- A CASE STUDY ON TOYOTA PRODUCTION SYSTEM - ppt video online download
- Benefits of Kaizen to Business Excellence: Evidence from a Case Study
- A Culture of Contradictions
- Toyota's Kaizen Experience Case
Toyota came up with a hybrid engine that combined the power of an internal combustion engine with the environmental friendliness of an electric motor much earlier than rivals. In the early s, the company faced near bankruptcy, but over the past 40 years, the company has recorded steady sales and market-share growth. The company assigns many more employees to offices in the field than rivals do, and its senior executives spend an inordinate amount of time visiting dealers. Toyota also uses a large number of multilingual coordinators—a post that Carlos Ghosn abolished at Nissan soon after he became CEO in —to help break down barriers between its headquarters and international operations.
In Japan, the company turns off the lights in its offices at lunchtime. Staff members often work together in one large room, with no partitions between desks, due to the high cost of office space in Japan. At the same time, Toyota spends huge sums of money on manufacturing facilities, dealer networks, and human resource development.
A CASE STUDY ON TOYOTA PRODUCTION SYSTEM - ppt video online download
When making presentations, they summarize background information, objectives, analysis, action plans, and expected results on a single sheet of paper. They felt they were doing the right thing by offering executives constructive criticism. However, digging into Toyota is like peeling an onion: You uncover layer after layer, but you never seem to reach the center.
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After we had written a half-dozen case studies, a pattern finally emerged. We identified six forces that cause contradictions inside the company. Three forces of expansion lead Toyota to instigate change and improvement. Not surprisingly, they make the organization more diverse, complicate decision making, and threaten its control and communications systems. To prevent the winds of change from blowing down the organization, Toyota also harnesses three forces of integration.
Established practices become standardized and create efficiencies. Over time, however, those methods can prevent the adoption of new ideas.
Toyota prevents rigidity from creeping in by forcing employees to think about how to reach new customers, new segments, and new geographic areas and how to tackle the challenges of competitors, new ideas, and new practices. In , the founder, Kiichiro Toyoda, wanted to produce automobiles in Japan without using foreign technology. It seemed like an impossible goal; even mighty zaibatsu such as Mitsubishi and Mitsui had decided against entering the automobile industry at that stage because of the investments they would have to make.
Toyoda dared to—and the rest is history. Besides, the strategy runs contrary to management thinking, which espouses the merits of making trade-offs. Strategy guru Michael E. Porter, for instance, says that the essence of strategy is choosing what not to do. However, Toyota tries to cater to every segment because of its belief that a car contributes to making people happy. This is our duty. This is Toyota. Zenji Yasuda, a former Toyota senior managing director, points out the wisdom of painting with broad strokes.
The vague nature of this goal confers freedom to researchers to open new avenues of exploration; procurement to look for new and unknown suppliers who possess needed technology; and sales to consider the next steps needed to sell such products.
Benefits of Kaizen to Business Excellence: Evidence from a Case Study
This strategy pushes Toyota out of Japan, where it is dominant, and into overseas markets, where it has often been the underdog. Pursuing local customization also exposes Toyota to the sophistication of local tastes. Local customization forces Toyota to push the envelope in numerous ways. For instance, the company faced complex challenges in when it developed the Innovative International Multipurpose Vehicle IMV platform.
Toyota engineers had to design the platform to meet the needs of consumers in more than countries in Asia, Europe, Africa, Oceania, Central and South America, and the Middle East. The IMV platform is used for three vehicle types—trucks, minivans, and sport utility vehicles—so Toyota can minimize design and production costs. Notably, the IMV-based vehicles were the first that Toyota produced overseas without first making them in Japan, which led to the decentralized development of production know-how, manufacturing technology, and production planning technologies. Many executives thought it was risky to relinquish the label since it had become synonymous with quality.
However, executive vice president Akio Toyoda, then in charge of sales and production in Asia, launched a personal crusade to persuade employees that the company should replace Made in Japan with Made by Toyota. People test hypotheses and learn from the consequent successes and failures. By encouraging employees to experiment, Toyota moves out of its comfort zone and into uncharted territory. Toyota has found that a practical way to achieve the impossible is to think deeply but take small steps—and never give up.
A Culture of Contradictions
It first breaks down a big goal into manageable challenges. Then it experiments to come up with new initiatives and processes for handling the more difficult components of each challenge. This pragmatic approach to innovation yields numerous learning opportunities. In , the company decided to develop a car that would be environmentally friendly and easy to use. That was unachievable using even the most advanced gasoline and diesel engines or even fuel cell technology—based engines. When a subsequent model did, the prototype moved only a few hundred yards down the test track before coming to a dead halt.
In later models, the battery pack shut down whenever it became too hot or cold. They believed the project was worth the investment because Toyota would learn a lot in the process. Toyota organizes experiments using strict routines, as is widely known. The eight-step TBP lays out a path for employees to challenge the status quo: clarify the problem; break down the problem; set a target; analyze the root cause; develop countermeasures; see countermeasures through; monitor both results and processes; and standardize successful processes.
Similarly, the A3 report, named for a sheet of paper 11 inches by 17 inches, is a succinct communication tool. As we mentioned earlier, it forces employees to capture the most essential information needed to solve a problem on a single sheet that they can disseminate widely. By encouraging open communication as a core value, Toyota has made its culture remarkably tolerant of failure. It is, anything unproductive. It can be applied to traditional production, but also for services. We understand this waste as the unnecessary displacement of materials or persons within a process.
Any movement without an output which generates value is considered a waste. This is actually a very common waste when you must send your stock or work-in-progress products to temporary storages, or your factory layout is not optimized so that the materials and other components must be transported between different processing points.
Actually, changing the current layout is one of the most common ways of eliminating transportation wastes.
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If your workers must endure a total of one transportation hour every day during their work time, there might be something wrong with the location of their tasks. Of course, any necessary or unnecessary transportation involve risks : damages or delays. This will affect directly the product quality, so even when producing or acquiring parts from other countries may have benefits in terms of labor or flexibility, the transportation must be carefully considered.
Inventory is sometimes a must for the company.
The production requires raw materials, manufactured components or COTS that will be used for adding value to the finished product. In addition to that, the stock provides flexibility and adaptability to the customer requirements.
If you have your finished goods in storage, you can send them as fast as possible and your sales service will be more valuable. However, this is one of the most surprising facts with Lean: inventory is sometimes a symptom of problems in the process.
Toyota's Kaizen Experience Case
We will learn it from the popular ship metaphor. Imagine your company is a ship. You do not know it, but there are dangerous rocks under the sea level, so your ship will only be safe as long as the water makes you float over the rocks. It means that you are completely dependent on the water level , and the low tide may be fatal for your ship. In addition to that, you will never know if there are new rocks in the water you will sail in the future, and how deep from the sea level they are.
As you can see from the image, the water is the inventory of your company, and the rocks are problems, hidden by the water.