which the Japanese (including Taiichi Ohno) sometimes refer to as simply "IE". But I think there is more to Production Engineering than Industrial Engineering as we know it, so I will leave the title as you see it above. The word gijutsu can be translated as "engineering" or "technology" or "technique" in some cases. So the title could also be The Difference Between Production Technology and Manufacturing Technology, but in the English "technology" tends to imply the hardware and software rather than the thinking process to get you there, as "engineering" does. This is an important distinction and we need to spend a few moments understanding the nuances here. When I first began interpreting with the Shingijutsu consultants 13 years ago, one of the most common questions by these former disciples of Taiichi Ohno and members of the Toyota Autonomous Study Group, after touring the gemba of an American company, was "Where are your Production Engineers?" They saw very little evidence of Production Engineering at these companies. They were not talking about the machines and processes, but the thinking that led to them. This is true in many U.S. manufacturers even today. Because they were not asking for the IEs (Industrial Engineers) and because I wanted to stay true to the nuance of the sensei's question, I would ask for the production engineers, and we would most be introduced to the manufacturing engineers. In some cases we would meet product engineers, industrial engineers, process engineers, but never production engineers. The Shingijutsu sensei would shake their head and bemoan the lack of production engineering (industrial engineering, equipment design and process design). I have yet to meet a production engineer outside of Japan. I am sure they exist. Holler if you are one. Back to the book. Just as computers have hardware and software, Ohno explains that they have been thinking seriously for many years about the differences between production engineering and manufacturing engineering. Ohno stresses the importance of manufacturing engineering for making kaizen more effective. "We used to call manufacturing engineering "gemba gijutsu" (shop floor engineering or plant engineering)." Taiichi Ohno relates a story from one of his trips to the U.S. in the 1950s when a plant engineer with the title of "General Plant Engineer" took him on a factory tour. Ohno was impressed by how this person knew what was happening in the gemba, and how easily he
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Introducing Gemba Keiei by Taiichi Ohno Jon Miller communicated with the foremen. Ohno says that he would like to think of the manufacturing engineers at Toyota as plant engineers (with some implication that they are not) and warns against the separation of production engineering from the gemba (factory). The production engineer must be close to the gemba and understand the process and develop the tools and equipment needed. Ohno tells of how he was disliked by the production engineers at the Toyota Motor Corporation for calling them "catalog engineers" because they would point to equipment in catalogs and ask to buy them rather than developing their own equipment. "Within a company, production engineering and manufacturing engineering really ought to be a single body." In calling for the integration of both manufacturing engineering and production engineering, Ohno wants both to be closer to the gemba and focused on kaizen. He says that the ideal state is when material selection, equipment design, process design, process improvement, equipment kaizen can all be the work of manufacturing (gemba) engineering. "This is a most important thing, but people who don't get it just don't get it."
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Chapter 34: The Pitfall of Cost Calculation

