Monday, April 12, 2010

In Eyes of a novice

Toyota—the brand itself invokes several feelings and thoughts. World’s largest automobile company, pioneer of path breaking quality systems, robots in action, global leader in defining modern age safety standards, workers’ participation in mainstream business activities, fuel efficient and attractively designed suite of vehicles catering to various income strata...and so on!

The weight of such overbearing background was ruling my mind, as I was about to visit Toyota’s largest manufacturing facility of North America in the last week. Frankly, although I had decided to go on a guided tour around this factory, I wasn’t sure what to look for—given that a sea of information, although unstructured, was already available with me even without visiting any of the Toyota locations. So I decided to intentionally vacate my mind of any such bits and pieces and half baked information that I had collected over the last many years. I said to myself - ‘ignorance is the best policy, when it comes to learning afresh’ and carried on with my plans for this visit.

As I entered the large visitor car park of the Toyota manufacturing plant, based out of Georgetown-Kentucky in the USA, I was a complete novice, not knowing what was in the store for me to watch, observe and learn over the next few hours of my visit.

Georgetown, a small city located in Scott County, Kentucky (a state located in the East Central United States of America and is classified by the United States Census Bureau, as a Southern state) got it’s name in 1790 in honor of President George Washington. The population of the city today is in the region of 22,000. While the city has been in existence for centuries, it’s real growth began in the mid-1980s, when Toyota built Toyota Motor Manufacturing Kentucky (TMMK), the first wholly owned United States plant. This plant has been producing 2000 quality vehicles every day since 1988.

The reason for me to give this short introduction to Georgetown is to not only provide some relevant context but also to highlight how my preconceived ideas about the place were full of shortcomings! My original thinking was that Georgetown would be typically an industrial town constructed around one large manufacturing plant i.e. Toyota—and what turned out was an amazing amalgam of a modern day township and a historically rich town!

So, entering Toyota factory as a novice was turning out to be a good idea, after all!

Winding back—after crossing over a large car park reserved for the visitors, I entered reception area of the Visitor Center. In a large reception hall were placed the latest models of the cars manufactured in that facility, namely Camry, Avalon and Venza. The visitors have full freedom to enter those cars and check out all the features they offer. With the enthusiasm of a child, I got into each one of them, including getting into the boot/trunk of Venza, a mid-size crossover that has been beautifully crafted with features of both a sedan and a SUV. This imposing Visitor Center has many other features viz, interactive computer activities, videos and a gift-shop for the visitors to buy Toyota emblemed mementos. I could easily spend over 45 minutes in just browsing through and trying my hand in various interactive activities while awaiting a call for the conducted tour around the plant. And I could have easily spent another hour there!

The plant tour started in a large conference room adjacent to the visitor reception area. We were first introduced to our guide who welcomed us and provided some key snippets of history of the facility, important safety instructions during our plant round and most importantly a two minute training demonstration around usage of the earphones and safety glasses. With that kind of preparation, a 10 minute video film was screened for the benefit of the visitors, providing all the basic necessary information about the plant—it’s history, significance to the US economy, positive impact on the employment market, Toyota philosophy, products et al.

Then the actual tour began.

We were guided to an open tram that was ready to take us all around the plant. As I was embarking on to the tram, I was still trying hard to empty my mind to allow fresh insights and observations that I was all set to acquire!

And what did I see there?

The purpose of this article being not to capture end-to-end manufacturing process, my observations, now on, are going to be more topical than chronological and they are not necessarily in any order of priority and importance.

However, a small introduction to The Toyota Production System (TPS) will enable readers to gain some context. TPS is an integrated socio-technical system, developed by Toyota that comprises its management philosophy and practices. The TPS organizes manufacturing and logistics for the automobile manufacturer, including interaction with suppliers and customers.

The main objectives of the TPS are to design out overburden (muri) and inconsistency (mura), and to eliminate waste (muda). The most significant effects on process value delivery are achieved by designing a process capable of delivering the required results smoothly; by designing out "mura" (inconsistency).

Ergonomics, Safety and Housekeeping: There was plenty of evidence of work systems being tailor-made to suit operator comfort. Some significant examples as follows:

* The whole manufacturing floor was an example of high caliber housekeeping. I didn’t notice any oil spots on the floor nor was there even a piece of paper or trace of litter lying anywhere to be lifted or left in some corner inadvertently.

