Book Report

BOOK REPORT ON TH E MACHINE

THA T CH ANG ED TH E WO RL D

By: JAMES P. WOMACK,, DANIEL T. JONES

& DANIEL ROOS

BY

SAURAV ABOUT THE AUTHOR

James P. Womack , Daniel T. Jones & Daniel Roos have beautifully engineered the book named as “The Machine That Changed The World” .The authors were the three senior managers at International Motor Vehicle program (IMVP) at MIT. Daniel Roos, Ph.D was director of the International motor vehicle program at MIT ,James P Womack, Ph.D was research director of program, Daniel T Jones was the program’s European research director . Other book written by these authors is “The Future Of Automobiles”, in which they examined the problem facing the world motor vehicle industry at that time. The autos were driven by the success of Japanese automobile industry in revolutionizing the production of automobiles. The changing scenario of production of automobiles and perception of people to the lean production were the key factors which prompted the authors to come up with the book titled “The Machine That Changed The World”.

SUMMARY

The machine that changed the world, written by James P. Womack , Daniel T. Jones and Daniel Roos is a work of research by them in the field of automobile industry . Their research was sponsored by the International Motor Vehicle Program (IMVP). This book is an attempt to highlight the revolutionizing technique of automobile production by Japanese referred to as lean production. A researcher at IMVP named John krafcik coined the term lean production. Before understanding lean production, we will have to be aware with the craft production and mass production. Craft production the technique or process of production of automobiles using highly skilled workers and simple but flexible tools to make exactly what the consumer asks for one commodity at a time, example- exotic sports car. The first cars were custom built by the craft system. Due to the lack of standardized parts, no two cars were the same. The result was an expensive product, available only to the wealthy. Mass production uses narrowly skilled professionals to design products by unskilled or semi-skilled workers tending expensive, single purpose machines. Lean producers by juxtaposition, combines the advantage of craft and mass production, while avoiding the high cost of former and rigidity of latter. It’s referred to as lean because it uses less of everything compared to with mass production- half of the human effort in factory, half the manufacturing space , half the investment tools, half the engineering hours to develop a new production in half the time. The book compares the working and management strategy of different automobile companies, their evolution, their disappearance etc. the book gives at the start of few of few chapters gives a detailed account of different automobile companies such as P&L, Ford, G.M, Toyota, and during the coming decades changes in their production techniques and even management strategy. Some great personalities like Henry ford, Alfred sloan, ohno, Eiji toyoda to name among a few who left a remarkable mark in history to revolutionize these techniques. This was achieved by the authors, based on a five-year study of the worldwide automobile industry that included visits to 90 assembly plants in 17 countries. Their research indicates that the answer lies instead in the type of production system used, regardless of country or

product. The authors identify three types of production systems: craft, mass production, and lean production. Lean production, the focus of the book, is the most efficient of the three and was begun in Japan. The authors discuss the rise of lean production, the new approach to manufacturing that has shaken the mass production system to its very bases. The authors trace back the history of automobile industry, with P&L. P&L was situated in Paris in 1890s was the leading company, and Evelyn Ellis a wealthy member of English parliament became the first person to drive an automobile in England in june 1895. But, P&L was not able to survive and now it can only be seen in the museums. Ford’s moving assembly line was revolutionary in automobile industry. It helped wider mass of population to have the reach of the automobiles and was effective in minimizing the costs and was having designed-in repair ability, Ford assumed that his buyer would be a farmer with modest tool kit and the kinds of mechanical skills needed for fixing the farm machinery. As every car had a manual for self guiding repairing tool. By the introduction of revolutionary assembly line Ford reached peak production volume of 2million identical vehicles a year in early 1920s, he had cut the cost to the consumer by an additional two-thirds. This served as a division or separation of labor, the assembler required only a few minutes of training. Moreover, he was relentlessly disciplined by the pace of line. A 1915 survey revealed that Highland workers spoke more than fifty languages an that many of them could barely speak English. Ford’s original mass-production, the model-T produced 2.1 million models in 1923, the peak year of model-T production. GM was founded by William Durant, but he was not managing it well .So, Alfred Sloan was called in . Sloan’s strategy was the tool of decentralization. Sloan wanted to advice standardization and model diversity and achieved both goals by many mechanical items, across the company’s entire product range.

This situation of stagnant mass production in both the united state & Europe might have continued indefinitely if a new motor industry had not emerged in Japan. The true significance of this industry was that it was not simple another replication of the by now venerable American approach to mass production. Eiji Toyota & Family founded Toyota Motor Company in 1937. The production genius Taiichi ohno soon conducted that mass production that would have never worked in Japan. It was ohno from whom concept of Team Leader emerged. Ohno began to experiment; the first step was to group workers into teams with a team leader rather than a foreman. A revolutionary and empowering decision taken by Ohno was that, he placed a Cord above every work station and instructed worker to stop the whole assembly line immediately, if a problem emerged that they couldn’t fix. Then the whole team would come over to work on the problem. This yields 100% approach and line never stopped . Toyota gave a stiff competition to firms such as GM, because Toyota can offer twice as many vehicles with the same development budget. Toyota’s Marketing Strategy They did not wait for customers to show up at show-rooms instead they went directly to customers by making house calls. Unlike mass producers who used to conduct production evaluation “clinics” and other survey research on randomly selecting buyers. Toyota went directly to its existing customer in planning new products .The customers were considered as a part of Toyota family. The book also signifies the changing socio-economic conditions and tastes of population. How the low tech weaklings transformed to high tech weaklings, how the perception of Japanese cars changed to be high tech. Company customer relationship was also beautifully surfaced out. In Japan, it was like that cars were sold door to door ,Team members drew up a profile on every household within the geographic area around the dealership, then periodically visit each one, after first calling to make an appointment . During their visits the sales representatives updates the household profile.

In the later part, the book dealt with the customer relationship and brand loyalty. Then new approach such as the personnel management, information flows, product development, cross-regional trade and internationalized finance were evolved. Utilizing the inherent efficiency and quality benefits of lean production, Japanese firms like Honda, Nissan and Toyota have gained noticeable market share in the US. After sensing the threat from lean producers, US automakers resisted Japanese entrance into the American market. However, the domestic automakers have had little success keeping Japanese vehicles out and are having trouble competing with the high levels of Japanese quality. As a result American auto manufactures have begun to adopt some of the techniques of lean production. Progress until this point has been slow. While recent troubles in the Asian economies have cast a shadow on Japanese business practices, the most adept lean automobile producers, Honda and Toyota, continue to have success and have been able to adapt their practices during periods of economic hardship. The systems level outlook of lean production appears to have real benefits over traditional American mass production techniques. Womack, Jones and Roos exposed the fact that much of lean production has wide applicability, even outside the Japanese business environment.

KEY LEARNING

The book teaches many concepts embedded in its excellent research of automobile industry .One of them being that change and shift to new techniques or to the market needs is necessary for development and evolution .The book also highlights the need for problem solving as soon as it appears and not keeping it for the last stage to be rectified . It doesn’t only saves money but also the precious time, a unique and beautiful concept developed by the lean producers. Company customer relationship can be intimate and rewarding. This is shown by the Japanese automobile makers, where it is said that in Japan the only way to escape the sales agent from whom you once bought a car is to leave the country.