This document provides an overview of Toyota's lean manufacturing system known as the Toyota Production System (TPS). It discusses how TPS was developed based on the philosophies of Toyota's founders and leaders like Taiichi Ohno. Key aspects of TPS discussed include just-in-time production using kanban systems, jidoka or built-in quality control, eliminating waste, visual management with 5S, and problem-solving through continuous improvement. The document positions TPS as a holistic management approach focused on eliminating waste and respecting people, not just an inventory reduction technique.

1. Presented By-
Akshay Jain
Pratik Agrawal
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2. “Toyota’s focus on JIT is a continual problem-solving process (not an
inventory reduction plan) illustrates why the automaker is a JIT leader not
only in its industry but all of industry.”
“Toyota is the benchmark in manufacturing and product development”
- General Motors Officials
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3. SOME BEST-PRACTICES /
MANAGEMENT CONCEPTS
From Western World –
• Out-Sourcing 3PL & 4PL
• ERP
• Six Sigma
• Customer Delight
• Postponement
• VMI
• CPFR
• SCOR Model
From Japan –
• SMED – Quick Changeover
• Single Piece Flow
• Employee Empowerment
• JIT / Kanban
• 5-S principles
• TPM,
• TQM
• Poka Yoke System
• Jidoka

4. Manufacturing Management Guru’s

5. History
• Starts with Sakichi Toyoda who grew up in
predominantly farming community in late 1800s.
Weaving was a major industry promoted by the
Japanese government.
• By 1894, Sakichi began to make manual looms that
were cheaper but of better quality (more features and
less failures).
• Sakichi Toyoda, the founder of the Toyoda group of
companies, started Toyoda as a textile machine
company with Japan’s first automated loom.
• Started working on his own to develop power-driven
loom. This approach of learning and doing yourself
became integral part of TPS (genchi genbutsu).
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6. • 1902 Modification: Loom Stopped
Automatically if Thread Broke or
Spool Empty Signal for Attention.
• Among his inventions was a special
mechanism to automatically stop a
loom whenever a thread broke –
building in quality as you produce
the material (Jidoka or poka-yoke).
• Result: No Waste from Defective
Work and Lower Production Costs
Toyoda Automated Loom Works
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7. • The “mistake-proof” loom became Toyoda’s most
popular model and in 1929, his son Kichiro,
negotiated the sale of patent rights to Platt Brothers
of England for £100,000.
• In 1930, these funds were used to start building the
Toyota Motor Corp.
• The company was founded by Kiichiro Toyoda as a
spin-off from his father's company Toyota Industries
to create automobiles.
• Headquarters of Toyota are located in its home
country in Toyota, Aichi
• Kichiro’s contribution to the Toyota philosophy – JIT
Kiichiro Toyoda,
1894-1952
Toyota Founder
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8. • Not much laterWWII started.
• During WWII, Toyoda became Toyota and
manufactured Motorcycles and Delivery Trucks
• AfterWWII, Japanese Industry needed to re-build
• Post-WWII, rampant inflation meant getting paid
by customers was very difficult. Cash-flow
problems lead to pay cuts.
• When situation worsened, 1600 workers were
asked to “retire voluntarily.” and closed two
facilities .
• The resultant work stoppages and public
demonstrations by workers led to resignation of
Kichiro. Eiji Toyoda took over as president.
• Eiji’s main contribution – leadership towards
development of the TPS.
Eiji Toyoda
1957-1994
CEO/Chairman
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9. • Eiji hired Taiichi Ohno as the plant manager and
asked him to improve Toyota’s manufacturing
process so that it equals the productivity of Ford.
• 1956 – Taiichi Ohno went to US to study Ford’s
Manufacturing Facilities
• Found Mass Production Principles not Applicable:
• Scale of Japanese Markets
• Desire for Product Variety
• Unable to Afford Resources and Inventories
• Before returning to Japan, Ohno went to an
American Grocery Store
• Discovered Production and Operation Methods that
• Were Linked to Customer Actions: Inventories
Replenished by Sales (“PULL” Strategy)
• Delivered Product Variety and Scale
• MinimizedWaste
Taiichi Ohno
1954-1978
Director/ Vice President
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10. • “Pull” system was implemented by Kanban cards.
• Taiichi Ohno benchmarked the competition by visiting
Ford and studied Henry Ford’s “book.”
• Impressed with Ford’s philosophy of eliminating waste.
Ford itself didn’t seem to practice it.
• Ohno also took ideas from Deming when he was
lecturing in Japan about quality and productivity.
• He was THE main developer of Toyota Production
System (TPS).
• Toyota Exports its First Car: The Forgettable “Crown”
1957 to USA.
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11. • Toyota Production System (TPS) drew wide attention from the industrial
community because Toyota was a profitable car company in Japan during
and after the oil embargo in 1970s.
• Outside Japan, dissemination began in earnest with the creation of the
Toyota-General Motors joint venture-NUMMI (New United Motor
Manufacturing Inc.) in California in 1984.
• Widespread recognition of TPS as the model production system grew
rapidly with the publication in 1990 of The Machine That Changed the
World: The Story of Lean Production, the result of five years of research
led by the Massachusetts Institute of Technology (MIT).
• The MIT researchers found that TPS was so much more effective and
efficient than traditional, mass production that it represented a completely
new paradigm and coined the term lean production to indicate this radically
different approach to production.
