Toyota

Survival and Lean Manufacturing

In the aftermath of World War II, the Toyota Motor Corporation faced challenges that influenced the company’s survival strategies for decades into the future. The war had destroyed much of Japan’s industrial capacity. Postwar inflation and wage cuts led to labor disputes that slowed production. After President Kiichiro Toyoda and other top executives took responsibility for the company’s downturn and resigned, scrappy production manager Taiichi Ohno was tasked with radically restructuring the company’s production strategies. Learning from extensive tours and training at U.S. manufacturing plants, Ohno developed the Toyota Production System. This system, which would come to be known as lean manufacturing in the U.S., addressed Toyota’s smaller market and limited manufacturing base by optimizing production per unit. Ohno’s foundational practices of just-in-time production, eliminating waste, and continuous improvement transformed Toyota from a company nearly on its deathbed to the world’s largest automaker in 2008. Lean manufacturing would also bolster Toyota’s resilience during the supply chain issues caused by the COVID-19 pandemic, all because of Taiichi Ohno’s clever response to nearly unmanageable conditions.

Keywords:
  • Automobiles
  • Toyota System
  • Just In Time Manufacturing
  • Lean Production
  • Japan
  • Post World War 2
Industry:
  • Manufacturing
  • Automobiles
Subject:
  • Operations Management

Learning Objectives

At the end of this experience, your students will be able to grasp, evaluate and articulate…

  1. The causes and origins of the lean manufacturing approach
  2. How optimizing production per unit rather than production per batch drives waste out of the system.
  3. How continuous improvement and supplier trust bolster a company’s resilience to supply chain issues.


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