Toyota Got Just-in-Time From an American Supermarket

In the spring of 1956 a Japanese factory engineer named Taiichi Ohno walked into a Piggly Wiggly in the United States and watched the milk section. A customer pulled a carton off the shelf; a clerk replaced it from a small back-of-store stockroom; the stockroom, in turn, restocked from a delivery scheduled to arrive only when needed. There was no warehouse full of milk. Ohno, who was running the machine shop at Toyota Motor in Nagoya, took notes.

Postwar Toyota was poor. It could not afford the inventory cushions that American factories like Ford's River Rouge floated on — bins of parts everywhere, weeks of finished cars waiting to ship. Ohno had been told to find a way to manufacture more cheaply. The supermarket gave him the metaphor he had been groping for.

Back in Nagoya he and his colleague Shigeo Shingo built a system around two ideas. First, jidoka: any worker may stop the line on detecting a defect, so problems are fixed rather than passed downstream. Second, kanban (literally "signboard"): a small card travels with each container of parts, returning upstream when the container empties to authorise the next batch. No card, no production. The line pulled inventory through itself the way the supermarket customer pulled milk.

What became the Toyota Production System took roughly two decades to refine. Ohno did not write it up for outsiders until his 1978 book Toyota seisan hoshiki. American manufacturers, by then losing market share, took longer to absorb it; Womack, Jones, and Roos coined the term lean production in their 1990 MIT study The Machine That Changed the World.

The stocking shelf with the milk has had a long second career.