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THE  <br />TOYOTA WAY<br />14 MANAGEMENT PRINCIPLES FROM THE WORLD’S <br />GREATEST MANUFACTURER<br />By Wg Cdr DK Sharma<...
THE TOYOTA WAY <br />02/49<br />Toyota Production System <br />(TPS) <br />Also called The Toyota Way<br />
THE TOYOTA WAY <br />03/49<br />Toyota Production System <br />14 Principles<br /><ul><li>Philosophy	(01 principle)
Process		(07 principles)
People / Partners	(03 principles)
Problem Solving	(03 principles)</li></li></ul><li>THE TOYOTA WAY <br />04/49<br /><ul><li>Lean Engineering / Manufacturing...
Defining the Value Stream (Process)
Making it Flow (Process)
“Pulling” from the Customer back (Inventory)
Striving for Excellence (Long term)</li></li></ul><li>THE TOYOTA WAY <br />05/49<br />Objectives of TPS<br /><ul><li>Elimi...
Building quality into workplace systems
Finding low cost but reliable alternatives to expensive new technology
Perfecting business processes
Building learning cultures for continuous improvements</li></li></ul><li>THE TOYOTA WAY <br />06/49<br />+Continual org le...
THE TOYOTA WAY <br />07/49<br />Principle 1 - Management Decisions on a Long–Term Philosophy, even at the expense of Short...
The way you treat your customer when you do not owe them anything, like how you treat somebody who can not fight back – th...
THE TOYOTA WAY <br />10/49<br />Principle 2.  Create Continuous Process Flow to Bring Problems to the Surface<br /><ul><li...
Flow means when a customer places an order, this triggers the process of obtaining raw material from suppliers, flow to pr...
Flow also forces the implementation of other lean tools such as preventive maintenance, built-in quality (jidoka), continu...
THE TOYOTA WAY <br />12/49<br />Principle 2.  Create Continuous Process Flow to Bring Problems to the Surface<br />4. Over...
THE TOYOTA WAY <br />13/49<br />Computer Base Dept (1 min each)<br />Computer Monitor Dept (1 min each)<br />Computer Test...
Transportation from Base to Monitor Dept is in batch of 10
First good computer ready in 21 minutes
There are at least 21 sub-assemblies in process at a time</li></ul>Batch Processing Example<br />
THE TOYOTA WAY <br />14/49<br />Computer Base Dept<br />Product requires three processes that takes one minute each <br />...
10 complete assembly ready in 12 minutes
Only two sub-assembly in process at a time</li></ul>Continuous Flow Example<br />
Process – Eliminate Waste<br />15/49<br />Principle 3. Use “Pull” Systems to Avoid Overproduction<br />“The more inventory...
Process – Eliminate Waste<br />18/49<br />Principle 5.Build a Culture of Stopping to Fix Problems, to Get Quality Right th...
How Toyota Reacted – If you are not shutting down the assy plant, it means that you have no problem. All mfg plants have p...
Process – Eliminate Waste<br />20/49<br />Principle 5. Keep Quality Controls Simple and Involve Team Members<br />...........
Analyze the situation
Use one piece flow and andon (cord to stop production) to surface problems
Ask “Why?” Five times to get to the root of problem</li></ul>Quality for customer drives your value proposition, because a...
Process – Eliminate Waste<br />21/49<br />Principle 6. Standardized Tasks are the Foundation for Continuous Improvement an...
Standardization, stabilize the process before continuous improvements can be made.
Until you have the fundamental skill needed to swing the club consistently, there is no hope of improving your golf game.
Standardization is to find that balance between providing employees with RIGID procedures to follow and providing the free...
Process – Eliminate Waste<br />23/49<br />Principle 7 <br />Use Visual Controls so No Problems Are Hidden<br /><ul><li>Tra...
The visual aspect means being able to look at the process, a piece of equipment, inventory, or information or at worker pe...
Visual management complements humans because we are visual, touch and audio oriented</li></li></ul><li>Process – Eliminate...
Process – Eliminate Waste<br />25/49<br />Principle 8 <br />Use Only Reliable, Thoroughly Tested Technology That Serves Yo...