In this chapter Taiichi Ohno talks about the pitfalls of using cost calculation to justify new equipment purchases and also decisions to scrap or replace equipment based on depreciation. "Whenever we need to make a decision, we end up doing something like cost calculation. Cost calculation is not wrong, but I think top management sometimes makes the wrong judgment because of it." Taiichi Ohno explains how equipment purchases are made based on forecasts of production volume over a period of years. When these assumptions are wrong, these can become expensive purchases. He points out how it is easy to make cost calculations say what you want them to, when you have already decided that you want to buy the machine. Ohno moves on to the discussion of equipment depreciation as part of cost calculation. Equipment depreciation contributes to retained profit. Ohno criticizes production engineers in large, profitable companies who say "That machine is fully depreciated. It is old and wearing out. We can improve productivity by buying a new machine." Ohno says believing that the money from the retained profit was used to buy the new machine is a misconception. Ohno wants to see a company continue to use the fully depreciated equipment. The machine is already paid for and can make more profit more quickly than investing in new equipment. Yet accountants want to take advantage of depreciation against taxes. Ohno is a fan of general purpose machines rather than equipment specialized or optimized for a particular product. Simple, fully depreciated general purpose machines can be easily modified and dedicated for a new part, and this is a key aspect of flexibility for Lean manufacturing. Ohno says he first began telling people to build what he calls "general purpose dedicated machines" after the first oil shock in 1973. By the late 1980s this had become more common practice and the majority of equipment cost was in the tool and die. At Toyota 60% of the cost of the equipment is the tooling (metal dies), says Ohno. Putting Ohno's comments from this chapter in historical context, the Japanese economy grew steadily between 1950 and 1990 and between these years. Ohno likely saw many investment decisions that were based on the assumption of ever higher production volumes, and by definition not all forecasts can be correct. The result being either overproduction to justify the equipment cost (the greatest of the seven types of waste) or an embarrassingly idle new machine. I'm sure Ohno saw many old but useful machines scrapped and replaced by the new generation of engineers who had never experienced the post-war days of scarcity and had fallen into the pitfall of cost calculation. Today when we walk through the Toyota's Kamigo engine plant in Japan you will see plenty of "general purpose dedicated machines" and old equipment, thoroughly depreciated but still making money for Toyota.
Comments
I agree completely with this philosophy. The only problem I see is the American idea of a "general purpose" machine. In many companies, this is read as a "do-all" machine which can turn and grind and mill and drill and and and!!!!! Posted by: John Zavacki - December 15, 2006 6:19 AM
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Chapter 35: The Monaka System

How many Japanese words do we have in the Lean lexicon? Do we really need another? It's a rhetorical question, but would you rather have "sweet azuki bean jam wafer system"? I thought not. "Replaceable core system" also works, if you must. However, Taiichi Ohno gives us the monaka system. "Dies are not general purpose items. So here is something we did." Taiichi Ohno goes on to explain the challenge of making dies that are reusable as general purpose tools rather than specialized tools. While the press machine is general purpose (can be use to make many different types of products by changing the die) the die itself is typically for only one type of part. The monaka is a Japanese sweet that is made from a sweet bread-like crust and a sweet bean filling in the middle. The same crust can be used and filled with different "monaka" center to make different varieties of this Japanese sweet. So Ohno is making an analogy of the outer part of the die being similar to the outside crust of this food and the core of the die being the monaka or sweet bean part of this food. Here is a picture of gourd-shaped monaka snack from a store in Tokyo. The black in the middle is the sweet azuki bean. Click on the links in blue letters between the two red squares on the bottom of this page to see other examples of tasty monaka. Ohno says that while the sweet bean spoils if cooked ahead (overproduction) you can make the crust ahead an then cook the sweet bean filling to demand when you get the order. He also says it is a waste not to make the crusts in advance, and wait until you have an order and then struggle to make them all at once. It sounds very much like he is saying "build ahead" for the crusts, even when you don't have orders, in anticipation of orders. It is a very odd thing that he is making an exception here and actually promoting overproduction of crusts. The idea with the die is to have the middle section hollow so that a core can be replaced and the "crust" of the die reused. Ohno admits there are challenges to this, but that this idea is being attempted in some areas. He says it will take five or ten years to go completely in this direction. As he said this back in 1989, I would be interesting in hearing from someone at Toyota just how far they did go with the monaka system. Ohno says that this type of versatility and the ability to reuse general purpose dies and equipment is characteristic of the Toyota method. He goes on to say that there are three elements to running a business: man (people), materials (or more broadly "things") and money. Companies must generate a profit in order to be able to continue to exist and contribute to society. Ohno says you can make money in three ways. First by being good at selling things, second by being good at managing money, and third by reducing cost. When making sales is easy, the gemba gets lazy about reducing cost. As long as times are good you may not notice but as it becomes more challenging to make sales and as it gets harder to make money through financial instruments, engineering work and work on the gemba become most important, says Ohno. Ohno points out the difference between having 500,000,000 yen in cash or 500,000,000 yen in the warehouse as inventory. On the one hand you can use the cash to to make money through investments in financial instruments while the inventory will cost you 10% interest to the bank. You can pay dividends on profits to shareholders on one hand, interest to the bank on the other. "When people hear cost reduction they tend to think of it as an accounting function. But accounting can't do cost reduction." Taiichi Ohno says it's all up to what you do on the gemba to make a profit, pay your taxes and contribute to your country.
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Chapter 36: Only the Gemba Can Do Cost Reduction

