There were, however, other considerations. A piece of plant cannot be immediately responsive to all demands upon it if it makes parts in greater quantities than are required at the time. Responsiveness, and hence service to our customers (whether they be external or the subsequent operations within our own plant) requires that we manufacture components in small batches.
We knew that smooth workloads make management of the manufacturing process far easier and had established smooth finished product plans with the adoption of Master Production Scheduling. However, no matter how smooth our final assembly plans, we still had lumpiness elsewhere.
The major contributor to parts being made in large batches is, of course, set-up times. Shigeo Shingo, a quality consultant hired by Toyota, had set about effectively eliminating set-ups. The accounting conventions that led Western businesses to make significant quantities of parts that may not be used were also shown to be ludicrous.
2. Safety Stocks / Quality
A major element of Western manufacturing’s inventory was that which we held in case of problems. We held safety stocks to allow us to continue manufacturing should some of the components or raw materials in our stores be found to be defective.
Ohno and his colleagues, ironically, had listened to the American quality gurus, W. Edwards Deming and Joseph Juran, who had advised Japanese industry as it recovered after World War II. Among the key concepts learned by the Japanese and neglected for many years in the West were:
Deming’s teaching that we cannot inspect quality in a product but must build it into the manufacturing process.
Juran’s definition of the internal customer. If we each give service to our internal customer then we will ultimately take care of the end customer.
By applying these teachings and aggressively eliminating all sources of non-compliance the Japanese moved quality onto a completely different plane. Where the West continued to measure percentage defect rates our competitors were working in parts per million.
As well as addressing the manufacturing processes, we learned that the JIT approach considered other contributors to improved quality. Is the component designed in such a way as to make it easy to produce or can we simplify it and reduce the chances of a defect? We began to think of «design for manufacture» and combining the previously separate functions of design engineering and production engineering.
