For automation to be effective, we must implement a system in which the machines sense the occurrence of an abnormality and stop themselves. In other words, we must give the automated machines a human touch — enough intelligence to make them autonomated and achieve “worker saving” rather than “labor saving.”

The oil crisis in the fall of 1973 brought a new twist to Japan’s economy. At Toyota, where production increases had been achieved yearly since the 1930s, we were forced to reduce production for 1974.

Throughout the industrial sector in Japan, profits plummeted as a result of zero growth and the shock of production cutbacks. The results were terrible. At this time, because Toyota had suffered less from the effects of the oil crisis, people began to pay attention to its production system.

With the reduced production that followed the oil crisis, Toyota faced problems that had been hidden or less visible during the previous high-growth period. The problems had to do with the autonomated machines to which a fixed number of operators were assigned.

A perfect autonomated machine, that is, a machine without an operator, was the exception. The autonomated machine that needed two workers to complete a cycle was the problem. With production reduced by 50 percent, the operation still required two workers. One worker was needed at the input and one at the output of a large, autonomated machine, for example.

Thus, an autonomated machine discovers abnormalities and performs the useful role of preventing the production of defective products. From another angle, however, it has the disadvantage of requiring a certain number of workers.

This is a major handicap in any factory that has to respond to a change in production. Therefore, the next step for the Toyota production system was to embark on demolishing the system of a fixed number of workers. This was the concept of reducing the number of workers.

This idea is applied not only to the machine but also to the production line where people are working. A five-worker line, for example, is organized in such a way that the work can be done by four men in case one worker is absent. But the quantity produced is only 80 percent of the standard. To accomplish this, improvements in plant layout and equipment, as well as multi-skilled training of workers must be instituted while times are still normal.

To reduce the number of workers means that a production line or a machine can be operated by one, two, or any number of workers. The idea originated with the need to refute the need for a fixed number of workers for a machine.

Isn’t this sort of understanding needed by all businesses during periods of low growth? In a high-growth period, productivity can be raised by anyone. But how many can attain it during the more difficult circumstances induced by lowgrowth rate? This is the deciding factor in the success or failure of an enterprise.

Even during high growth, to prevent generating excess inventory through overproduction, we avoided arbitrarily buying mass production machinery. We knew how big a strain the approach of “big guns” could be on manufacturing. So we concentrated on developing the Toyota production system without being pushed by the trends.

The Toyota production system first established the basis of rationalization with its production method. Its challenge was the total elimination of waste by using the just-in-time system and kanban.

For every problem, we must have a specific countermeasure. A vague statement that waste should be eliminated, or that there are too many workers, will not convince anybody. But with the introduction of the Toyota production system, waste can be identified immediately and specifically. In fact, I always say production can be done with half as many workers.

At Toyota today, changes are occurring in all production areas. Everyone knows the fluctuations of various factors in producing different types of cars. When one model drops in sales, its costs rise. But you cannot ask the customer to pay more for the car.

Car models in lesser demand still somehow have to be made cheaply and sold for a profit. Facing this fact, we continue to study methods of increasing productivity even when quantities decrease.

Each automobile model has its own history. The Corona currently sells well, but it did not, at first, and we had a difficult time. When a model does not sell well, we must increase efficiency even with small quantities to reduce costs. I always tell people in manufacturing:

“There must be hundreds of people around the world who can improve productivity and efficiency by increasing production quantity. We, too, have such foremen at Toyota. But few people in the world can raise productivity when production quantities decrease. With even one such person, the character of a business operation will be that much stronger.”

People prefer working with large quantities, however. It is easier than having to work hard and learn from producing small quantities.

It has been over 30 years since I began work on the Toyota production system. During this period, I have been taught a lot of ideas by many people and by society. Each idea was conceived and developed in response to a need.

I think it is more worthwhile in a company to work in the area where there are problems due to dwindling sales than in an area where sales are rising. The need for improvement is more urgent even though it may not seem that way.

It is a shame that in today’s business and industrial society, the relationships between work and worker and machine and worker have become so adversarial. For our development to continue, we must become more generous, more resourceful, and more creative.

As the Toyota production system evolved, I frequently applied reverse common sense or inverse thinking. I urge all managers, intermediate supervisors, foremen, and workers in production to be more flexible in their thinking as they go about their work.

Digressing for a moment, it is said that the characters for fermented soybean (nattō) and bean curd (tōfu) had opposite meanings originally.

There are various theories about this. One holds that Ogyū Sorai, a Confucian scholar of the mid-Edo period, mistook the two terms. Another has it that he intentionally switched them.

Nattō, a product for which the Tōhoku region, Mito, and other areas are famed, should originally have been written the way tofu is now [], because nattō is made by allowing soybeans [] to rot [].

What we now call “tofu” was originally written with the characters now used for nattō, [], because tofu is made from soybeans [] and formed []into cubes.

The problem is that no one would ever eat nattō if the word were written with the characters for “rotten soybeans,” while tofu is so white and appetizing that, even if it were written as [], no one would think of it as rotten beans. The story goes, then, that each written word was used for the other.

Nomenclature in Japan contains many other fascinating examples of this sort, examples that reveal a characteristically Japanese way of conceiving things.

Among the Chinese characters used in Japanese, we find a thought process in Japanese that differs from the older Chinese. This way of thinking was born in the Japanese environment.

I place value on the native ideas unique to Japan. For instance, although the Toyota Motor Company has become a ¥2 trillion firm, we do not consider moving away from the main office in Mikawa. Sometimes we are warned that by staying in such a place we miss out on the latest news. However, I do not believe this keeps us in the dark information-wise from the world or the rest of Japan. The Toyota-style information system mentioned earlier, organized as part of the Toyota production system, is working very effectively in this sense.

Of course, what is important is not the system but the creativity of human beings who select and interpret the information. Fortunately, the Toyota production system is still being perfected. Improvements are made daily thanks to the vast number of suggestions received from its employees.

My mind has a tendency to crystallize and so I renew my determination every day and force myself to think creatively. There is always much to do in the production field…