5 ms·

It's pretty self-evident if you read the next two paragraphs: > (Ironically, the Fremont plant is prominently featured in “The Machine…” as the locus of the ul

by Hypx 9y ago

It's pretty self-evident if you read the next two paragraphs: > (Ironically, the Fremont plant is prominently featured in “The Machine…” as the locus of the ultimately failed GM-Toyota cooperation.) > As I watched Tesla’s messy, hiccuping line, with workers dashing in to fix faulty parts in place, my mind travelled back to the Honda plant I had visited years ago in Marysville, Ohio. Clean, calm, everything moved smoothly. I was so shocked by the contrast that I imprudently voiced my concern. That didn’t go over well with my fellow Tesla owners. I was a killjoy, I was calling their choice into question. So we have an actual first-hand description of the differences between Tesla's and Toyota/Honda's understanding of lean manufacturing. Even in the very same building in fact. And I'm pretty sure the author is describing the production of Model S or X, not the new Model 3. Since those cars have been in production for a while now, there's no way they wouldn't have implemented something like the lean manufacturing system unless they simply don't understand it.

carlivar 9y ago
I really find it hard to believe they don't understand the TPS. Sure. Maybe. I don't know. It seems more likely to me their "goal" (pun intended for those readers of "The Goal") is the TPS but their particular supply chain may not currently allow for it.
- majormajor 9y ago
  So even that interpretation leaves me wondering "why didn't they take that into account earlier"? Do the fancy computer-control-all-the-things people have too much influence compared to the boring practicalities of things like "how will we build this?" Fundamentally my question on Tesla is now: if you're priced as a "we have a fundamentally better way of doing things that will disrupt the industry" company, but the core process in your business is still fundamentally inferior, will you have a long enough runway? I used to be a bear on Tesla for grumpy "I don't like the decisions and design choices they make" reasons, but now the business itself seems a bit underdeveloped.
  - carlivar 9y ago
    Here we agree. I come across as a Tesla fanboy in these comments but I think Tesla's valuation is crazy high, too high, and I still think there's a chance they fail completely like so many other auto companies (a tough business). My theory is Musk knows the only way he'll be able to compete is attracting the best talent through stock incentives, and to do that he needs to jack up the stock price by pushing engineers way past what they are comfortable with. An underreported stat is the increase in TSLA outstanding shares, which I think is Elon throwing stock incentives at his employees to make them go faster, as a TPS alternative (for now?) https://ycharts.com/companies/TSLA/shares_outstanding https://ycharts.com/companies/TSLA/shares_outstanding
    - prostoalex 9y ago
      The increase in shares was due to secondary offering https://www.fool.com/investing/2016/05/26/tesla-motors-maxed-out-its-secondary-offering.aspx https://www.fool.com/investing/2016/05/26/tesla-motors-maxed... Tesla’s stock behavior is due to the ongoing game of “who blinks first” between TSLA shorts and TSLA short-squeezers. With $10 billion short position the company’s fundamentals are reduced to a side show.
      - carlivar 9y ago
        Your article only accounts for about 7.9 million new shares from the secondary offering, but many more have been issued. It's primarily from equity grants. Even your article says Musk tacked on his stock option exercise as part of the secondary offering, which increased the dilution.
- wpietri 9y ago
  > I really find it hard to believe they don't understand the TPS. Sure. Maybe. I don't know. American carmakers didn't get it for decades. Even when they thought they did, they performed Lean rituals without real understanding. This was despite Toyota trying vigorously to teach them.
  - pja 9y ago
    History shows that knowledge transfer is really, really hard. Humans are just not very good at it :( (A similar story is told of the spread of the use of Feynman diagrams in physics - I’ve read that their spread was far slower than you’d expect given their utility: For whatever reason it wasn’t enough to be told that they were an incredibly useful tool by people you trusted - it was only when non users actually worked together on problems with Feynman diagram users, or were taught by Feynman diagram users directly that their use actually spread. Both of these transfer methods required physical proximity which restricted the use of Feynman diagrams to a small number of labs for a surprisingly long time.)
    - mcherm 9y ago
      Fascinating story, do you have any idea where you read that?
      - pja 9y ago
        Nope, but a quick Google suggests that this paper: “Spreading the Tools of Theory: Feynman Diagrams in the USA, Japan, and the Soviet Union” by David Kaiser, Kenji Ito and Karl Hall http://web.mit.edu/dikaiser/www/Kaiser.SpreadingTools.pdf http://web.mit.edu/dikaiser/www/Kaiser.SpreadingTools.pdf must have been the original source research. edit: Also, there’s a book (by one of the authors of that paper): “Drawing Theories Apart: The Dispersion Of Feynman Diagrams In Postwar Physics” https://www.amazon.co.uk/dp/B002Y5W2X2 https://www.amazon.co.uk/dp/B002Y5W2X2
        dctoedt 9y ago
