2. Mich. He was impressed by the size of the
plant but noted many inefficiencies,6 including large amounts
of both inventory and rework to fix production
mistakes.7 Some good did come from this trip, but it was from a
visit to a Piggly Wiggly supermarket. “
[T]he delegation was inspired by how the supermarket only
reordered and restocked goods once they had
been bought by customers.”8 This would become the kanban
system, part of the inventory restocking policy
that would become world-renowned.
The TPS
While growing the company in Japan between 1949 and 1975,
Toyota management—primarily Taiichi
Ohno, Shigeo Shingo, and Eiji Toyoda9—worked on improving
the company’s logistics and production
processes, especially as they related to minimizing inventory,
involving employees in the process of managing
their jobs, and defining the manufacturing process so that it
could handle multiple products easily.10 The
result of their work became known around the world as the
Toyota Production System (TPS).
TPS is “an integrated socio-technical system…that comprises
[Toyota’s] management philosophy
and practices. The TPS organizes manufacturing and logistics
for the automobile manufacturer, including
interaction with suppliers and customers.”11 It has two
foundational concepts:
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MGT545-141 taught by Ivana Zilic, DePaul University from
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3. 2
A Profile of Toyota’s Production System W90C18
1. “One of these is the ‘just-in-time production,’ an especially
important factor in an assembly
industry such as automotive manufacturing. In this type of
production, ‘only the necessary
products, at the necessary time, in the necessary quantity’ are
manufactured, and in
addition, the stock on hand is held to a minimum.
2. “Second…is the ‘respect-for-human’ system where the
workers are allowed to display in
full their capabilities through active participation in running
and improving their own
workshops.”12
The Toyota Production System
1. Reduced setup times for equipment and people.
2. Small-lot production: Usually allows for smaller inventories,
smaller machines, smaller lead times,
and less cost.
3. Employee involvement and empowerment.
4. Quality at the source: Correct errors as soon as possible. Any
worker can stop the entire line if necessary.
5. Equipment maintenance: Machine operators are trained to
also do basic maintenance since they can
4. see the problem before anyone else.
6. Pull production: The amount of product produced is specified
by the amount needed immediately in
the next stage. Kanbans are usually used here.
7. Supplier involvement: Suppliers are partners, and are integral
parts of the overall production process.
TPS, or “lean manufacturing” as it has become known more
generally, has seven features (as shown
above).13 Two distinctive practices, kaizen and kanban, are
closely associated with TPS. Kaizen (Japanese for
“good change”) “refers to activities that continually improve all
functions of a business, from manufacturing
to management and from the CEO to the assembly line
workers.”14 This is pervasive in any TPS organization.
“Everyone is encouraged to come up with small improvement
suggestions on a regular basis. This is not a
once a month or once a year activity. It is continuous. [In]
Japanese companies, such as Toyota and Canon,
a total of 60 to 70 suggestions per employee per year are written
down, shared, and implemented.”15
Kanban (Japanese for “visual card”) is a simple and inexpensive
means to coordinate manufacturing and
control inventory. The following illustrates how a kanban-based
system works:
“A simple example of the kanban system implementation might
be a ‘three-bin system’ for
the supplied parts (where there is no in-house manufacturing)—
one bin on the factory
floor (demand point), one bin in the factory store, and one bin
at the suppliers’ store. The
bins usually have a removable card that contains the product
5. details and other relevant
information—the kanban card. When the bin on the factory floor
becomes empty, i.e, there
is demand for parts, the empty bin and kanban cards are
returned to the factory store. The
factory store then replaces the bin on the factory floor with a
full bin, which also contains
a kanban card. The factory store then contacts the supplier’s
store and returns the now
empty bin with its kanban card. The supplier’s inbound product
bin with its kanban card is
then delivered into the factory store, completing the final step
to the system.”16
A company can implement a kanban-based system in many
different ways, depending on the process
used to make the product. Companies can use something as
simple as golf balls sent down a system of tubes
as the basis for a kanban system.17
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MGT545-141 taught by Ivana Zilic, DePaul University from
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3
A Profile of Toyota’s Production System W90C18
Toyota is remarkably open with information about the TPS and
its management practices. Hundreds, if
not thousands, of companies now use TPS,18 including General
Motors Corporation,19 Virginia Mason Medical
6. Center,20 Porsche AG, Steelcraft, Boeing Co., Honda Motor
Car Co., and Mitsubishi Heavy Industries. However,
it is often the case that other companies have been less
successful than Toyota at implementing this
system. It can be hard to copy because it’s not only a complete
system of management, manufacturing, and
inventory control, it’s also a system of work. This system of
work is not formally documented within the
company. Four tacit rules underlie how Toyota employees work:
1. “All work shall be highly specified as to content, sequence,
timing, and outcome.
