CAMBRIDGE, ONT. -- Getting inside Toyota Inc.'s assembly plant in Cambridge, Ont., isn't easy.
Demand for corporate tours, which give outside companies a first-hand glimpse at how the Japanese auto maker works, is so high that executives have been known to sign up for public tours just to get in the door.
But Toyota is by no means secretive about what it does at the sprawling Cambridge facility, nor anywhere else for that matter. Despite riding atop the North American auto sector for the past decade, the company's manufacturing methods are an open book.
Its practices have been pulled apart and dissected by authors and academics alike in an effort to crack the code that has made Toyota the most profitable car maker in Canada and the United States.
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But for all the openness, which has laid bare much of the mystique that once surrounded Japanese auto making, the secret to Toyota's prowess remains intact.
North America's Big Three auto makers have studied Toyota's ways, and in some cases incorporating carbon-copy business models into their own plants, but they haven't been able to challenge its dominance in the profit column.
Case in point: Toyota made $11-billion (U.S.) last year -- more than Ford Motor Co., General Motors Ltd. and DaimlerChrysler AG combined.
The Cambridge facility, which makes the Corolla, Matrix and Lexus RX330, is "on balance, the best plant in Canada," says Ron Harbour, president of Harbour Consulting, which measures productivity at auto makers.
Inside Cambridge, the set-up looks like any other modern North American facility might.
Crews work quickly along the production line; the pace is a steady drumming of bolting and fastening. Each task is broken down into roughly minute-long intervals and tools are kept within arm's length at all times. A fresh supply of parts arrives at the line roughly every 40 minutes.
And a long network of lights and wires runs the length of the assembly operation as it snakes its way through the plant. The Andon system, named after a Japanese word for lamp, lets workers halt the assembly process if a problem arises with one of the parts.
At the push of a button, lights flash, an alarm is sounded and, under the principles of the Toyota strategy, crews must fix the situation immediately, rather than allow the problem be shipped down the line to the next assembly point.
While Toyota invented the Andon, it has become somewhat of an industry standard. Several North American car makers, including General Motors of Canada Ltd., have employed the strategy in some form.
The secret, however, lies in the way the system is used, says Jeffrey Liker, director of the Japan Technology Management Program at the University of Michigan and author of The Toyota Way. "Not everyone uses it effectively."
For years, North American car makers were reluctant to stop their production lines for anything, arguing that productivity dropped to rock bottom if the line was halted.
"They have spent a lot of money and they've hired a lot of consultants -- and they've hired a lot of Toyota people," Mr. Liker says. "But the results have varied tremendously from company to company, plant to plant."
It's not that Toyota hasn't tried to help the process. Second only to its export of cars is the export of its philosophies.
In the mid-1980s, former chairman Eiji Toyoda issued a company-wide hoshen kanri -- an edict within the corporation -- that the car maker would share its methods with the industry. At the time, Toyota was looking to set up in the U.S. market and knew it needed the political goodwill of competitors to make the expansion work.
Toyota also knew that if its suppliers were going to operate efficiently, they needed to know the company's system of lean management, where parts are kept flowing into the plant throughout the day and minimal stock is kept on hand.
Though the Cambridge plant has played host to a number of auto makers -- from BMW to Volvo -- who want to benchmark their operations with the facility, its biggest impact has arguably been seen at GM.
With its own use of the Andon and a minimalist approach to managing inventory, GM has made significant productivity gains since it partnered with Toyota on a joint plant in the early '80s. The California partnership helped Toyota get off the ground in the U.S. and opened GM to lean manufacturing, Mr. Liken says.
"They knew that they were teaching GM a lot. But they know it ultimately rests on people and culture, and they realized that GM just seeing what they do isn't a major risk."
More than 20 years later, car companies are still playing catch up.
"The other companies are very intelligent. Don't get us wrong, they're smart companies," says Phil Rodi, head of manufacturing at the Cambridge plant. "I don't think they go down to the level of detail that we do."
Mr. Rodi, who has worked at Ford and Chrysler plants, says the differences in the Cambridge operation rest in the subtleties of how it runs, rather than the infrastructure or the line itself.
"Everything we do has to be done the same way every time," he explains. "You pick a bolt with your right hand, you shoot it with your left hand, then you do it again the same way. So if there is a problem with what we're doing, and we've trained everybody to do everything exactly the same, we can easily find where the variable is."
Line workers spend two hours at one job, then transfer to another within their group of half a dozen people, a strategy Toyota believes helps break monotony, foster teamwork and keep the plant flexible when employees are away.
North American auto makers have experimented with that strategy, but with limited success. Critics argue workers who do the same task repeatedly are more specialized.
However, the industry has flocked to lean management of inventory to save costs. Though it requires careful co-ordination with suppliers, parts aren't needlessly gathering dust in an overstocked warehouse, Mr. Rodi says.
When Toyota opens its new plant in Woodstock, Ont., in 2008, the facility will be a near duplicate of the Cambridge operation, using many of the same people from the Corolla factory.
The goal for Toyota Canada will be to seamlessly duplicate the Cambridge model, matching productivity car for car. It's a challenge that has eluded many of the company's rivals, Mr. Harbour says.
"Toyota has probably laughed behind everybody's backs for years," he says. "Everybody goes in there and looks at [the Cambridge plant] and walks out, but doesn't really understand how to do it. So because of that, I guess they still continue to let them look at it."
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