THE TOYOTA WAY <br />26/49<br />+Continual org learning.<br />+Go & see yourself.<br />+Decision slowly by consensus and  ...
PEOPLE & PARTNERS<br />27/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, ...
PEOPLE & PARTNERS<br />28/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, ...
PEOPLE & PARTNERS<br />29/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, ...
PEOPLE & PARTNERS<br />30/49<br />Principle 9 <br />TOYOTA LEADERSHIP MODEL<br />Bottom-Up (Development)<br />Top Down<br ...
PEOPLE & PARTNERS<br />31/49<br />Principle 10 <br />Develop Exceptional People and teams Who Follow Your Company’s Philos...
PEOPLE & PARTNERS<br />32/49<br />Principle 10 <br />
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Toyota Production System 14 Management Principles

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  1. 1. THE <br />TOYOTA WAY<br />14 MANAGEMENT PRINCIPLES FROM THE WORLD’S <br />GREATEST MANUFACTURER<br />By Wg Cdr DK Sharma<br />
  2. 2. THE TOYOTA WAY <br />02/49<br />Toyota Production System <br />(TPS) <br />Also called The Toyota Way<br />
  3. 3. THE TOYOTA WAY <br />03/49<br />Toyota Production System <br />14 Principles<br /><ul><li>Philosophy (01 principle)
  4. 4. Process (07 principles)
  5. 5. People / Partners (03 principles)
  6. 6. Problem Solving (03 principles)</li></li></ul><li>THE TOYOTA WAY <br />04/49<br /><ul><li>Lean Engineering / Manufacturing / Thinking / Enterprise /System is a: - </li></ul>A Five Step Process<br /><ul><li>Defining customer value (internal / external)
  7. 7. Defining the Value Stream (Process)
  8. 8. Making it Flow (Process)
  9. 9. “Pulling” from the Customer back (Inventory)
  10. 10. Striving for Excellence (Long term)</li></li></ul><li>THE TOYOTA WAY <br />05/49<br />Objectives of TPS<br /><ul><li>Eliminating wasted time and resources
  11. 11. Building quality into workplace systems
  12. 12. Finding low cost but reliable alternatives to expensive new technology
  13. 13. Perfecting business processes
  14. 14. Building learning cultures for continuous improvements</li></li></ul><li>THE TOYOTA WAY <br />06/49<br />+Continual org learning.<br />+Go & see yourself.<br />+Decision slowly by consensus and implement rapidly. <br />+Grow leaders who live the philosophy.<br />+Respect, develop and challenge people, teams and suppliers.<br />+Create process flow to surface problems<br />+Use pull system to avoid over production<br />+Stop when there is a quality problem. (Jidoka)<br />+ Level out the workload. (heijunka)<br />+Standardize tasks for continuous improvement.<br />+Use visual control so no problems are hidden. <br />+Use only reliable technology.<br />+Base management decisions on a long term philosophy, even at the expense of short term financial gains.<br />“4 P” MODEL OF THE TOYOTA WAY<br />
  15. 15. THE TOYOTA WAY <br />07/49<br />Principle 1 - Management Decisions on a Long–Term Philosophy, even at the expense of Short-Terms Financial Goals.<br /><ul><li>We wanted to break new ground in ride quality. To get that, our tire compounds were fairly soft. So even though the customer experienced a good ride and the tires were well within our specs, they did not last as long initially as many customers wished. 5-7% of the customers actually complained about tire life. For Toyota that is a big deal, as Toyota is used to dealing in complaint level far < 1%. </li></li></ul><li>THE TOYOTA WAY <br />08/49<br />Base Management Decisions on a Long–Term Philosophy, even at the expense of Short-Terms Financial Goals.<br /><ul><li>So Toyota sent the owner of every Lexus who had the specified batch of tires, a coupon they could redeem for $500 and apologised for inconveniency. Many of these customers had already sold their Lexus.
