This morning I read a rambling screed on India’s Business Standard website decrying U.S. manufacturers and others for their failure to honor the true principles of lean manufacturing, and for effectively leaving the world worse off as a result.

John Podlasek, managing director at Polish injection molder Frohe and the author of the essay, begins by citing Henry Ford’s approach to manufacturing, economics, and community as the foundation of today’s lean principles. He calls Ford the true father of lean manufacturing, and notes that Toyota’s Taiichi Ohno credits Ford for inspiring the Toyota Production System.

Podlasek then veers into an indictment of society:

Today, the US is basically bankrupt. For all of the advances in technology and improved standards of living, we can easily see in our world, more poverty, more pollution, more war, more suffering.

He blames this state of affairs on “a basic misunderstanding of lean, free market capitalism economics, and how they relate to lean.”

The lever for Podlasek’s argument is Henry Ford’s 1926 book, Today and Tomorrow. Podlasek writes:

[Ford] believed that business leaders needed to work together with communities to build a better society. His revolutionary ideas were based on the concepts of “wage motive” and the “money power.”

To paraphrase Podlasek’s view of Ford’s thesis: Manufacturers should look to maximize the wages of their workers, because their workers are also their buying public. Thus, any efficiencies gained in the manufacture of product (the result of lean efforts) should be passed on as higher wages to the worker. He writes:

Ford was against the idea that the goal of business was to increase prices and lower wages to maximize profits. He believed that this would lead to a weaker society and the benefits gained by improved productivity would be lost to the society as a whole. 

Sadly, Ford was a maverick then and now. The prevailing business ethos during his time — cut costs (e.g., labor costs) and maximize prices — still prevails today. There will always be some companies — Ford during its early years and companies like Google now — that place a premium on employee contributions and offer higher wages, but I believe they’ll always be outnumbered by those that look to minimize labor costs and maximize output.

However, this is not a failing of lean, as Podlasek implies. Rather, it’s the mechanism of basic capitalism, combined with the impulses of human nature on both sides of the equation. The owners of wealth will look to improve their fortunes, and the seekers of wealth will do the same. That’s why even a company as generous to its employees as Google appears to be will suffer worker defections. That’s not a misunderstanding of lean. It’s business.

Should we look to uplift our workers as much as possible? Absolutely. The relationship should be less adversarial and more collaborative. But are companies failing at lean manufacturing because they’re looking to trim workforce expenses? I don’t think so.

What do you think?

On a side note, it’s interesting to hear the early echoes of lean accounting in Ford’s words from Today and Tomorrow, as quoted by Podlasek:

You never see that inventory expressed in things. It is always in dollars. There are no dollars there, as dollars. There are furnaces, machinery, ovens, trucks, elevators, materials, and buildings.