By Jon Miller - December 15, 2006 11:12 AM
Taiichi Ohno begins the chapter by demonstrating the Toyota philosophy of "aim for 10X improvement, not 10% improvement". He instructed Human Resources to give the shop floor 10 people even though they had asked for 100 people. Let them struggle and they will figure out how to get it done with 90 less people than they thought they needed. That's how Human Resources can make a 90% improvement, he says. Ohno says that in a similar way Finance can do kaizen by using the cash freed up through inventory reduction on the gemba to make more money. The point is that when Finance allocates costs or requires cost savings from design or production this is not really kaizen. Finance must create value, but they depend on the gemba for this. "The gemba must become fanatical about cost reduction with 'Only the gemba can do cost reduction' as a belief." Says Ohno. Taiichi Ohno makes a very interesting and important distinction between cost knowledge and cost awareness. "People are overly concerned with knowledge of cost, but this displaces cost awareness. I say you don't need cost knowledge. I'm not even interested in learning the terminology." He goes on to make the point that cost calculation and cost reduction plans based on monthly targets are unreliable. When times are good and volumes are high, results may come quickly while at other times it may take a lot longer to see results. Implementing robots or computers can yield quick results, or they can take a lot longer than planned. Ohno emphasizes the importance for patience and perseverance when doing kaizen, particularly when volumes are reduced. The word for 'perseverance' in Japanese that Ohno uses is (shin-bo). When people say "We must do " in Japanese this means "We must endure hard times" and implies personal sacrifice. It is different from persevering as in simply working hard and not giving up. Understanding this and considering GM's struggles today, Ohno's following comment becomes poignant: "If General Motors' UAW had the perseverance to accept a reduction in wage they would become a formidable competitor (to Toyota). In Japan we are not there yet, and suggesting a reduction in wages would cause an outcry..." Ohno switches themes mid-chapter. I would have taken the second half of this chapter and made it a separate chapter named "Follow the Rules You Make". He talks a lot about rules, setting of rules, how people perceive and sometimes resist rules that are set, how kanban and Standard Work both rely on setting and following rules, as well as how Standard Work should be frequently improved updated on the gemba. Certainly these things are related to cost reduction on the gemba, but Ohno does not make an explicit connection. I think he was telling his stories and might have drifted a bit. Nonetheless it makes for a chapter rich in the wisdom of Taiichi Ohno.
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Chapter 37: The Standard Time Should be the Shortest Time

By Jon Miller - December 21, 2006 8:55 AM
"Speaking of standards, time study is another thing everyone gets wrong." The typical time study is based on taking 10 times and setting an average time as the standard. Ohno says this is very bad because if you are watching someone do something 10 times and they are doing it differently each time you should stop to correct them right away. This is the kaizen "stop and fix" mentality, extended to time study. Ohno asks what's the point of just taking times that are not good times to begin with, when you can take the shortest time as the best time. "Some say that is harsh, but what's harsh about it?" asks Ohno. "The shortest time is the easiest method." The purpose of process observation and time study is not to get an average time and build in the waste and variation to the standard time but to ask why there is variation between different people or between the same person over 10 repetitions of the same process. Ohno is looking at time study not from the standpoint of establishing Industrial Engineering standards but from a kaizen standpoint. Ohno recommends not including allowances for breaks to go to the toilet. These times are unreliable anyway, he says, so let people go to the toilet when they need so long as they stop the line. The team lead or the supervisor should step in to keep the line going. He says that allowing times to go to the toilet as part of the standard time, whether people need to go or not, just creates slack. This again is an example of the jidoka (stop the line) principle built into his thinking, influencing how time study should be done. The principles (stop and fix) dictate how the improvement tool (time study) should be used. This is an important lesson. Ohno ends the chapter by saying that if you have to take several measurements in order to set a standard, use the shortest time. Then find the reasons why this time can not be met and teach them how to make it possible to do it in the shortest time. Just as the theme from Chapter 6 was "Costs do not exist to be calculated. Costs exist to be reduced" the theme from this chapter could be stated as "Times do not exist to be studied. Times exist to be reduced."
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Words of Taiichi Ohno Sensei
Jon Miller