        The Kaiser et al. paper cited by 'pja is fascinating. This passage (at 887) practically puts the reader in the room at the Institute for Advanced Study: <blockquote> ... Thus, when [Freeman] Dyson arrived at the Institute for Advanced Study in September 1948, Feynman diagrams in hand, he immediately joined ten fellow ‘postdocs’ in theoretical physics, the largest cohort yet. [J. Robert Oppenheimer had reorganized the Institute to emphasize post-doc training for physicists; he was quoted as saying that "the best way to send information is to wrap it up in a person."] In fact, the new building that had been planned to hold offices for the newly expanded ranks had not been completed on time, so all of the postdocs wound up sharing desks in one large room for the first 6 weeks of their stay – an architectural arrangement perfectly suited for the sharing of tacit knowledge. They huddled around large tables swapping ideas, pressing Dyson to explain the details of how to use Feynman diagrams. He delivered several sets of long lectures to the group, supplemented by constant, informal conversations. By the winter of 1948–49, Dyson had organized them into several groups, each working on distinct diagrammatic calculations. One pair, Kenneth Watson and Joseph Lepore, worked with Dyson to calculate high-order terms in a certain model of nuclear forces, while another duo, Norman Kroll and Robert Karplus, took up Dyson’s lead to undertake similarly complex diagrammatic calculations in QED. So effective were Dyson’s tutorials that Wolfgang Pauli wrote to another of the young Institute theorists that May, asking what Dyson and the rest of the ‘Feynman-school’ were working on. </blockquote> (Extra paragraphing added.)
- Lazare 9y ago
  TPS is, in part, a way of configuring your supply chain in order to ramp up production smoothly. Tesla wants to ramp up production as their primary goal right now; if their supply chain is preventing them from doing so then they've funamentally failed. > I really find it hard to believe they don't understand the TPS. I agree, but that makes this more confusing and (at least potentially) more damning for Tesla. It's not that hard a concept; if you're running a manufacturing company but you screw up your supply chain badly then...I dunno. Maybe you're bad at running a manufacturing company? Supply chains are really important when you're doing something like making cars. And people having been advocating TPS since before I was even born. So...it's a conundrum.
  - carlivar 9y ago
    Obviously Tesla is doing _something_ about this because what is the Gigafactory if not a major part of the supply chain?
- Gibbon1 9y ago
  Might be the production _rate_ for the previous models doesn't mesh well with their suppliers. We buy plastics in runs of 15,000 parts. It takes us a couple of months to go through those. And then we order more. The manufacturer doesn't make 200 parts a day. Or 1000 a week. The do a full run of 5-20,000 every three months. Which takes them a whole day, once the machine is setup they run it till the order is filled. Sometimes it's obvious they do higher runs and then break up the shipments. Okay so our products are cheap and simple. But our yearly totals of 50,000 to 100,000 units is comparable to the what Tesla is hoping to get out the door. Tesla's numbers for previous models weren't nearly that high. Gonna be hard to just in time that. Personal feeling. What an automaker is doing by outsourcing parts to suppliers and then making them manage inventory is. a) they as someone mentioned, keep the inventory management away from the production line. And importantly allowing suppliers to apply higher levels of scale then you could other wise. Important because likely many of Tesla's suppliers production machinery has vastly more capacity then Tesla needs. Telsa and other automakers are thus 'renting' time on those machines. Frankly I think Tesla is ramping to this scale for the first time, it's bound to be a mess.
hbarka 9y ago
I’ve been to a factory tour. The author’s anecdote is off the mark. What I observed were mostly robots doing the assemble and welding and then the typical assembly line for installing the interiors. It was smooth and had a cadence. Mr Gasee was talking about Just-In-Time (JIT) concepts and lean inventory and when he saw parts on a shelf it contradicted his idea of JIT. JIT doesn’t mean you can’t have safety stock. Tesla is also pursuing vertical integration and prefer to make subassemblies in-house. I have my doubts about Gasee’s agenda.
digikata 9y ago
Toyota is a global car manufacturing company who has been manufacturing cars (and building new car factories) for many many decades now. This is will be Tesla's first high volume line of vehicles. I think it makes sense for some time to work out kinks in process and meta-processes. Even a couple of years back when Toyota passed GM as highest volume maker of vehicles, the execs at Toyota said there was a moment where they took their eye off clean processes and Toyota quality suffered a bit. Some of that I suspect had to do with the timing of the retirement of a generation of very experienced people in Toyota. I think they've since been on a corrective course.
- ubernostrum 9y ago
  I think it makes sense for some time to work out kinks in process and meta-processes. I think it makes sense to consider the state of the art for reliable production lines. But NIH syndrome will have its way.

