The manufacturing industry has been shaped by two great thinkers, HenryFord and Taiichi Ohno. Ford revolutionized mass production by introducingthe flow lines. Ohno took Ford’s ideas to the next level in his TPS, a systemthat forced the entire industry to change its grasp of inventory from an asset toa liability.Ford’s starting point was that the key for effective production is toconcentrate on improving the overall flow of products through the operations.His efforts to improve flow were so successful that, by 1926, the lead timefrom mining the iron ore to having a completed car, composed of more than5,000 parts on the train ready for delivery, was 81 hours!
Eighty years later,no car manufacturer in the world has been able to achieve, or even comeclose, to such a short lead time.Flow means that inventories in the operation are moving. When inventory isnot moving, inventory accumulates. Accumulation of inventory takes upspace. Therefore, an intuitive way to achieve better flow is to limit the spaceallowed for inventory to accumulate. To achieve better flow, Ford limited thespace allotted for work-in-process between each two work centers. That is theessence of the flow lines, as can be verified by the fact that the first flow linesdidn’t have any mechanical means, like conveyers, to move inventory fromone work center to another.The daring nature of Ford’s method is revealed when one realizes that a directconsequence of limiting the space is that when the allotted space is full, theworkers feeding it must stop producing. Therefore, in order to achieve flow,Ford had to abolish local efficiencies. In other words, flow lines are flying inthe face of conventional wisdom; the convention that, to be effective, everyworker and every work center have to be busy 100% of the time.One might think that preventing resources from working continuously willdecrease throughput (output) of the operation. That undesirable effect mighthave been the result if Ford would have been satisfied with just limiting thespace. But, there is another effect that stems from restricting the accumulationof inventory. It makes it very visible to spot the real problems that jeopardize
Today and Tomorrow
, Productivity Press, 1988 (originally published in 1926).