Part 1: "I Never Said There Were 7 Types of Waste"
By Jon Miller - July 10, 2006 10:31 AM One has to be careful these days when making statements about the origins of TPS and check the facts, or else be pinned to the mat for a count of three by the investigative tagteam of Art Smalley and Isao Kato. So Ill confess to a terrible truth of Lean manufacturing that Ive known about, but only for a short time: Taiichi Ohno never said there were 7 types of waste. Kaizen consultant and author Yoshiya Ito was a journalist when he was younger, and knew Mr. Ohno. On his website Ito shares his memories of Mr. Ohno and words that he spoke. In a section called Words of Taiichi Ohno Sensei, Ito credits his teacher with the following: I dont know who came up with it but people often talk about 'the 7 types of waste'. This might have started when the book came out, but waste is not limited to 7 types. Theres an old expression He without bad habits has seven meaning even if you think theres no waste you will find at lest 7 types. So I came up with overproduction, waiting, etc. but that doesnt mean there are only 7 types. So dont bother thinking about what type of waste is this? just get on with it and do kaizen. Wow. At this point its tempting to follow Mr. Ohnos advice, give up thinking and writing about the 7 types of waste and TPS and just do kaizen. If I suddenly give up blogging, you'll know why. Mr. Ohno was known for making shocking statements. One of the other gems Ito attributes to Ohno was Just because it says so in a book doesnt mean I said it. So who did arrive at the number seven and codify the 7 types of waste? My guess is the managers at Toyota who in 1973 wrote down the Toyota Production System ideas and philosophy that was in the air. Perhaps on his next trip to Japan this summer the Green Hornet* (a.k.a. Art Smalley) can find out more about who actually coined the 7 types of waste if it was not Taiichi Ohno. Bonus Section: 5S Contains 25% More S than You Need While were shattering myths of Lean manufacturing do you think there are actually 5S in the Toyota Production System? There arent. There are 4S, the first four. Who needs selfdiscipline if you do the first four properly? In some smart Japanese companies I have seen 3S, where they drop seiketsu which is literally cleanliness as in spic and span or wash your hands with soap. Who needs that if you Sweep properly. Originally 5S was seiri seiton which means tidy up the place. But 2S was too simple to make a book that sells. The real reason we have 5S in the Lean manufacturing lexicon instead of 4S is that Hiroyuki Hirano wrote a book on 5S that was translated into English. Had a Toyota person written about workplace organization we would be calling it 4S. Just because it says so in a book doesnt mean its the truth. Kaizen. Read about it, think about it but most important, do it. *For those of you who are not familiar with the Green Hornet, he is an American comic book hero and crime-fighting newspaper owner.
Comments
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Words of Taiichi Ohno Sensei Jon Miller Thanks Jon, It would be really great if someone could translate more of what Onosan actually said in Japanese to English. I have read the three English Books, but there is a lot more in Japanese. It might help everyone's understanding to hear more of what he actually said. Posted by: B. Huff - July 11, 2006 6:11 AM The seven types of wastes were also documented by yet another TPS sensei Suzaki Kiyoshi. As a matter of fact these are known as Suzaki's seven wastes in many Lean circles. Suzaki's '87 book The New Manufacturing Challenge is a good read. Posted by: Venkatesh - July 13, 2006 10:28 AM Jon says, "While were shattering myths of Lean manufacturing do you think there are actually 5S in the Toyota Production System? There arent. There are 4S, the first four. Who needs self-discipline if you do the first four properly?" In my time with Toyota, we practiced 4S, but it was "spic and span" that we omitted. Posted by: Mark Jaeger - July 13, 2006 7:52 PM Thanks for your comment Mark. It shows that what's important is not so much how many S there are or what they are called but the underlying thought and behavior that is TPS. Posted by: Jon Miller - July 16, 2006 8:21 PM The number of elements in a list has to do with national culture. Japanese lists tend to have seven elements: the 7 tools of QC, the NEW 7 tools of QC, the 7 steps of automation, etc. On the other hand, since 4 ("shi") sounds like "death," that number is avoided and many buildings in Japan don't have 4th floors. Maybe that is why 4S became 5S... The magic number in this culture in 10, as in the ten commandments or the 10 articles in the bill of rights, and 13 is avoided. These choices don't always have to do with content. Best regards. Posted by: Michel Baudin - July 18, 2006 11:37 AM I guess I've never read or heard that there was a limit to the numbers of wastes, or that Ohno had anything to do with labeling them. Anybody with a brain knows of these wastes before being taught that they have been named by somebody. I do know the 7 very well but when originally taught about the wastes I seen a list of hundreds. Hirano's manual shows a very large list. Best, David Posted by: David McGiverin - September 3, 2006 9:51 AM
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Jon Miller
Part 2: Foreword from the First Textbook on the Toyota Production System
By Jon Miller - July 12, 2006 11:21 PM This is an image of the first textbook ever written on the Toyota Production System. The title reads Toyota Style Production System The Toyota Method. The Toyota Education Department published this in January 1973.
Taiichi Ohno wrote the foreword to this book. The foreword is titled Practice, Not Theory.
In the foreword to the first textbook on the Toyota Production System, Taiichi Ohno said the following: Looking back at the many things we tried over the years and reading about it now in these pages, prepared by so many people who were involved in our efforts, I realize it was quite an undertaking.
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Words of Taiichi Ohno Sensei Jon Miller In the words of the late Kiichiro Toyoda, former President of Toyota, in an industrial enterprise such as automobile assembly it is best for parts to arrive at line side Just In Time. This theory is well known, but when you actually try to practice this you run into various problems, and it is not easy to do. If you say Just In Time is an ideal or Just In Time is not realistic then that is the end of the story. However, if the of (to rationalize, to do kaizen) is the same as the of (ideal), then for those of us who do kaizen, we absolutely must achieve the ideal, or at least challenge ourselves to get as close as possible to the ideal. To common sense thinking it seems that Just In Time is full of contradictions, such as that between Just In Time and productivity, or between Just In Time and cost, or even the squeeze Just In Time puts on suppliers. We must break through this wall of common sense, and go beyond common sense in order to take the two contradictory sides and make them stand up to reason. Just In Time translated to the language of the gemba is (The departments that need) go to get what they want, when they need it, in the amount they need. The downstream process goes to the upstream process to get it. In the case of supplier parts they must deliver, so we specify the quantity, date and time of deliveries. This is the basic thinking of the Toyota Production System, and it was this thinking that was developed and made concrete in various ways. The upstream process must be able to produce in response to this more economically. It is too easy for the upstream process (manufacturing shop floor) to think of quality, quantity and cost as separate things. The focus may be on quality, or meeting production volume, or even cost. Often there is a particular focus on quantity. I used to call the technique of harmonizing quality, quantity and cost gemba technique. Some also call this manufacturing technique. I recently had the opportunity to coin a new name for Toyota-style IE, which I called MIE for moukeru IE [translation note: moukeru = 'to make a profit' in Japanese]. The name aside, our system is so far from generally accepted ideas (common sense) that if you do it only half way it can actually make things worse. If you are going to do TPS you must do it all the way. You also need to change the way you think. You also need to change how you look at things. Just as magicians have their tricks, the gemba technique has its tricks. The magicians trick in this case is the relentless elimination of waste. In order to eliminate waste, you must develop eyes to see waste, and think of how you can eliminate the wastes you see. And we must repeat this process. Forever and ever, neither tiring nor ceasing.
Comments
Jon, This is excellent. Thank you, can you do more from this book ? Posted by: B. Huff - July 13, 2006 11:04 AM Once I'm through with Gemba Keiei I'll consider it.
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Words of Taiichi Ohno Sensei Jon Miller Much of the content of the textbook is the technical details of waste vs. value, kanban, the role of the supervisor, Standard Work, line balancing, line layout, etc. All fantastic stuff, but textbook. There's some philosophy also. Much of it appears in other works of Ohno or other books. Posted by: Jon Miller - July 18, 2006 7:02 PM Is this Book available to purchase somewhere in Japanese or English. Or was it just a book published and meant for internal circulation at Toyota ? Thanks again Jon for your valuable work ! Posted by: B. Huff - July 21, 2006 6:22 AM This is from the first textbook on TPS written by Toyota for internal use. Posted by: Jon Miller - July 21, 2006 8:53 PM
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Jon Miller
Part 3: The Top 8 Pearls of Wisdom on Kaizen