  16. 16. The way you treat your customer when you do not owe them anything, like how you treat somebody who can not fight back – that is the ultimate test of character and long term philosophy of values. </li></li></ul><li>THE TOYOTA WAY <br />09/49<br />+Continual org learning.<br />+Go & see yourself.<br />+Decision slowly by consensus and implement rapidly. <br />+Grow leaders who live the philosophy.<br />+Respect, develop and challenge people, teams and suppliers.<br />+Create process flow to surface problems<br />+Use pull system to avoid over production<br />+Stop when there is a quality problem. (Jidoka)<br />+ Level out the workload. (heijunka)<br />+Standardize tasks for continuous improvement.<br />+Use visual control so no problems are hidden. <br />+Use only reliable technology.<br />+Base management decisions on a long term philosophy, even at the expense of short term financial gains.<br />“4 P” MODEL OF THE TOYOTA WAY<br />
  17. 17. THE TOYOTA WAY <br />10/49<br />Principle 2. Create Continuous Process Flow to Bring Problems to the Surface<br /><ul><li>Flow is the heart of the Lean message that shortening the elapsed time from raw material to finished goods / service will lead to the best quality, lowest cost and shortest delivery time
  18. 18. Flow means when a customer places an order, this triggers the process of obtaining raw material from suppliers, flow to production plant, assemble the order, transport to dealer and deliver to customer
  19. 19. Flow also forces the implementation of other lean tools such as preventive maintenance, built-in quality (jidoka), continuous improvement (kaizan) and even production (heijunka)</li></li></ul><li>THE TOYOTA WAY <br />11/49<br />Principle 2. Create Continuous Process Flow to Bring Problems to the Surface<br />Toyota Identified 7 Major Non-Value Adding Waste<br />1. Overproduction – Producing items for which there are no orders<br />2. Waiting (time on hand)– Worker waiting for a preceding process to be over, tool, part, lot processing, capacity bottlenecks<br />3. Unnecessary transport or conveyance – Carrying work-in-progress (WIP) long distance<br />
  20. 20. THE TOYOTA WAY <br />12/49<br />Principle 2. Create Continuous Process Flow to Bring Problems to the Surface<br />4. Over / incorrect processing - Inefficient process due to poor tooling or production design<br />5. Excess / unavailable Inventory– Extra inventory hides problems such as production imbalances, late deliveries, defects, downtime and long set up time<br />6. Unnecessary Movement – Wasted motion like looking for, reaching for, stacking part, tools etc, even walking is a waste during production<br />7. Defects – Production of defective parts and its correction, Repair or rework, replacement production and inspection<br />
  21. 21. THE TOYOTA WAY <br />13/49<br />Computer Base Dept (1 min each)<br />Computer Monitor Dept (1 min each)<br />Computer Test Dept (1 min each)<br /><ul><li>Complete processing of first batch of 10 takes 30 minutes
  22. 22. Transportation from Base to Monitor Dept is in batch of 10
  23. 23. First good computer ready in 21 minutes
  24. 24. There are at least 21 sub-assemblies in process at a time</li></ul>Batch Processing Example<br />
  25. 25. THE TOYOTA WAY <br />14/49<br />Computer Base Dept<br />Product requires three processes that takes one minute each <br />(One Piece Flow Production Cell) <br />Lean Thinking – Batch size - ONE<br />Computer Monitor Dept<br />Computer Test Dept<br /><ul><li>First part is ready in 3 minutes
  26. 26. 10 complete assembly ready in 12 minutes
  27. 27. Only two sub-assembly in process at a time</li></ul>Continuous Flow Example<br />
  28. 28. Process – Eliminate Waste<br />15/49<br />Principle 3. Use “Pull” Systems to Avoid Overproduction<br />“The more inventory a company has, .....the less likely they will have what they need.” TaiichiOhno<br /><ul><li>Provide your down line customers in the production process with what they want, when they want it, and in the amount they want. Material replenishment initiated by consumption is the basic principle of just-in-time (JIT). It triggers at a customer’s orders of Toyota.</li></ul> <br /><ul><li>Minimize your work in process (WIP) and warehousing of inventory by stocking small amounts of each product and frequently restocking based on what the customer actually takes away.</li></ul> <br /><ul><li>Be responsive to the day-by-day shifts in customer demand rather than relying on computer schedules and systems to track wasteful inventory.</li></li></ul><li>Process – Eliminate Waste<br />16/49<br />Principle 4. Level out the Workload (heijunka)<br />(Work like the tortoise not the hare) <br /><ul><li>Eliminating waste is just one-third of the equation for making lean successful. Eliminating overburden to people and equipment and eliminating unevenness in the production schedule are just as important</li></ul> <br /><ul><li>The slower and consistent tortoise causes less waste and is much more desirable than the speedy hare that races ahead and then stops occasionally to doze. The TPS can be realised only when all move at the speed of tortoise. </li></li></ul><li>Process – Eliminate Waste<br />17/49<br />Principle 4. Level out the Workload (heijunka)<br />(Work like the tortoise not the hare) <br />Elimination<br />
  29. 29. Process – Eliminate Waste<br />18/49<br />Principle 5.Build a Culture of Stopping to Fix Problems, to Get Quality Right the First Time<br /><ul><li>GM followed the golden rule of automotive engine production: do not shut down the assy plant! At GM, managers were judged by their ability to deliver the numbers, Get the job done no matter what – and that meant getting the assy plant to keep it running.
