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The toyota way

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  • 1. THE TOYOTA WAY 14 MANAGEMENT PRINCIPLESFROM THE WORLD’S GREATEST MANUFACTURER JEFFREY K. LIKER
  • 2. CHALLENGE EVERYTHING….• “All elements to be practiced everyday in a very consistent manner, not in spurts”
  • 3. PROBLEM SOLVING (Continuous Improvement and Learning) PEOPLE and PARTNERS (Respect, Challenge, and Grow Them) PROCESS (Eliminate Waste) PHILOSOPHY (Long- Term Thinking)The Business of Principles- The TOYATA WAY
  • 4. Organizational learning…• Philosophy• Process right• People and partners building• Problem solving “operational excellence” as strategic weapon…
  • 5. 5 step ‘Lean Manufacturing’1. Defining customer value2. Defining value stream3. Making it flow4. Pulling from the customer back5. Striving for excellence Cost, quality and service to be the BEST
  • 6. Founders’ thoughts• King of inventors of Japan- Sakichi Toyoda• Toyota way- genchi genbutsu (1926)• Toyota conglomerate- Keiretsu• Automation with a human touch and mistake proofing- Jidoka/ autonomation• Hard work, perseverance, discipline- James Watt• Management by Facts…
  • 7. Kiichiro Toyoda• “everyone should tackle some great project at least once in their life”• Education from Tokyo Imperial University• Learning by Doing• Pillars of the Toyota Production System- jidoka, just-in-time• Creativity, challenge, courage, commitment and patience
  • 8. Taichi Ohno• One piece flow• Pull system• Kanban• “Shortening lead time by eliminating waste in each step of a process leads to best quality and lowest cost, while improving safety and morale”• Spirit of challenge- the acceptance of responsibility to meet the challenge
  • 9. • “we accept challenges with a creative spirit and the courage to realize our own dreams without losing drive or energy. We approach our work vigorously, with optimism and a sincere belief in the value of our contribution”• “we strive to decide our own fate. We act with self reliance, trusting on our own abilities. We accept responsibility for our conduct and for maintaining and improving the skills that enable us to produce added value”
  • 10. • Kaizen- change for the better• Kaikaiku- major revolutionary change• Walk the actual path- to construct the value stream• Takt- German word for ‘meter’• Total Productive Maintenance- always a sense of urgency
  • 11. Framework• Quality• Cost• Delivery• Safety• Morale
  • 12. BEST QUALITY- LOWEST COST- SHORTEST LEADTIME PEOPLE & TEAMWORK CONTINUOUS JIT IMPROVEMENT JIDOKA (JUST IN TIME) (IN STATION QUALITY) • GENCHI GENBUTSU • 5 WHY’S •EYES FOR WASTE •PROBLEM SOLVINGLEVELED PRODUCTION (HEIJUNKA)-STABLE-STANDARDIZE PROCESS- VISUAL MANAGEMENT TOYOTA WAY PHILOSOPHY
  • 13. • Never be satisfied with inaction• Question and redefine your purpose to attain progress• 5S facilitates teamwork• Sensei- mentors• Total Budget Control System
  • 14. • Muri- no value added beyond capability• Mura- unevenness “most businesses are 90% waste (muda) and 10% value added work”
  • 15. Benefits of one piece flow• Builds in quality• Creates real flexibility• Creates higher productivity• Frees up floor space• Improves safety• Improves morale• Reduces cost of inventory
  • 16. TPS- Thinking Production System• Pull system• Flow where you can pull, where you must• Learning to see• Heijunka- level out the workload• Andon- light signaling system• Jidoka- autonomation• Standard work chart• Fit customer demand into leveled schedule and establish standard times for delivering different types of service
  • 17. 4 tools1. Go and see Genchi genbutsu (refered as ‘Management by Walking Around’2. Analyze situation first by Hewlett Packard)3. Use one piece flow and Andon4. Ask “why?” 5 times• Kentou- study drawing• Kentouzu- plural of drawing
  • 18. Standardized work• Takt time• Sequence of process• Inventory required
  • 19. Visual control (Management by Sight) SOCIAL STRUCTURETECHNICAL STRUCTURE COERCIVE ENABLING BUREACRACY AUTOCRATIC ORGANIC
  • 20. A3 reports• State problem• Document current situation• Determine the root cause• Suggest alternate solution• Suggest recommended solution• Cost-benefit analysis
  • 21. TPS- Respect for Humanity System• Recruiting is 96% employees, 92% employers, 84% yellow pages, 47% personal contact• Team development process (Blanchard) 1. Orientation 2. Dissatisfaction 3. Integration 4. Production
  • 22. • Jishuken- voluntary study groups• Hoshin kanri- policy deployment• Horensu- to report, give updates periodically (a form of micro management)• Thorough consideration in decision making
  • 23. • Nemawashi- decision making to all options and rapid implementation• Integrity and excellence• Kozokeikaku- structure plan (K4) “a picture is worth a thousand words”
  • 24. “Meeting”• Clear objectives prior to the meeting• The right people at the meeting• Prepared participants• Effective use of visual aids• Separate information sharing from problem solving• The meeting starts and ends on time
