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Automotive industryFrom crisis to restructuring  Rewriting the rules of   automotive industry
The third revolutionLean production        By Masters Division - Facoltà di             Economia di Torino
From…Fujimoto T., The evolution of a manufacturing          T.,system at Toyota, Oxford University Press,          Toyota,...
The Pre-World War II history of       Pre-automobile manufacturing in Japan,1Although production of four-wheel            ...
The Pre-World War II history of       Pre-automobile manufacturing in Japan, 2Knock-Knock-down (KD) assembly of foreignaut...
The Pre-World War II history of       Pre-automobile manufacturing in Japan, 3Dominance by US automakers.The first signifi...
The Pre-World War II history of         Pre-  automobile manufacturing in Japan, 4Protectionist policy and Japanese firms....
Toyota AA 1936  By Masters Division - Facoltà di       Economia di Torino
The Pre-World War II history of       Pre-automobile manufacturing in Japan, 5The origin of Toyota’s automobile business.T...
The Pre-World War II history of       Pre-automobile manufacturing in Japan, 6Patterns of technology transfer: Toyotaversu...
World War IIHiroshima, 6 agosto 1945            By Masters Division - Facoltà di                 Economia di Torino
A Postwar II history of automobile     manufacturing in Japan, 1Late 1940s- Recovery and survival.     1940s-The Japanese ...
A Postwar II history of automobile     manufacturing in Japan, 21950s-1950s- Laying the foundation of Toyota-style        ...
Korean War. Motor vehicles for the        American Army           By Masters Division - Facoltà di                Economia...
A Postwar II history of automobile       manufacturing in Japan, 31960s-1960s-Rapid growth of domestic car market. Annual ...
Toyota Sports 1965    By Masters Division - Facoltà di         Economia di Torino
A Postwar II history of automobile       manufacturing in Japan, 41970s-1970s-Export expansion and technology  development...
A Postwar II history of automobile     manufacturing in Japan, 5Thus, by the end of the decade 1970sJapanese motor vehicle...
Toyota Corolla 1975    By Masters Division - Facoltà di         Economia di Torino
Nissan Skyline 1975    By Masters Division - Facoltà di         Economia di Torino
Brief Toyota’s historyToyota’s headquarter in Nagoya            By Masters Division - Facoltà di                 Economia ...
ToyotaToyota was founded in 1933 as anoffshoot of Toyoda Loom Works, acompany that made machinery forweaving vast bolts of...
Eiji went to U.S. againEiji Toyoda studied how the massiveRouge complex turned out 800 hundredvehicles a day, examining ho...
Taiichi OhnoShortly after Toyoda returned to Japan,one of the greatest figures in Toyota’shistory, Taiichi Ohno, came forw...
Ford …..Ohno saw how Fordtook in vast carloads of copper, iron ore and coalon its own freighters, which arrived at its own...
……and supermarketsOhno studied the manufacturing lines…..And then went to a supermatket…Maynard M., The end. How the big t...
River Rouge complex     By Masters Division - Facoltà di          Economia di Torino
Toyota’s principlesFrom his observation Ohno created threebasic principles that required theinvolvment of everyone in the ...
Toyota’s principles, 2Second, all employees had to partecipatein implementing itThird, everyone involved in making anautom...
Under TPS..A fundamental element is the concept of  just-in-  just-in-time delivery.  As with the replenishment of goods i...
“The pull system”“Pull system” means that the requiredgoods are pulled out of inventoryaccording to demand.It’s vastly dif...
Months talking to consumers and dealers The “pull system” requires a daisy/first rate chain of communication. As Toyota en...
Customer needThe customers’ need and desires are thestarting and ending points of TPS.The most humbling and frustrating as...
Not to become complacentToyota executive say that they havemastered only 50 to 60 per cent of whatOhno hoped Toyota could ...
Toyopet was a disasterBut before Toyota could run, it had to walk.Its first attempt to sell a car in U.S.,Toyopet, wasa di...
Toyopet Corona 1970     By Masters Division - Facoltà di          Economia di Torino
To be selectiveIn the 1970s Toyota began setting up itsdealer organization, which would        organization,eventually pro...
A far bigger foreign competitor:But Detroit barely took notice as Toyotawas putting together its dealer network,because To...
Volkswagen at the heightThrough the 1960s and into the 1970s,Volkswagen was at the height of itspostwar popularity thans t...
