TOYOTA MOTOR MANUFACTURING CASE STUDY

The Toyota Production system has been hailed as the source of Toyotas
outstanding performance as a manufacturer. The worlds best
manufacturing companies GM, Ford, Chrysler have independently
created major initiatives to develop Toyota-like production systems.

Even then nobody understood the Toyota way completely. The reason is
that the observers confuse the tools and practices they see on their plant
visits with the system itself. That makes it impossible for them to resolve
an apparent paradox of the system namely that activities, connections
and production flows in a Toyota factory are rigidly scripted, yet at the
same time flexible and adaptable. Toyota system is based on scientific
method.

The tacit knowledge that underlies the Toyota Production system can be
captured in four basic rules

1. All work shall be highly specified as to content, sequence, timing and
outcome
2. Every customer-supplier connection must be direct, and there must be
an unambiguous yes or no way to send requests and receive responses
3. The pathway for every product and service must be simple and direct
4. Any improvement must be made in accordance with the scientific
method, under the guidance of a teacher at the lowest possible level in
the organisation.
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 founders of Toyota drew
heavily on the work of W. Edwards Deming and the writings of Henry
Ford. When these men came to the United States to observe the
assembly line and mass production that had made Ford rich, they were
unimpressed. While shopping in a supermarket they observed the
simple idea of an automatic drink resupplier; when the customer wants a
drink, he takes one, and another replaces it. The principles underlying
the TPS are embodied in The Toyota Way.
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 "muda" (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. over-production
2. motion (of operator or machine)
3. waiting (of operator or machine)
4. conveyance
5. processing itself
6. inventory (raw material)
7. correction (rework and scrap)
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)
2. Make decisions slowly by consensus, thoroughly considering all
options (Nemawashi, implement decisions rapidly;
3. Become a learning organization through relentless reflection
(Hansei, and continuous improvement (Kaizen)
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.


Conclusion
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.
It has been proposed that the TPS is the most prominent example of the
'correlation', or middle, stage in a science, with material requirements
planning and other data gathering systems representing the
'classification' or first stage. A science in this stage can see correlations
between events and can propose some procedures that allow some
predictions of the future. 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.