Chapter 2: Literature review
2.1 Lean production
2.1.1 Historical background
Lean production originates from the Toyota Production System. The TPS is a production method invented by Taiichi Ohno, a former Toyota engineer. Taiichi Ohno realised Toyota had to implement a production method that would incorporate the benefits of both craft-production and mass-production if the company wanted to compete with Western automotive companies (Womack et al., 1991). The TPS delivered Toyota a sustainable competitive advantage over the Western competition within the automotive industry (Warnecke and Huser, 1995). Toyota’s success story caused a widespread dispersion of lean production practices. The diffusion started within the Western automotive companies and diffused over the years within other industries, organizations and countries (Shah and Ward, 2007).
The ultimate goal of the Toyota Production System is to create a continuous flow by absolute elimination of waste, or muda in Japanese. The two main methods to reduce waste are just-in-time and autonomation. Just-in-time means that parts go only to the next process after a trigger of end customer demand. Autonomation refers to automation with a human touch (Ohno, 1978). By these principles Toyota tried to eliminate seven wastes (Womack