In the early 1950s one of the founders of Toyota Motor Company in Japan came to the U.S, bought himself a Ford Truck, and took it along with him to Japan. They then took it apart, tried to figure out how it was designed and built, and tried to do the same at Toyota.
At that time, Japanese products were world-famous for their shoddy quality and poor workmanship, no matter what the product was.
There are many reasons Toyota has beaten the Big 3 AMerican Car makers in their share of the Global and US Markets. But one of the major ones is Toyota taking to heart, the lessons of an American QUality Guru Edrward Deming, who was sent there by the U.S administration for Post-war reconstruction of Japan.
Now, Edward Deming is an interesting genius! He will not sign up to consult with any company on quality unless the CEO signs on to his quality prescriptions, heart and soul. If he felt that the committment was not there from the top person in a sustained manner, he wasn't interested.
The Japanese were interested. They had nothing to lose. Any change from what they knew currently, they were sure was a step up. They adapted Deming's lessons to the geography, culture and institutions in Japan and built a whole lot upon it themselves also.
They decided that whatever they did, they would continuously improve their manufacturing processes, shop floor and the way cars and trucks were manufactured. They designed the Toyota Production System (TPS) which was at its heart and soul, a systematic, thoughtful, considered, way to eliminate all kinds of waste from processes - whether they were manufacturing or others.
They thought that any activity had enormous potential for elimination of waste if enough time was spent observing the process very carefully, identifying areas where waste of human effort, movement of things and rework occurred, The rootcauses for these were carefully analyzed and the root causes fixed permanently!
This enabled them to rationalize every part of their manufacturing process. In automobile factories, even to this day
, stamping machines are used to stamp out from thick sheets of steel, your auto body panels, doors, hood, roof, etc.
These stamping machines had, as you can imagine, heavy and extremely strong, dies that pressed against the flat steel with great force to bend them to the shape of a door, say.
Setting up of these dies in the stamping machines, used to take weeks. So for example, if you want to switch from manufacturing Toyota Camrys to Toyota Pickups, these stamping machines need to be retooled for the truck body parts.
So the guys at Toyota thought, why should this take weeks? Why not do this in a week? They analyzed how the resetting of the die was done, and redesigned the work so that it took a week. Then they thought why a week? Why not a day? After a few years, it was a day. Then they thought why should it take a day, why not a few hours? After one or two years, it was a few hours. They did these kinds of improvements by things like pre-assembling the other die before hand, in a circular die holder, swinging the new one in place by just rotation. At last count, it was of the order of minutes to reconfigure the stamping machines to manufacture Toyota Pickups to Camrys! From weeks to minutes!
Now when many Toyota truck factories are being retooled to manufacture Toyota Prius, a lot of these kinds of knowledge will, no doubt , help Toyota achieve these kinds of improvement.
On the other hand, the Big 3 automakers had only excuses after excuses - They did not stick to any one way of thinking for too long. It was always the Quality Fad of the decade that ruled - Total QualitY Management, Zero Defect manufacturing, etc.
The end result was that Toyota was improving the quality of the end product over decades, by focusing intensely on every part of manufacturing, driving up quality while driving down costs of manufacturing - since waste in all its forms were eliminated. When more is done by less people with less material, time and labor, your costs are driven downward very quickly.
Of course, the US Car makers had legacy pension plans that added $2400 or so per car but even without that Toyota and other manufacturers were able to squeeze so much of the costs out that they were making more money even when you add the $2400 per car!
The moral of the story is that elimination of wasted effort, time, in companies is very much underestimated! So much of business processes in companies are unnecessary duplicate human effort, or time wasted in waiting for someone to look at something or approve. When mistakes happen, things have to be redone. This is the worst kind of waste since it requires effort that may have been unnecessary, if things had been done right in the first place!
Business Intelligence should ideally be helping in capturing in detail, this kind of information so that you can make your business processes lean and mean! Better and faster customer services, being faster than your competitors, making it easy for your customers to do business'with youall snowball into better sales and profits.
Typically, management gurus have the mistaken notion that daily operation and processes have nothing to do with great Sales and Profits!
On the other hand they have everything to do with it!
If only Business Intelligence paid attention to business processes also, they could now begin to capture EVERY aspect of what makes companies great! Things can be improved only if Business Intelligence can capture what is happening now! Then you can improve things and measure them again to see if it has improved and 6 months from now whether it has stayed improved or regressed back!
The Never-ending Task of Self-Improvement - Ralph Waldo Emerson
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