By Jon Miller - July 13, 2006 11:34 PM Taiichi Ohno loved wordplay. He would take a few choice Japanese words and pack in as much kaizen wisdom as he could. He chose his words carefully, even though in much of his writing he was informal and direct, and not highly articulate. During the years when I was an interpreter for Ohnos students, the members of the Toyota Autonomous Study Group who formed Shingijutsu consulting, I had many opportunities to hear Ohnos pearls of wisdom second hand. These are what I conside the top 8 pearls of wisdom on kaizen from Ohno, as they were taught to me. Some require explanation, some don't. They all deserve deep consideration and action. Sanjutsu vs. Ninjutsu This is one of those phrases that takes 2 seconds to say in Japanese and about 20 seconds in English to explain. Mr. Ohno was fond of Ninjas. Ninjutsu is the art of technique of ninjas, the Japanese black-clad spies of the samurai era who were known for being very clever and resourceful. Sanjutsu can mean arithmetic, calculation or a colloquial term Ohno used for cost accounting. Taiichi Ohno liked to say if you use ninjutsu (your wits and your training) you could double your throughput without doubling your resources, while traditional management based on calculation could not help you do this. The production line that never stops is either excellent or terrible. The explanation I received was that the line that never stops either has so many extra people, buffer inventory or other slack that the problems never come to the surface and it is a terrible line, or that all of the problems have been brought to the surface and kaizen has been done so that it is fool-proofed to the point where you could not stop it if you tried, and it is excellent. This is true not only for production lines but for any operation. You are smart enough to make excuses, so use your smarts to take action. Check is hansei. The check step in the PDCA (Plan Do Check Act) cycle is reflection (hansei) and this is true of course when you were not able to achieve your target but even when you do achieve your target you must also do hansei and reflect on the reasons why you succeeded so that you can use what you learned from your success. All decision must be based on Will this actually reduce cost and Will this actually result in improved business performance. Education is teaching what one does not know and training is repeated physical practice of what one knows. We need not only education, we need also training. Kaizen leaders and management need more than education (what and why) but also training (how). Even today we see too many executives who support kaizen 100% by dropping in at the end of the kaizen event or at review points in a kaizen project, but do not involve themselves for days hands-on in order to physically practice and learn the new way of thinking, managing and doing business. Hearing one hundred times is not as good as seeing once. Seeing one hundred times is not as good as doing once. This is similar to the English expression a picture is worth a thousand words but probably comes from the saying of Confucius I hear and I forget. I see and I remember. I do and I understand. Understanding means taking action.
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Jon Miller
Part 4: It's a Race to Get People to Think

