Toyota Production System

An introduction to the Toyota Production System

The Toyota Production System is a philosophy of manufacturing that was created by the Toyota Corporation. The Toyota Production System or TPS, has come to be known as a term that is synonymous with Lean Manufacturing. Lean manufacturing aims to improve the manufacturing process by eliminating wastes in all their forms. The TPS names seven wastes specifically and collectively calls these wastes "Muda." Also called "The Seven Deadly Wastes" the muda as defined by Toyota includes the following: over-production, motion (of operator or machine), waiting (of operator or machine), conveyance, processing itself, inventory (raw material) and correction (rework and scrap).

Not only are processes sped up when waste is eliminated through TPS but the quality of the product is better. This means that the customer benefits from the TPS process just as much, if not more, than the manufacturer benefits. Everyone wins and the profits reflect this improvement in process. Toyota has long benefited from their innovations in the world of lean thinking and in 2007 became the largest car manufacturer in the world. Other manufacturing companies are definitely taking note and many of the Toyota Production System methods are being copied. Although the principles of TPS can theoretically be applied universally, no manufacturer has yet to master the processes the way that Toyota has.

The origins of the Toyota Production System are said to actually have been inspired by American businesses. A delegation from Toyota came to the United States to study their commercial businesses. At the time the Ford Company was recognized as being the innovator in Lean Manufacturing, but when the Toyota executives visited the Ford Motor Company, they were disappointed with how inefficiently they managed their inventory. It was actually from a super market chain that they gained their inspiration for a process now known as Just In Time. It was at this supermarket that they saw that a piece of inventory was only re-ordered once it had been sold from the shelves.

This was the start of a new way to manufacture, a way that is both complicated and simple and that American's have had a difficult time understanding because of all of the meaning that is behind the actions that are taken in the Just In Time and other methodologies. It is not simply a matter of eliminating the waste but replacing it with a system that allows for continual improvement that benefits the worker, the customer and the company's bottom line. Basically the point is to sacrifice short-term financial goals if need be in order to base management decisions on a more long-term philosophy. This philosophy of sacrificing the short-term for the long-term is called The Toyota Way.

Common terms used in the Toyota Production System:

The Toyota Production System has come to include a great number of different concepts and methodologies. As different companies will find it useful to utilize different strategies for the implementation of their Toyota Production System a brief list and definition of common terms is listed below:

• Just In Time (JIT) - JIT is an inventory strategy that a company may chose to implement in order to improve the return on investment of a business by reducing inventory and the costs associated with carrying unsold goods.
• Jidoka (Autonomation) - Jidoka is a Japanese word that refers to the process of creating an automated production line that also includes a human touch. Machines perform with Autonomation when they are programmed to stop producing in the case of an error. It is then the human who identifies and resolves the problem.
• Kaizen (Continuous Improvement) - This Japanese term refers to the process of gradual change for the better. Employees are encouraged to provide input and improve the processes that they are over thereby making their jobs more enjoyable and the production line more efficient.
• Andon - This term refers to a method used in visual control and when translated into English means "Signboard." Visual control is a process that uses visual cues such as graphics to constantly illustrate to workers just how the production process and work environment should flow.
• Pokayoke - The process of fool-proofing or mistake-proofing a system by identifying the cause of defects or errors and putting a plan in place to prevent such inadvertent errors from occurring again.
• Muda - The term muda is often accompanied with a list of seven different wastes or "deadly wastes" that a company looking to implement lean manufacturing techniques is trying to eliminate. (The terms "Muri" and "Mura" refer respectively to the overburden and unevenness that accompanies the carrying of the unnecessary wastes).

The Toyota Way

The Toyota Corporation has named their managerial philosophy "The Toyota Way." The Toyota Way includes a series of 14 principles that are considered the basis on which management decisions are made. The people at Toyota believed that in order to think in terms of long-term goals, they needed to have a process for solving problems, a way by which they could add value to the organization by developing its people (on every level, not just management), and to recognize that continuously solving problems by first discovering their origins drives organizational learning.

The Toyota Production System and the Toyota way of thinking have given them a competitive advantage on a global scale. This advantage was gained through a combination of their human resource management policies and their highly efficient network of suppliers and manufacturers of the machine and other components used for production. It is the approach to management that is most interesting though. Toyota is known for their corporate culture of employee empowerment. Just consider the following statistics and perhaps you can begin to get a better idea of just how employee centered the Toyota Corporation is. In an average year more than 700,000 improvement suggestions were submitted by Toyota's employees. That is an average of over 10 improvement suggestions per employee per year. What is perhaps most impressive is that over 99% of suggestions were implemented!

Toyota knows that the workers are at the center of the process of continuous improvement and that it is their creativity that leads not only to innovation but also to company loyalty and improved morale in the workplace. When job satisfaction is high, there is a greater likelihood that reliable and high quality products will be produced at an affordable price. Of course Toyota is most readily known for their production of cars, but it is their human resource management techniques that have caught the attention of manufacturers around the world.

7 Principles of the Toyota Production System

1. Reduce setup times - Employees at Toyota were made responsible for their own setups thus reducing the wastefulness of this process that ultimately adds to value to the customer and takes up valuable in process labor time and equipment.

2. Small-lot production - The process of economically producing a variety of things in small quantities rather than producing things in large batches.

3. Employee involvement and empowerment - Employee are divided into teams and even those in supervisory positions work along side other employees on the production line as part of the team.

4. Quality at the source - Product defects are identified and corrected as soon as they occur or at the source.

5. Equipment maintenance - Operators of the equipment are also assigned to take care of their maintenance since these should be the individuals who know the equipment best.

6. Pull production - The work performed at each stage of the process is dictated solely by demand for materials from the immediate next stage (also known as "Just in Time").

7. Supplier involvement - Suppliers are treated as partners and are also trained in the TPS methods.

How Can TPS Help My Organization?

Some of the most common benefits that a company sees as a result of perusing Toyota Production System practices are that they are able to identify and enhance customer perceived value in the product or line of products being offered (this includes improved product quality and timely deliveries), waste is decreased and thereby costs are minimized, and they are able to develop a competitive advantage in their manufacturing field. TPS helps almost any organization that chooses to implement its best practices. However, few companies have achieved the kind of benefits that the Toyota company themselves have discovered because of an all too common inability to adopt the same mentality that the creators and perpetuators of the Toyota Production System are famous for.

The Toyota Production System mentality In the case of TPS and Lean Manufacturing, waste refers to anything which does not advance the process or in other words, everything that does not increase or add value. Many people in manufacturing managerial positions settle for eliminating the waste that everyone recognizes as waste. But the key to implementing the TPS as well as Toyota lies in recognizing waste that people are willing or have been trained to tolerate and recognizing waste that has never yet been recognized as waste. Thinking outside of the box is not something that can necessarily be taught with methods and step-by-step processes. This is why the Toyota Production System does not work perfectly for all those who implement it. The trouble with manufacturers is that the routine of having to deal with certain problems has made them numb to the possibility that these problems can be solved. The Toyota Production System asks that these people abandon their former ways of thinking and in essence start from square one again; evaluating every problem at face value and leaving behind all preconceived notions of what solutions are possible. Making fundamental improvements no matter the perceived significance of the problem is what the Toyota Production System makes possible for those who are able and willing to change.