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The Toyota Production System
A Transition from Mass Production to
Lean Manufacturing and Supply Chain Management
Gunjan Tiwari
D-19
SIMS
MBA 2015-17
TOYOTA
 Toyota Motor Corporation is a Japanese automotive
manufacturer headquartered in Toyota, Aichi, Japan.
 In March 2014 the multinational corporation consisted of
338,875 employees worldwideand, as of November 2014, is
the fourteenth-largest company in the world by revenue.
 Toyota was the largest automobile manufacturer in 2012
(by production) ahead of the Volkswagen Group and
General Motors.
 Toyota is the world's first automobile manufacturer to
produce more than 10 million vehicles per year.
 As of July 2014, Toyota was the largest listed company in
Japan by market capitalization and by revenue.
Major Revolutions in
Manufacturing
 1776, Adam Smith The Wealth of Nations
 1910, Henry Ford and Mass Manufacturing.
 1980, The Toyota Production System.
 Lean Manufacturing.
 Supply Chain Management.
The Gestation of TPS
 Eiji Toyoda visit to Henry Fords factory in 1950.
 The SMED (Single-digit in Minutes Exchange of Dice)
program at the stamping plant.
 Demings quality movement in Japan.
 The Engineers: Taiichi Ohno and Shigeo Shingo
 Japanese Manufacturing hits America in 1970
Main Features of TPS
 Greater Product Variety
 Fast Response (Flexibility)
 Stable Production Schedules
 Supply Chain Integration
 Demand Management
Elements of TPS
 The SMED Program.
 Highlight Problems (Jidoka).
 Gradual Elimination of Waste.
 Continuous Improvement (Kaizen), Root-Cause Analysis (5-whys?) and Fool-
proofing (Poka-Yoke).
 Cross-Trained Workers.
 Just-In-Time Production.
 Stable Production Schedules (Heijunka)
Traditional Buffered Supply
Chain
Assembler
2nd
Tier
1st
Tier
Flow of Production
Flow of Information
Customer
Demand
The Just-in-Time Supply Chain:
Look Ma No Stocks!
Toyota
2nd
Tier
1st
Tier
Flow of Production
Flow of Information
Customer
Demand
Expectations from Suppliers
 Frequent deliveries.
 Hours (not days) lead time.
 Rapid response capability (not from stocks).
 Delivery to assembly line at the right time in the
right sequence without inspection.
 Reliability (quality and timing).
Supplier Relationships
 Long-term, steady relationships with a few
suppliers.
 Negotiation based on a long term commitment to
productivity and quality improvement.
 Interested in supplier capabilities.
 Continuous improvement.
 Product/process technology.
 Design for manufacturability.
Whats in it for a supplier?
 A Stable Manufacturing Environment.
 Steady production volume.
 Leaner Processes.
 Cost/Flexibility/Quality
 Profits.
THANK YOU

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  • 1. The Toyota Production System A Transition from Mass Production to Lean Manufacturing and Supply Chain Management Gunjan Tiwari D-19 SIMS MBA 2015-17
  • 2. TOYOTA Toyota Motor Corporation is a Japanese automotive manufacturer headquartered in Toyota, Aichi, Japan. In March 2014 the multinational corporation consisted of 338,875 employees worldwideand, as of November 2014, is the fourteenth-largest company in the world by revenue. Toyota was the largest automobile manufacturer in 2012 (by production) ahead of the Volkswagen Group and General Motors. Toyota is the world's first automobile manufacturer to produce more than 10 million vehicles per year. As of July 2014, Toyota was the largest listed company in Japan by market capitalization and by revenue.
  • 3. Major Revolutions in Manufacturing 1776, Adam Smith The Wealth of Nations 1910, Henry Ford and Mass Manufacturing. 1980, The Toyota Production System. Lean Manufacturing. Supply Chain Management.
  • 4. The Gestation of TPS Eiji Toyoda visit to Henry Fords factory in 1950. The SMED (Single-digit in Minutes Exchange of Dice) program at the stamping plant. Demings quality movement in Japan. The Engineers: Taiichi Ohno and Shigeo Shingo Japanese Manufacturing hits America in 1970
  • 5. Main Features of TPS Greater Product Variety Fast Response (Flexibility) Stable Production Schedules Supply Chain Integration Demand Management
  • 6. Elements of TPS The SMED Program. Highlight Problems (Jidoka). Gradual Elimination of Waste. Continuous Improvement (Kaizen), Root-Cause Analysis (5-whys?) and Fool- proofing (Poka-Yoke). Cross-Trained Workers. Just-In-Time Production. Stable Production Schedules (Heijunka)
  • 7. Traditional Buffered Supply Chain Assembler 2nd Tier 1st Tier Flow of Production Flow of Information Customer Demand
  • 8. The Just-in-Time Supply Chain: Look Ma No Stocks! Toyota 2nd Tier 1st Tier Flow of Production Flow of Information Customer Demand
  • 9. Expectations from Suppliers Frequent deliveries. Hours (not days) lead time. Rapid response capability (not from stocks). Delivery to assembly line at the right time in the right sequence without inspection. Reliability (quality and timing).
  • 10. Supplier Relationships Long-term, steady relationships with a few suppliers. Negotiation based on a long term commitment to productivity and quality improvement. Interested in supplier capabilities. Continuous improvement. Product/process technology. Design for manufacturability.
  • 11. Whats in it for a supplier? A Stable Manufacturing Environment. Steady production volume. Leaner Processes. Cost/Flexibility/Quality Profits.