2. “Every customer-supplier connection must be direct, and
there must be an unambiguous
yes-or-no way to send requests and receive responses.
3. “The pathway for every product and service must be simple
and direct.
4. “Any improvement must be made in accordance with the
scientific method, under the
guidance of a teacher, at the lowest possible level in the
organization.”21
If these rules are not implemented at a company trying to
implement the TPS, then the TPS implementation
can fail even if the TPS implementation is handled well.
Recent Events
In April 2002, Fujio Cho, then president of Toyota, declared
that he wanted Toyota to have 15% of the
global market by 2010.22 Figure 123 reflects (1) Toyota’s
growing market share through 2008, and (2) both
VW Group and Hyundai Kia gaining significant share. Toyota
7. did not commit to several emerging markets,
such as China and Brazil, as its rivals did. This meant that, as
demand for autos expanded in these markets,
Toyota lagged behind its more aggressive rivals.24 Even so,
Toyota increased production over ten years by
about 80%.25 Regardless of the issues, Toyota appeared well on
its way to reaching the 15% goal until the
recent economic problems.
Unfortunately for Toyota, it was not only the economy that hurt
the company’s push for market share.
The quality of its cars had noticeably fallen. In January 2010
Toyota recalled 2.3 million vehicles in North
America because of mechanical failures; this was after recalling
4.2 million vehicles in November 2009 for
another such failure.26 No one problem seemed to have caused
these quality issues; however, “[p]eople
within the company believe these quality problems were caused
by the strain put on the Toyota Production
System by the headlong pursuit of growth.”27 On the other
hand, it was not as if Toyota had fallen to the
back of the pack in terms of quality. In the 2009 J.D. Power
Initial Quality Survey28 and three-year Vehicle
Dependability Study,29 Toyota led more segments than any
other automaker.
In addition to quality, Toyota also had issues related to the
design of its cars. They were generally
panned as boring. AutoWeek, as quoted by U.S. News, had this
to say in a review of the 2010 Toyota Camry:
““This is a perfectly functional, perfectly capable, perfectly
reasonable, perfectly boring automobile. ...
Again, all pleasant enough and functional enough, but it’s duller
than an empty office cubicle.”30 A survey
of car-buyers concluded that Toyota’s quality advantage was not
that significant to customers any more and
8. that other carmakers had “products that inspired greater
‘love’.”31
All of these issues affected Toyota’s bottom line. Figure 332
shows Toyota’s sales and net income since
2000. The loss in 2009 was Toyota’s first annual loss in 59
years.33
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This document is authorized for use only by Wenlong Gu in
MGT545-141 taught by Ivana Zilic, DePaul University from
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A Profile of Toyota’s Production System W90C18
Figure 1
Global Light-Vehicle Market Share
Figure 2
Toyota Production Amounts (millions)
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This document is authorized for use only by Wenlong Gu in
MGT545-141 taught by Ivana Zilic, DePaul University from
September 2017 to November 2017.
5
9. A Profile of Toyota’s Production System W90C18
Figure 3
Toyota’s Financial Result
Toyota Financials
-100.0
0.0
100.0
200.0
300.0
400.0
1998 2000 2002 2004 2006 2008 2010
Year
$
bi
lli
on
s
Sal es Net Income
In response to these problems, Toyota took a few significant
steps. About 40% of Toyota’s production
was outside Japan in FY 2008,34 and the company realized that
10. it no longer had its homogeneous workforce
to rely on when communicating with its employees. To address
this, the company opened the Toyota Institute
in Toyota City as a forum for teaching employees about the
Toyota Way. Toyota planned other such institutes
in Kentucky and Thailand.35
In June 2009 Toyota named Akio Toyoda, grandson of the
founder, as the company president. Soon
after taking the helm, he said that Toyota would continue to
work on “efforts to cut costs, boost regional
autonomy, and develop affordable, high-quality vehicles that
stir emotions. ‘[We] will work hard to develop
cars that people fall in love with,’ he said.”36
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This document is authorized for use only by Wenlong Gu in
MGT545-141 taught by Ivana Zilic, DePaul University from
September 2017 to November 2017.