by Hypx 9y ago

carlivar 9y ago

I really find it hard to believe they don't understand the TPS. Sure. Maybe. I don't know. It seems more likely to me their "goal" (pun intended for those readers of "The Goal") is the TPS but their particular supply chain may not currently allow for it.

majormajor 9y ago
So even that interpretation leaves me wondering "why didn't they take that into account earlier"? Do the fancy computer-control-all-the-things people have too much influence compared to the boring practicalities of things like "how will we build this?" Fundamentally my question on Tesla is now: if you're priced as a "we have a fundamentally better way of doing things that will disrupt the industry" company, but the core process in your business is still fundamentally inferior, will you have a long enough runway? I used to be a bear on Tesla for grumpy "I don't like the decisions and design choices they make" reasons, but now the business itself seems a bit underdeveloped.
- carlivar 9y ago
  Here we agree. I come across as a Tesla fanboy in these comments but I think Tesla's valuation is crazy high, too high, and I still think there's a chance they fail completely like so many other auto companies (a tough business). My theory is Musk knows the only way he'll be able to compete is attracting the best talent through stock incentives, and to do that he needs to jack up the stock price by pushing engineers way past what they are comfortable with. An underreported stat is the increase in TSLA outstanding shares, which I think is Elon throwing stock incentives at his employees to make them go faster, as a TPS alternative (for now?) https://ycharts.com/companies/TSLA/shares_outstanding https://ycharts.com/companies/TSLA/shares_outstanding
  - prostoalex 9y ago
    The increase in shares was due to secondary offering https://www.fool.com/investing/2016/05/26/tesla-motors-maxed-out-its-secondary-offering.aspx https://www.fool.com/investing/2016/05/26/tesla-motors-maxed... Tesla’s stock behavior is due to the ongoing game of “who blinks first” between TSLA shorts and TSLA short-squeezers. With $10 billion short position the company’s fundamentals are reduced to a side show.
    - carlivar 9y ago
      Your article only accounts for about 7.9 million new shares from the secondary offering, but many more have been issued. It's primarily from equity grants. Even your article says Musk tacked on his stock option exercise as part of the secondary offering, which increased the dilution.
wpietri 9y ago
> I really find it hard to believe they don't understand the TPS. Sure. Maybe. I don't know. American carmakers didn't get it for decades. Even when they thought they did, they performed Lean rituals without real understanding. This was despite Toyota trying vigorously to teach them.
- pja 9y ago
  History shows that knowledge transfer is really, really hard. Humans are just not very good at it :( (A similar story is told of the spread of the use of Feynman diagrams in physics - I’ve read that their spread was far slower than you’d expect given their utility: For whatever reason it wasn’t enough to be told that they were an incredibly useful tool by people you trusted - it was only when non users actually worked together on problems with Feynman diagram users, or were taught by Feynman diagram users directly that their use actually spread. Both of these transfer methods required physical proximity which restricted the use of Feynman diagrams to a small number of labs for a surprisingly long time.)
  - mcherm 9y ago
    Fascinating story, do you have any idea where you read that?
    - pja 9y ago
      Nope, but a quick Google suggests that this paper: “Spreading the Tools of Theory: Feynman Diagrams in the USA, Japan, and the Soviet Union” by David Kaiser, Kenji Ito and Karl Hall http://web.mit.edu/dikaiser/www/Kaiser.SpreadingTools.pdf http://web.mit.edu/dikaiser/www/Kaiser.SpreadingTools.pdf must have been the original source research. edit: Also, there’s a book (by one of the authors of that paper): “Drawing Theories Apart: The Dispersion Of Feynman Diagrams In Postwar Physics” https://www.amazon.co.uk/dp/B002Y5W2X2 https://www.amazon.co.uk/dp/B002Y5W2X2
      - dctoedt 9y ago