Volkswagen Bus 1975     By Masters Division - Facoltà di          Economia di Torino
Karmann Ghia 1975    By Masters Division - Facoltà di         Economia di Torino
Honda  Honda had founded an auto part companybefore World War II but sold it to Toyota as  the war ended, choosing to star...
Mann Tourist Trophy    By Masters Division - Facoltà di         Economia di Torino
HondaSoichiro Honda was close to retirementage when he finally got into the carbusiness.Honda was 60 years old as Honda’s ...
Honda N360 1967   By Masters Division - Facoltà di        Economia di Torino
Example:            Example: initial situation          (without lean manifacturing)                        manifacturing)...
Example:                 Example: middle step1.   New logistics2.   Small containers3.   Compression of spaces4.   “Zoning...
Example:                    Example: final step1.   Integration of a new     model and its parts on the     existing line....
IMPV measured productivity principallyby the number of hours nedeed forassembly.            By Masters Division - Facoltà ...
The time needed  Because all assembly plants performed roughly  the same three operations- welding the body,- painting the...
The gapThe IMVP found that lean producers needed  much less time than mass producers for  final-  final-assembly operation...
Make it easyThe Machine That Changed The Worldconcluded that the main cause of theproductivity gap was“manufacturability”....
Toyota the bestThe easiest vehicles to build were made byToyota, followed by Honda.                     Honda.All 18 compe...
Easy to see…Many North American final assemblyplants offer public tours.                    tours.Even a casual visitor in...
… but ignoredUS car makers through 1980s failed to                           1980saccept that differences between massprod...
Incontrovertible evidenceThe smoking gun that irrevocably convincedeven last holdouts came from a 5 million, 5years study ...
“The machine that changed the           world”The book, “The machinethat changed the world”,published in 1990, is         ...
It shocked sceptical car makers“The machine that changed the world”shocked sceptical US and European carmakers into admitt...
To be perfectThe quality goal under mass productionwas to be “good enough”, while under leanproduction it was to be perfec...
KaizenLean producers can never achieve thegoal of perfection, so they settle for acontinuous, never ending process ofimpro...
… measured quality“The Machine That Changed TheWorld”World” measured quality at assemblyplants by the number of defects pe...
…average of 60 defectsIMPV relied on the Initial Quality Surveyconducted in 1989 by J.D. Power andAssociates, one of a lar...
It’s never too lateStung by the demonstration gap in qualitywith Japanese competitors, European                competitors...
Toyota Production System (TPS) The U.S. and European car makers emulated the Toyota Production System (TPS), a rulebook of...
Three key philosophiesTPS is a collection of manufacturing methods that incorporate three key philosophies: Customer first...
Objectives of TPSObjectives of TPS: Highest quality Lowest cost Shortest lead timeMagee D., How Toyota became n.1, Portfol...
Kaizen’s three principlesEffective kaizen relies on three principles  Process and results (not just results)  Systematic t...
TPS’s main principlesTPS is built on two main principles Just-in- Just-in-time,      reducing wasteful inventory by using ...
Toyota’s kaizenHow to implement Toyota’s kaizen culture in the workplace:                               Determine         ...
Trading off productivity and qualityFor European and North American companies“The Machine That Changed The World” World”re...
