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 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.
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 "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:
Over-production
Motion (of operator or machine)
Waiting (of operator or machine)
Conveyance
Processing itself
Inventory (raw material)
Correction (reworks and scraps)
The elimination of muda 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 mura or muri reduction
which drives out muda 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.
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.
This occurred when a delegation from Toyota (led by Ohno) visited the United
States in the 1950s. The delegation first visited several Ford Motor Company
automotive plants in Michigan but, despite Ford being the industry leader at that
time, found many of the methods in use to be not very effective. They were mainly
appalled by the large amounts of inventory on site, by how the amount of work
being performed in various departments within the factory was uneven on most
days, and the large amount of rework at the end of the process.
However, on a subsequent visit to a Piggly Wiggly, the delegation was inspired by
how the supermarket only reordered and restocked goods once they had been
bought by customers.
Toyota applied the lesson from Piggly Wiggly by reducing the amount of inventory
they would hold only to a level that its employees would need for a small period of
time, and then subsequently reorder. This would become the precursor of the nowfamous Just-in-Time (JIT) inventory system.
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 inventory is no longer 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: 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:
1. Long-term philosophy
a. Base your management decisions on a long-term philosophy, even at the
expense of short-term financial goals.
2. The right process will produce the right results
a. Create continuous process flow to bring problems to the surface
b. Use the "pull" system to avoid overproduction
c. Level out the workload (heijunka). (Work like the tortoise, not the hare.)
d. Build a culture of stopping to fix problems, to get quality right from the
first
e. Standardized tasks are the foundation for continuous improvement and
employee empowerment
f. Use visual control so no problems are hidden
g. Use only reliable, thoroughly tested technology that serves your people
and processes.
3. Add value to the organization by developing your people and partners
a. Grow leaders who thoroughly understand the work, live the philosophy,
and teach it to others.
b. Develop exceptional people and teams who follow your company's
philosophy.
c. Respect your extended network of partners and suppliers by challenging
them and helping them improve.
4. Continuously solving root problems drives organizational learning
a. Go and see for yourself to thoroughly understand the situation (Genchi
Genbutsu, );
b. Make decisions slowly by consensus, thoroughly considering all options
(Nemawashi, ); implement decisions rapidly;
c. 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.
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. 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.
Commonly used terminology
Andon () (English: Signboard)
Genchi Genbutsu () (English: Go and see for yourself)
Hansei () (English: Self-reflection)
Heijunka () (English: Production Smoothing)
Jidoka () (English: Autonomation - automation with human intelligence)
Just In Time () (JIT)
Kaizen () (English: Continuous Improvement)
Kanban (, also ) (English: Sign, Index Card)
Muda (, also ) (English: Waste)
Mura ( or ) (English: Unevenness)
Muri () (English: Overburden)
Nemawashi () (English: Laying the groundwork, building consensus,
literally: Going around the roots)
Poka-yoke () (English: fail-safing - to avoid (yokeru) inadvertent errors
(poka)

TPS Concept
Jidoka
Highlighting/visualization of
problems
-Quality must be built in during the
manufacturing process!If equipment malfunction or a defective part
is discovered, the affected machine
automatically stops, and operators cease
production and correct the problem.
For the Just-in-Time system to function, all of
the parts that are made and supplied must
meet predetermined quality standards. This
is achieved through jidoka.
1. Jidoka means that a machine safely
stops when the normal processing is
completed. It also means that, should
a quality / equipment problem arise,
the machine detects the problem on
its own and stops, preventing
defective products from being
produced. As a result, only products
satisfying quality standards will be
passed on to the following processes
on the production line.
2. Since a machine automatically stops
when processing is completed or when
a problem arises and is communicated
via the "andon" (problem display
board), operators can confidently
continue performing work at another
machine, as well as easily identify the
problem's cause to prevent its
recurrence. This means that each
operator can be in charge of many
machines, resulting in higher
productivity, while continuous
improvements lead to greater
processing capacity.

Just-in-Time
Productivity improvement
- Making only "what is needed, when it is
needed, and in the amount needed!"

Producing quality products efficiently

through the complete elimination of waste
inconsistencies, and unreasonable
requirements on the production line.
In order to deliver a vehicle ordered by a
customer as quickly as possible, the
vehicle is efficiently built within the
shortest possible period of time by
adhering to the following:
1. When a vehicle order is received, a
production instruction must be
issued to the beginning of the
vehicle production line as soon as
possible.
2. The assembly line must be stocked
with required number of all needed
parts so that any type of ordered
vehicle can be assembled.
3. The assembly line must replace the
parts used by retrieving the same
number of parts from the partsproducing process (the preceding
process).

4. The preceding process must be

stocked with small numbers of all
types of parts and produce only the
numbers of parts that were retrieve
by an operator from the next
process.