6
A Profile of Toyota’s Production System W90C18
Endnotes
1 Dawson, Chester. “Kiichiro and Eiji Toyoda: Blazing the
Toyota Way.” BusinessWeek 24 May 2004.
http://www.businessweek.com/
magazine/content/04_21/b3884031_mz072.htm downloaded 16
Jan. 2010.
2 “Toyota Motor Corp.” Yahoo! Finance.
http://finance.yahoo.com/q!s=TM downloaded 24 Jan. 2010.
11. 3 “Fortune Global 500 2009.” CNNMoney.com.
http://money.cnn.com/magazines/fortune/global500/2009/full_li
st/ downloaded
24 Jan. 2010.
4 “Toyota in the World 2009.”
http://www.toyota.co.jp/en/about_toyota/in_the_world/pdf2009/
databook_en_2009.pdf
downloaded 24 Jan. 2010: p. 2.
5 Dawson.
6 Dawson.
7 “Toyota Production System.” Wikipedia.
http://en.wikipedia.org/wiki/Toyota_Production_System
downloaded 17 Jan. 2010.
8 “Toyota Production System.” Wikipedia.
http://en.wikipedia.org/wiki/Toyota_Production_System
downloaded 17 Jan. 2010.
9 “Toyota Production System.” Wikipedia.
http://en.wikipedia.org/wiki/Toyota_Production_System
downloaded 17 Jan. 2010.
10 “Just in time, Toyota Production System & Lean
Manufacturing.” Strategos Inc.
http://www.strategosinc.com/just_in_time.htm
downloaded 17 Jan. 2010.
11 “Toyota Production System.” Wikipedia.
http://en.wikipedia.org/wiki/Toyota_Production_System
downloaded 17 Jan. 2010.
12 Sugimori, Y., K. Kusunoki, F. Cho, and S. Uchikawa.
“Toyota production system and Kanban system: Materialization
of just-in-
time and respect-for-human system.” International Journal of
Production Research 15:6 (1977): p. 553.
13 Kotelnikov, Vadim. “7 principles of Toyota Production
12. System (TPS).”
http://www.1000advices.com/guru/processes_lean_
tps_7principles.html downloaded 25 Jan. 2010.
14 “Kaizen.” Wikipedia. http://en.wikipedia.org/wiki/Kaizen
downloaded 24 Jan. 2010.
15 Hudgik, Steve. “What is Kaizen?” Graphic Products.
http://www.graphicproducts.com/tutorials/kaizen/index.php
downloaded
25 Jan. 2010.
16 “Kanban.” Wikipedia. http://en.wikipedia.org/wiki/Kanban
downloaded 25 Jan. 2010.
17 McMahon, Tim. “Simple Kanban with Golf Balls.”
http://leanjourneytruenorth.blogspot.com/2009/07/simple-
kanban-with-golf-
balls.html downloaded 25 Jan. 2010.
18 “Why lean manufacturing? – Toyota Production System TPS
Example.” Gembutsu Consulting. http://www.gembutsu.com/
articles/why_lean.html downloaded 25 Jan. 2010.
19 “Lean manufacturing and the environment.” US
Environmental Protection Agency.
http://www.epa.gov/lean/studies/gm.htm
downloaded 25 Jan. 2010.
20 “Virginia Mason Production System.” Virginia Mason
Medical Center.
https://www.virginiamason.org/home/body.cfm?id=5154
downloaded 25 Jan. 2010.
21 Spear, Steven, and H. Kent Bowen. “Decoding the DNA of
the Toyota Production System.” Harvard Business Review
September-
13. October 1999, reprint 99509: p. 4.
22 Treece, James B. “Toyota’s vision: 15% global share.”
Automotive News 8 April 2002.