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Parte 3 third revolution [modalità compatibilità]

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  1. 1. Automotive industryFrom crisis to restructuring Rewriting the rules of automotive industry
  2. 2. The third revolutionLean production By Masters Division - Facoltà di Economia di Torino
  3. 3. From…Fujimoto T., The evolution of a manufacturing T.,system at Toyota, Oxford University Press, Toyota,1999.Magee D., How Toyota became n.1, Portfolio, n.1,2007.Maxton G.,Wormald J., Time for model change, change,Cambridge University Press, 2004.Womack J., Jones D. e Roos D., “Themachine that changed the world”,Macmillan,1991. By Masters Division - Facoltà di Economia di Torino
  4. 4. The Pre-World War II history of Pre-automobile manufacturing in Japan,1Although production of four-wheel four-automobiles in Japan started around 1910,early work was nothing but sporadic trialsby small venture business owners,inventor-inventor-engineers, or mechanics.Customers were mostly limited to a smallnumber of wealthy upper-class people upper-with curiosity. By Masters Division - Facoltà di Economia di Torino
  5. 5. The Pre-World War II history of Pre-automobile manufacturing in Japan, 2Knock-Knock-down (KD) assembly of foreignautomobiles, as well as imports ofcomplete vehicle (mainly Europeanmakes), existed by 1920, but the numbersof cars produced was extremely small. small. By Masters Division - Facoltà di Economia di Torino
  6. 6. The Pre-World War II history of Pre-automobile manufacturing in Japan, 3Dominance by US automakers.The first significant attempts at automobileproduction in Japan were knock-down knock-(KD) assembly operations, mostlybetween mid-1920s and the mid-1930s, mid- mid-mainly by Ford and General Motors.American cars and trucks dominated theJapanese between 1925 and 1935. By Masters Division - Facoltà di Economia di Torino
  7. 7. The Pre-World War II history of Pre- automobile manufacturing in Japan, 4Protectionist policy and Japanese firms. The situation changed in 1936, when the Japanese government under the military authority’s influence, launched a protecionist policy. The same law subsidized three licensed domestic companies for producing trucks: Toyota, Nissan e Isuzu. Toyota’s prewar productivity was estimated to be roughly one-tenth that of Ford Motor Company one- By Masters Division - Facoltà di Economia di Torino
  8. 8. Toyota AA 1936 By Masters Division - Facoltà di Economia di Torino
  9. 9. The Pre-World War II history of Pre-automobile manufacturing in Japan, 5The origin of Toyota’s automobile business.Toyota Motor Co., a spinoff automobile producer ofToyoda Automatic Loom Works, was established in1937.Kiichiro Toyoda ordered from Germany and US themachine tools for building a prototype, purchased aChevrolet car, reverse-engineered it, sketched the reverse-composed parts, and estimated the materials used.In 1934, Toyoda started building a pilot plant By Masters Division - Facoltà di Economia di Torino
  10. 10. The Pre-World War II history of Pre-automobile manufacturing in Japan, 6Patterns of technology transfer: Toyotaversus Nissan. Nissan adopted the U.S system as a package Toyota was more active than Nissan inabsorbing unbundled American and Europeantechnologies and infusing them in its ownproduction base, in which certain traditional base,craft-craft-type production elements persisted. By Masters Division - Facoltà di Economia di Torino
  11. 11. World War IIHiroshima, 6 agosto 1945 By Masters Division - Facoltà di Economia di Torino
  12. 12. A Postwar II history of automobile manufacturing in Japan, 1Late 1940s- Recovery and survival. 1940s-The Japanese auto industry started producingtrucks soon after the end of World War II, undersupervision of Allied Forces.For the first five years, the main Japaneseautomobile firms did not have financialcapability, so they have to live with existingproduction equipment and models.Production of passengers cars was negligible. negligible. By Masters Division - Facoltà di Economia di Torino
  13. 13. A Postwar II history of automobile manufacturing in Japan, 21950s-1950s- Laying the foundation of Toyota-style Toyota-manufacturing.The special orders for motor vehicles by theAmerican Army during the Korean War helpedToyota and other Japanese truck makers torecover from the recession.As for management techniques, the Japaneseautomakers continued to learn the UStechniquesKaizen and Kanban started in late 1950s By Masters Division - Facoltà di Economia di Torino
  14. 14. Korean War. Motor vehicles for the American Army By Masters Division - Facoltà di Economia di Torino
  15. 15. A Postwar II history of automobile manufacturing in Japan, 31960s-1960s-Rapid growth of domestic car market. Annual automobile production grew dramatically, dramatically, from about 500.000 units in 1960 to 5 million in 1970. The major engine for this growth was domestic demand for family-owned psssenger cars which family- profoundly changed the automobile production system. The 1960s was the era of Total Quality Control By Masters Division - Facoltà di Economia di Torino
  16. 16. Toyota Sports 1965 By Masters Division - Facoltà di Economia di Torino
