The left-hand column shows non-value-adding setup activities and the right-hand column shows value-adding machining operations. 

Had Taylor focused on reducing the left-hand activities, he would have been SMED's undisputed inventor. He focused instead on making the value-adding operations more efficient. This was a valuable contribution because, at the time, there was a false economy paradigm that called for maximization of tool life even at the cost of productivity. Nonetheless, American sources of that period describe SMED explicitly.

"In a certain shop with which we are familiar a piece had to have several holes of different sizes drilled in it, a jig being provided to locate the holes. The drills and the sockets for them were given to the workman in a tote box. The time study of this job revealed several interesting facts. First, after the piece was drilled the machine was stopped, and time was lost while the workman removed the piece from the jig and substituted a new one. This was remedied by providing a second jig in which the piece was placed while another piece was being drilled in the first jig, the finished one being removed after the second jig had been placed in the machine and drilling started."
—Robert Thurston Kent, introduction to Frank Gilbreth's Motion Study (1911)

Basic Principles of SMED

• Internal setup requires the tool to stop. Reduce internal setup time, or convert internal to external setup.
• Example: Robert Thurston Kent (above) described how a job was set up in a drill press' jig while the drill press was working on another job. When the drill press finished, the jigs were exchanged. This reduced the time required for internal setup.
• External setup can be performed while the tool is working on another job.
• "A sufficient number of spare milling cutters are provided for each operation to ensure having a newly ground set of cutters on hand before change is needful …the setting of the cutters is facilitated by table marks and suitable straight edges so as to consume the least possible time, and to ensure the utmost attainable accuracy in cutter placing" (Arnold and Faurote, 1915. Ford Methods and Ford Shops, 73-74.) Note that grinding the cutters is part of external setup. Furthermore, the table marks and straightedges make the tool change easy.
• Identify and eliminate wasted motions and non-value-adding activities.
• Only the final turn on a bolt or screw adds value (by securing a die, clamping/unclamping work, and so on).
• The interrupted screw (or interrupted thread) provides one means of clamping and unclamping something quickly. Artillery breeches have been sealed in this manner since the nineteenth century.