23 “Losing its shine.” The Economist 10 Dec. 2009.
http://www.economist.com/displaystory.cfm?story_id=15064411
downloaded
24 Jan. 2010.
24 Economist.
25 “Toyota in the World 2009.”
http://www.toyota.co.jp/en/about_toyota/in_the_world/pdf2009/
databook_en_2009.pdf
downloaded 24 Jan. 2010: p. 17.
26 Soble, Jonathan. “Toyota in huge US safety recall.”
Financial Times 22 Jan. 2010.
http://www.ft.com/cms/s/0/5f9f2c6e-0706-
11df-b058-00144feabdc0.html downloaded 24 Jan. 2010.
27 Economist.
28 Press release for J.D. Power & Associates Initial Quality
Survey. 22 June 2009. http://businesscenter.jdpower.com/news/
pressrelease.aspx?ID=2009108 downloaded 25 Jan. 2010.
29 Press release for J.D. Power & Associates Vehicle
Dependability Study. 19 March 2009.
http://businesscenter.jdpower.com/news/
pressrelease.aspx?ID=2009043 downloaded 25 Jan. 2010.
30 “2010 Toyota Camry Reviews, Pictures, and Prices.” U.S.
News Rankings and Reviews.
http://usnews.rankingsandreviews.com/
cars-trucks/Toyota_Camry/ downloaded 25 Jan. 2010.
31 Economist.
14. For the exclusive use of W. Gu, 2017.
This document is authorized for use only by Wenlong Gu in
MGT545-141 taught by Ivana Zilic, DePaul University from
September 2017 to November 2017.
7
A Profile of Toyota’s Production System W90C18
32 Toyota Motor Corporation Annual Report 2009: pp. 42-3.
33 Rowley, Ian. “Toyota’s loss is worse than expected.”
BusinessWeek 8 May 2009.
http://www.businessweek.com/globalbiz/
content/may2009/gb2009058_991777.htm downloaded 25 Jan.
2010.
34 Welch, David, and Ian Rowley. “Toyota’s all-out drive to
stay Toyota.” BusinessWeek 3 Dec. 2007.
http://www.businessweek.com/
magazine/content/07_49/b4061064.htm downloaded 25 Jan.
2010.
35 Fackler, Martin. “The ‘Toyota Way’ is translated for a new
generation of foreign managers.” The New York Times 15 Feb.
2007.
http://www.nytimes.com/2007/02/15/business/worldbusiness/15t
oyota.html downloaded 24 Jan. 2010.
36 Rowley, Ian. “Japan: Toyota’s new president takes the
wheel.” BusinessWeek 25 June 2009.
http://www.businessweek.com/
globalbiz/content/jun2009/gb20090625_571664.htm downloaded
15. 25 Jan. 2010.
For the exclusive use of W. Gu, 2017.
This document is authorized for use only by Wenlong Gu in
MGT545-141 taught by Ivana Zilic, DePaul University from
September 2017 to November 2017.
Established at the University of Michigan in 1992, the William
Davidson Institute
(WDI) is an independent, non-profit research and educational
organization focused on
providing private-sector solutions in emerging markets.
Through a unique structure
that integrates research, field-based collaborations,
education/training, publishing,
and University of Michigan student opportunities, WDI creates
long-term value for
academic institutions, partner organizations, and donor agencies
active in emerging
markets. WDI also provides a forum for academics, policy
makers, business leaders, and
development experts to enhance their understanding of these
economies. WDI is one
of the few institutions of higher learning in the United States
that is fully dedicated to
16. understanding, testing, and implementing actionable, private-
sector business models
addressing the challenges and opportunities in emerging
markets.
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September 2017 to November 2017.
Chapter outline
Parties and Elections Have Been Vital to American Politics and
Government
1. Political parties are organizations that seek influence over
government. In modern history, political parties have been the
chief points of contact between governments and individual
citizens and interest groups; political parties are the instruments
through which citizens and government influence each other.