  30. 30. How Toyota Reacted – If you are not shutting down the assy plant, it means that you have no problem. All mfg plants have problems. So you must be hiding your problems. It is better to shut down the plant and work on quality and continue to solve your problems.</li></li></ul><li>Process – Eliminate Waste<br />19/49<br />Principle 5. Keep Quality Controls Simple and Involve Team Members<br /> Things like ISO-9000, an industrial quality standard that calls for all kinds of detailed SOPs, for whatever good they have done, have made companies believe that if they put together detailed rule books the rules will be followed. Quality planning dept are armed with reams of data analyzed using most sophisticated statistical analysis methods. Six Sigma has brought us roving bands of black belts who attack major quality problems with a vengeance, armed with an arsenal of sophisticated technical methods. But at Toyota........................<br />
  31. 31. Process – Eliminate Waste<br />20/49<br />Principle 5. Keep Quality Controls Simple and Involve Team Members<br />..........they keep things simple and use very few complex statistical tools, the quality team have just four key rules (power of simplicity): -<br /><ul><li>Go and See
  32. 32. Analyze the situation
  33. 33. Use one piece flow and andon (cord to stop production) to surface problems
  34. 34. Ask “Why?” Five times to get to the root of problem</li></ul>Quality for customer drives your value proposition, because adding value to customer is what keeps you in business and allow you to make money. <br />
  35. 35. Process – Eliminate Waste<br />21/49<br />Principle 6. Standardized Tasks are the Foundation for Continuous Improvement and Employee Empowerment (Kaizan)<br /><ul><li>It is impossible to improve any process until it is standardized.
  36. 36. Standardization, stabilize the process before continuous improvements can be made.
  37. 37. Until you have the fundamental skill needed to swing the club consistently, there is no hope of improving your golf game.
  38. 38. Standardization is to find that balance between providing employees with RIGID procedures to follow and providing the freedom to INNOVATE and be creative. </li></li></ul><li>Process – Eliminate Waste<br />22/49<br />Principle 6<br />Coercive Vs Enabling Systems and Standards<br />High Bureaucracy<br />Low Bureaucracy<br />Coercive<br />Enabling<br />
  39. 39. Process – Eliminate Waste<br />23/49<br />Principle 7 <br />Use Visual Controls so No Problems Are Hidden<br /><ul><li>Traffic signals tend to be well-designed visual controls. Good traffic signs don’t require you to study them: their meaning is immediately clear
  40. 40. The visual aspect means being able to look at the process, a piece of equipment, inventory, or information or at worker performing a job and immediately see the standards being used to perform the task and if there is a deviation from standards
  41. 41. Visual management complements humans because we are visual, touch and audio oriented</li></li></ul><li>Process – Eliminate Waste<br />24/49<br />Principle 7 <br />Clean It Up and Make It Visual – 5 S<br />
  42. 42. Process – Eliminate Waste<br />25/49<br />Principle 8 <br />Use Only Reliable, Thoroughly Tested Technology That Serves Your People, Processes and Values<br />“Society has reached the point where one can push a button and be immediately deluged with technical and managerial information. This is all very convenient, of course, but if one is not careful there is a danger of losing the ability to think. We must remember that in the end it is the individual human being who must solve the problems”<br />Eiji Toyoda<br />Any information technology must meet the acid test of supporting people and processes and prove it adds value before it is implemented broadly.<br />First work out the manual system and then automate it<br />