  17. 17. A Postwar II history of automobile manufacturing in Japan, 41970s-1970s-Export expansion and technology development. Quite contrary to the 1960s situation, domestic production growth was fueled by exports. exports. While production increased from about 5 million to 11 million units per year betweenn 1970 and 1980, exports grew from 1 million to 6 million units. By Masters Division - Facoltà di Economia di Torino
  18. 18. A Postwar II history of automobile manufacturing in Japan, 5Thus, by the end of the decade 1970sJapanese motor vehicle exports hadsurpassed domestic sales. sales.The main area of export growth was NorthAmerica (from 500.000 in 1970 to about2,6 million in 1980). 1980). By Masters Division - Facoltà di Economia di Torino
  19. 19. Toyota Corolla 1975 By Masters Division - Facoltà di Economia di Torino
  20. 20. Nissan Skyline 1975 By Masters Division - Facoltà di Economia di Torino
  21. 21. Brief Toyota’s historyToyota’s headquarter in Nagoya By Masters Division - Facoltà di Economia di Torino
  22. 22. ToyotaToyota was founded in 1933 as anoffshoot of Toyoda Loom Works, acompany that made machinery forweaving vast bolts of industrial fabrics.…outside Nagoya, three hours west ofTokyo.Maynard M., The end. How the big three lost their grip on the Americancar market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  23. 23. Eiji went to U.S. againEiji Toyoda studied how the massiveRouge complex turned out 800 hundredvehicles a day, examining how Fordproduced engines.Maynard M., The end. How the big three lost their grip on the Americancar market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  24. 24. Taiichi OhnoShortly after Toyoda returned to Japan,one of the greatest figures in Toyota’shistory, Taiichi Ohno, came forward toimplement ideas that he, too, had learn inDearborn.Maynard M., The end. How the big three lost their grip on the American end.car market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  25. 25. Ford …..Ohno saw how Fordtook in vast carloads of copper, iron ore and coalon its own freighters, which arrived at its own docks from its ownmines in northern Michigan,and trasformed the raw materials into steel,glass and auto parts…Maynard M., The end. How the big three lost their grip on the American carmarket. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  26. 26. ……and supermarketsOhno studied the manufacturing lines…..And then went to a supermatket…Maynard M., The end. How the big three lost their grip on theAmerican car market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  27. 27. River Rouge complex By Masters Division - Facoltà di Economia di Torino
  28. 28. Toyota’s principlesFrom his observation Ohno created threebasic principles that required theinvolvment of everyone in the company.First,management had to make strongcommitment to the system.Maynard M., The end. How the big three lost their grip on the Americancar market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  29. 29. Toyota’s principles, 2Second, all employees had to partecipatein implementing itThird, everyone involved in making anautomobile from hourly workers tosuppliers, to dealers had to accept thatthis way was the way Toyota was run.Maynard M., The end. How the big three lost their grip on the Americancar market. Doubleday, 2003. By Masters Division - Facoltà di Economia di Torino
  30. 30. Under TPS..A fundamental element is the concept of just-in- just-in-time delivery. As with the replenishment of goods in a supermarket, every components that Toyota uses, whether engines on the assembly line floor or SUVs shipped to dealers arrives as it is needed. This is called a “pull system”.. By Masters Division - Facoltà di Economia di Torino
  31. 31. “The pull system”“Pull system” means that the requiredgoods are pulled out of inventoryaccording to demand.It’s vastly different from, and more difficultthan, Detroit companies’ traditionalpractice of stockpiling supplies of partsand automobiles and selling down thesupply, which is called the “push system”. By Masters Division - Facoltà di Economia di Torino
  32. 32. Months talking to consumers and dealers The “pull system” requires a daisy/first rate chain of communication. As Toyota engineers set out to develop new vehicles, they spend months talking to consumers and dealers to find out what kind of features they want. Likewise, once those vehicles reach the showroom, dealers must keep track of what consumers are requesting and stock their lots with vehicle that will move quickly By Masters Division - Facoltà di Economia di Torino
  33. 33. Customer needThe customers’ need and desires are thestarting and ending points of TPS.The most humbling and frustrating aspectsof TPS is that it is impossible to becomecompletely proficient. By Masters Division - Facoltà di Economia di Torino
  34. 34. Not to become complacentToyota executive say that they havemastered only 50 to 60 per cent of whatOhno hoped Toyota could achieve throughthe production systemThat kind of thinking all but guaranteesthat Toyota will not become complacent By Masters Division - Facoltà di Economia di Torino