• The term was coined by John Krafcik, a research assistant at MIT with the
International Motor Vehicle Program in the late 1980s. He then worked for
General Motors and now is a Vice President of Hyundai, U.S.
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12. Toyota Production System
“Identify activities that add value to raw material, and get rid of everything
else.”
In short TPS is the following:
• Make what the customer needs, when it is needed, in the right amount
• Minimize inventories
• Separate machine work from human work and fully utilize the capacity of
both
• Build quality into the process and prevent errors from happening
• Reduce lead-times to allow for rapid, flexible scheduling
• Produce a high mix of low volume products efficiently
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13. The Toyota Way
“4P” model
 Philosophy (Long-term thinking)
 Process (eliminate waste) Kaizen
 People and partners (Respect,
Challenge them to achieve more,
Grow leaders)
 Problem-solving (Continuous
improvement and learning) Genchi
genbutsu
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14. 14 Toyota-Way Principles
Section I – Long-term philosophy
 Principle 1: Base your management decisions on a long-term philosophy, even at the
expense of short-term financial goals.
Section II – The Right processes will produce the right results
 Principle 2: Create continuous process flow to bring problem to the surface.
 Principle 3: Use “pull” system to avoid overproduction.
 Principle 4: Level out the workload (heijunka). (work like a tortoise not the hare.)
 Principle 5: Build the culture of stopping to fix problems to get quality right the first
time.
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15. 14 Toyota-Way Principles
 Principle 6: Standardize tasks are the foundation for continuous
improvement and employee empowerment.
 Principle 7: Use visual control so no problems are hidden.
 Principle 8: Use only reliable, thoroughly tested technology that serves your
people and processes.
Section III – Add value to the organization by developing your people and partners
 Principle 9: Grow leaders who thoroughly understand the work, live the
philosophy, and teach it to others.
 Principle 10: Develop exceptional people and teams who follow your
company’s philosophy.
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16. 14 Toyota-Way Principles
 Principle 11: Respect your extended network of partners and suppliers by
challenging them and helping them improve.
Section IV – Continuously solving root problem drives organizational learning
 Principle 12: Go and see for yourself to thoroughly understand the situation
(genchi genbutsu).
 Principle 13: Make decisions slowly by consensus, thoroughly considering
all options, implement decisions rapidly.
 Principle 14: Become a learning organization through relentless reflection
(hensei) and continuous improvement (kaizen).
So we see that the JIT, Lean, 5S etc. are just tools that enable quality and
productivity. TPS is much more than that!
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17. The TPS house diagram
Two main pillars:
1. JIT (the most visible and highly
publicized characteristics of TPS)
2. Jidoka (never letting a defect pass
to the next station; and freeing
people from machines)
Base:
1. Heijunka – (Leveling out
production schedule for both
volume and variety)
2. Kaizen (Change for better =
continuous improvement)
3. Standard Work (When manpower,
equipment, and materials are used
in the most efficient combination)
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18. The TPS house diagram
• JIT means removing, as much as possible, the inventory used to buffer
operations against problem that may arise in production.
• The ideal one-piece flow is to make one unit at the rate of customer
demand or takt (German for meter).
• Using smaller buffer means quality defects become immediately visible.
• This will reinforce Jidoka which can halt the production (Andon).
• The production line restarts once workers resolve the problem.
• Less inventory and the Andon forces urgency among the workers.
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19. The TPS house diagram
• If the same problem happens repeatedly the management realizes the
critical situation and invests in Total Productive Maintenance, where
everyone learns how to clean, inspect and maintain equipment.
• In traditional system, if the machine is down, the urgency is missing
because the maintenance department is scheduled to fix it while
production continues through the depletion of inventory.
• People are the center of the house because only through continuous
improvement can the operation ever attain the system stability.
• People must be trained to see waste and solve problem at the root
cause by repeatedly asking why the problem really occurs.
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20. Eliminating Waste (Muda)
• First question the TPS asks is “What does the customer want from this
process?” (both internal as well as external customers). This defines
value.
• Through the customer’s eyes, we can then observe the process and
separate the value-added steps from the non-value added steps.
• This can be applied to any process – manufacturing, or a service.
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21. Eliminating Waste
• First step in removing non-value added steps from a process is to map
the process. Map the value stream following the actual path taken by
the part in the plant.
• Walk the full path yourself (genchi genbutsu).
• One can draw the path on a layout and calculate the time and distances
traveled (spaghetti diagram).
• Traditional cost saving focuses on value-added items and try to
improve those.
• TPS focuses on the entire value stream to eliminate the non-value
adding items.
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22. DSIMS 22

