The Agile For Agilists Podcast

Beyond the Toyota Way: The True History of Lean Manufacturing


One of my favorite books is “Beyond The Phoenix Project” by Gene Kim and John Willis—a remarkable exploration of DevOps history and the making of “The Phoenix Project.” However, the book leaves some gaps in its historical account. Rather than rehashing their audiobook content, I aim to complement their insights by shedding light on events preceding the ones they highlight. Those familiar with me are aware of my passion for delving into historical contexts, as I believe genuine comprehension stems from understanding the reasons behind the existence of certain practices and the problems they solved.

The Toyota Production System (TPS) provided Toyota with a distinctive competitive advantage, disrupting General Motors’ (GM) dominance in the American automotive market and catalyzing innovation across industries. When dissecting Toyota’s success, the discussion tends to focus around the standardization of work, continuous flow, waste reduction, and relentless improvement — items associated with Lean Manufacturing today. That is because many of us have been taught that Lean Manufacturing is rooted in the Toyota Production System. However, these notions predate Toyota’s 1937 founding, and can be observed decades earlier in the 1913 Ford Assembly Line.

Evolution of the Assembly Line: Olds, Whitney, and Taylor

To trace the origin of automotive assembly practices in general, we need to go further back than Ford to a man named Ransom E. Olds, founder and engineer of the Olds Motor Vehicle Company (later Olds Motor Works). Between 1897 and 1901, Olds pioneered the first mass-assembled gas-powered automobile, the “Curved Dash,” using a technique known now as the stationary assembly line. This approach consisted of workers lining up around the car to work on their specific piece and increased production fivefold from 1901 to 1902, making Olds the largest U.S. automobile manufacturer by 1903. Olds even established the first automotive supply chain by contracting the Dodge brothers to supply transmissions.

These assembly lines were heavily influenced by the concept of interchangeable parts, dating back to the 18th century with Samuel Bentham and Honoré LeBlanc, but popularized by Eli Whitney during the American-French war in 1798. Tools have existed throughout antiquity, steam-powered machines for centuries by this point, and architectural drawings have existed for thousands of years. However, previously each part was custom built and handcrafted by skilled craftsmen. Whitney’s interchangeable parts standardized the assembly of firearms and made repairs accessible.

Frederick Winslow Taylor, the “father of scientific management,” began his extreme waste management practices in the 1880s and later published “The Principles of Scientific Management” in 1911. “Taylorism” was already a well-known practice in the industrial industry by the time of publication. It’s uncertain whether Ford directly read Taylor’s work, but these practices likely influenced him through various machining jobs or were reflective of the prevailing ethos of that time period. Initially, Ford was a hands-on leader, working alongside his employees and maintaining a playful equilibrium. However, in later years, Ford and his company became notorious for autocratic behaviors. Despite contemporary opposition to Taylorism’s leadership styles, Taylor’s contribution to focusing on efficiency should not be understated.

Ford’s Revolution: From Stationary to Moving Assembly Lines

Henry Ford applied these efficiency concepts at his third automotive company, established in 1903—the same year Olds rose to popularity. Ford was driven to reduce costs and enhance quality by optimizing car assembly. He constantly challenged and refined processes, advocating, “Be ready to revise any system, scrap any method, abandon any theory if the success of the job requires it.” Ford emphasized creating many parts in-house, investing in facilities at a single location to reduce time and distribution costs.

The next significant leap in assembly line innovation occurred when Ford enlisted Walter E. Flanders in 1906. Flanders strategically realigned machines and workstations, maximizing flow and imparting more efficient production methods to workers. He introduced a system assigning assemblers the same task for each automobile, providing precise tools and parts at their station. Flanders also implemented “runners” or “stock chasers” to ensure materials and the right tools were readily available—an approach later refined at Toyota with the Kanban signaling system, conceived by Taiichi Ohno during his visit to the US in 1956 (Ohno drew inspiration from the well-stocked shelves at Piggly Wiggly’s supermarket). Flanders also pioneered a production schedule integrated with parts purchasing before resigning in 1908 to establish his own company. An interesting aside is that Flanders learned his way around machinery from the sewing machine industry, similar to the Toyodas.

In 1913, Ford Motor Company unveiled the “Crystal Palace,” a facility reimagined by Henry Ford and industrial architect Albert Kahn to house the first “Assembly Line.” This revolutionary facility more than doubled production in its first year. The engineering focused on promoting flow, utilizing flowcharts to organize machines intelligently and prevent unintended work accumulation between stations. Ford invested heavily in advanced machinery, implemented binned systems for parts proximity, upheld strict cleanliness standards, and established machine maintenance cycles.

A groundbreaking shift occurred when Ford embraced the idea of “taking the work to the men instead of the men to the work,” a concept whose exact origin remains unknown. Some attribute it to how butchers moved meat on metal hooks, others to conveyors for watches or sandbags, while some believe it organically evolved over years. Regardless, this era marked the beginning of parts being moved between stations. Later that year, Ford production engineer Clarence W. Avery mechanized the assembly line, leading to the creation of the moving assembly line.

Hawthorne Studies: Mayo, Shewhart, and Deming

A decade later, in 1924, at Western Electric Companies’ Hawthorne plant, Dr. Walter A. Shewhart and Elton Mayo initiated what has now been named the Hawthorne studies. Shewhart revolutionized the world with statistical process control and quality improvement, introducing control charts and PDSA (Plan-Do-Study-Act). PDSA became the basis for modern learning and knowledge practices. It was later changed to PDCA (Plan-Do-Check-Act) or sometimes called the Deming Cycle due to its popularization by Dr. Edward Deming. Deming learned directly from Shewhart by working alongside him at Hawthorne, before going on to help the US during war production efforts, and later invited to support Japan’s post-war reconstruction by General MacArthur.

Mayo’s studies opposed Taylorism, focusing on the human condition of Western Electric’s workers. Social interaction emerged as the primary contributor to worker performance, as Mayo discovered that employees excelled when they felt cared for by coworkers and managers. Although Dr. Deming worked at Western Electric during these studies, it is unclear if he had access to their data. However, his leadership principles align with these findings, likely influenced by his time at Hawthorne.

Toyota’s Transformation: From Looms to Automobiles

Toyota’s automotive journey began in 1933 when Kiichiro Toyoda established a division at his father’s company, Toyoda Automatic Looms Works, at the Japanese government’s request. Initially focused on military vehicle production, the division would evolve into an independent entity in 1937. Kiichiro drew on his father Sakichi Toyoda’s business concepts, including the Andon Cord. Post World War II, Toyota would be exposed to Dr. Deming’s teachings during the Reconstruction Era of Japan. On the verge of bankruptcy in the 40s, and succeeding a bailout from the Bank of Japan in 1949, company executives traveled to the United States to train at the Ford Motor Company. This led to Toyota coalescing their insights from the Ford Assembly Line, Deming’s ideology, and Toyoda’s loom expertise to develop what we now recognize as The Toyota Way and the Toyota Production System. Throughout the 1950s, Toyota meticulously solidified and refined these practices, findings, and methodologies. By the 1960s, the company had evolved into a global phenomenon, achieving the monumental milestone of creating the world’s all-time best-selling automobile.

Additional References:

  1. Kim, Gene & Willis, John (2018, February 17) Beyond The Phoenix Project: The Origins and Evolution Of DevOps. IT Revolution Press.
  2. Watts, Steven. The People’s Tycoon: Henry Ford and the American Century (p. 141). Knopf Doubleday Publishing Group. Kindle Edition. 

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