  43. 43. THE TOYOTA WAY <br />26/49<br />+Continual org learning.<br />+Go & see yourself.<br />+Decision slowly by consensus and implement rapidly. <br />+Grow leaders who live the philosophy.<br />+Respect, develop and challenge people, teams and suppliers.<br />+Create process flow to surface problems<br />+Use pull system to avoid over production<br />+Stop when there is a quality problem. (Jidoka)<br />+ Level out the workload. (heijunka)<br />+Standardize tasks for continuous improvement.<br />+Use visual control so no problems are hidden. <br />+Use only reliable technology.<br />+Base management decisions on a long term philosophy, even at the expense of short term financial gains.<br />“4 P” MODEL OF THE TOYOTA WAY<br />
  44. 44. PEOPLE & PARTNERS<br />27/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, and Teach It to Others<br />The Automotive News recognized newsmakers in the auto industry. Direct quotes from the issue about these newsmakers: -<br />Bill Ford (Ford): Talks up revitalization, brings backs old guys, stars in TV commercial. Ford stock remains mired in the $10 range<br />Robert Lutz (GM):Former Marine pilot inspires GM’s troops and simplifies product development, giving designers a bigger voice<br />Dieter Zetzsche (Chrysler): Turns the company around a year early with 3 Qtrs in the black<br />
  45. 45. PEOPLE & PARTNERS<br />28/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, and Teach It to Others<br />Fujio Cho (Toyota):Toyota President presides over rise in operating profit to industry record. Take lead on hybrids. Grabs 10 point of US market. Joins with Peugeot for plants in Eastern Europe. <br /> Changing the culture each time a new leader comes into office necessarily means jerking the company about superficially, without developing any real depth or loyalty from the employees. The problem with the radical shifts in the culture is that organization will never learn – it loses its ability to build on achievements, mistakes, or enduring principles. <br />Deming, the Quality Guru terms it “Constancy of Purpose”. <br />
  46. 46. PEOPLE & PARTNERS<br />29/49<br />Principle 9 <br />Grow Leaders Who Thoroughly Understand the Work, Live the Philosophy, and Teach It to Others<br />+Growth<br />+Attention<br />+Go & See<br />+Problem solving<br />+Presentation skills<br />+Project Mgt<br />+Supportive culture<br />+Stability<br />+JIT<br />+Jidoka<br />+Kaizan<br />+Heijunka<br />Long term assets Learned skills<br />Machinery depreciatesLoses value<br />People appreciates continue to grow<br />PHILOSOPHY<br />Customer First<br />People are most important asset<br />Kaizan – continuous improvement<br />Go and See – Give feedback<br />Efficiency thinking<br />True (vs. Apparent) condition<br />Total (vs. Individual) team involvement<br />PEOPLE<br />MANAGEMENT<br />TECHN I CAL<br />Toyota Leader’s view of the TPS<br />
  47. 47. PEOPLE & PARTNERS<br />30/49<br />Principle 9 <br />TOYOTA LEADERSHIP MODEL<br />Bottom-Up (Development)<br />Top Down<br />(Directional)<br />General Management Expertise<br />In-depth Understanding <br />of Work<br />
  48. 48. PEOPLE & PARTNERS<br />31/49<br />Principle 10 <br />Develop Exceptional People and teams Who Follow Your Company’s Philosophy<br />
  49. 49. PEOPLE & PARTNERS<br />32/49<br />Principle 10 <br />
  50. 50. PEOPLE & PARTNERS<br />33/49<br />Principle 11<br />Respect Your Extended Network of Partners and Suppliers by Challenging Them and Helping Them Improve<br />Auto industry suppliers consistently report that TOYOTA is their best customer ….and also their toughest. <br /> Have respect for your partners and suppliers and treat them as an extension of your business.<br /> Challenge your outside business partners to grow and develop. <br /> It shows that you value them. <br /> Set challenging targets and assist your partners in achieving them.<br />
  51. 51. PEOPLE & PARTNERS<br />34/49<br />Principle 11<br />Respect Your Extended Network of Partners and Suppliers by Challenging Them and Helping Them Improve<br /><ul><li>Toyota is very carefully when deciding what to outsource and what to do in house. Toyota outsource about 70% of the components. It still wants to maintain internal competency
  52. 52. Even when Toyota chooses to outsource a key component, it does not want to lose internal capability
  53. 53. As a general rule, Toyota wants to have at least two suppliers for every component
