Wednesday, April 9, 2014

Toyota replaces robots with humans to increase manufacturing efficiency

Toyota replaces robots with humans to increase efficiencies

Toyota, in a move to improve operating efficiencies, has replaced some of their automated machines with humans.  This is in coherence with their previous business strategy of ‘kaizen’.  Toyota developed the Toyota Production System, based on the Japanese philosophy of kaizen – to continuously improve.  Kaizen encourages all company workers to find places for innovation, something machines are still unable to do.  Mitsuru Kawai, Toyota project lead, has said “We cannot simply depend on the machines that only repeat the same task over and over again.  To be the master of the machine, you have to have the knowledge and the skills to teach the machine.”  Since robots are unable to improve efficiencies without human input, bringing more skilled workers into the factory has reinforced Toyota’s position as leaders in production management. 

By replacing machines with humans, Toyota has also been able to hone their low-cost strategy, employing efficiencies in the ‘experience curve’.  Re-employing humans over robots, Toyota was able to reduce waste in crankshaft production by 10% and also shortened the production line.  These efficiency increases were made possible because humans who are skilled at a trade are able to identify ways to improve existing processes.  This is also a strategy which would be incredibly difficult for Toyota’s competitors to implement, as they are still reliant on machines to conduct most all menial tasks.  Additionally, when a competitor’s robot fails, their production workers are not skilled enough for the most part to continue with production, however, Toyota by employing skilled tradesmen in their factories are able to find ways to keep production moving. 

Toyota is also able to improve the differentiation of their product by developing a higher quality product at a lower cost.  Toyota can market their new systems as a differentiated advantage over the competition.  By saying Toyota has replaced ‘stupid’ machines with skilled craftsmen who think, they have been able to reduce overall costs, reduce waste, and improve efficiencies; the savings of which are passed on to the consumer.  Additionally, people tend to associate the quality of handmade products as higher than those that are made by machine, so Toyota will also be able to differentiate their product on the premise of quality as well as price. 

What are other industries predominantly manufactured by robots, that could benefit from the use of more skilled workers in their factories?  What complications would they face in implementing this strategy? 

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