The toyota production system

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Toyota Motor Corporation's vehicle production system is a way of "making things" that is sometimes referred to as a "lean manufacturing system" or a "Just-in-Time (JIT) system," and has come to be well known and studied worldwide.

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The toyota production system

  1. 1. The Toyota Production System High Quality and Low Cost Readings; James Womack, Daniel T. Jones and Daniel Roos, The Machine that Changed the World, 1990, Ch 3 and 4 Kenneth N. McKay, “The Evolution of Manufacturing Control- What Has Been, What Will Be” Working Paper 03 –2001 Michael McCoby, “Is There a Best Way to Build a Car?” HBR Nov-Dec 1997 COST VS DEFECTS
  2. 2. Consumer Reports
  3. 3. Gains of imports
  4. 4. The Toyota Production System Historical View Performance measures Elements of TPS Difficulties with Implementation Six Eras of Manufacturing Practice
  5. 5. Three Major Mfg Systems from 1800 to 2000 1800 1900 2000 Machine tools, specialized machine tools, Taylorism, SPC, CNC, CAD/CAM Interchangeable Parts at U.S. Armories Mass Production at Ford Toyota Production System
  6. 6. Key Elements for New Mfg Systems Japanese Banks Taiichi Ohno CNC, Integration of Labor Jobs, Security Post WarToyota Production System EarningsHenry Ford Moving Assembly Line,etc $5/day Immigrant Trans- portation Mass Production U.S. Govt Roswell Lee/ John Hall Machine Tools, Division of Labor “Yankee Ingenuity” MilitaryInterchange- able Parts ResourcesLeaderEnabling Technology Work Force Motivation Need of Society Element/ System
  7. 7. Q. By what method did these new systems come about? A. Trial and Error
  8. 8. History of the Development of the Toyota Production System ref; Taiichi Ohno 1945 1975
  9. 9. The Toyota Production System Historical View Performance measures Elements of TPS Difficulties with Implementation Six Eras of Manufacturing Practice
  10. 10. Japanese Japanese in American in All Europe in Japan North America North America Performance: Producvitity (hours/Veh.) 16.8 21.2 25.1 36.2 Quality (assembly defects/100 vehicles) 60 65 82.3 97 Layout: Space (sq.ft./vehicle/yr) 5.7 9.1 7.8 7.8 Size of Repair Area (as % of assembly space) 4.1 4.9 12.9 14.4 Inventories(days for 8 sample parts) 0.2 1.6 2.9 2 Work Force: % of Work Force in Teams 69.3 71.3 17.3 0.6 Job Rotation (0 = none, 4 = frequent) 3 2.7 0.9 1.9 Suggestions/Employee 61.6 1.4 0.4 0.4 Number of Job Classes 11.9 8.7 67.1 14.8 Training of New Production Workers (hours) 380.3 370 46.4 173.3 Absenteeism 5 4.8 11.7 12.1 Automation: Welding (% of direct steps) 86.2 85 76.2 76.6 Painting(% of direct steps) 54.6 40.7 33.6 38.2 Assembly(% of direct steps) 1.7 1.1 1.2 3.1 Source: IMVP World Assembly Plant Survey, 1989, and J. D. Power Initial Quality Survery, 1989 Summary of Assembly Plant Characteristics, Volume Producers, 1989 (Average for Plants in Each Region)
  11. 11. Cost Vs Defects Ref. “Machine that Changed the World” Womack, Jones and Roos
  12. 12. Cost Vs Automation Ref. “Machine that Changed the World” Womack, Jones and Roos
  13. 13. The Toyota Production System Historical View Performance measures Elements of TPS Difficulties with Implementation Six Eras of Manufacturing Practice
  14. 14. How do you get this kind of performance? Womack, Jones and Roos J T. Black’s 10 Steps Demand Flow Technology’s 9 Points
  15. 15. Womack Jones and Roos • New Technology? – No silver bullet • Automation? – Yes, but integrated with system • Standardized Production? – Not in the usual “don’t stop the line” sense • Lean Characteristics? – Integration of Tasks (opposite of deskilling) – Identification and removal of defects (stop the line!) – kaizen – institutionalizing change
  16. 16. J T. Black’s 10 Steps Ref; JT. Black “Factory with a Future” 1991 1. Form cells 2. Reduce setup 3. Integrate quality control 4. Integrate preventive maintenance 5. Level and balance 6. Link cells – KANBAN 7. Reduce WIP 8. Build vendor programs 9. Automate 10. Computerize
  17. 17. Demand Flow Technology’s 9 Points 1. Product Synchronization 2. Mixed Model Process Maps 3. Sequence of Events 4. Demand at Capacity 5. Operational Cycle Time 6. Total Product Cycle Time 7. Line Balancing 8. Kanbans 9. Operational Method Sheets
  18. 18. Current Value Stream Map
  19. 19. Future Value Stream Map
  20. 20. J T. Black –1, 2 1. Form Cells Sequential operations, decouple operator from machine, parts in families, single piece flow within cell 2. Reduce Setup Externalize setup to reduce down-time during changeover, increases flexibility
  21. 21. TPS CellToyotaCell,onepartisproduced foreverytriparoundthecell J T. Black
  22. 22. Standardized Fixtures
  23. 23. J T. Black – 3, 4 3. Integrate quality control Check part quality at cell, poke-yoke, stop production when parts are bad 4. Integrate preventive maintenance worker maintains machine , runs slower
  24. 24. J T. Black – 5, 6 5. Level and balance Produce to Takt time, reduce batch sizes, smooth production flow 6. Link cells- Kanban Create “pull” system – “Supermarket” System
  25. 25. Balancing and Leveling • Balanced line: each process has the same cycle time. Match process time to assemble time, match production rate to rate of demand (Takt time) • Leveled Line: each product is produced in the needed distribution. The process must be flexible to do this.
