Toyota Production System

The Toyota Production System (TPS) is an integrated socio-technical system, developed by Toyota, that comprises its management philosophy and practices. The TPS organizes manufacturing and logistics for the automobile manufacturer, including interaction with suppliers and customers. The system is a major precursor of the more generic "lean manufacturing." Taiichi Ohno, Shigeo Shingo and Eiji Toyoda developed the system between 1948 and 1975.

Originally called "just-in-time production," it builds on the approach created by the founder of Toyota, Sakichi Toyoda, his son Kiichiro Toyoda, and the engineer Taiichi Ohno.The principles underlying the TPS are embodied in The Toyota Way.

Goals

The main objectives of the TPS are to design out overburden (muri) and inconsistency (mura), and to eliminate waste (muda). The most significant effects on process value delivery are achieved by designing a process capable of delivering the required results smoothly; by designing out "mura" (inconsistency). It is also crucial to ensure that the process is as flexible as necessary without stress or "muri" (overburden) since this generates "banasik" (waste). Finally the tactical improvements of waste reduction or the elimination of muda are very valuable. There are seven kinds of muda that are addressed in the TPS:

1. Waste of overproduction (largest waste)
2. Waste of time on hand (waiting)
3. Waste of transportation
4. Waste of processing itself
5. Waste of stock at hand
6. Waste of movement
7. Waste of making defective products

The elimination of waste has come to dominate the thinking of many when they look at the effects of the TPS because it is the most familiar of the three to implement. In the TPS many initiatives are triggered by inconsistency or overburden reduction which drives out waste without specific focus on its reduction.

Origins

This system, more than any other aspect of the company, is responsible for having made Toyota the company it is today. Toyota has long been recognized as a leader in the automotive manufacturing and production industry.

It is a myth that "Toyota received their inspiration for the system, not from the American automotive industry (at that time the world's largest by far), but from visiting a supermarket." The idea of Just-in-time production was originated by Kiichiro Toyoda, founder of Toyota.. The question was how to implement the idea. In reading descriptions of American supermarkets, Ohno saw the supermarket as model for what he was trying to accomplish in the factory. A customer in a supermarket takes the desired amount of goods off the shelf and purchases them. The store restocks the shelf with enough new product to fill up the shelf space. Similarly, a work-center that needed parts would go to a 'store shelf' (the inventory storage point) for the particular part and 'buy' (withdraw) the quantity it needed, and the 'shelf' would be 'restocked' by the work-center that produced the part, making only enough to replace the inventory that had been withdrawn.

While low inventory levels are a key outcome of the Toyota Production System, an important element of the philosophy behind its system is to work intelligently and eliminate waste so that only minimal inventory is needed. Many American businesses, having observed Toyota's factories, set out to attack high inventory levels directly without understanding what made these reductions possible. The act of imitating without understanding the underlying concept or motivation may have led to the failure of those projects.

Principles

Main article: The Toyota Way

The underlying principles, called the Toyota Way, have been outlined by Toyota as follows:

Continuous Improvement

• Challenge (We form a long-term vision, meeting challenges with courage and creativity to realize our dreams.)
• Kaizen (We improve our business operations continuously, always driving for innovation and evolution.)
• Genchi Genbutsu (Go to the source to find the facts to make correct decisions.)

Respect for People

• Respect (We respect others, make every effort to understand each other, take responsibility and do our best to build mutual trust.)
• Teamwork (We stimulate personal and professional growth, share the opportunities of development and maximize individual and team performance.)

External observers have summarized the principles of the Toyota Way as:

Long-term philosophy

1. Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals.

The right process will produce the right results

1. Create continuous process flow to bring problems to the surface.
2. Use the "pull" system to avoid overproduction.
3. Level out the workload (heijunka). (Work like the tortoise, not the hare.)
4. Build a culture of stopping to fix problems, to get quality right from the first.
5. Standardized tasks are the foundation for continuous improvement and employee empowerment.
6. Use visual control so no problems are hidden.
7. Use only reliable, thoroughly tested technology that serves your people and processes.

Add value to the organization by developing your people and partners

1. Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others.
2. Develop exceptional people and teams who follow your company's philosophy.
3. Respect your extended network of partners and suppliers by challenging them and helping them improve.