2. Historically, parties originate through either internal or
external mobilization by those seeking to win governmental
power. Internal mobilization occurs when political conflicts
break out and government officials and competing factions seek
to mobilize popular support. External mobilization takes place
when a group of politicians outside government organizes
popular support to win governmental power.
3. Parties are important in the electoral process for recruiting
and nominating candidates for office.
4. Through primary elections or caucuses, voters have the
opportunity to pick the candidates who will represent each party
in the general election.
5. Parties are involved in voter registration and can make a big
difference in persuading citizens to vote.
17. 6. Political parties help to organize Congress. Congressional
leadership and the committee system are both products of the
two-party system.
7. Strong presidents can depend on party ties in Congress to get
their legislation enacted and, in turn, build support in
congressional elections. Or a president can focus more on party
building and the party's ability to mobilize voters.
America Is One of the Few Nations with a Two-Party System
1. The United States has usually had a two-party system,
meaning that only two parties have a serious chance to win
national elections.
2. The structure of America's single-member districts and
plurality voting limit the electoral prospects of third parties.
3. Electoral realignments are transitions between party systems
when a new party replaces the ruling party and becomes the
dominant political force. During these periods, the coalitions
that support the parties and the balance of power between them
are redefined. There have been five realignments in American
history.
4. American third parties have always represented social and
economic issues that are ignored by the other parties. Third
parties almost always lose at the national level, but they can
influence and realign the two parties and elections.
5. Party identification refers to an individual voter's
psychological ties with a party. The two major national parties
do not draw equal support from members of every social
stratum. A variety of group characteristics are associated with
party identification, including race and ethnicity, gender,
religion, class, ideology, region, and age.
Political Participation Takes Both Traditional and Digital Forms
1. Political participationrefers to a wide range of activities
designed to influence government. Political participation can
fall into two major categories: traditional political participation
and digital political participation.
2. Common forms of traditional political participation are
voting, protest, and volunteering or fund-raising for a campaign.
18. 3. Throughout American history, there has been a progressive,
if uneven, expansion of suffrage to groups previously denied
suffrage, such as African Americans, women, and youths.
4. Though the United States now has a system of universal
suffrage, voter turnout continues to be low.
5. Digital political participation influences government by using
the Internet, including mobilizing support through email,
visiting candidate websites, campaigning on social networking
sites, and signing online petitions.
6. By 2016, virtually every serious candidate for higher office
has social media accounts to reach supporters, who in turn can
signal amplify the candidate's message to their own friends and
followers.
7. Research suggests that digital politics does have an impact on
participation, and new forms, like expressive politics, such as
the sharing of hashtags and symbolic profile pictures.
8. Digital participation reproduces some of the inequalities of
offline life, but candidates have found campaigning online
extremely attractive because it is cost-effective and reaches a
wide audience.
9. Three factors organize our understanding of voting in
elections: (1) a person's social and demographic backgrounds
and attitudes about politics, (2) the political environment in
which elections take place and whether an election is contested
among at least two political candidates, and (3) the state
electoral laws that shape the political process.
10. Americans with a high socioeconomic status are much more
likely to participate in politics than those with less education
and less income.
11. One of the most significant patterns in political
participation is that older people have much higher rates of
participation than young people.
12. Several strategies of mobilization emerged to guide African
Americans' quest for equality in the twentieth century,
including protest, legal action, and political pressure. But the
question remains whether political participation can improve the
19. lives of African Americans, especially the poor.
13. One critical aspect of political environments is whether
people are mobilized by parties, candidates, interest groups, or
social movements. People are much more likely to participate
when someone—especially someone they know—asks them to
get involved.
14. In recent decades, political parties have shifted toward fund-
raising and advertising and away from mobilization. However,
beginning with the 2008 campaign, Barack Obama's expansion
of the electorate through mobilization became a central
campaign strategy.
15. Ballot measures and competitive elections, which result in
active campaigns and more information, lead to higher voter
turnout.
16. Voter identification requirements of various strictness can
also be an impediment to voting for some, with research
suggesting it reduces overall turnout.
17. State electoral laws regarding registration requirements,
restrictions for people who have committed a felony, permanent
absentee ballots, and early voting can affect participation.
