Muda – Toyota Production System’s key concept

The way a business operates is by people moving, thinking, going somewhere to get something, coming back, moving again, etc. People make things move and change. A company succeeds because many activities are put together in an organized fashion to produce something that the customers consider more valuable than their money.

Some time ago I was put in charge of a production plant. Our market was small but our products were known for their great quality and so people came to us instead of our competitors. At some point my boss became fascinated with the Toyota System and wanted me to look into it. It took me awhile before I started reading the books he had given me (he was a pretty patient boss, but beyond that – just as the Toyota managers, he also understood that it is better for me to be converted to the Lean Philosophy than trying to force it upon me – much more effective in a long run). I will be honest – at that point I didn’t have to deal directly with the production side of the business. I actually avoided the shop floor at any cost. After all, I didn’t go to a college to get my hands dirty, I told myself. I preferred my clean, quiet office and the soothing clicking sound coming from my laptop.

One of the first concepts that caught my attention as I was studying the writings of Shigeo Shingo was the concept of Muda (which in Japanese means “waste” or “uselessness”). I was sitting in my office trying to focus on the book I was reading over the sounds of banging, filing and thumping coming from the production shop. Here is Shingo telling me that at least some of that noise will never be converted into profit. “No way,” thought I. Our workers are good guys and they are some of the most skillful craftsmen in town. They know what they are doing and surely they would not want to do anything that doesn’t add to the value of our products.

muda is anything that the customer won't pay for

Shingo seemed unrelenting though. He claimed that only a small percentage of our workers’ efforts actually add to the value of our products. In other words – most of their activities our customers are not willing to pay for. I thought it was a crazy idea, but guess what? After reading it I started actually feeling bad for the guys and for all that effort they were putting into their work. So, I decided to look into it.

One day I came in after hours to the largest production room and, with the help of a trusted worker, installed a video camera under the ceiling right above a ventilation tube. The next day, around noon, that same worker came to my office and told me that a few guys noticed something strange under the ceiling and tried to take it down using any tool they could find and throwing screws and other objects at it. I decided that perhaps we didn’t need any more filming that day and went to take the camera down.

As you can imagine the workers were not very pleased when they found out they were secretly filmed, but eventually they believed me when I assured them that they were not being spied on but that I was simply interested in how their work could be improved so that they could be more effective and at the same time move less.

I watched the video with a stopwatch in my hand and to my amazement I realized that on average – about 70% of the workers’ time was spent doing things that did not add to the value of our products! And I am not saying they were goofing off. They were working – pretty much all that time, but only 30% of it they were actually filing, drilling, putting in screws, welding, etc. The rest they were looking for tools, picking up the screws from the floor, walking to the nearest polishing machine, etc. Obviously that experience was an eye opener for me. Shingo definitely got my attention.

Muda is any kind of activity that the customer will not pay for. Looking for tools is muda, making too many items that then acquire dust is muda, making 100 parts that eventually get thrown away because the engineering department changed the shape a little bit is muda, disorganization that makes people stand and wait to be told what to do next is muda, buying and installing a cool little gadget on a car that impresses only our engineers but no customers is muda also. All those things need to be eliminated and this is one of the main points Shingo and other guys from Toyota make.

There is something else I’ve learned about muda. It has little to do with production but much to do with realizing how inspired the Toyota Production System or Lean Philosophy is. After learning about the concept of muda and seeing what difference it makes when one constantly tries to eliminate it I started wondering about what I do after work and, guess what? I found lots of things in my daily activities that could be classified as muda. Don’t get me wrong – I’d be the last person to call entertainment or fat in my diet muda – those are important parts of a happy life. But I started thinking about which of my activities add value to the things I am trying to accomplish in my life: a good relationship with my family, some goals that I hope to accomplish one day, etc. and you know what? I found there was even more muda in my life than there was in my factory. Just something to think about.

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Toyota Production System | Lean Manufacturing

Imagine there was a lottery offering real business opportunities instead of cash. You win the biggest prize: a sure position as a manufacturing plant manager. Your phone rings and this is what you hear: “Hi, this is the Teach A Man To Fish Lottery. We would like to congratulate you again on your victory and inform you that we have just learned about another person who picked the same numbers as you, which means that we now have two winners – you and Mr. Fish from Alaska. Our plan is to give each of you a managerial position in a separate plant. Since you were the original lottery winner, we offer you the choice of which plant you’d like to work in.”

To make a long story short – you send your trusted manufacturing expert to both of the plants and this is what you learn from her report:

• both plants are located in the same town

• both are producing exactly the same products

• each factory has the same number of employees, however

• factory A offers better quality products than factory B

• factory A delivers its products 2 weeks from the moment they are ordered by the customer while factory B can guarantee no less than one month delivery time

• factory A’s annual sales are double its competitor’s

• factory A has less than half of the amount of money invested in material and work-in-process than factory B

• a quick survey shows that many of the workers in factory A like their jobs and their favorite day of the week is Monday while factory B’s employees’ favorite days of the week are Friday, Saturday and Sunday and the labor turnover in factory B is significantly greater than its local competitor’s

Which factory would you choose to own and manage? Your choice is as easy as the choice between the Toyota Production System over the conventional way of managing production.

The Toyota System site is for you if:

• you are considering the implementation of the Toyota Production System in your factory, office, hospital, post office, etc. but first you want to make sure it’s worth the trouble, or

• you want to understand the System better, or

• you are looking for ways to help your managers or employees understand and appreciate (or even be converted to) the Lean Philosophy, or

• you want to share your experience implementing Lean Manufacturing with the world

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