By Greg | March 25, 2009
System of One Piece Flow
Most people associate Henry Ford with the development of the Mass Production (also known as Series Production) system. The more cars Ford produced the lower the cost of making an individual car. In many respects the Toyota System is the very opposite of the Mass Production System (as the alternative name of the Toyota Production System – “One Piece Flow” suggests). Toyota’s most famous manager, Taiichi Ohno surprised many by attributing his understanding of the Toyota Production System to. . . Henry Ford.
Toyota System vs. Mass Production System
In a traditional factory it is easy to see how larger volumes are more economic than smaller volumes. Here is a very simplified example: if a small company pays it’s workers $100,000 a month and during that time produces 100 kit cars – the cost of making a kit car is $1,000 plus material. If they increase their production to 150 kit cars per month – each set will now cost them less than $700 plus material. $700 is much less than $1,000 so viva the Mass Production System! Now we can lower our prices and sell more cars and enjoy larger profits! Away with anything that tries to argue against the Mass Production System!
Believe it or not, some managers actually stop their interest in the Toyota System at this point. The fact is that we haven’t even started our search for the differences between the Toyota Production System and the Mass Production System. Everyone at Toyota will agree that selling 150 pieces of something is better than selling 100 pieces. The difference is how much it actually costs us to produce them. Now – let’s really start comparing the two opposite systems:
One Piece Flow vs. Series Production
Imagine two companies manufacturing exactly the same product, something simple, let’s say… pens – same shape, same color – no difference whatsoever. Here is how they are made in the factory called Good Old Way Pens (since I don’t actually know how pens are made – keep in mind that the point of this exercise is to show the idea behind the two production systems):
Once a month, from three different suppliers, 2000 sets of plastic tubes (a set consists of two pieces), 2000 ink cartridges and enough metal wire to make 2000 springs are purchased.
Frank puts the wire into a machine that forms it into a spring. When the spring is made he throws it into a box. When the box is full (it has 100 springs inside), he takes it to Stephen’s station, comes back and starts filling another box.
At the same time Dorothy takes the plastic tube, puts in the ink cartridge and drops it into the box. When the box is full (it has about 100 tubes with ink cartridges inside) she takes it to Stephen.
Stephen adds the spring to the set and puts it in a box. After 100 of those sets he takes them to Martha.
Martha closes the pen with another plastic tube and screws it in. The pen is made and ends up in a box.
Once a week a salesperson comes to Martha to collect the ready pens (about 400 of them). They are then distributed to stores, etc.
Now, let’s take a look at New Way Pens’ production. It also hires 4 employees and they are the exact clones of Frank, Dorothy, Stephen and Martha. Here is how pens are produced:
Twice a week suppliers bring 300 sets of plastic tubes, 300 ink cartridges and enough wire to make 300 springs.
Frank notices that a small, white dent on the desk between him and Dorothy is empty. “Dorothy needs a new spring!” – he thinks so he takes the wire, puts it into a machine that turns it into a spring and puts it on the little dent
At the same time Dorothy takes the plastic tube, puts in the ink cartridge, grabs the spring from the dent and puts it on the cartridge inside the tube. She then put the whole thing on the dent between her work station and Martha’s work station.
Martha grabs it, screws another plastic tube and the pen is ready. She puts it into a box which is emptied every day at noon. The pens are immediately distributed to the stores.
You might ask: “What happened to Stephen?”. No worries. He is happy with his position in a different section of New Way Pens and occasionally subs for Frank, Dorothy or Martha (you know – people get sick sometimes, etc.).
I wish I could demonstrate in this article how it is that the second company with the same number of work force can produce more pens and each costs them less than the costs of the first, traditional example. I am planning to make a simple demonstration video for you and post it soon on this page to show that the One Piece Flow system is much more productive than the Mass Production system. For now let me mention just a few kinds of expensive muda that exists in Good Old Way Pens.
Muda (Waste) is often invisible and is costly
First of all, notice that in the Good Old Way Pens factory there is a lot of inventory all over the place. Thousands of plastic tubes, ink cartridges, etc. – basically pens in different stages of production. Besides the fact that they all cost money, since they lay in different boxes for awhile the reality is that they are occasionally moved, lost, found, moved again, lost again and never found, etc. If the engineering department decides to change something – hundreds of pieces already made are thrown away, etc. Some of those pens are defects, because at some point the machine that makes springs broke and all day long was producing defects. The worse thing is that because there is so much inventory – no problems are really visible. Why? Because even if there are problems – everybody always has something to do. There are always boxes full of work-in-process that need to be advanced, etc.
The workers in the production line are, in a way, producers and clients. For example Dorothy is the client, Frank is the producer. Frank doesn’t even start making the next spring until Dorothy orders it (remember – the Toyota System is also called Just In Time). How does Dorothy order a new spring? Its simple: by emptying the dent between her and Frank’s station. The dent is called Kanban (an article about Kanban – one of the greatest inventions of the Toyota System is coming soon). All Frank needs to worry about is making sure the Kanban is full again and his client (Dorothy) is happy with his product. Dorothy’s job is to make her client, Martha, happy, etc.
The number of work-in-process pens can be counted on one hand. Pretty much no inventory here. What if the spring machine brakes? As soon as Dorothy starts putting the spring on the cartridge, she will immediately notice there is something wrong and the production stops until new springs are produced. The production will stop, but the visible problem will be taken care of – another stone removed from the bottom of Ohno’s river.
This article only touched on some of the many benefits of the One Piece Flow System. Are there any strong points of the Mass Production System? One characteristic that is often brought up as the advantage is the Series Production’s ability to cover for defects, malfunction, sick leave and other kinds of waste, as none of those problems stops the production because there is always a mass of work-in-process to work on. However, this is the traditional system’s biggest weakness, as it merely covers the problem for a while. Of course we don’t like to see problems, but it’s better to see them and fix them than discover them belatedly and suffer in the long run because of waste. Better to feel the pain in your stomach and get to the hospital in time to have your appendix removed than to have no feeling. Sure you would be saved the pain, but at what cost?