23. Types of waste
 Overproduction: Producing items for which there are no orders,
which generates wastes such as overstaffing, storage and transportation
costs because of excess inventory.
 Waiting: Workers having to stand around waiting for the next
processing step, tool, part etc. Or no work because of stock-outs, lot
processing delays, equipment downtime, and capacity bottlenecks.
 Unnecessary transport: Carrying WIP long distances, creating
inefficient transport, or moving parts in and out of storage facility.
Walking is a waste.
 Over-processing or incorrect processing: Taking unneeded steps to
process the parts. Inefficient processing due to poor tools and product
design, causing unnecessary motion and producing defects. Waste
generated when providing higher-quality products than is necessary.
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24. Types of waste
 Excess inventory: Excess raw material, WIP or finished goods causing
longer lead times, obsolescence, damaged goods. Extra inventory hides
problems such as production imbalances, late deliveries from
suppliers, defects, equipment downtime, and long set-ups.
 Defects: Production of defective parts or correction. Repair or rework,
scrap, replacement production, and inspection mean wasteful handling,
time and efforts.
 Unused employee creativity: Losing ideas, skills, improvements, and
learning opportunities by not engaging or listening to your employees.
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25. 5 S’s
• 5 S’s is simple to begin and gives good benefits.
• Each individual in an organization is asked to get rid of overburdening
items.
• Red tag attack : A red tag attack is the strategy of a group of people
going through the plant and putting red tags on everything that has not
been used within the last 30 days. The items that people feel are
necessary to "hold on to" must be justified to their superior, or the item
is taken out of the plant!
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27. 5 S
5 S: Important part of Kaizen/Lean Manufacturing
The 5 S stand for:
 Seiri - keep only what is absolutely necessary, get rid of things that you
don't need, i.e. simplify or sort.
 Seiton - create a location for everything, i.e. organize
or straighten.
 Seiso - clean everything and keep it clean, i.e. cleanliness or sweep.
 Seiketsu - implement Seiri, Seiton and Seiso plant wide, i.e. standardize.
 Shitsuke - assure that everyone continues to follow the rules of 5S, i.e.
stick to it or self discipline.
5S in the US: Sort, Straighten, Sweep, Standardize, Self Disciple
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28. 5 S in a Factory
Factory tour: Toyota vs. others.
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29. 5 S in Office
Before 5 S
After 5 S
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30. Life Without 5S 