* Cars on assembly line were moving at a particular height and operators working on them were working on adjustable platforms that could be aligned with jobs in front of them, such that they didn’t have to bend. Similarly, those working at the floor and base of the cars were standing in the well specifically designed for operator comfort.

* Those required working on the car interiors sat in the moving and hanging trolleys which straightaway entered a car-in-the-making and door assembly would join the assembly line only after the interiors were fully completed.

* Entire plant lighting was completely glare-free and evenly lighted.

* Noise levels throughout the plant varied based on the manufacturing activities in the respective areas, but I didn’t notice even one person in the entire plant not using ear-plugs. I consistently noticed inter-personal communication on the shop-floor using some simple sign language - a welcome difference from many other factories where operators tend to speak to each other in loud voices to beat the machine sounds surrounding them. It may not be an exaggeration to state that such a sight was almost adding a calming effect to the otherwise inevitably surrounding high-decibel manufacturing environment.

Multi-skilled Operators: Each logical section in the manufacturing process was assigned a set of multi-trained operators. This is an interesting phenomenon and I must explain it. These operators, although are responsible for handling production of a particular car part at one point in time, are trained in many such parts within a logical unit e.g. Engine assembly. This multi-trained capability helps them to rotate jobs (in a sense an anti-thesis of specialization!) every few hours, thereby avoiding possible fatigues and burn-outs. This is also a measure that keeps productivity high and finally such multi-trained operators are a boon in managing replacements for planned/unplanned absenteeism! I was told that this is one of the signature facets of the world famous Toyota Production System (TPS), an integrated socio-technical system, developed by Toyota, that comprises its management philosophy and practices.

Employee Empowerment: Integral part of Toyota’s philosophy, ‘The Toyota Way’, is respect for people. Thus, all the employees at Toyota are referred to as Team Members. Every team member working at the production line is skilled to be an Operator and empowered to be a Quality Inspector at the same time. Every team member has a right to stop assembly or any production using the Andon system (raising a flag to alert of a potential problem), in the interest of tackling any in-process quality issues—even at the risk of affecting production. Every team member has a composite skill-set acquired out of planned job rotations and training, and additionally they are trained to take ownership of their work in order to eliminate defects being passed on to their customers, both internal and external. Thus, when it comes to the responsibility, the buck stops with them! That underscores Toyota’s customer centricity!!

Autonomation: Toyota and automation were the inseparable twins in my mind and what I saw there was just a reaffirmation of my assumption. From watching gigantic robots in the Body Welding area to the plant-wide ground traffic of (driver-less) automated guided vehicles & carts that carry parts to each process following their programmed path; it was a dream-come-true for me. I also came back with an addition to my vocabulary—and the word was Autonomation. In simple terms, it may be described as "intelligent automation" or "automation with a human touch." At Toyota this usually means that if an abnormal situation arises the machine stops and the operator will stop the production line. And more importantly, if the machine breaks down, team members are skilled to complete the process manually. Thus, Autonomation prevents the production of defective products, eliminates overproduction and focuses attention on understanding the problem and finding a long-term solution without causing excessive production delays.

JIT: A lot has been said and written about Just-in-time (JIT) philosophy and I’m not going to dwell much on the obvious advantages of JIT. However, my reportage about the visit to Toyota’s largest manufacturing facility outside of Japan will be incomplete without this compelling example I saw.

From end-to-end i.e. from Metal Stamping stage to final car being driven out of the assembly line with all quality checks completed, it takes a cycle of approximately 36 hours in this plant. When the metal is cut for a particular car, the order for a door assembly is placed to the outside vendor such that the vendor then starts assembling the doors at his premises which are about two hours drive from this Georgetown plant of Toyota. So, while the car is getting ready, the vendor simultaneously gets on with making doors for the same. Eventually, the door assembly arrives in the Toyota plant just in time when required to be fixed on the designated car—and this happens for every car that is manufactured here. Just to get the context - every year 500,000 vehicles are manufactured in this plant alone! Now that must provide us the enormity of this strategic initiative!

Red Tag Area: This one is my real favorite. Just for the simplicity of the concept. The whole initiative is around cost-optimization. Let’s say, one employee has three pens and two staplers at her desk, while she only requires one pen and one stapler. This makes two pens and one stapler an excess and worthy of being tagged ‘red.’ All such materials are stored in various designated Red Tag Areas for eventual distribution against the demand-pull. And the story doesn’t obviously end at pens and staplers. I find a universal application of this concept—very independent of the type of enterprise and the geography in which it operates.

