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Book Review: The Toyota Way  by Harish Verma Book Review: The Toyota Way by Harish Verma Presentation Transcript

  • The Toyota Way by Jeffery Liker Book Review Competition Harish Verma IIM Raipur1
  • The Toyota Way In 2004, Dr. Jeffrey Liker, published "The Toyota Way." In his book Liker calls the Toyota Way, "a system designed to provide the tools for people to continually improve their work.” It consists of principles in two key areas: 1. continuous improvement 2. respect for people2
  • The 14 principles of The Toyota Way are organized in four sections:  Continual organizational learning through Kaizen  Go see for yourself to thoroughly understand the situation. (Genchi Genbutsu) 4  Make decisions slowly by consensus, thoroughly considering all options; implement rapidly (Nemawashi) Problem Solving P’s (Continuous Improvement and Learning)  Grow leaders who live the philosophy People and Partners  Respect, develop and challenge (Respect, Challenge and Grow Them) your people and teams Create process “flow” to surface  Respect, challenge, and help problems your suppliers Level out the workload (Heijunka) Stop when there is a quality problem (Jidoka) Process Use pull systems to avoid (Eliminate Waste) overproduction Standardize tasks for continuous improvement  Base management Use visual control so no problems are decisions on a long-term hidden Philosophy philosophy, even at the Use only reliable, thoroughly tested (Long-term Thinking) expense of short-term technology financial goals 3
  • Philosophy - Principle 1 Base management decisions on a long-term philosophy, even at the expense of short-term financial goals. The Right Process Will Produce the Right Results 1. Generate value for the customer, society and the economy. 2. Align the organization toward a purpose greater than “making money.” 3. Be responsible. Accept responsibility for your conduct and maintain and improve the skills that enable you to produce added value.4
  • Process - Principle 2  Create continuous process flow to bring problems to the surface. 1. Redesign processes to achieve continuous flow. 2. Create flow to move material and information fast. 2. Link processes and people so that problems surface right away. 3. Make flow obvious throughout your organizational culture.5
  • Lean manufacturing is a manufacturing philosophy which shortens the time between the customer order and the product build / shipment by eliminating sources of waste. Business as Usual CUSTOMER Waste PRODUCT ORDER BUILT & SHIPPED Time Lean Manufacturing CUSTOMER PRODUCT ORDER BUILT & SHIPPED Waste Time (Shorter)6
  • Product Lead Time Casting W aiting Machining Assembly Transportation Staging Inventory Staging Time Raw Finished Material Parts = Value Value Added Time is only a very small Added Time percentage of the Lead time. Traditional Cost Savings focused on only = Non-Value Value Added Items. Added Time (WASTE)  LEAN FOCUSES ON NON-VALUE ADDING ITEMS.7
  • Before Lean: Organization By Machine Type With Convoluted Flow No Organization and No Control LATHE LATHE LATHE LATHE PART FLOW 500pcs. MILL MILL MILL MILL MILL 750pcs. GRINDER GRINDER GRINDER 250pcs. DRILL DRILL DRILL8
  • After Lean: U-Shaped One- Piece Flow Cell Organization and Control9
  • Process - Principle 3 Use “pull” systems to avoid overproduction. 1. Provide downstream customers in the process with what they want, when they want it, and in the amount that they want. 2. Pull vs Push Material replenishment initiated by consumption is the basis for just-in-time.10 Just-in Time - an organized system of inventory buffers
  • Process - Principle 4  Level out the workload (heijunka)—work like the tortoise, not the hare.  Meeting the demand without overproducing.11
  • Process - Principle 5  Build a culture of stopping to fix problems, to get quality right the first time.  This will ensure that the same problem doesn’t arises again i.e. problem is fixed on permanent basis.12
  • Process - Principle 6  Standardized tasks are the foundation for continuous improvement and employee empowerment.  Standardized task is the prescribed, proper and exact way of doing any particular task.13
  • Process - Principle 7  Use visual control so no problems are hidden. 5 S for elimination of waste Sort What to keep and dispose Sustain Straighten  Simple visuals to support maintain (orderliness) stabilized place for  work flow workplace everything  Determine deviation  from standard  Reduce report size Standardize Shine procedure maintain 1st inspection 3 affect quality14
  • People & Partners - Principle 8  Use only reliable, thoroughly tested technology that serves your people and processes. Add Value to the Organization by Developing Your People and Partners  Support people not replace them  Analyze impact of new technologies on existing processes  Encourage to consider new technologies while seeking for new approach15
  • People & Partners - Principle 9  Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others.  Don’t buy leaders from outside  Leaders job: not only • Accomplishing task • Having good people skills  Role models of company’s philosophy  Must understand daily work in great details16
  • People & Partners - Principle 10  Develop exceptional people and teams who follow the company’s philosophy. • Create Strong stable culture. • Train Exceptional Individual & Teams to work with corporate philosophy. • Use Cross Functional Team • Make a Continuous effort towards Teamwork. • Understand & Use OB theories. • Maslow’s Need Hierarchy theory • Herzberg’s Job Enrichment theory17
  • People & Partners - Principle 11  Respect your extended network of partners and suppliers by challenging them and helping them improve.  Continuously Solving Root Problems Drives Organizational Learning • Maintain Principle of partnership • Acquire new suppliers. • Enhance relations with existing suppliers. • Teach “ The Toyota Way”18
  • Problem Solving - Principle 12  Go and see for yourself to thoroughly understand the situation (genchi genbutsu). • Genchi (actual location) genbutsu (actual material or product)…also known as going to the gemba. • Confirm the fact yourself. • Solve problem by going to root causes. • Think & speak based on personally verified data. “Common sense will tell you the answer, but collecting data and then understanding the facts will tell you whether your common sense was correct.”19
  • Problem Solving - Principle 13  Make decisions slowly by consensus, thoroughly considering all options: implement decisions rapidly. Group Consensus, With Full Group Authority Consensus, Seek Group Management Input, then Approval Level of Involvement Decide and Seek Individual Announce Input, then Decide and Announce Decide and Announce20 Time
  • Problem Solving - Principle 14  Become a learning organization through relentless reflection (hansei) and continuous improvement (kaizen).  All these principles should be inculcated strongly into the organization.21
  • Best Quality – Lowest Cost – Shortest Lead Time – Best Safety – High Morale Through shortening the production flow by eliminating waste Just-in-Time People & Teamwork Right Part, Right • Selection Jidoka Amount, Right Time • Common Goals (In-station Quality) Make Problems • Take Time Planning Visible • Continuous Flow • Pull System Continuous Improvement (kaizen) • Automatic Stops • Error Proofing • In-station Quality Waste Reduction Control • Genchi Genbutsu • Solve Root Cause of • 5 Why’s Problems (5 Why’s) • Eyes for Waste • Problem Solving Leveled Production (Heijunka) Stable and Standardized Processes Visual Management22
  • My Learning:  To achieve proper results from applying Toyota’s approach we need more than tools and that lean needs to ‘permeate an organisation’s culture’.  The concept of learning by doing.  I liked the idea of poka yoke – devices used to make it impossible for an operator to make a mistake. The emphasis is on fixing the process rather than blaming the person.  Focus on customers and its requirements.  The idea of continuous improvement.23
  • Thank you !24