31. Life With 5S 

32. JIT - BACKGROUND AND HISTORY
 Initially, JIT was used as a method for reducing inventories in Toyota's
shipyards, but later it evolved into a Japanese management philosophy
 First developed and perfected within the Toyota manufacturing plants by
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Taiichi Ohno
 JIT would only be successful if every individual within the organization
was involved and committed to it
 JIT has the capacity to strengthen the organization’s competitiveness
 Aimed at avoiding waste, reducing inventories and increasing production
efficiency

33. JUST-IN-TIME PRODUCTION SYSTEM
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What it is
 Management philosophy
 'Pull' System through the plant
What it does
 Attacks waste (time, inventory,
 scrap)
 Exposes problems and
bottlenecks
 Achieves streamlined production
What it requires
 Employee participation
 Industrial engineering/basics
 Continuing improvement
 Total quality control
 Small lot sizes
What it assumes
 Stable environment

34. THE KANBAN
 Essential component of Toyota's JIT concept.
 Japanese referred to Kanban as a simple parts-movement system that
depended on cards and boxes/containers to take parts from one
workstation to another on a production line.
 Ohno had developed the idea in 1956 from the super markets in the US.
 Kanban developed into a sophisticated information system.
 Ensured production in required quantities at the right time.
 A chain process in which orders flowed from one process to another, the
production or delivery of components was 'pulled' to the production line.
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35. Kanban at Toyota
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36. DSIMS 36

37. Jidoka
• Jidoka is a method to detect defects when they occur and automatically
stop production so an employee can fix the problem before the defect
continues downstream.
• Jidoka is also referred to as autonomation – equipment endowed with
human intelligence to stop itself when it has a problem.
• In-station quality is much more effective and less costly than inspecting
and repairing quality problem after the fact.
• Lean manufacturing dramatically increases the importance of building
things right the first time.
• With very low levels of inventory, there is little buffer to fall back on in
case there is quality problem.
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38. Andon System
• When the equipment shuts down because of a quality
problem, flags or light, usually with accompanying
music, signal that help is needed to solve the problem.
• This signaling system is called the Andon system.
• At Toyota, the Andon is called a “fixed-position line
stop system.”
• When a workstation in the assembly line signals a
problem, the production line is not stopped
immediately.
• The manufacturing team has until the product moves to
the next workstation to respond and address the
problem, before the Andon turns red and stops the
assembly line.
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39. Andon System
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40. Andon System
• If the problem is small enough that can be solved in the lead-time
between two workstation, 100% quality is achieved
without stopping the line.
• If the problem is complex, the team leader can conclude that
the line should stop.
• In TPS, the workstation detects the defects by using
countermeasures and error-proofing (poka-yoke).
• Applications of Andon system to service organizations like
call-center are obvious!
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41. The Five Steps of Lean Production/TPS
Implementation
Step 1: Specify Value
Define value from the perspective of the final customer. Express value in
terms of a specific product, which meets the customer's needs at a specific
price and at a specific time.
Step 2: Value Stream Mapping.
Identify the value stream, the set of all specific actions required to bring a
specific product through the three critical management tasks of any
business: the problem-solving task, the information management task, and
the physical transformation task. Create a map of the Current State and the
Future State of the value stream. Identify and categorize waste in the
Current State, and eliminate it.
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42. The Five Steps of Lean Production/TPS
Implementation
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Step 3: Create Continuous Flow
Make the remaining steps in the value stream flow. Eliminate functional
barriers and develop a product-focused organization that dramatically
improves lead-time.
Step 4: Create Pull Production
Let the customer pull products as needed.
Step 5: Perfection
There is no end to the process of reducing effort, time, space, cost, and
mistakes. Return to the first step and begin the next lean transformation,
offering a product which is ever more nearly what the customer wants.