  26. 26. J T. Black – 7, 8 7.Reduce WIP Make system reliable, build in mechanisms to self correct 8. Build Vendor program Propagate low WIP policy to your vendors, reduce vendors, make on- time performance part of expectation
  27. 27. Some Basics Concepts of TPS Smooth Flow and Produce to Takt Time Produce to Order Make system “observable” and correct problems as they occur Integrate Worker Skills Institutionalize change
  28. 28. Two Examples; Takt Time Pull Systems
  29. 29. Takt Time: demand time interval DemandProduct TimeAvailable TimeTakt = Calculate Takt Time per month, day, year etc. Available time includes all shifts, and excludes all non- productive time (e.g. lunch, clean-up etc). Product demand includes over- production for low yields etc.
  30. 30. Takt Time Automobile Assembly Line; Available time = 7.5 hr X 3 shifts = 22.5 hrs or 1350 minutes per day. Demand = 1600 cars per day. Takt Time = 51 sec Aircraft Engine Assembly Line; 500 engines per year. 2 shifts X 7 hrs => 14 hrs/day X 250 day/year = 3500hrs. Takt time = 7 hrs.
  31. 31. Engines shipped over a 3 month period at aircraft engine factory “B” 0 2 4 6 8 10 12 7-Jun 15-Jun 23-Jun 30-Jun 7-Jul 15-Jul 24-Jul 31-Jul 7-Aug 15-Aug 24-Aug 31-Aug Weeks enginesshippedperweek month 1 month 2 month 3 Factory “B”
  32. 32. Engines shipped over a 3 month period at aircraft engine factory “C” 0 1 2 3 4 5 6 7 may june july august weeks enginesshipped Factory “C”
  33. 33. On-time performance of engine plants A B C 0% 20% 40% 60% 80% 100% enginesdelivered A B C on time late on time on time late
  34. 34. Push and Pull Systems Machines Parts Orders 1 2 3 4
  35. 35. Push Systems – Order (from centralized decision process) arrives at the front of the system and is produced in batches of size “B”. Q. How long does it take to get one part out of the system? 1 2 3 N Time = T3 Time = T2 Time = TN Time = T1 Time = 0 …..
  36. 36. Push Systems – Time = 0 1 2 3 N Time = TN ….. If the process time per part is “t” at each of “N” processes, and the batch size is “B”, it takes time TN = “NBt” to get one part through the system. Comment; Of course, this part can come from inventory in a much shorter time, but the point is that the push system is not very responsive.
  37. 37. Pull Systems- The order arrives at the end of the line and is “pulled” out of the system. WIP between the machines allows quick completion. Q.How long does it take to pull out one part? A.The time to finish the last opetration “t”.
