The Factory Guru Tinkering With Toyota

Blue cap slightly askew, eyes bright above his salt-and-pepper beard, Mikio Kitano breezes into Toyota Motor Corp.'s Motomachi factory, greeting workers by name. Up rushes Deputy General Manager Yoshitaka Kimura to show him a fence of mismatched scrap metal built to shield the rest of the factory from the intense lights beaming out from the plant's final inspection site.

Kitano, Toyota's top production guru, takes frequent walkabouts in the company's factories. And in this one, he had long puzzled over why the workers installing instrument panels across the aisle from the inspection site seemed to grimace at him each time he went by. Then, he noticed the inspection lights hitting them in the eyes. "Excellent," Kitano proclaims as Kimura shows how the fence solved the problem. "And the best part," he chuckles later, is that "it was simple and cheap."

SIMPLICITY. For Toyota, "simple and cheap" ring like gospel these days. And Mikio Kitano, 53, has emerged as a key figure in helping the auto giant keep the faith. During the booming 1980s, Japan's carmakers--Toyota included--barreled headlong into factory automation to dodge an expected labor shortage. But after a three-year sales slump, the jumble of underutilized machines is looking foolish and expensive. Despite more than $532 million in cost-cutting from July to December, Toyota's operating margin has dipped to a precarious 0.8%, says analyst Stephen Usher of Kleinwort Benson International Inc. Kitano's job is to steer the company's assembly lines back on course.

Long a maverick engineer within Toyota's sprawling bureaucracy, Kitano was named director of production engineering in 1990. Since then, he has been instituting the kinds of subtle, incremental changes that improve efficiency over time. His chief goal is to wean the company away from "showcase" factory automation that boosts costs without improving efficiency. He's not anti- automation: In the early 1980s, Kitano fought for robotics where machines could relieve monotonous or difficult tasks. But now, he rejects machines that merely overcomplicate. "The key to productivity is simplicity," he says. "Men control machines, not the other way around."

Toyota forgot that lesson in the late 1980s when, awash in sales, it began pumping cash into robotics. At the time, Kitano was spending a three-year stint at Toyota's California joint venture with General Motors Corp. When he returned in 1990, he was shocked. The new assembly line at Toyota's Tahara plant was loaded with machines that needlessly replaced workers while intimidating those who remained. Concedes the current Tahara plant manager Tadaaki Jagawa: "Some of it was wasteful."

Upon being named to Toyota's board of directors that year, Kitano mounted a campaign to convince his colleagues they had gone too far. He streamlined the blueprints for automation at Toyota's new plant, which cranked up in December on the island of Kyushu, 400 miles southwest of Toyota City.

NO PALLETS. A walk through the Kyushu plant reveals several Kitano touches. At Tahara, for instance, a $1.6 million system inserts the engine and drivetrain into the body of a car. Instead of being pulled by a chain, as they normally would be, the engines travel on independent pallets that move at their own speed. Kitano figured the pallets did little to improve efficiency but a lot to boost maintenance costs. So he revamped the line at Kyushu, ditching the pallets and knocking 75% off the system's price tag. Similarly, two robots attach wheels at Kyushu, instead of the four at Tahara--cutting costs significantly.

Fine-tuning automation, says Hosei University professor Koichi Shimokawa, was "an intelligent decision. Automation is not as flexible as a multiskilled worker." Others, including GM's successful Saturn division, have taken the same notion to heart in their new plants. What Kitano did was to remind Toyota what it already knew: Let workers, not bean counters, guide the way to productivity. In the same spirit, he reemphasized teamwork at Kyushu by breaking the line into shorter, independent chunks. Having control over a discreet section of the line fosters a sense of autonomy and pride among workers.

PARK YOUR OWN. Kitano is not your typical Japanese businessman. He has little patience for the perquisites or ceremony that go along with his status at Toyota. He thanks his secretary when she serves tea, even introducing her to guests by name. He pulls his four-wheel-drive Land Cruiser into an executive parking lot filled with chauffeured Lexuses. He eschews heavy socializing and is up before six most mornings to run laps at a track with his wife, Atsuko.

Around Toyota, he is known as a renegade. Much of his career has been spent needling management to let him put his plans to work. That can be risky. In the 1970s, he took on the sticky job of designing a line to produce exhaust systems to meet tough U.S. emissions laws. He missed the deadline and landed in hot water (though the system ultimately performed well). More often, however, Kitano has proved his doubters wrong.

In the early 1980s, he was among the first to argue that Toyota adopt automation to take over the tasks workers found most numbing. Body welding, for instance, was not only mindless work but could be done more precisely with machines. Convincing management, though, was another matter. Kitano had to beg for the $9 million needed for a system that could weld several car models on the same line. Skeptics circled, but when he introduced the prototype in 1984, the system spoke for itself. Within three years, every Toyota plant had one.

Kitano's delight in the system is still infectious. Instead of welding a car together piecemeal, it takes underbody, sides, and top--each on its own pallet--and swoops them together in a 50-second flash of dancing robotic arms. Viewed from a staircase above, a new car seems as if it has been plucked out of air. For Kitano, the motion crosses the line between technology and art. "It's like a sculptor bringing out the essence in a stone," he says.

The current sales slump has taken the poetry out of Toyota's more recent automation binge, however. Kitano's efforts to streamline production lines couldn't come at a more crucial time. U.S. sales for Japan's No.1 auto maker sank 8.3% in the first quarter as Americans balked at its high prices, turning to affordable domestic alternatives. With the yen strong and margins weak, the pressure on prices is up, not down.

Kitano has helped Toyota rediscover simplicity. But his long-term goal is to draw young people into the manufacturing work they now tend to shun. "I want to teach them to make things with their hands, to preserve that skill," he says. Good thing. Toyota will need all the young engineers it can find to keep it on the straight and narrow.

      Kitano leads design of equipment to make exhaust systems that meet strict new 
      U.S. emissions requirements
      While helping set up NUMMI, Toyota's U.S. joint venture with GM, Kitano demands 
      all existing production equipment be scrapped to improve quality
      Against stiff criticism, Kitano pushes Toyota to adopt a flexible body-welding 
      system now used in all plants
      Insists Toyota wasted money in overautomating final assembly and suggests 
      paring automation in the new Kyushu plant
      Now turning to the heart of manufacturing, Kitano is in charge of producing 
      better dyes and machines for Toyota's  lines
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