  • 25. • Hansei (relentless reflection) + kaizen (continuous improvement)= learning organization• Pareto- the only statistical tool used in toyota technical center• Point of cause (POC)• Toyota Practical Problem Solving Process (20% tools, 80% thinking)
  • 26. 3 types of measures at TOYOTA• Global performance• Operational performance• Stretch improvement metrics“process orientation”Hoshin kanri (policy deployment process) for stretching the improvement goals
  • 27. Adapt-Develop-Sustain• Value Stream Mapping- Material and Information Flow Diagram (Mike Rother and John Shook, 1999)• Project review events (Hansei)• Box- process, triangle- inventory• Task time- TT, Time in System- TIS, Value Ratio- VR• Core Value Stream
  • 28. A Toyota leader’s view of the Toyota Production System PEOPLE PHILOSOPHICAL
  • 29. TOYOTA LEADERSHIP MODEL Toyota Leaders(Development) Group Facilitator Builder of Learning Bottom-Up Organizations “You’re empowered!” “Here is our purpose and direction- I will guide and coach” Bureaucratic Managers Task Master(Directives) Top-Down “Follow the rules!” “Here is what to do and How- do it!” General Management In-Depth understanding of Expertise Work
  • 30. Supply chain need hierarchy LearningNext Level of EnterpriseImprovement Enabling Systems Clear Expectations Stable, Reliable Processes Stability Fair and Honorable Business Relations
  • 31. Alternative Toyota Decision making methods Preferred Group Consensus with Full Authority Group Consensus,Level of Involvement Management Fallback Approval (if consensus Seek group not achieved ) Input, then decide and announce Fallback (if consensus Seek Individual not achieved ) Input, then decide and announce Decide and Announce Time
  • 32. 1. Initial Problem Perception (Large, Vague, complicated problem 2. Clarify the Problem The “Real” Problem Grasp the Situation 3. Locate Cause/ Point of Cause--------------------------------- POC Basic Cause and Effect Investigation Cause Investigation Root Cause 4. 5- Whys? Investigation of--------------------------------- Root Cause 5. Countermeasure 6. Evaluate 7. Standardize Toyota’s practical problem-solving process
  • 33. Policy deployment process (hoshin kanri)Targets for OrganizationTimeQualityCostInnovation High-Level PlanExecutive Staff Improvement? Who? Method? Target? Plan- Do Time? Manager/ Supervisor Work Plan by item Action Check Measurement Countermeasure Improvement? Work Team Method? Result? Countermeasure? Target & Time? All 3 Levels
  • 34. Creating flow and PDCA Create Flow (Act)Evaluate Results Eliminate Surface Problems (Check) Waste (Plan) Counter Measures (Do)
  • 35. Kaizen workshops• Phase I• Phase II• Phase III
  • 36. Phase I- Preparation for the workshop1. Clearly define the scope2. Set objectives3. Create preliminary current state map4. Collect all relevant documents5. Post a preliminary current state map in the team room
  • 37. Phase II- The Kaizen Workshop1. Who is the customer?2. Analyze the current state - Valued added - Non-Value added. What is pure waste? - Non-Value added, but Required (incidental work)3. Develop future state vision4. Implementation5. Evaluate: measuring performance
  • 38. Phase III- After the workshop- Sustaining and Continuous Improvement• Review the status of action items• Review process metrics• Discuss additional opportunities for improvements• Continue to improve the process
  • 39. Factors influencing Top Leaders in Lean vision1. Ownership structure2. Promote from within3. Environmental pressures4. Experience with lean
  • 40. Myth versus reality of TPSWhat TPS is not What TPS is• A tangible recipe for success • A consistent way of thinking• A management project or • A total management philosophy program • Focus on total customer• A set of tools for implementation satisfaction • An environment of teamwork and• A system for production floor improvement only • A never ending search for a• Implementable in a short or mid- better way term period • Quality built in process • Organized, disciplined workplace • evolutionary
  • 41. Why Changing Culture is so Difficult?• Tip of the iceberg- Kanban, 5S, Charts, Teams, Andon, Slogans, Value Stream Maps• Immersed iceberg- Culture Change (Involve people in continuous improvement to eliminate waste through the Toyota Way)
  • 42. 13 Tips for Transitioning Your Company to a Lean Enterprise1. Start with action in the technical system; follow quickly with cultural change2. Learn by doing first and training second3. Start with value stream pilots to demonstrate lean as a system and provide a “go see” model4. Use value stream mapping to develop future state visions and help “learn to see”
  • 43. 5. Use kaizen workshops to teach and make rapid changes6. Organize around value streams7. Make it mandatory8. A crisis may prompt a lean movement, but may not be necessary to turn a company around9. Be opportunistic in identifying opportunities for big financial impacts
  • 44. 10.Realign metrics with a value stream perspective11.Build on your company’s roots to develop your own way12.Hire or develop lean leaders and develop a succession system13.Use experts for teaching and getting quick results
  • 45. Thank you…..!