By Jon Miller - January 10, 2007 1:47 PM I came across a new quote from Taiichi Ohno recently. It was in Japanese, and may not be new to the world, but I can't recall seeing it in English before. I think it nicely captures the idea of kaizen and respect for people, which are at the heart of the Toyota Production System. "In a company when there is no race to get each person to add their good ideas to the work they do, I think this ruins people. Your improvements make the job easier for you, and give you time to make further improvements. Unlike in the [Charlie] Chaplin movie where people are treated as parts of a machine, the ability to 'add your creative ideas and changes to your own work' is what makes it possible to do work that is worthy of humans." This is from the book (Encyclopedia of Shop Floor Waste Elimination - The Practical Philosophy of the Toyota Production System) by Hitoshi Yamada, a former journalist who knew Taiichi Ohno. Yamada now is an author with a successful consulting practice mimicking the message and demanding style of his teacher. For what it's worth, here is the original Japanese: The race or competition to get each person to add their good ideas ( ) is not a race between workers for good kaizen suggestions, it is a race with the managers and their workers on one side and the competitive forces in the world on the other side. It is a competition about how quickly you can get each person to use their minds creatively to improve their work. It's a race to get people to think. Ohno is making a powerful statement here that if you do not challenge people to use their minds and improve their work, you are dehumanizing them. No wonder he was famous for yelling at managers who were slow to change.
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Toyota Owes Grandpa Ford
Jon Miller
Toyota Owes Grandpa Ford