  38. 38. Comparison between Push and Pull Systems Push system characteristics: Central decision making, local optimization of equipment utilization leads to large batches, large inventories and a sluggish system. Pull system characteristics: Local decision making, emphasis on smooth flow, cooperative problem solving. See HP Video
  39. 39. HP Video Dots Tacks Tape Pack Inventory in the system = L Time in the system = W Little’s Law L = λ W
  40. 40. 0.210.120.15 Production Rate λ = L / W VisibleVisibleHiddenQuality Problem 31026 Rework Units ≈ WIP 0:191:403:17“Cycle time” = W 41230WIP = L 1 Table2 Tables2 TablesSpace Pull (1)Pull (3)Push system (6) HP Video Results
  41. 41. Graphical Interpretation 0 50 100 150 200 250 0 2 4 6 Batch Size "B" NumberorTime[s] Inventory, L Time in System, W L = λ W L ≈ k1B W ≈ k2B λ = L / W = k1 / k2
  42. 42. So what are the advantages of the pull systems? • quick response • low inventories • observable problems (if stopped = problem) • sensitive to state of the factory (if no part = problem) • possible cooperative problem solving
  43. 43. The Toyota Production System Historical View Performance measures Elements of TPS Difficulties with Implementation Six Eras of Manufacturing Practice
  44. 44. TPS Implementation • Physical part (machine placement, standard work etc) • Work practices and people issues • Supply-chain part • Corporate Strategy (trust, job security)
  45. 45. Work practices and people issues • Failed TPS attempts; GM Linden NJ, CAMI, GM-Suzuki, Ontario Canada. • Successes GM NUMMI, Saturn. Toyota Georgetown, KY • See MacCoby article • Other Ref: “Just Another Car Factory” Rinehart, Huxley and Robertson, “Farewell to the Factory”, Milkman
  46. 46. Work practices and people issues • “Innovative” Work Practices Ref; C. Ichniowski, T. Kochan et al “What Works at Work: Overview and Assessment”, Industrial Relations Vol 35 No.3 (July 1996)
  47. 47. Examples of “Innovative” Work Practices • Work Teams • Gain Sharing • Flexible Job Assignments • Employment Security • Improved Communications
  48. 48. “What Works at Work: Overview and Assessment”, • Conclusion 1; “Bundling” Innovative human resource management practices can improve business productivity, primarily through the use of systems of related work practices designed to enhance worker participation and flexibility in the design of work and decentralization of managerial tasks and responsibilities.
  49. 49. “What Works at Work: Overview and Assessment”, • Conclusion 2; “Impact” New Systems of participatory work practices have large economically important effects on the performance of the businesses that adopt the new practices.
  50. 50. “What Works at Work: Overview and Assessment”, • Conclusion 3; “Partial Implementation” A majority of contemporary U.S. businesses now have adopted some forms of innovative work practices aimed at enhancing employee participation such as work teams, contingent pay-for-performance compensation, or flexible assignment of multiskilled employees. Only a small percentage of businesses, however, have adopted a full system of innovative work practices composed of an extensive set of these work practice innovations.
  51. 51. “What Works at Work: Overview and Assessment”, • Conclusion 4; “Barriers to Implementation” The diffusion of new workplace innovations is limited, especially among older U.S. businesses. Firms face a number of obstacles when changing from a system of traditional work practices to a system of innovative practices, including: the abandonment of organization change initiatives after limited policy changes have little effect on performance, the costs of other organizational practices that are needed to make new work practices effective, long histories of labor-management conflict and mistrust, resistance of supervisors and other workers who might not fare as well under the newer practices, and the lack of a supportive institutional and public policy environment.
  52. 52. Barriers to Implementation • Early abandonment • Costs (training, commitment, benefits..) • History of conflict and distrust • Resistance of supervisors • Lack of supportive infrastructure
  53. 53. The Toyota Production System Historical View Performance measures Elements of TPS Difficulties with Implementation Six Eras of Manufacturing Practice
  54. 54. Six Eras of Manufacturing Practice, Ken McKay Pioneering Systemization Technology and Process Internal Efficiency Customer Service Systems Level Re-engineering
  55. 55. Ken McKay – 1, 2 1. Pioneering - sellers market, competition is not by manufacturing, large margins emphasize throughput not efficiency 2. Systemization - firm grows and system gets complex, gross inefficiency becomes apparent, competition begins to make its presence felt. Need for standard operating procedures, demand still high, inventory used to buffer against instabilities.
  56. 56. Ken McKay – 3, 4 • 3. Technology and Process – competition is increasing, sales are softening, manufacturing is still in early maturity and competition is limited to firms in similar situation. Product options grow. Mfg focus shifts to efficiency. 4. Internal Efficiency - competition “cherry pickers” enter the market they don’t offer all of the options and parts service but focus on the 20% which yields 80% of the revenue stream. Internal plant is put into order, problems are pushed outside to suppliers, best in class, bench marking identifies the silver bullet. Still using inventory to cushion production support variety, and maintain functional features.
  57. 57. Ken McKay- 5, 6 5. Customer Service - talk to the customer, identify core competency, outsource, be responsive, reduce lead time, eliminate feature creep, focused factory etc. 6. System Level Re- engineering - firms have addressed the internal system and factory – no more to squeeze out – look to improving indirect and overhead, supply chain development.
  58. 58. Toyota Summary • High quality and low cost • Relationship to previous systems (see McKay paper), yet new,………. in fact revolutionary • Many elements – Overall, see ”The Machine that Changed the World” – Cells, next time – People, see Maccoby Article
  59. 59. Summary …….. continued • “Autonomation” automation with a human touch • Worker as problem solver • TRUST

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