January, 2012

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Sunday, January 22nd, 2012

Toyota said that recovery after the Japan earthquake would take the rest of 2011 and that full production wouldn’t resume until 2012. Amazingly, Toyota achieved full production capacity within 7 months of the disaster. How did they do that?

Bounce Forward

Here’s How They Did It:

1. Free labor for suppliers.Many autoworkers were told to stay home in the days following the devastating earthquake. Toyota offered their workers the opportunity to collect their full salary while helping hard-hit suppliers get back to production. By paying their workers to help their suppliers, Toyota helped get the ball rolling much faster. Plus, building relationships with suppliers will pay dividends for years to come. Very shrewd move on Toyota’s part.

2. Using less electricity. One of Japan’s biggest problems following the earthquake was diminished national power production. Helping reduce electricity demand, Toyota:

Curtailed or eliminated use of air conditioning. Toyota’s workers assembled cars at 84F through the summer.

Toyota cleverly moved their “weekend” to Thursday and Friday, thus reducing electrical demand on those peak days, then opened on Saturday and worked through Wednesday.

Minimized Lighting as much as possible. A policy was implemented of no lit hallways in Toyota office buildings or factories in Japan. Most offices are maintained half-lit.

Workers encouraged to take the stairs. To save on electricity use, workers were asked to take the stairs instead of the elevator whenever possible.

3. Parts Chain Re-engineering. Toyota engineers worked diligently to reduce the number of parts bottlenecks, using a wide array of techniques. Some suppliers with fully-operational plants were given temporary contracts to produce parts that a competitor couldn’t build. Some suppliers were given engineering and disaster recover assistance to help solve problems at the plant. Some vehicle options were temporarily eliminated to reduce demand for critical parts.

4. People Rising To The Occasion. When a disaster strikes, the tendency is to assume the worst. Yet disasters provide people with extraordinary motivation and subsequent effort to do extraordinary things. Toyota workers accepted the challenge giving his or her all to get Japan back on track.

Congratulations to Toyota, Toyota suppliers, and the people of Japan for getting the company (and their country) back on track so quickly.