What is Lean

Lean thinking and principles are focused on the relentless and continuous elimination of waste. Waste can be defined as anything does not create value that a customer is willing to pay for. By minimizing waste we are able to reduce costs and capital while creating maximum value for our customers.

Waste reduction thinking can be traced back as far as pre-20th century, but the Lean system of management is based on the Toyota Production System (TPS) which was established by the former Toyota vice president, Taiichi Ohno. After World War II, Mr. Ohno started experimenting with the assembly lines at Toyota’s factories in an attempt to catch up with America’s Big Three: General Motors, Ford and Chrysler. Taiichi studied the management approach Henry Ford had applied when he and his team first designed his production line – the Model T Assembly Line – for the model T Ford in the early 1900s.

The Toyota Production System (TPS) was based on the “Just-in-Time” philosophy, originally developed by Kiichiro Toyoda, the founder and second president of Toyota. The “Just-in-time” concept refers to making only what is needed and achieving “the complete elimination of all waste”. By supplying “what is needed, when it is needed, and in the amount needed” Toyota was able to eliminate waste in their production plan, with the result being improved productivity.

Taiichi Ohno expanded on the JIT concepts to reduce waste and began experimenting with methodologies designed to produce required components and subassemblies efficiently in order to support final assembly. These experiments led to the development of several new tools such as the Kanban Pull system, a process which signals the need for work and allows the supply of components to be regulated through the use of an instruction card which is sent along the production line.

One of the core elements of the TPS is waste reduction or control. Toyota realized during the 1950s that most of what happened in their factories did not add value to their products and was therefore waste. Ohno identified 7 types of waste (or Muda), often referred to today as the 7Ws:

  1. Transportation
  2. Inventory
  3. Motion
  4. Waiting Time
  5. Overprocessing
  6. Overproduction
  7. Defects

The acronym “TIMWOOD” is useful to help remember the seven wastes.

The Toyota Production System was developed over a period of almost 30 years as the company grew and learned from its mistakes, and it is still evolving today. In 2008, Toyota overtook General Motors to become the world’s largest car manufacturer, producing about 10 million cars a year globally.

When companies in the West realized that they were quickly losing market share to Japanese manufacturers, many U.S. and European academics began studying the differences between Toyota’s manufacturing methods and those of manufacturers in the U.S. and Europe. The term “Lean manufacturing” was coined by academics James Womack and Dan Jones in the 1980’s in an attempt to describe Toyota’s relentless and ongoing pursuit of the elimination of waste. Today, Lean Methodology is being implemented by businesses all over the world to transform productivity and maximize value for customers in an environment where every person in the organization is shown respect.