  35. 35. Toyopet was a disasterBut before Toyota could run, it had to walk.Its first attempt to sell a car in U.S.,Toyopet, wasa disaster. It was a small, inexpensive car meantto coax cash strapped consumer back into themarket.It arrived in the middle of the most ostentatiousera of American automobile history.Toyota was forced to retreat from the market. By Masters Division - Facoltà di Economia di Torino
  36. 36. Toyopet Corona 1970 By Masters Division - Facoltà di Economia di Torino
  37. 37. To be selectiveIn the 1970s Toyota began setting up itsdealer organization, which would organization,eventually prove to be one of its mostvaluable tool.Unlike Detroit companies, which seemedto have a showroom in every sizable townacross the United States, Toyota decidedto be selective and choose areas wherepopulation growth was taking place By Masters Division - Facoltà di Economia di Torino
  38. 38. A far bigger foreign competitor:But Detroit barely took notice as Toyotawas putting together its dealer network,because Toyota sales were dwarfed by afar bigger foreign competitor:Volkswagen. By Masters Division - Facoltà di Economia di Torino
  39. 39. Volkswagen at the heightThrough the 1960s and into the 1970s,Volkswagen was at the height of itspostwar popularity thans to the Beetle,the VW Bus and Karmann Ghia By Masters Division - Facoltà di Economia di Torino
  40. 40. Volkswagen Bus 1975 By Masters Division - Facoltà di Economia di Torino
  41. 41. Karmann Ghia 1975 By Masters Division - Facoltà di Economia di Torino
  42. 42. Honda Honda had founded an auto part companybefore World War II but sold it to Toyota as the war ended, choosing to start over from the scratchHonda wanted to win the famous Mann Tourist Trophy motorcycle race.Sold more than a million of Dreams, introduced its next best seller SuperCub By Masters Division - Facoltà di Economia di Torino
  43. 43. Mann Tourist Trophy By Masters Division - Facoltà di Economia di Torino
  44. 44. HondaSoichiro Honda was close to retirementage when he finally got into the carbusiness.Honda was 60 years old as Honda’s firstcar, the N360, went on sale in Japan in1966, and it wasn’t until 1977 that Hondacars debuted in the US. By Masters Division - Facoltà di Economia di Torino
  45. 45. Honda N360 1967 By Masters Division - Facoltà di Economia di Torino
  46. 46. Example: Example: initial situation (without lean manifacturing) manifacturing)1. Rack unnecessarily oversized taking up too much space on the line. line.2. Example of wasted non- non- value- value-creating space. space.3. Onerous operator task. task.4. Unnecessary motions. motions.5. Operator idleness. idleness. By Masters Division - Facoltà di Economia di Torino
  47. 47. Example: Example: middle step1. New logistics2. Small containers3. Compression of spaces4. “Zoning” of cleared spaces: spaces: nothing happens here - no mudas. mudas.5. Parts within immediate reach of the operators. operators. By Masters Division - Facoltà di Economia di Torino
  48. 48. Example: Example: final step1. Integration of a new model and its parts on the existing line. line.2. Compressed line side, elimination of a several mudas: mudas: Flexibility of the production tool with a considerable increase in productivity. productivity. By Masters Division - Facoltà di Economia di Torino
  49. 49. IMPV measured productivity principallyby the number of hours nedeed forassembly. By Masters Division - Facoltà di Economia di Torino
  50. 50. The time needed Because all assembly plants performed roughly the same three operations- welding the body,- painting the body- and attaching components to the bodythe time needed from initial welding to final drive- drive-way of complete vehicle from the assembly line was the best industry’s measure for comparing relative efficiency. By Masters Division - Facoltà di Economia di Torino
  51. 51. The gapThe IMVP found that lean producers needed much less time than mass producers for final- final-assembly operations: 17 hours for plant in Japan, 21 hours for Japanese managed plants in North America, 25 hours for plants owned by American firms in North America and 36 hours at European plants By Masters Division - Facoltà di Economia di Torino
  52. 52. Make it easyThe Machine That Changed The Worldconcluded that the main cause of theproductivity gap was“manufacturability”.The 19 world largest producers wereasked to rank the other 18 companiesaccording to the ease with which theirvehicles could be built. By Masters Division - Facoltà di Economia di Torino
  53. 53. Toyota the bestThe easiest vehicles to build were made byToyota, followed by Honda. Honda.All 18 competitors ranked Toyota vehiclesamong the three easiest to build. build.FIAT ranked fourthFord was the highest ranking US company, insixth place, with GM ranked tenth and Chryslerthirteenth.thirteenth.Mercedes Benz was ranked eighteen, andJaguar last. last. By Masters Division - Facoltà di Economia di Torino
  54. 54. Easy to see…Many North American final assemblyplants offer public tours. tours.Even a casual visitor in a public tour in2000 could see the obvious differencesbetween assembly plants in North Americaoperated by US companies, such as GMand Ford, and those operated byJapanese companies, such as Toyotaand Honda. Honda. By Masters Division - Facoltà di Economia di Torino
