Toyota Production System and Lean Manufacturing

TOYOTA PRODUCTION SYSTEM

The Toyota Production System was adopted by many Japanese companies in the aftermath of the 1973 oil shock

“Waste” Elimination Philosophy:

“.. Above all, one of our most important purposes was increased productivity and reduced cost. To achieve this purpose, we put our

emphasis on the notion of eliminating all kinds of unnecessary functions in the factories. Our approach has been to investigate one by one the causes of various "unnecessaries" in manufacturing operations

and to devise methods for their solution, often by trial and error ...”

Taiicho Ohno, Former Vice President, Toyota Motor Corp., Former President, Japan Industrial Management Association; Former Chairman, Toyoda Spinning and Weaving Co., Ltd.

PURPOSES OF JIT

Primary Purpose: Profit through cost reduction (or improvement of

Productivity) This is attained through WASTE elimination.

Other important purposes: Quantity control:

JIT, Kanban & Autonomation (visual control system) Quality control:

Autonomation, improvement by small groups, functional management

Respect for humanity:

Flexible work force (adapt to demand changes), capitalize workers ideas.

TYPES OF WASTE

Excessive production resources (primary waste): excessive workforce excessive facilities

excessive inventories unnecessary capital investment

Overproduction (secondary waste - the WORST waste):

leads to

Excessive inventories (tertiary waste): extra jobs make overproduction invisible.

adds losses in opportunity cost

lead to

Unnecessary capital investment (fourth waste): adds facility depreciations and overhead cost

TO ACHIEVE THESE PUPOSES

7 Wastes Elimination Just-In-Time (JIT) Production Kanban System Production Smoothing 5S Setup Time Reduction Machine Layout & Multi-function Worker Autonomation (Visual Management)

Identification and Elimination of Waste

Philosophy

Identification and elimination of waste is the central theme of a lean manufacturing production system Lean manufacturing is a dynamic and constantly improving process dependent upon understanding and involvement by all employees Successful implementation requires that all employees must be trained to identify and eliminate waste from their work Waste exists in all work and at all levels in the organization

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Identification and Elimination of Waste

Philosophy

Effectiveness is the result of the integration of:- Man

- Method

- Material

- Machine

At the worksite

• Waste exists in all work and at all levels in the organization

Seven Types of Waste

Over-production

Wait time

Transportation

Processing

Inventory

Motion

Defects

Over-production Waste

Definition

Producing more than needed Producing faster than needed

Over-production Waste

Characteristics:

Inventory StockpilesExtra equipment/oversized equipmentUnbalanced Material FlowExtra Part Storage racksExtra Manpower

Batch ProcessingComplex Inventory ManagementExcessive Capacity/InvestmentAdditional Floor Space/Outside StorageHidden ProblemsExcessive ObsolescenceLarge Lot Sizes

Building Ahead

Over-production Waste

Causes:

Incapable ProcessesJust in Case Reward SystemLack of Communication

Local OptimizationAutomation in the Wrong PlacesCost Accounting PracticesLow UptimesLack of Stable/Consitent Schedules

Waiting Time Waste

Definition

Idle Time That is Produced When Two Dependant Variables are not Fully Synchronized.

Man Wait TimeMachine Wait Time

Waiting Time Waste

Characteristics:

Man Waiting for MachineMachine/Materials Waiting for ManUnbalanced Operations (Work)Lack of Operator Concern for Equipment BreakdownsUnplanned Equipment Downtime

Waiting Time Waste

Causes:

Inconsistent Work MethodsLong Machine Change Over TimeLow Man/Machine EffectivenessLack of Proper Equipment/Materials

Transportation Waste

Definition

Any Material Movement That Does Not Directly Support a Lean Manufacturing System

Transportation Waste

Characteristics:

Extra carts, fork lifts, dolliesMultiple Storage LocationsExtra Material Racks

Complex Inventory ManagementExtra Facility SpaceIncorrect Inventory Counts

Damaged Material

Transportation Waste

Causes:

Large Lot ProcessingUnleveled SchedulesLack of 5 S’sLack of Visual Controls

Improper Facility LayoutLarge Buffers and In Process Kanbans

Processing Waste

Definition

Effort Which Adds No Value To a Product or Service. Enhancements which are Transparent to The Customers or Work Which Could Be Combined with Another Process.

Processing Waste

Characteristics:

Process Bottlenecks

Lack of Clear Customer SpecificationsEndless Refinement

Redundant ApprovalsExtra Copies/Excessive Information

Processing Waste

Causes:

Engineering Changes Without Processing ChangesDecision Making at Inappropriate LevelsInefficient Policies and Procedures

Lack of Customer Input Concerning Requirements

Inventory Waste

Definition

Any Supply in Excess of Process Requirements Necessary to Produce Goods or Services Just in Time.

Inventory Waste

Characteristics:

Extra Space on Receiving DocksMaterial Between Processes

Stagnated Material FlowLIFO instead of FIFOExtensive Rework When Problems Surface

Long Lead Time for Engineering ChangesAdditional Material Handling Resources (Men, Equipment, Racks, Storage Space)

Inventory Level

Over

Production

Wait Time

Inventory Waste

Causes:

Incapable ProcessesUncontrolled Bottleneck Processes

Incapable SuppliersLong Change Over TimesManagement DecisionsLocal Optimization

In times

Process Defects

Motion Waste

Definition

Any Movement of People Which Does Not Contribute Added Value To The Product or Service

Motion Waste

Characteristics:

Looking for ToolsExcessive Reaching or BendingMaterial Too Far Apart (Walk Time)Equipment for Moving PartsExtra “Busy” Movements While Waiting

Motion Waste

Causes:

Equipment, Office & Plant LayoutLack of 5 S’sLack of Visual ControlsInconsistent Work Methods (Standardized Work)Large Batch Sizes

Rework or Correction Waste

Definition

Repair of a Product or Service To Fulfill Customer requirements

Rework or Correction Waste

Characteristics:

Extra Floor Space/Tools/EquipmentExtra Manpower To Inspect/Rework/RepairStockpiling InventoryComplex Material FlowQuestionable QualityMissed Shipments/DeliveriesLower Profits Due To ScrapReactive Organization

Rework or Correction Waste

Causes:

Incapable ProcessesExcessive Variation

Incapable SuppliersManagement DecisionsInsufficient TrainingInadequate Tools/EquipmentPoor Layouts/Unnecessary HandlingHigh Inventory Levels

Seven Types of Waste

Over-production

Wait

Transportation

Processing

Inventory

Motion

Defects

Seven Types of Waste