Boards and Charts: Toyota’s emphasis on visual and transparent communications across the entire workforce was evident throughout the tour. Every process area seemed to have boards and charts to track efficiency, productivity and quality using Key Performance Indicators (KPIs), clearly indicating a focus on ‘metrics-driven approach’— the most objective way of managing any production environment.

Hierarchy on the shop floor: Every area in the plant has a Group Leader reporting to an Assistant Manager who in turn reports to a Department Head. Similarly, Group Leaders have Team Leaders reporting to them. These Team Leaders act as go-betweens Team Members and Group Leaders. Team Leaders are essentially former Team Members who have been with Toyota for a considerable amount of time and are deeply familiar with all the production processes within their group. They help Team Members in case of any production related problems and also act as their absenteeism cover. Team Leaders assist Group Leaders in creating work schedules and help them with management of shop floor issues.

Team Members’ Dress Code: I noticed that team members in different sections of the plant, wore different types of clothes designed to suit the activity in their respective area of work. Some examples include:
• In the final assembly area, team members wore softer fabrics without any accessories to avoid damage to the finished product e.g. a scratch
• In the body welding area where team members handle metal parts, they wore tougher materials such as denims
• In paint, they wore overalls made of lint-free and non-static material to avoid quality distortions in the painting process

I was informed that even though there is a pre-defined type of dress code, every team member has several options to choose from in colors and styles, thus removing monotony. Another example of Toyota’s employee centricity!

Some other key observations:

* An average shop-floor employee, when walking swiftly on the floor, seemed to be a person in a hurry—a clear indication of a ‘sense of urgency.’

* A plant that employs 7,000 workers has a visually striking sense of ‘rhythm’ and co-ordination between people & people and people & machines.

* Kaizen, Quality Circles and Suggestion Schemes happily co-exist as prominent features of employee empowerment philosophy of Toyota.

* Pull System (yet another important facet of Toyota Production System), a method of controlling the flow of resources by replacing only what has been consumed, is evident in many ways. The most compelling example being that every car produced in the plant is produced only against the ‘customer order’ and not as part of anticipated demand. Prevalence of Kanban and Red Tags are the other relevant examples.

* Despite the cyclical nature of the auto business and particularly in the light of the recent recession, it is noteworthy that Toyota continues to steadily maintain employment levels of it’s employees.

* This 7,000 people strong facility has generated an employment for another 100,000 individuals in the Toyota vendor network and the community around the Georgetown area. The effect of the same was pretty evident when we walked around the high street of the town noticing shops after shops proudly displaying boards such as “We support Toyota”, in reaction to the current public debate around quality of some past batches of Toyota vehicles.

* While the Georgetown plant is Toyota’s first fully owned manufacturing facility in the US, a lot of raw material for running it is sourced from North America itself.

* Toyota’s focus on Diversity was evident and what was easily observable was ‘Gender Diversity’ on the shop-floor.

While sitting in my ‘study room’ after a week of my visit in trying to pull together my thoughts, I am feeling even more reassured of the stance of ‘novice’ that I took. But for that, I would have lost an opportunity to gain some precious management insights!


Anonymous said...

Abhay, good article. Nice to read about new things. But if you want to publish it, in my view, you need to shorten it, especially, you may consider removing the styles like “as follows” and “not in chronological order”.., this is very corporate writing…

In many places, you could jump into the point without introducing the point and avoid saying what you are going to say in that point… May consider inserting some anecdotes from your guide or from employees.

Also, you want to mention if anyone crosses the automated carrier, that stops and go, once that person crosses, I found that interesting!

(Deva Ramamoorthy)

Abhay Valsangkar said...

Hi Deva,

Thanks a lot for your prompt and very useful suggestions.

I'm going to work on each point while finalising the article.


Amit Malik said...

Hi Abhay

Interesting read but as you publish it a few thoughts:

1) WIFM for the reader - you may want to somewhere share how the philosophy / concepts have changed /influenced your way of thinking and perspective so that reader could have that as take away

2) Shorten the concepts as some of them are widely read already

3) include the nuggets of your conversation and little pieces of history that made for insightful and interesting conversation

4) focus on concepts like red tags a little more as they would be new for a average reader.

Your style is very good , its a nice read and use of languages is good.

let me know when and where you publish this ....


Anonymous said...


I did not enjoy this one to the extent of other blogs I have read.

