World: The motor industry - time for a change of gear or suicide.

World: The motor industry - time for a change of gear or suicide. - "The Machine that Changed the World" by James P Womack, Daniel T Jones and Daniel Roos (Rawson Associates, 278 pages, £19.95).

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Last Updated: 31 Aug 2010

"The Machine that Changed the World" by James P Womack, Daniel T Jones and Daniel Roos (Rawson Associates, 278 pages, £19.95).

Review by Graham Turner.

Here is one of those rare books which every director of a sizeable manufacturing enterprise ought to read. It is the story of how the Japanese motor industry became the most efficient in the world. But it also contains crucial lessons for any other manufacturing business which has ears to hear. It presents a chilling analysis of the weaknesses of mass production, and reveals how the Japanese moved to a system which its authors call "lean production". This, they argue, western businessmen will ignore only at the risk of corporate suicide.

Disaster scenarios of this kind are normally dreamt up by dollar-hungry futurologists on the basis of skeletal research. This book, by contrast, is the fruit of one of the most comprehensive surveys of an industry ever carried out (at a cost of $5 million), and is the work of a group of academics many of whom previously held senior jobs within the motor industry. Nor do they present their findings in dull, prosaic language. Without being in any way shallow or cheap, they write in a style which is always easy to read and often downright conversational.

The book is full of arresting statistical comparisons. For example, Toyota - the authors' beau ideal - produces in its own plant a modest 27% of the cost of each vehicle that it makes. Yet it employs only 37,000 employees to turn out four million of them every year. General Motors, by contrast, adds 70% of their value to the eight million vehicles that it produces every year, but employs no less than 850,000 workers to do the job. GM has 6,000 purchasing staff compared with a mere 337 at Toyota.

But the heart of the book is a devastating critique of the weaknesses of mass production methods - inflexible, expensive, single-purpose machines with the boring, dispiriting work that they demand - and a celebration of the economic and human benefits of the system of lean production which the Japanese have pioneered. The authors spell out what it has achieved for the Japanese motor industry over the past 40 years. The industry now, they say, requires only half the effort, half the space, half the investment in tools and half the stock to turn out a far wider choice of models than comparable western companies can - and in half the time at twice the quality. The statistics which support this assertion are comprehensive and convincing.

By treating assembly-line workers as the lynchpins of the operation rather than as mindless helots, and by training them and rewarding them as such, they have combined massive cost savings with considerable job satisfaction. The workers have become willing to initiate the continuous improvement which is the essence of the system. Anybody who believes that this is pure hokum, or that it could not be done here, should pay a visit to the Nissan plant in Sunderland.

Whereas Nissan and Toyota plants set aside only tiny areas at the end of the assembly line for the rectification of faults, western factories commonly devote 20% of their plant space, and 25% of their total effort, to putting them right. The contrasts between the ways in which Japanese and western companies design and sell their cars is equally thought provoking.

Not surprisingly, the authors predict a gloomy future for western corporations which fail to adopt lean production methods. They are particularly pessimistic about the European motor industry, which they regard as the last refuge of mass production techniques. They recall meeting a young French engineer in 1982 who was bubbling over with keenness to introduce into his own plant the lean production methods which he had seen in Japan. In 1989 they met him again, at a factory where he was by then head of manufacturing. Sadly, he had failed to convince his bosses of the merits of the Japanese methods. His plant put three times as much effort as the best Japanese facilities into turning out cars, and had to correct three times as many faults.

The authors of this fascinating and disturbing book take the view that those who are about to die at least deserve to know why - and how they could save themselves if they chose.

(Graham Turner is a freelance writer.)

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