Continuously solving root problems drives organizational learning

1. Go and see for yourself to thoroughly understand the situation (Genchi Genbutsu, 現地現物);
2. Make decisions slowly by consensus, thoroughly considering all options (Nemawashi, 根回し); implement decisions rapidly;
3. Become a learning organization through relentless reflection (Hansei, 反省) and continuous improvement (Kaizen, 改善).

The Toyota production system has been compared to squeezing water from a dry towel. What this means is that it is a system for thorough waste elimination. Here, waste refers to anything which does not advance the process, everything that does not increase added value. Many people settle for eliminating the waste that everyone recognizes as waste. But much remains that simply has not yet been recognized as waste or that people are willing to tolerate.

People had resigned themselves to certain problems, had become hostage to routine and abandoned the practice of problem-solving. This going back to basics, exposing the real significance of problems and then making fundamental improvements, can be witnessed throughout the Toyota Production System.

Results

Toyota was able to greatly reduce leadtime and cost using the TPS, while improving quality. This enabled it to become one of the ten largest companies in the world. It is currently as profitable as all the other car companies combined and became the largest car manufacturer in 2007. Due to the success of the production philosophy's predictions many of these methods have been copied by other manufacturing companies, although mostly unsuccessfully.

Also, many companies in different sectors of work (other than manufacturing) have attempted to adapt some or all of the principles of the Toyota Production System to their company. These sectors include construction and health care.

Commonly used terminology

• Andon (行灯) (English: Signboard)
• Genchi Genbutsu (現地現物) (English: Go and see for yourself)
• Hansei (反省) (English: Self-reflection)
• Heijunka (平準化) (English: Production Smoothing)
• Jidoka (自働化) (English: Autonomation - automation with human intelligence)
• Just-in-Time (ジャストインタイム) (JIT)
• Kaizen (改善) (English: Continuous Improvement)
• Kanban (看板, also かんばん) (English: Sign, Index Card)
• Manufacturing supermarket where all components are available to be withdrawn by a process
• Muda (無駄, also ムダ) (English: Waste)
• Mura (斑 or ムラ) (English: Unevenness)
• Muri (無理) (English: Overburden)
• Nemawashi (根回し) (English: Laying the groundwork, building consensus, literally: Going around the roots)
• Poka-yoke (ポカヨケ) (English: fail-safing - to avoid (yokeru) inadvertent errors (poka)

See also

• Taiichi Ohno
• Shigeo Shingo
• W. Edwards Deming
• Lean manufacturing
• The Toyota Way
• The Vanguard Method

References

• Emiliani, B., with Stec, D., Grasso, L. and Stodder, J. (2007), Better Thinking, Better Results: Case Study and Analysis of an Enterprise-Wide Lean Transformation, second edition, The CLBM, LLC Kensington, Conn., ISBN 978-0-9722591-2-5
• Liker, Jeffrey (2003), The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer, First edition, McGraw-Hill, ISBN 0-07-139231-9.
• Monden, Yasuhiro (1998), Toyota Production System, An Integrated Approach to Just-In-Time, Third edition, Norcross, GA: Engineering & Management Press, ISBN 0-412-83930-X.
• Ohno, Taiichi (1995), Toyota Production System: Beyond Large-scale Production, Productivity Press Inc., ISBN 0-915299-14-3.
• Shingo, Shigeo (1989) A Study of the Toyota Production System from an Industrial Engineering Viewpoint (Produce What Is Needed, When It's Needed), Productivity Press, ISBN 0-915299-17-8. (This refers to the English version; the Japanese version was published in 1981, but the ISBN is unknown)
• Spear, Steven, and Bowen, H. Kent (September 1999), "Decoding the DNA of the Toyota Production System," Harvard Business Review
• Womack, James P. and Jones, Daniel T. (2003), Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated, HarperBusiness, ISBN 0-7432-4927-5.
• Womack, James P., Jones, Daniel T., and Roos, Daniel (1991), The Machine That Changed the World: The Story of Lean Production, HarperBusiness, ISBN 0-06-097417-6.
• Zamprotta L., (1993), La qualité comme philosophie de la production. Interaction avec l'ergonomie et perspectives futures, Thèse de Maîtrise fr:Maîtrise ès Sciences Appliquées, TIU Press, Independence,MO, (1994), ISBN 0-89697-452-9.

External links

• History of the TPS at the Toyota Motor Manufacturing Kentucky Site
• Toyota Production System Terms
• Article: Lean Primer: Introduction