The management insights are definitely there but scattered among factual description may be because of approach from the point of view of a NOVICE?

A crisper version would help for publishing purpose.


Anonymous said...

Hello Abhay -

Given that you have written it, I had to read every word in the article. I do believe that Deva's suggestion is a good one with the length of the article.

I also believe that you are sending a message of being a learner in your description of concluding the "novice" approach. Another paragraph at the end about being a novice, learner, and walking with an open mind will give enormous thinking and reflection to the reader.

In terms of quality and content, it is very professionally drafted and comparable to the prints in HBR, length being an exception.

I really enjoyed it. I still need to show up for a cup of coffee with you, one of these days.

Himanshu Shah

Abhay Valsangkar said...

Hi Himanshu,

Thanks for your kind words and more importantly your improvement suggestions! I'll certainly incorporate those.Yes, we must make it for a coffee session soon.


Anonymous said...

Dear Abhay,

You are a good writer. I can perceive the strength in each post.

One small suggestion, the beginning of the post reminds me some of the "Pravas Varnan" I read in sakal. Perhaps, it could be edited. The professional flow after you start on the plant tour is excellent and informative.

Keep writing.

- Jagdish
(Jagdish Ghorpade)

Abhay Valsangkar said...

Hi Jagdish..Very valuable suggestion! I'll amend the 'travelogue' part! Thanks for your quick response.Cheers..Abhay

Abhay Valsangkar said...

Dear Sri...Thanks for going through the recent blog and sending your prompt comment of appreciation...Cheers...Abhay

Abhay Valsangkar said...

Hi Vijay...Thanks for your frank comment.I really appreciate it.In fact, I have received some more that relate to the length of the article..clearly there is a need to make the contents crisper!...will do it...cheers..Abhay

Abhay Valsangkar said...

Hi Amit,

Thanks for your suggestions. They really make sense in terms of incorporating in the final draft. I'll surely work on those. I'll also let you know the publication details...Cheers...Abhay

Vijay Karkare said...

Hi Abhay,

Would you like to mention/ comment on recent quality problems/ product recalls/ differences among top management as reported in press and what your thoughts are on this in the context of this article. Every good organisation suffers over a period including people problems at one of the leading/ respected IT giant.What causes the decay? Can success be emulated in perpetuity?
Vijay Karkare

Abhay Valsangkar said...

Dear Vijay,

Thanks for your insighful comment.

One of the reasons I did not comment on the recent product quality controversy was my own lack of sufficient knowledge around the same, and therefore wanted to restrict my thoughts around what I pesonally observed...Thanks..Abhay

Abhay Valsangkar said...

Dear Amit...Thanks for your feed-back on the recent blog.Yes, I'm aware of the current issues,however,I thought of writing what I saw.Keep responding as always,it really helps me...cheers..Abhay

Abhay Valsangkar said...

Dear Pankaj..Thanks for your mail about my recent blog. I appreciate your compliments.

Nagesh Pai said...

Dear Abhay

This is very informative. I guess it explains why Japanese are superior in getting the best out of their employees....I wonder if Toyota would have been successful if they had opened their plant in India....

Abhay Valsangkar said...

Dear Nagesh...Thanks for your comments.I think your thoughts about whether Toyota would be equally successful in India environment or not are valid. In my view, if they could do it in the US, they should be able to do it in India as well.There are many MNCs operating in India in multiple sub-sectors of manufacturing and services sectors--almost all of them conforming to the global standards.It will esentially be a matter of training the workforce appropriately.

Anil Pimple said...

The article is interesting.
This indicates the perfection,professionalism along with ease & comfort. this is avery rare blend.

Abhay Valsangkar said...

Thanks for your comment, Anil...i appreciate it..cheers..Abhay

Abhay Valsangkar said...

Dear Abhay,

As always, your response is insightful and encouraging. Thanks a ton.


Abhay Valsangkar said...

Sorry for very very late OS had crashed and I could not get it repaired soon etc etc..

Leaving the sob story aside, it was a very nicely worded story. As a few readers have said, you have a story tellers expression. Feels like you took us in a guided tour of Toyota plant and believe me, I could see it with blue colours(was there any blue..BTW?)


It made lot of sense to me-your obs about housekeeping ,noise. I worked with Cummins here. What you observed are indeed something out of world for us!
Okay-someday we will try to be at that level-if get to read something like this..

Thanks Boss..It was a pleasure!
Abhay Joshi