43. Traditional process improvement vs.
TPS
• Traditional approach focuses on identifying local efficiencies. “Go to
the equipment, the value-added processes, and improve uptime, or
make the cycle faster, or replace the person with automated
equipment.”
• In TPS, large number of non-value-added steps are squeezed out.
• One way to achieve this is through cell formation (cellular
manufacturing), which should ideally result in one-piece flow of
products or services.
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44. One Piece Flow Production Cell
15
• First good Computer ready in 3 minutes
• 10 completed in 12 minutes
• Only 2 sub-assemblies in process at a time
• Only 2 minutes to discover a defect in the testing
department.
• Only 2 parts assembled may have the same defect if it
occurred in the base department

45. Benefits of One-Piece Flow
• Builds in quality – Every operator is an inspector and works to fix problems
in station before passing them on. If defects do get passed on, they are
detected quickly and problem can be immediately diagnosed and corrected.
• Creates flexibility – If shorter lead times, more flexibility to respond and
make what customer really wants. Pushes for set-up time reduction.
• Creates higher productivity – Every easy to spot the busy or idle station and
easier to calculate the value-added work.
• Frees up floor space – Because of inventory storage reduction.
• Improves safety – Smaller batches means simpler transportation system and
less accidents because of forklifts.
• Improves morale – People do high percentage value-added work and can see
the results of their work faster.
• Reduces cost of inventory – Obvious!
45

46. One Piece Flow
Batch Single Piece Flow
Catches Defects too Late
• How many more do you have?
•Where are they in the process?
•What is the root cause?
Catches Defects Immediately
• You only have one
• You know where it occurred
• Resolve the root cause immediately
The Next Process is the Customer … Never Send Defects !

47. Continuous Flow Production
Traditional Flow
Flow with JIT
Customers
Suppliers
Customers
Suppliers
Production Process (stream of
water)
Inventory (stagnant ponds)
Material
(water in stream)
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48. Ford vs. Toyota
• Ford’s mass production system was designed to make huge quantities of
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limited number of models.
• Toyota needed a system to make low volumes of different models using
the same assembly line.
• Ford had cash and a large market.
• Toyota needed to turn cash around quickly.
• Toyota didn’t have the resources for huge volumes of inventory and
economies of scale and afforded by Ford’s mass production system.

49. Ford vs. Toyota
• The mass production system was focused on short-term costs.
• “Make bigger machines and through economies of scale drive down
cost.”
• “Automate to replace people if it can be justified in terms of cost.”
• Then the business world got the quality religion from Deming, Juran,
Ishikawa and other quality gurus.
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50. Ford vs. Toyota
• Combining these Toyota developed the TPS which focused on speed in the
supply chain:
• “Shortening lead time by eliminating waste in each step of a process leads
to best quality and lowest cost, while improving safety and morale.”
• Toyota system demonstrates that focusing on quality actually reduced cost
more than focusing only on cost.
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51. THE TOYOTA WAY
The Lessons and
Secrets of Toyota way
It creates bonds among individual and patterns such that they
“move to fit together just right, working together” towards a common
goal.
Creating a WHOLE much greater and stronger than the SUM of
the individuals
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52. Companies who have implemented 5 S:
o Toyota
o Bosch
o Mahindra & Mahindra
o Suzuki
o The list is endless …

53. Companies currently using JIT
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o Harley Davidson
o Toyota Motor Company
o General Motors
o Ford Motor Company
o Manufacturing Magic
o Hawthorne Management Consulting
o Strategy Manufacturing Inc.

54. Reference
• Book:- The Toyota Way
• Wikipedia, Toyota Motor Co., Shmula.com
• http://www.toyota-global.com/
Videos
• https://www.youtube.com/watch?v=kce2L23yLcw
• https://www.youtube.com/watch?v=T5zcCk-uF3g
• https://www.youtube.com/watch?v=UEJHpE86MJo
• https://www.youtube.com/watch?v=Qvbly2i5dB4
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55. Quizz……
1. What automobile company did the lean production philosophy
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originate from?
a. Volkswagon
b. Toyota
2. What is Taiichi Ohno's claim to fame?
a. He's considered the father of the Toyota Production System.
b. He's considered the father of agile production.

56. 3. Product and finances are two of the flows of supply chain management
-- what's the third?
a. waste
b. information
4. Which comes first in the Toyota mission statement?
a. Velocity
b. Quality
c. Profit
d. cost reduction

57. 5. What is the objective of the Toyota Production System and Lean
Manufacturing?
a. to reduce cost
b. to improve profit
c. to eliminate everything that does not add value for the customer
d. to optimize capital investment
6. JIT is a philosophy of
a. re-engineering for breakthrough.
b. push production.
c. variability increase.
d. waste reduction.

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