The Machine That Changed the World by James P. Womack Book Summary

The Machine That Changed the World, The Story of Lean Production – Toyota’s Secret Weapon in the Global Car Wars That Is Revolutionizing World Industry by James P. Womack, Daniel T. Jones and Daniel Roos


This management classic, taught in business schools worldwide, has remained relevant since the day of its first publication in 1990. It speaks to the timeless cycles of innovation, disruption and change, including the struggles that industries and firms face in adapting to rapidly changing markets and technologies. In this 2007 update, authors James P. Womack, Daniel T. Jones and Daniel Roos offer lessons from the lean revolution for 21st-century transformations around digitization and advanced computing.


  • The lean production method, invented by automaker Toyota after WWII, borrows from the best of craft production and mass manufacturing.
  • Competitively priced, high-quality cars vaulted Toyota to the top of the industry.
  • Lean beats mass production in manufacturing and across each step in the making of an automobile.
  • In the West, dealership networks operate in more or less the same way as they did in Henry Ford’s time.
  • Japanese firms were the first to embrace the idea that to compete in a market, you must manufacture in that market.
  • Mass production took decades to be accepted outside the United States; the same reluctance faces lean processes.
  • Despite resistance, lean will evolve as the mainstream production method worldwide in the 21st century.
The Machine That Changed the World

The Machine That Changed the World Book Summary

The lean production method, invented by automaker Toyota after WWII, borrows from the best of craft production and mass manufacturing.

Craft manufacturing dominated the automotive industry from the 1880s through the next three decades, when dozens of shops produced bespoke vehicles for wealthy buyers. In the early 1900s, Henry Ford used mass production to transform the industry by manufacturing better and more affordable cars. His innovations made the Ford Motor Company the world’s largest automaker.

By 1928, Alfred Sloan of General Motors (GM) had developed better management practices, including superior finance and marketing. GM cut into Ford’s dominance and took the lead.

“The fundamental ideas of lean production are universal – applicable anywhere by anyone.”

By the 1950s and ’60s, American-style mass production had spread to Europe and worldwide. However, union power, high wages, inefficiencies, and an oil and gas crisis derailed US and European progress in the 1970s, paving the way for a newcomer.

Eiji Toyoda, nephew of Toyota’s founder, visited Ford’s US plants in 1950. Toyoda wanted to learn how Ford churned out 7,000 cars a day at its Rouge motor plant in Detroit, while by 1950 Toyota had produced a total of 2,685 cars in 13 years. He saw great production, but also great waste.

Post-war Japan lacked the capital to build American-type auto plants. Local demand was small, and international markets would take years to penetrate. Nonetheless, Toyota purchased a few of the giant, expensive presses GM and Ford used to mass-produce each section of a car’s body. Toyoda realized the need to use the machines more efficiently and, with his production designer Taiichi Ohno, he laid the foundations for the Toyota Production System and, ultimately, for the lean production movement.

By the late 1950s, Toyota had refitted the presses to handle multiple parts quickly – in minutes compared with the days it took Western manufacturers.

“Lean production is a superior way for humans to make things. It provides better products in wider variety at lower cost.”

Toyota’s leaders understood that it needed greater individual worker production than American or European firms achieved. In return for lifelong employment guarantees, Japanese workers agreed to a partnership in which, unlike workers in the United States, they would commit to continual improvement, including making suggestions and sharing ideas. Toyota delegated autonomy and decision making to assembly-line workers, enabling them to halt the entire production line if they perceived an issue. Japanese workers fixed problems and defects as they encountered them rather than let them pass down the line as Western workers did.

Competitively priced, high-quality cars vaulted Toyota to the top of the industry.

By 1990, Toyota had surpassed Ford to become the world’s largest automaker and was threatening GM. In 1984, GM partnered with Toyota to reopen an assembly plant in Fremont, California. After its workers received training in Toyota’s lean methods, the plant matched Toyota’s best plants in productivity and nearly in quality. The experiment demonstrated that Toyota’s lean philosophy could work anywhere.

“Lean production is now spreading from Japan to practically every nation.”

In the 1970s and early ’80s, Western assembly plants suffered rampant waste, inventory clutter, inefficient processes and disengaged workers. At the same time, factories in Japan were succeeding with far fewer workers than their Western counterparts, but those employees were more skilled and engaged, and they produced much better cars in half the time. Japanese automakers also used just-in-time inventory management instead of storing weeks’ worth of inventory.

General Motor’s success with its Fremont plant spurred other North American plants to make changes. By 1989, US automakers narrowed the gap between American and Japanese productivity and quality, even as the gap between Europe and Japan widened. Ford’s adoption of lean practices created the world’s best-producing plant – which happened to be in Mexico. Japan maintained a lead in the luxury car segment, with productivity and quality twice that of North America and four times better than Europe. The European defect-resolution process alone took longer than Toyota’s entire production process and resulted in inferior cars as measured by the number of defects.

Lean beats mass production in manufacturing and across each step in the making of an automobile.

Lean plants tend toward greater use of automation and robots, though this accounts for no more than one-third of lean factories’ improvements over mass manufacturing. Enhanced parts design contributes at least another third. The remainder accrues from improved organization and management processes, including having less hierarchy, delegating authority, cross-training workers, emphasizing teams, and leveraging a culture of trust and continual improvement.