  54. 54. Toyota is very bureaucratic in their dealings with suppliers, having extensive standards, auditing procedures, rules etc. But suppliers consider Toyota as their partner and Toyota is viewed as enabling customer who participate and solve their problems too. </li></li></ul><li>PEOPLE & PARTNERS<br />35/49<br />Principle 11<br />Respect Your Extended Network of Partners and Suppliers by Challenging Them and Helping Them Improve<br />Progressing Need Satisfaction<br />Regressing Need Satisfaction<br />Next Level of Improvement <br />Stability<br />Supply Chain Need Hierarchy<br />
  55. 55. THE TOYOTA WAY <br />36/49<br />+Continual org learning.<br />+Go & see yourself.<br />+Decision slowly by consensus and implement rapidly. <br />+Grow leaders who live the philosophy.<br />+Respect, develop and challenge people, teams and suppliers.<br />+Create process flow to surface problems<br />+Use pull system to avoid over production<br />+Stop when there is a quality problem. (Jidoka)<br />+ Level out the workload. (heijunka)<br />+Standardize tasks for continuous improvement.<br />+Use visual control so no problems are hidden. <br />+Use only reliable technology.<br />+Base management decisions on a long term philosophy, even at the expense of short term financial gains.<br />“4 P” MODEL OF THE TOYOTA WAY<br />
  56. 56. PROBLEM SOLVING<br />37/49<br />Principle 12<br />GO and SEE to Thoroughly Understand <br />the Situation (GenchiGenbutsu)<br />“Observe the production floor without preconceptions and with a blank mind. Repeat “why” five times to every matter.”<br />TaiichiOhno(as quoted in the Toyota Way document)<br />It is more than going and seeing. “What happened? What did you see? What are the issues? What are the problems?” At the root of all of that, we try to make decisions based on factual information, not based on theory, statistics and number contribute to the facts, but it is more than that. Some time we get accused of spending too much time doing all the analysis. Some will say, “Common sense will tell you. I know what the problem is.” But collecting data and analysis will tell you if your common sense is right. <br />
  57. 57. PROBLEM SOLVING<br />38/49<br />Principle 12<br />GO and SEE to Thoroughly Understand <br />the Situation (GenchiGenbutsu)<br />Mr. Ohno at times made his supervisor / managers to draw a circle on the floor of a plant and they were told, “Stand in that and watch the process and think for yourself”, and then he did not even give you any kind of hint of what to watch for. This is the real essence of TPS.<br />The Power of Deep Observation <br />To Question, Analyze and Evaluate<br /><ul><li>We often depend upon computers to analyze and evaluate data
  58. 58. Like Six Sigma quality improvement initiatives – we collect data and run it through statistical analysis – correlations, regressions, variance etc, some of the results we get are statistically significant. But do we really understand the context of what is going on or the nature of the problem? </li></li></ul><li>PROBLEM SOLVING<br />39/49<br />Principle 12<br />GO and SEE to Thoroughly Understand <br />the Situation (GenchiGenbutsu)<br /><ul><li>Data is of course important in manufacturing, but place greatest emphasis on facts – go and see
  59. 59. Think and speak based on personally verified data
  60. 60. See America, then design for America – to design Sienna minivan in 2004, the Chief Engineer of D&D drove extensively in US, Canada and Mexico to get a feel of what people wants in a minivan
  61. 61. You can not expect to do your job without getting your hands dirty</li></li></ul><li>PROBLEM SOLVING<br />40/49<br />Principle 13<br />Make Decisions Slowly by Consensus, Thoroughly Considering All Options; Implement Rapidly<br />If there is a project supposed to be fully implemented in a year. A typical company anywhere would spend about three months on planning and begin to implement. But they encounter all sorts of problems after implementation and would spend rest of the year in correcting them<br /> Toyota will spend 10 months planning, building consensus, implement it in a small pilot production – and fully implement at the end of year, with virtually no remaining problems<br />Nothing is assumed. Every thing is verified<br />
