Most people have at some point heard of Lean, or Lean manufacturing, or Just-in-Time, or Six Sigma, etc.  However, most people do not really know how most of this came about, or how Lean has come into existence.  Here I will give you a brief background on how a lot of this started.  Firstly though, I must explain quickly how the word “Lean” came about just so you are clear.

The word “Lean,” did not come from Japan at all.  “Lean” is simply a business term that one guy in particular decided to use to coin these new understandings and processes.  Lean was never the official word used by Toyota (famous for their innovations in this area) or other organizations/parties heavily involved in these new methods.  The word “Lean” has now taken off and is used extensively to describe all of these areas.  Give credit to this guy I guess for marketing the word in such a way as to make it so big.

Let’s move on to the historic background of how most of this started.  After World War II Japan was devastated.  Their country was in ruins and they were left with almost nothing.  However, the U.S.  and Russia immediately were at war with each other right after WWII in the famous Cold War.  Because of this, and because of Japan’s convenient placing the U.S. wished to have positive relations with them in order to use Japan’s territorial placement when necessary against Russia and allies.  One of Russia’s allies during that time was China which was another reason why the U.S. wished to have a relationship with Japan.  In order to keep this relationship, the U.S. told Japan that they could trade and sell their products in the U.S. with no tariffs or taxes against Japanese exports into the States.

At the same time, the U.S. told Japan they weren’t going to give them money or anything like that, but that they would allow them free trade.  This is why Japan has such a big influence in the U.S. right now.  However, this still did not change the fact that Japan was in ruins and had no money.  Because of this, Japan had to learn how to be extremely Lean.  Toyota wanted to compete in the U.S. but had a fraction of the money that Ford had.  What did they do?  They learned to build only one car at a time and have it shipped out as soon as it was finished.  The money from that car brought in enough to build one more car which was made quickly and shipped off immediately in order to bring in money and so on…

Japan’s rise in manufacturing is nothing short of genius.   They learned to adopt an attitude of constant improvement in order to compete with the giant manufacturers who had way more money and resources.  In the 1950’s Japanese managers were coming to the U.S. to visit factories and learn the advanced American techniques.  Nowadays, this trend has reversed to where people around the world are visiting factories/businesses in Japan to see and learn how they are operating.

There is one difference that really characterizes the situation quite well.  In North America the “Hero,” or person who creates the big new innovative product is rewarded and idolized, whereas, in Japan improvement is rewarded.  In fact, so much so that even the effort at improving is rewarded.  Japanese managers often reward simply the effort at trying to make improvements.  In North America the focus is more so on making that big sale, or catching the best customer, etc.

Innovation vs. Constant Improvement…