The Toyota Production System A Transition from Mass Production to

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The Toyota Production System A Transition from Mass Production to

  1. 1. The Toyota Production System A Transition from Mass Production to Lean Manufacturing and Supply Chain Management Genaro J. Gutiérrez McCombs School of Business The University of Texas at Austin Greater San Antonio Chamber of Commerce San Antonio, Texas April 15, 2003
  2. 2. Major Revolutions in Manufacturing <ul><li>1776, Adam Smith “The Wealth of Nations” </li></ul><ul><li>1910, Henry Ford and Mass Manufacturing. </li></ul><ul><li>1980, The Toyota Production System. </li></ul><ul><ul><li>Lean Manufacturing. </li></ul></ul><ul><ul><li>Supply Chain Management. </li></ul></ul>
  3. 3. The Gestation of TPS <ul><li>Eiji Toyoda visit to Henry Ford’s factory in 1950. </li></ul><ul><li>The SMED (Single-digit in Minutes Exchange of Dice) program at the stamping plant. </li></ul><ul><li>Deming’s quality movement in Japan. </li></ul><ul><li>The Engineers: Taiichi Ohno and Shigeo Shingo </li></ul><ul><li>“ Japanese” Manufacturing hits America in 1970 </li></ul>
  4. 4. Main Features of TPS <ul><li>Greater Product Variety </li></ul><ul><li>Fast Response (Flexibility) </li></ul><ul><li>“ Stable” Production Schedules </li></ul><ul><li>Supply Chain Integration </li></ul><ul><li>Demand Management </li></ul>
  5. 5. Elements of TPS <ul><li>The SMED Program. </li></ul><ul><li>Highlight Problems (Jidoka). </li></ul><ul><li>Gradual Elimination of Waste. </li></ul><ul><ul><li>Continuous Improvement (Kaizen), Root-Cause Analysis (5-whys?) and Fool-proofing (Poka-Yoke). </li></ul></ul><ul><li>Cross-Trained Workers. </li></ul><ul><li>Just-In-Time Production. </li></ul><ul><li>Stable Production Schedules (Heijunka) </li></ul>
  6. 6. Traditional “Buffered” Supply Chain Assembler 2 nd Tier 1 st Tier Flow of Production Flow of Information Customer Demand
  7. 7. The Just-in-Time Supply Chain: “Look Ma” No Stocks! Toyota 2 nd Tier 1 st Tier Flow of Production Flow of Information Customer Demand
  8. 8. Expectations from Suppliers <ul><li>Frequent deliveries. </li></ul><ul><li>Hours (not days) lead time. </li></ul><ul><li>Rapid response capability (not from stocks). </li></ul><ul><li>Delivery to assembly line at the right time in the right sequence without inspection. </li></ul><ul><li>Reliability (quality and timing). </li></ul>
  9. 9. Supplier Relationships <ul><li>Long-term, steady relationships with a few suppliers. </li></ul><ul><li>Negotiation based on a long term commitment to productivity and quality improvement. </li></ul><ul><li>Interested in supplier capabilities. </li></ul><ul><ul><li>Continuous improvement. </li></ul></ul><ul><ul><li>Product/process technology. </li></ul></ul><ul><ul><li>Design for manufacturability. </li></ul></ul>
  10. 10. What’s in it for a supplier? <ul><li>A Stable Manufacturing Environment. </li></ul><ul><ul><li>Steady production volume. </li></ul></ul><ul><li>Leaner Processes. </li></ul><ul><ul><li>Cost/Flexibility/Quality </li></ul></ul><ul><li>Profits. </li></ul>

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