Henry Ford and Toyota Production System ..

We all know Henry Ford was the doyen behind the introduction of affordable motor cars for the traveling public of the world in 1912 with the introduction of the Model T Ford motor car in the US. 

Going through Henry Ford's autobiography, My Life and Work, published in 1922, while talking of workplace organisation, hygiene, cleanliness, orderliness, vendor relationships, innovation etc, it gently reminds us that the original principles of efficient low cost production was proposed by Henry Ford around the 1920s itself. 

I get a feeling that the Toyota Production System principles were originally proposed by Henry Ford around 1920s. The only TPS/lean manufacturing thinking I find lacking then, is the unit type of production, acting against old batch production. The 1914 Harris EOQ model was ruling the world of Inventory management then.

Henry Ford in his autobiography also talks of costs as paid to vendors and prices paid by customers to buy Ford cars. According to Ford, the costs should be lowered and this will ensure that prices at which cars are offered to customers are also lower. If the vendor is not working at full efficiency, what ever products he offers to Ford will be at a higher price. The supplying vendor cannot lower it any further as he is already working at an inefficiency and is unaware of ways and means to lower it any further. This is a challenge for Ford as it cannot reduce the prices at which cars are offered to customers. 

Ford found a solution to this. Why not make everything by itself from scratch, from steel to tyres to parts. This will ensure that the same high level thinking to improve efficiency of production at high quality and lower raw material costs are incurred by Ford and thence charged to the customer through lower prices for Ford products.

I have been engaging the subject of Lean Operations for the past more than ten years in Alliance University Bangalore and have taken lots of industry workshops on the above topic. Little did I know or ever dream that the same principles used by Toyota in the 60s and 70s and later expanded as Lean Manufacturing practiced by world manufacturing and service organisations around 80s, 90s and still continuing, they have all been copied from Ford's production / manufacturing philosophy.

Why could not Ford motor company carry forward the revolutionary thinking on simple and efficient production system to benefit itself in the long run.  Even though I feel Toyota picked up Ford's production philosophy quite late, it was Toyota who could bring the substance, rigour and discipline of efficient production systems in place, result of the discipline in the Japanese systems and culture, so necessary to get high quality production out from the factory.

 

Ford and Edison (L2R) 1927 ..

In the book we even find how Ford encourages and implements the plans proposed by his shop floor workmen to improve workplace efficiency, what we in Japanese call as the Kaizen, more systematic and orderly application of incremental continual innovation on the Japanese shop floor. Ford believed that the line worker in touch with the machine and the process was most empowered and knowledgeable of innovations and changes that could be brought to products or processes on the production line more than anyone else on the shop floor, even the CEO.

The autobiography of Henry Ford, the doyen of world automobile sector, titled My life and work, is worth reading for any mechanical, automobile and industrial engineering enthusiast. It opens one's mind not only to the production systems and capability to the 1920s, published in 1922, but also tells us what were the thoughts that went through Henry Ford's mind, far ahead of dreams going thru the minds of existing American and other global manufacturers and customers. 

 

Ford River Rouge factory, Dearbon, Michigan, 1944

In fact, Ford was far ahead of the competition and thought of customer delight and obsession much earlier than any of the modern practitioners like Toyota or Amazon. He was among the first and earliest to propound the lean philosophy thinking to charge the customers less, produce less waste and  offer high quality products at low affordable prices to the masses (Motorolla's six sigma philosophy). 

 

In order not to charge the customers more, he looked at the vendor supply chain, exploring ways and means to reduce vendors costs by efficient working, manufacturing to scale and cheaper availability of resources. The result was Ford had facilities across the whole supply chain right from rubber plantations to produce rubber tyres to owning iron ore mines to produce steel for the automobiles.

Henry Ford, the founder of Ford Motor Company, turned to the Brazilian rainforest in the 1920s to construct a rubber plantation that would serve as his personal supply of the material. The town, dubbed Fordlandia, was more than an industrial operation — it was Ford's attempt to establish a picturesque American society - Businessinsider, Feb 20

Ford Motor Company once owned 700,000 acres of forest, iron mines and limestone quarries in northern Michigan, Minnesota and Wisconsin. Ford mines covered thousands of acres of coal-rich land in Kentucky, West Virginia and Pennsylvania - www.thehenryford.org

After going through the book, I am more than convinced that the concepts of efficiency and value resulting in customer satisfaction was initially introduced to the world Henry Ford and later carried forward by Taichi Ohno and Sakichi Toyoda from Toyota and others. The world of global manufacturing owes to Henry Ford than to any other personality in post industrial 20th century global manufacturing for bringing in the modern concepts of value and customer obsession.

George.