How Voters Decide Based on Party, Issues, and Candidate
1. Three factors influence voters' decisions at the polls: party
loyalty, issue and policy concerns, and candidate
characteristics.
2. Party loyalty predisposes voters in favor of their party's
candidates and against those of the opposing party.
3. The impact of issues and policy preferences on electoral
choice is diminished if competing candidates do not differ
substantially or do not focus their campaigns on policy matters.
4. Candidates' attributes and personality characteristics always
influence voters' decisions.
5. The salience of these three bases of electoral choice varies
from contest to contest and from voter to voter.
The Electoral Process Has Many Levels and Rules
1. There are three types of elections in the United States:
primary elections, general elections, and initiative and
20. referendum elections.
2. Legislative referendum is the practice of referring proposed
laws passed by a legislature of which the electorate votes for
approval or rejection. All fifty states have legislative
referendum elections.
3. Americans do not vote directly for presidential candidates.
Rather, they choose electors who are pledged to support a
party's presidential candidate. These electors cast their ballots
in what is known as the electoral college.
4. Support for eliminating the electoral college in favor of a
national popular vote is increasing among states.
5. Americans participate in direct democracy via ballot
initiatives and the referendum. Eighteen states also have legal
provisions for recallelections, which allow voters to remove
governors and other state officials from office prior to the
expiration of their terms.
The 2016 Elections
1. In 2016, both the Democratic and Republican nominations
were sharply contested, with Hillary Clinton prevailing over her
main rival, Senator Bernie Sanders of Vermont, and Donald
Trump beating out a crowded field of Republican contenders to
win the nomination.
2. Up until Election Day, Clinton seemed to be poised for
success given the voting patterns in recent years, like the 2012
presidential election. She believed she would be able to
assemble what was thought to be a growing coalition of
minorities and immigrants, as well as young people and women
in general.
The Trump campaign was successful in overcoming the
Democrats' perceived advantage through a strong appeal to
blue-collar white voters, which made him competitive in what
were assumed to be Democratic strongholds in the Midwest.
3. The 2016 presidential race was marked by some of the
strongest personal attacks by the nominees on each other.
Clinton was continually assailed for her use of a private email
server, as well as investigations into her perceived role in the
21. deaths of several American officials in an attack in Benghazi,
Libya. Outside factors, like hacks of DNC and Clinton
campaign emails by Wikileaks, further clouded Clinton's
reputation.
Donald Trump was routinely criticized by his offensive
comments, many perceived to be racists, xenophobic, and
misogynistic. The most explosive revelation of Donald Trump
came in October of 2016 when it was revealed he had made
extremely crude comments boasting about what some accused to
be sexual assault. Both candidates were considered among the
most unlikeable and unpopular ever nominated for the
presidency.
4. Trump's victory on election night stunned the media and
defied the polls. What had been predicted as an easy Clinton
win was instead a Trump blow-out in the electoral college,
though he lost the popular vote by more than 1 million votes.
Overall turnout was down slightly from 2008. The predicted
surge in turnout by Latinos and female voters did not
materialize. Ultimately, Trump prevailed with his strong
support from Republicans and members of the white working
class.
Money Is the Mother's Milk of Politics
1. Three Supreme Court cases have dismantled government
restrictions on campaign contributions on the basis of free
speech.
2. Campaign funds in the United States are provided by
individual donors, political action committees (PACs),
independent groups like 527s, political parties, public funding,
and the candidates' personal resources.
Political Parties, Elections, and Your Future
1. While parties are still elite-driven, the Internet and new
media have begun to alter party formation and party politics.
2. The socioeconomic bias in American politics remains an
important concern.
22. Click here to launch the simulation: You Are a State Elections
Commissioner.
https://services.wwnorton.com/aws/other?file=/wwnorton.colleg
e.public/Political_Science/Simulations/Participation_Voting/ind
ex.htm
You Are the Leader of a
State Political Party.
https://services.wwnorton.com/aws/other?file=/wwnorton.colleg
e.public/Political_Science/Simulations/Parties/index.htm
You Are a
Congressional Challenger.
https://services.wwnorton.com/aws/other?file=/wwnorton.colleg
e.public/Political_Science/Simulations/Campaigns_Elections/in
dex.htm