The production system developed by Toyota Motor Corporation to provide best

quality, lowest cost, and shortest lead time through the elimination of waste.
TPS is comprised of two pillars, Just-in-Time and jidoka, and is often illustrated with
the "house" shown below. TPS is maintained and improved through iterations of
standardized work and kaizen, following PDCA, or the scientific method.

Development of TPS is credited to Taiichi Ohno, Toyota's chief of production in postWWII period.
Beginning in machining operation and spreading from there, Ohno led the
development of TPS at Toyota throughout the 1950's and 1960's and the
dissemination to the supply base through the 1960's and 1970's.
Outside Japan, dissemination began in ernest with the creation of the ToyotaGeneral Motors joint venture - NUMMI - in California in 1984.
The concepts of Just-in-Time (JIT) and jidoka both have their roots in the pre-war
period. Sakichi Toyoda, founder of the Toyota group of companies, invented the
concept of Jidoka in the early 20th Century by incorporating a device on his
automatic looms that would stop the loom from operation whenever a thread
broke.
This enabled great improvements in quality and freed people up to do more value
creating work than simply monitoring machines for quality. Eventually, this simple
concept found its way into every machine, every production line, and every Toyota
operation.

Kiichiro Toyoda, son of Sakichi and founder of the Toyota automobile business,
developed the concept of Just-in-Time in the 1930's. He decreed that Toyota
operations would contain no excess inventory and that Toyota would strive to work
in partnership with suppliers to level production.
Under Ohno's leadership, JIT developed into a unique system of material and
information flows to control overproduction.

5S (methodology)
5S is the name of a workplace organization methodology that uses a list of five
Japanese words which are seiri, seiton, seiso, seiketsu and shitsuke. Translated into
English, they all start with the letter "S". The list describes how items are stored
and how the new order is maintained. The decision-making process usually comes
from a dialogue about standardization which builds a clear understanding among
employees of how work should be done. It also instills ownership of the process in
each employee.
Phases of 5S
There are 5 primary phases of 5S: sorting, straightening, systematic cleaning,
standardizing, and sustaining. Additionally, there are three other phases
sometimes included; safety, security, and satisfaction.
1. Sorting (Seiri)
Eliminate all unnecessary tools, parts, and instructions. Go through all tools,
materials, and so forth in the plant and work area. Keep only essential items
and eliminate what is not required, prioritizing things as per requirements and
keeping them in easily-accessible places. Everything else is stored or discarded.
2. Straightening or setting in order / stabilize (Seiton)
There should be a place for everything and everything should be in its place.
The place for each item should be clearly labeled or demarcated. Items should
be arranged in a manner that promotes efficient work flow, with equipment
used most often being the most easily accessible. Workers should not have to
bend repetitively to access materials. Each tool, part, supply, or piece of
equipment should be kept close to where it will be used in other words,
straightening the flow path. Seiton is one of the features that distinguishes 5S
from "standardized cleanup". This phase can also be referred to as Simplifying.
3. Sweeping or shining or cleanliness / systematic cleaning (Seiso)
Keep the workplace tidy and organized. At the end of each shift, clean the work
area and be sure everything is restored to its place. This makes it easy to know
what goes where and ensures that everything is where it belongs. A key point is
that maintaining cleanliness should be part of the daily work not an occasional
activity initiated when things get too messy.
4. Standardizing (Seiketsu)

Work practices should be consistent and standardized. All work stations should
be identical. All employees should be able to work in any station doing the same
job with the same tools that are in the same location in every station. Everyone
should know exactly what his or her responsibilities are for adhering to the first
3 S's.
5. Sustaining the discipline or self-discipline (Shitsuke)
Maintain and review standards. Once the previous 4 S's have been established,
they become the new way to operate. Maintain focus on this new way and do
not allow a gradual decline back to the old ways. While thinking about the new
way, also be thinking about yet better ways. When an issue arises such as a
suggested improvement, a new way of working, a new tool or a new output
requirement, review the first 4 S's and make changes as appropriate.
6. Safety
A sixth phase, "Safety", is sometimes added. There is debate over whether
including this sixth "S" promotes safety by stating this value explicitly, or if a
comprehensive safety program is undermined when it is relegated to a single
item in an efficiency-focused business methodology.
7. Security
A seventh phase, "Security", can also be added. In order to leverage security as
an investment rather than an expense, the seventh "S" identifies and addresses
risks to key business categories including fixed assets (PP&E), material, human
capital, brand equity, intellectual property, information technology, assets-intransit and the extended supply chain.
8. Satisfaction
An eighth phase, Satisfaction, can be included. Employee Satisfaction and
engagement in continuous improvement activities ensures the improvements
will be sustained and improved upon. The Eighth waste Non Utilized Intellect,
Talent, and Resources can be the most damaging waste of all.
It is important to have continuous education about maintaining standards. When
there are changes that affect the 5S program such as new equipment, new
products or new work rules, it is essential to make changes in the standards and
provide training. Companies embracing 5S often use posters and signs as a way of
educating employees and maintaining standards.