  62. 62. PROBLEM SOLVING<br />41/49<br />Principle 13<br />Make Decisions Slowly by Consensus, Thoroughly Considering All Options; Implement Rapidly<br />Preferred<br />Group consensus with full authority<br />Level of Involvement<br /><ul><li>Decision making is highly situational
  63. 63. Philosophy is to seek maximum involvement for each situation </li></ul>Group consensus, Management Approval<br />Get all the parties on board, iron out all the resistance, generate consensus, then implementing<br />Seek group input, then decide and announce<br />Fallback<br />If consensus not achieved<br />Seek individual input, then Decide and Announce<br />Fallback<br />Decide and Announce<br />Time<br />
  64. 64. PROBLEM SOLVING<br />42/49<br />Principle 14<br />A Learning Org Through Relentless Reflection (Hansei) <br />and Continuous Improvement (Kaizen)<br />We view errors as opportunities for learning. Rather than blaming individuals, the organisation takes corrective actions and distributes knowledge about each experience broadly. Learning is a continuous company-wide process as superiors motivates and train subordinates; as predecessors do the same for successors; and as a team subordinates at all levels share knowledge with one another.<br />The Toyota Way Document 2001<br />Toyota has judiciously used stability and standardization to transfer individual and team innovations into organisational-wide learning. Standardisation punctured by innovation, gets translated into new standards (Kaizen) . <br />
  65. 65. PROBLEM SOLVING<br />43/49<br />Principle 14<br />Relentless Reflection (Hansei) and Continuous Improvement (Kaizen)<br />5 Whys is a method to pursue the deeper, systematic causes of a problem to find correspondingly deeper countermeasures<br />Why<br />Why<br />Why<br />Why<br />Why<br />
  66. 66. 44/49<br />3. Locate Area / Point of Cause<br />Grasp the Situation<br />Basic Cause and Effect Investigation<br />Direct Cause<br />Why<br />Why<br />Cause<br />Cause Investigation<br />Why<br />Cause<br />4. Five Whys?<br />Investigation of Root Cause<br />Why<br />Cause<br />Why<br />Cause<br />Root Cause<br />5. Countermeasure<br />6. Evaluate<br />7. Standardize<br />Toyota’s Practical Problem Solving Process<br />
  67. 67. PROBLEM SOLVING<br />45/49<br />Principle 14<br />Relentless Reflection (Hansei) and Continuous Improvement (Kaizen)<br />Eliminate <br />Waste<br />Deming Circle of Quality (PDCA)<br />
  68. 68. THE TOYOTA WAY <br />46/49<br />One man did his part, and the other his, and neither even had to check to make sure both parts were getting done. Like the dance of atoms Alvin had imagined in his mind. He never realized it before, but people could be like those atoms, too. Most of the time people were all disorganized nobody knowing who anybody else was, nobody holding still long enough to trust or be trusted, just like Alvin imagined atoms might have been before God taught them who they were and gave them work to do.<br /> It was a miracle seeing how smooth they knew each other’s next move before the move was even begun. Alvin almost laughed out loud in the joy of seeing such a thing. Knowing it was possible, dreaming of what it might mean – thousands of people knowing each other that well, moving to fit each other just right, working together. Who could stand in the way of such people? <br />Orson Scott Card<br />Prentice Alvin: The Tales of Alvin Maker<br />
  69. 69. THE TOYOTA WAY <br />47/49<br />The Lessons and <br />Secrets of Toyota way<br /> It creates bonds among individual and patterns such that they “move to fit together just right, working together” towards a common goal. <br /> Creating a WHOLE much greater and stronger than the SUM of the individuals<br />
  70. 70. THE TOYOTA WAY <br />48/49<br />Bibliography &<br />Recommended Readings<br />The Toyota Way – Jeffery K. Liker<br />The Machine that Changed the World – Womack, Jones & Ross<br />Lean Thinking – Womack & Jones<br />
  71. 71. THE TOYOTA WAY <br />49/49<br />Thank You<br />
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