Four fundamental factors account for the difference between lean-production and mass-production design techniques:

  1. Leadership – Lean leaders control the new car design process. They shoulder ultimate responsibility for getting a new design to market on time and on budget. Unlike their Western counterparts, who negotiate each element along the way, lean leaders enjoy the authority to make things happen.
  2. Teamwork – Lean teams are made up of specialists from across the organization, and each team commits for the entire design and product lifecycle. In the West, divided loyalties and career conflicts often lead to lower levels of commitment.
  3. Communication – In Japan, the design leader brings all internal stakeholders together to hammer out agreements and reach consensus. In the United States, projects start small, involve fewer people, and grow to include the views and opposition of stakeholders later in the game – all of which cause delays while the team attempts to negotiate compromises.
  4. “Simultaneous development” – Because lean teams work together from the start, they get a jump on determining the required materials and equipment. For example, the design of a press can take two years. Starting the process early means that Japanese plants can start production of new designs sooner.

These four advantages allow lean producers to change models more often to keep pace with changing customer tastes. The lean design process accelerates innovation. Japanese automakers spend much less on R&D, yet file significantly more patents and bring more patented innovations to market than their American and European counterparts.

Lean extends to the supply chain. In the West, car assembly may rely on thousands of separate suppliers. In Japan, automakers deal with only a few hundred suppliers arranged in tiers. In the West, and particularly in the United States, automakers treat suppliers as adversaries, bargaining to the lowest price. Suppliers tend to bid money-losing quotes to win a contract, planning to extract profits over the life of the project, including its subsequent maintenance. In Japan, suppliers work with automakers in long-term, mutually beneficial relationships that provide a basis for just-in-time parts delivery, greater efficiencies and continual improvement.

Throughout the life of a contract, Japanese parts suppliers work with automakers to reduce costs, splitting the benefits evenly. Due to these close, trusting relationships, parts from suppliers go directly into the assembly process without inspection delays – further reducing time, costs and floor space. General Electric first implemented this approach in the 1940s; Japan adopted it in the 1960s.

Western automakers overall moved closer to lean supply chain management by the end of the 1980s. They narrowed the gap by consolidating suppliers into tiers and measuring quality. Unfortunately, they didn’t embrace the practices of full disclosure and information sharing, and thus they failed to build the trust necessary for partnerships with suppliers. In Japan, supplier costs typically drop over the life of a contract; in the West, costs typically rise.

In the West, dealership networks operate in more or less the same way as they did in Henry Ford’s time.

North American car dealers buy their inventories from the automaker and mostly sell one brand. Although dealers are closest to the customer, auto firms rarely seek dealer opinion or input. Customer interactions are largely transactional and adversarial, featuring much-despised haggling over price, information withholding and gamesmanship. Most American salespeople know little about their products, often lacking information such as knowing the size of the engine or whether a vehicle features rear- or front-wheel drive.

In contrast, Toyota salespeople join the company straight out of college and immediately enter into intensive product training programs. They often sell cars for the firm throughout entire careers. Thus, they work from the outset to build long-term relationships with all their customers and their families. Losing a customer brings sharp disappointment and even shame.

“It is often said in Japan that the only way to escape the sales agent from whom you once bought a car is to leave the country.”

Japanese dealerships regularly send employees to assembly plants and design teams to consult on customer preferences. Customers receive full services from their dealers, including free repairs as long as they own their cars, which in Japan, due to tax incentives, rarely extends past four years. Given fast, flexible and lean Japanese production, customers usually order custom cars. Delivery takes place within two weeks.

Japanese firms were the first to embrace the idea that to compete in a market, you must manufacture in that market.

Though Ford was the first global car company, Japanese firms have learned that tighter supply chains, insulation from currency swings, tariff avoidance, less exposure to regional economic cycles and the knowledge gained by operating in foreign markets generate greater advantages than manufacturing in their home country and shipping finished cars worldwide.

Joint ventures between American and Japanese car makers – and outright acquisitions of vehicles for international expansion – usually fail. Automakers should integrate global operations into one personnel system and one information platform, with decentralized decision making that takes advantage of enterprise economies of scale.

Mass production took decades to be accepted outside the United States; the same reluctance faces lean processes.

Lean production saves time and money, and improves employee happiness and engagement. Every firm in every industry in every nation should adopt it. But that won’t happen overnight. It could easily take decades because the status quo is so entrenched.

Mass production creates jobs. Lean destroys jobs, and that generates much more resistance – especially in an industry that is so unionized. But change often flourishes in crises. For example, on the verge of bankruptcy in 1981, Ford had to consider radical alternatives. Its leaders visited Mazda, of which Ford was a sizable owner. Seeing how lean worked there, Ford adopted elements of it worldwide.

General Motors faced no existential crisis, so it failed to leverage what it learned from its successes in its Fremont plant. Both GM and Chrysler closed underperforming plants in the United States, laying off thousands of people. Rather than adopt lean processes to save plants, Chrysler and its unions voted to shutter plants entirely. Meanwhile, Japanese firms in North America thrived using lean techniques.

Despite resistance, lean will evolve as the mainstream production method worldwide in the 21st century.

Lean manufacturing organizations emphasize production. As many people as possible work toward producing a product with minimal overhead. New employees start on the shop floor and earn increasing responsibility as they solve more complex problems. Lean organizations lack the hierarchies of mass production firms, so decision making gets pushed down to where the work gets done.

Lean will prevail. Will the Japanese drive it everywhere, or will Americans and Europeans control lean methods in their own territory?

“The greatest obstacle in the path of a lean world is easy to identify: the resistance of the massive mass-production corporations that are left over from the previous era of world industry.”

To complete the lean transformation in North America and then Europe, mass production operations must experience firsthand the superiority of the lean process. The industry may need a deep crisis – like the existential threat Ford faced – to change. Those who bail out the auto industry when the crisis comes must insist that companies use those funds to adopt lean processes.

About the Authors

James P. Womack

James P. Womack founded the Lean Enterprise Institute. Daniel T. Jones founded the Lean Enterprise Academy. Daniel Roos is a professor emeritus of engineering at the Massachusetts Institute of Technology.

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