By Jon Miller - January 19, 2007 12:21 AM Earlier this month the Lean Insider attempted to answer the question Which Lean Book is Right for My Boss? These folks ought to have the answer, since Productivity Press has published the lion's share of important books on what we call Lean manufacturing today. I have my favorite books on Lean, and I look forward to finding new books that will make it into this personal top 5 list. But who needs to read five books? If we would just implement 80% of what is in any one of these books we would far more good than getting a PhD in all things Lean. Alan Mullaly is a CEO of a big American firm who is making his managers read books on Lean these days. The company is Ford Motor Company and the book is The Machine that Changed the World, according to word on the street. Last month Mullaly made a surprise visit to Toyota in Japan, then both sides denied rumors of a tie-up. Today Toyota's chief Watanabe told the Nikkei Business Daily that Toyota would be open to some type of alliance with Ford, if only Ford asked. That is potentially big news for the automotive world. But it is not surprising. Ford and Toyota are soul mates in a way. The leaders at Toyota owe something to Grandpa Ford. The people that are at the helm of Toyota today got where they were because they studied works like Henry Ford's Today and Tomorrow and took his sage advice. Here is a sampling from that book, sequenced as a Lean implementation guide: 1. First, create a plan (32) 2. Strive for simplicity (p. 13) 3. Make cleanliness a must in all areas (p. 60) 4. Constantly perform experiments (p. 17) 5. Measure work scientifically and work to make things take less time (p. 81) 6. Put people and tools in the sequence operation to minimize travel (p. 80) 7. Use standardization to strengthen processes and to drive out waste (p. 49) 8. Mistake proof designs (p. 67) 9. Automate those process that you can (p. 90) 10. Create opportunities for people to think (p. 248-250) This is Henry Ford circa 1926, folks. It's spooky. Do just eight of these things. If safety, quality, delivery and cost have not gotten significantly better for you as a result, I will gladly stop by and give you another 10 ideas for you to try. And I'll probably just get them out of Henry Ford's book.
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Miller, Jon - Introducing Gemba Keiei by Taiichi Ohno

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Introducing Gemba Keiei by Taiichi Ohno

By Jon Miller - November 13, 2004 3:07 PM

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Taiichi Ohno's Book "Workplace Management" Returns to Print in 2007

Workplace Management Pre-Orders and Publication Update!

Translation for Taiichi Ohno's Workplace Management is Complete, Part 1

Translation for Taiichi Ohno's Workplace Management is Complete, Part 2

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 1: The Wise Mend their Ways

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 2: If You Are Wrong, Admit It

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 3: Misconceptions Reduce Productivity

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 4: Go See What Didn't Work with Your Own Eyes

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 5: Misconceptions Hidden within Common Sense

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 6: The Blind Spot in Cost Calculation

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 7: Don't Fear Opportunity Losses

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 8: Limited Volume Production is to Produce at Low Cost

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 9: Reduced Inventory, Increased WIP

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 10: The Misconception that Mass Production is Cheaper

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 11: Wasted Motion is Not Work

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 12: Agricultural People Like Inventory

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 13: Improve Productivity Even with Reduced Volumes

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 14: Do Kaizen When Times Are Good

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 15: Just In Time

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 16: Grandpa Sakichi's Jidoka Idea

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 17: The Goal - Improve Productivity TenFold

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 18: Supermarket System

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 19: Toyota Made the Kanban System Possible

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 21: Rationalization is Doing What is Rational

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 22: Shut the Machines Off!

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 23: Producing at the Lowest Possible Cost

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 24: Fight the Robot Fad

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 25: Work is a Game of Wits with Subordinates

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 26: There Are No Supervisors at the Administrative Gemba

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Chapter 27: We Can Still Do a Lot More Kaizen

Introducing Gemba Keiei by Taiichi Ohno Jon Miller

Introducing Gemba Keiei by Taiichi Ohno Jon Miller