  55. 55. … but ignoredUS car makers through 1980s failed to 1980saccept that differences between massproduction and lean production assemblyplants – visible even to an uninformedvisitor-visitor- were significant. significant. By Masters Division - Facoltà di Economia di Torino
  56. 56. Incontrovertible evidenceThe smoking gun that irrevocably convincedeven last holdouts came from a 5 million, 5years study begun in 1986 by theMassachusetts Institute of Technology (MIT)International Motor Vehicle Program (IMVP)paid by American and European car makers andgovernment agencies in several North Americaand European countries. countries.Smoking gun = a piece of incontrovertibleevidence of incriminating evidence By Masters Division - Facoltà di Economia di Torino
  57. 57. “The machine that changed the world”The book, “The machinethat changed the world”,published in 1990, is 1990,probably the mostinfluential study on autoindustry ever published. published.Authors are Womack J.,director of research IMVP,Jones D. e Roos D., By Masters Division - Facoltà di Economia di Torino
  58. 58. It shocked sceptical car makers“The machine that changed the world”shocked sceptical US and European carmakers into admitting that the quality gapexisted.In addition, and more important, itconvincingly explained the causes of thequality gap. By Masters Division - Facoltà di Economia di Torino
  59. 59. To be perfectThe quality goal under mass productionwas to be “good enough”, while under leanproduction it was to be perfect. perfect.Mass-Mass-producers set a target ofacceptable number of defect andproclaimed success when the targetwas achieved. achieved. By Masters Division - Facoltà di Economia di Torino
  60. 60. KaizenLean producers can never achieve thegoal of perfection, so they settle for acontinuous, never ending process ofimprovement, called kaizen inJapanese.Japanese. By Masters Division - Facoltà di Economia di Torino
  61. 61. … measured quality“The Machine That Changed TheWorld”World” measured quality at assemblyplants by the number of defects perhundred vehicles detected by dealersor consumers. consumers. By Masters Division - Facoltà di Economia di Torino
  62. 62. …average of 60 defectsIMPV relied on the Initial Quality Surveyconducted in 1989 by J.D. Power andAssociates, one of a large number of qualitymeasure generated by that company. company.In 1989 Japanese companies had an average of60 defects for 100 vehicles assembled in theirplants and 65 per 100 in their plants in NorthAmerica . North American plants owned byUS companies had 82 defects per 100vehicles, and European plants had 97 per100.100. By Masters Division - Facoltà di Economia di Torino
  63. 63. It’s never too lateStung by the demonstration gap in qualitywith Japanese competitors, European competitors,and American car makers scrambled toimprove.improve. By Masters Division - Facoltà di Economia di Torino
  64. 64. Toyota Production System (TPS) The U.S. and European car makers emulated the Toyota Production System (TPS), a rulebook of principles and procedures for factory managers and employees to follow. follow. By Masters Division - Facoltà di Economia di Torino
  65. 65. Three key philosophiesTPS is a collection of manufacturing methods that incorporate three key philosophies: Customer first Employee satisfaction Company stabilityMagee D., How Toyota became n.1, Portfolio, 2007. n.1, By Masters Division - Facoltà di Economia di Torino
  66. 66. Objectives of TPSObjectives of TPS: Highest quality Lowest cost Shortest lead timeMagee D., How Toyota became n.1, Portfolio, 2007. n.1, By Masters Division - Facoltà di Economia di Torino
  67. 67. Kaizen’s three principlesEffective kaizen relies on three principles Process and results (not just results) Systematic thinking (seeing the big picture) Non- Non-blaming (blame is wasteful)Magee D., How Toyota became n.1, Portfolio, 2007. n.1, By Masters Division - Facoltà di Economia di Torino
  68. 68. TPS’s main principlesTPS is built on two main principles Just-in- Just-in-time, reducing wasteful inventory by using only “what is needed, when it is needed and in the amount needed” Jidoka, Jidoka, the ability to stop production lines by man or machine to stop qualityMagee D., How Toyota became n.1, n.1, Portfolio, 2007. By Masters Division - Facoltà di Economia di Torino
  69. 69. Toyota’s kaizenHow to implement Toyota’s kaizen culture in the workplace: Determine Identify Develop a the root trouble solution cause By Masters Division - Facoltà diMagee D., How Toyota became n.1,Torino Economia di Portfolio, 2007. n.1,
  70. 70. Trading off productivity and qualityFor European and North American companies“The Machine That Changed The World” World”reinforced the traditional view that massproduction involved a trade-off between trade-productivity and quality. quality.North American manufacturers achievedhigh productivity at the expense of quality,while European manufacturers sacrificedproductivity for high quality. quality. By Masters Division - Facoltà di Economia di Torino
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