The Toyota Production System (TPS)

 

The Toyota Production System is Toyota´s unique approach to manufacturing. It is the basis for much of the “lean production” movement that dominated manufacturing trends (along with Six Sigma) for the last 10 years or so. Despite the huge influence of the lean movement, I hope to show that most attempts to implement lean have been fairly superficial. The reason is that most companies have focused too heavily on tools such as 5S and Just-in-time, without understand lean as an entire system that must permeate as organization´s culture. In most companies where lean is implemented, senior management is not involved in the day-to-day operations and continuous improvement that are of lean. Toyota´s approach is very different.

What exactly is lean enterprise? You could say it´s the end result of applying the Toyota Production system to all areas of your business. In their excellent book, Lean Thinking, James Womack and Daniel Jones define lean manufacturing as a five –step process:

1.       Defining costumer value,

2.       Defining the value stream,

3.       Making it “flow”,

4.       “pulling” from the costumer back,

5.       And striving for excellence.

To be lean, manufacturing requires a way of thinking that focuses on making the product flow through value-adding process without interruption (one-piece flow), a “pull” system that cascades back from costumer demand by replenishing only what the next operation takes away at short intervals, and a culture in which everyone is striving continuously to improve.

                Taiichi Ohno, founder of TPS, said it even more succinctly:

All we are doing is looking at the time line from the moment the costumer gives us an order to the point when we collect the cash. And we are reducing that time by removing the non-value-added wastes. (Ohno, 1988)

Now consider the following counter-intuitive truths about non-value-added waste within the philosophy of TPS.

·         Often the best thing you can do is to idle a machine and stop production parts. You do this to avoid over production the fundamental waste in TPS.

·         Often it is best to build up inventory of finished goods in order to level out the production schedule, rather than produce according to the actual fluctuating demand of costumer orders. Leveling out schedule (heijunka) is a foundation for flow and pull systems and for minimizing inventory in the supply chain. (Leveling production means smoothing out the volume and mix of items produced so there is little variation in production from day to day.)

·         Often is best to selectively add and substitute overhead for direct labor. When waste is stripped away from value-adding workers, you need to provide high-quality support for them as you would support a surgeon performing critical operation.

·         It may not be a top priority to keep your workers busy making parts as fast as possible. You should produce parts as the rate of costumer demand. Working faster just for the sake of getting the most out of your workers is another form of over production and actually leads to employing more labor overall.

·         It is best to selectively use information technology and often better to use manual process even when automation is available and would seem to justify its cost in reducing your headcount. People are the most flexible resource you have. If you have not efficiently worked out the manual process, it will not be clear where you need automation to support the process.

In other words, Toyota´s solutions to particular problems, often seem to add waste rather than eliminate it. The reason for these seemingly paradoxical solutions is that Ohno had learned from his experience walking the shop floor a very particular meaning of non-value-added waste: it had little to do with running labor and equipment as hard as possible, and everything to do with the manner in which raw material is transformed into a saleable commodity. For Ohno, the purpose of his journey through the shop floor was to identify activities that added value to raw material moving to a finished product that costumer was willing to pay for. This was a radically different approach from mass production thinking of merely identifying, enumeration, and eliminating the waste time and effort in existing production processes.

I challenge you to make Ohno´s journey for yourself, and look at your own organization´s process and you will see materials, invoicing, service calls, parts in R&D, etc…being transformed into something costumer wants. But on closer inspection, they are often being diverted into a pile, someplace where they sit and wait for long periods of time, until they can me moved to the next process or transformation.

What are you going to do about it?