        The Kaiser et al. paper cited by 'pja is fascinating. This passage (at 887) practically puts the reader in the room at the Institute for Advanced Study: <blockquote> ... Thus, when [Freeman] Dyson arrived at the Institute for Advanced Study in September 1948, Feynman diagrams in hand, he immediately joined ten fellow ‘postdocs’ in theoretical physics, the largest cohort yet. [J. Robert Oppenheimer had reorganized the Institute to emphasize post-doc training for physicists; he was quoted as saying that "the best way to send information is to wrap it up in a person."] In fact, the new building that had been planned to hold offices for the newly expanded ranks had not been completed on time, so all of the postdocs wound up sharing desks in one large room for the first 6 weeks of their stay – an architectural arrangement perfectly suited for the sharing of tacit knowledge. They huddled around large tables swapping ideas, pressing Dyson to explain the details of how to use Feynman diagrams. He delivered several sets of long lectures to the group, supplemented by constant, informal conversations. By the winter of 1948–49, Dyson had organized them into several groups, each working on distinct diagrammatic calculations. One pair, Kenneth Watson and Joseph Lepore, worked with Dyson to calculate high-order terms in a certain model of nuclear forces, while another duo, Norman Kroll and Robert Karplus, took up Dyson’s lead to undertake similarly complex diagrammatic calculations in QED. So effective were Dyson’s tutorials that Wolfgang Pauli wrote to another of the young Institute theorists that May, asking what Dyson and the rest of the ‘Feynman-school’ were working on. </blockquote> (Extra paragraphing added.)
Lazare 9y ago
TPS is, in part, a way of configuring your supply chain in order to ramp up production smoothly. Tesla wants to ramp up production as their primary goal right now; if their supply chain is preventing them from doing so then they've funamentally failed. > I really find it hard to believe they don't understand the TPS. I agree, but that makes this more confusing and (at least potentially) more damning for Tesla. It's not that hard a concept; if you're running a manufacturing company but you screw up your supply chain badly then...I dunno. Maybe you're bad at running a manufacturing company? Supply chains are really important when you're doing something like making cars. And people having been advocating TPS since before I was even born. So...it's a conundrum.
- carlivar 9y ago
  Obviously Tesla is doing _something_ about this because what is the Gigafactory if not a major part of the supply chain?
Gibbon1 9y ago
Might be the production _rate_ for the previous models doesn't mesh well with their suppliers. We buy plastics in runs of 15,000 parts. It takes us a couple of months to go through those. And then we order more. The manufacturer doesn't make 200 parts a day. Or 1000 a week. The do a full run of 5-20,000 every three months. Which takes them a whole day, once the machine is setup they run it till the order is filled. Sometimes it's obvious they do higher runs and then break up the shipments. Okay so our products are cheap and simple. But our yearly totals of 50,000 to 100,000 units is comparable to the what Tesla is hoping to get out the door. Tesla's numbers for previous models weren't nearly that high. Gonna be hard to just in time that. Personal feeling. What an automaker is doing by outsourcing parts to suppliers and then making them manage inventory is. a) they as someone mentioned, keep the inventory management away from the production line. And importantly allowing suppliers to apply higher levels of scale then you could other wise. Important because likely many of Tesla's suppliers production machinery has vastly more capacity then Tesla needs. Telsa and other automakers are thus 'renting' time on those machines. Frankly I think Tesla is ramping to this scale for the first time, it's bound to be a mess.

hbarka 9y ago

I’ve been to a factory tour. The author’s anecdote is off the mark. What I observed were mostly robots doing the assemble and welding and then the typical assembly line for installing the interiors. It was smooth and had a cadence. Mr Gasee was talking about Just-In-Time (JIT) concepts and lean inventory and when he saw parts on a shelf it contradicted his idea of JIT. JIT doesn’t mean you can’t have safety stock. Tesla is also pursuing vertical integration and prefer to make subassemblies in-house. I have my doubts about Gasee’s agenda.

digikata 9y ago

Toyota is a global car manufacturing company who has been manufacturing cars (and building new car factories) for many many decades now. This is will be Tesla's first high volume line of vehicles. I think it makes sense for some time to work out kinks in process and meta-processes. Even a couple of years back when Toyota passed GM as highest volume maker of vehicles, the execs at Toyota said there was a moment where they took their eye off clean processes and Toyota quality suffered a bit. Some of that I suspect had to do with the timing of the retirement of a generation of very experienced people in Toyota. I think they've since been on a corrective course.

ubernostrum 9y ago
I think it makes sense for some time to work out kinks in process and meta-processes. I think it makes sense to consider the state of the art for reliable production lines. But NIH syndrome will have its way.