When people think of Toyota, it’s usually in relation to cars, but the truth is that Toyota offers so much more. Toyota always has the customer at the heart of their management style and also aspires to provide the best quality product and service in the world. As with all of the Toyota Principles, ‘Design to Manufacture’ is a renowned concept that addresses the never-ending task of delivering QUALITY, in a FAST way and at a minimum COST.
From concept to design and then design to production, a product goes through the journey of creation all with the purpose of pleasing a customer. So how come the lead times and costs associated with this journey are enough to put some manufacturers out of business or to make some equipment impossible for organizations, such as start ups, to afford?
Obeya Room Strategy
Toyota’s development stage is known to be shorter and smarter then other automakers and it’s all thanks to the simple but powerful idea of having everyone involved in the making of the car gathering and debating in the same room. This ‘Obeya Room’, or ‘Large Room’ in Japanese, is where the customer’s voice is heard, engineers and designers create, manufacturers and suppliers give input, and all those involved in purchasing and assembly get together to design a car, learning from each other in the process.
Stage 1. From Concept to design
The first stage of a product’s journey is that of concept to design. The lead time in this stage is shortened in the Obeya Room by listening to the voice of the customer. Since communication is made easier by the customer’s presence, the concept becomes real by having usability and need as inputs to make sure the design captures a marketable solution. If the design phase does not consider usability and focuses too much on putting all available technology into the one product, it can be overwhelming to a customer and therefore, not acceptable to the market. An obvious example of this is software. Even the simplest equipment has software but all too often it hasn’t been designed having the client interface in mind and in a user-friendly way. The interface ends up being too hard to handle, or the screen is cluttered with options that are not even needed. A good indicator of this complexity / simplicity, could be how many clicks till the customer gets what he needs?
Stage 2. From Design to production
As the journey continues from design to production, the most overwhelming benefits of the Obeya Room become apparent.
Long lead times in many companies are usually associated with ‘silo’-driven operations. Production can suffer delays due to back and forward communication, and rework which arise when the product design or concept is being developed without consulting with those who understand the manufacturing limitations and operations guidelines, i.e. restrictions in equipment, what can or can’t be processed, what type of material the machines can cope with, capacity, etc. Unfortunately, this information often isn’t considered at the conceptual stage and only comes to light when products reach the prototype phase. By allowing production, suppliers, purchasing and all stakeholders relevant to manufacturing the product to have input into the design, Toyota reduces lead time and rework costs relative to its competitors, which results in Toyota cars being designed and built in a third of the lead time of other car makers. As Gary Convis, executive vice president of Toyota Kentucky, says, “The beauty of this is its simplicity. Obeya allows more integrated communications with our suppliers. Suppliers see and feel their ability to work with us”.
But designing according to machinery and material constraints is not the only contributor to the reduction of lead times and costs when designing to manufacture. Input from production and suppliers to the design incorporates consideration of the new equipment and manufacturing facilities, new tools, training staff for a new product build, and all the costs involved in manufacturing a new design. This input takes into account standardized work. If, when designing a new product, standardized work is applied, building and developing products that are similar in shape but are different in purpose could be done utilizing the same machinery since the cuts are in the same location, the moldings are standard for multiple products, etc.
Flexibility and Communication
When thinking of flexibility in manufacturing like this, the Toyota hybrid car comes to mind. Toyota designed the first hybrid model in such a way that allowed a current production line to be able to manufacture it. This way, with the factories already running, the cost saving and the lead time needed to set up a new factory for a new model was shortened. More than that, if for some reason the hybrid car wasn’t attractive to the market, the risk of investing in this model is minimized.
So simple and yet so smart. Michael Ballé writes, “An obeya is clearly a tool of teamwork: helping managers in various functions solve problems across their borders.”
Flexibility, simplicity and communication have always been Toyota’s secret for success. But if you think about it, common sense is not a secret … is it?
Disclaimer: Apologies if some interpretations may offend a reader. I do rely on literal translation at times since English is a second language. My intention with this article is to spread awareness. I welcome your feedback to ensure I will not be constantly making the same errors in translation.
I also write about my own professional experience and learning curve. I am a continuous improvement learner so I welcome you to share extra information and spread awareness with me if you have other ways of analyzing the same issues or you have value-added information to the readers of this article. Thank you for reading.