JAPAN’S NEW PERSONALIZED PRODUCTION Using robots and computers, a Japanese company is helping to usher in an era of customized manufacturing. You can choose among 11,231,862 variations of bicycle.
(FORTUNE Magazine)
By Susan Moffat
October 22, 1990

(FORTUNE Magazine) – TAKE A LOOK at the factory of the future: a slightly grungy little Japanese plant that turns out custom-made, hand-assembled bicycles one by one. Surprised? The concept has so intrigued executives and engineers that they have been flocking from as far away as Italy to this factory in Kokubu, in western Japan, to study it. Big Japanese manufacturers of other goods are also taking note, hoping to improve their own production systems. The National Bicycle Industrial Co., a subsidiary of electronics giant Matsushita, makes bikes under the Panasonic brand. It builds these one-of-a- kind models by replacing mass production with flexible manufacturing. The method is being employed all over Japan to shrink small-lot production jobs to lots of one. Robots, computers, and people work together to turn production on a dime. Most important, the system puts the consumer at the beginning rather than at the end of the process, starting with the individual order rather than with gross production targets. Customers get what they crave most: unique products. With 20 employees and a computer capable of design work, this small factory is ready to produce any of 11,231,862 variations on 18 models of racing, road, and mountain bikes in 199 color patterns and about as many sizes as there are people. Production doesn’t start until a customer places his order, but within two weeks he’s riding a one-of-a-kind machine. Here’s how the factory works. John Q. Suzuki visits his local Panasonic bicycle store, where the shopkeeper measures him on a special frame and faxes the specifications to the factory. There, an operator punches the specs into a Digital Equipment minicomputer, which automatically creates a blueprint and produces a bar code attached to a shapeless mass of tubes and gears that will become Mr. Suzuki’s bike. The code serves as a kind of DNA double helix, determining the size, color, and design. At every point in production, a computer reading the code knows that each part belongs to Mr. Suzuki’s bike and tells a robot where to weld or a painter which pattern to follow.

The process is not highly automated. The factory looks a little like a traditional workshop, with craftspeople hand-wiring gears and silk-screening the customer’s name on the frame with the same care that would be given to the finest kimono or lacquerware. Yet production is amazingly swift. CAD creates blueprints in three minutes that would take a draftsman 60 times as long. A custom bike requires three hours to make, vs. 90 minutes for a mass-produced model. So why the two-week wait? Says Koji Nishikawa, head of sales: ”We could have made the time shorter, but we want people to feel excited about waiting for something special.” The finished bikes sell for $545 to $3,200, compared with $250 to $510 for standard bikes. Margins are fat, workers proud, and customers happy with their unique machines. Matsushita may next apply the concept to industrial machinery.