WCM.

/AJ 07-2001/TPSHandout 1

TOYOTA PRODUCTION SYSTEM

1.0 INTRODUCTION

1.1 TOYOTA PRODUCTION SYSTEM

Toyota Motor Company former vice-president Mr Taiichi Ohno of Toyota

Corporation, developed the Toyota Production System (TPS) and they have been
practicing and refining the technique. This technique was well received by many
manufacturing sectors outside the automotive industry. Small lot production,
frequent delivery of parts and components, leveling of production volume, and
reduction inset-up time of dies, practised under this system through multiple-skill
training of workn9.ipl4eu4e

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basically means to produce the necessary units in the necessary quantities at the
necessary time. Autonomation (Jidoka in Japanese) may be loosely interpreted as
autonomous defects control. It supports Just-in-time by never allowing defective
units from a preceding process to flow into and disrupt subsequent process.

Two other concepts that are also key to the Toyota Production System include
Flexible Workforce (Shojinka in Japanese) which means varying the number of
workers to demand changes, and Creative thinking or inventive ideas (Shoikufu),
or capitalizing on worker suggestions.

To realize the above four concepts, Toyota has established the following systems
and methods:
1. Kanban system to maintain Just-in-time production.
2. Production smoothing method to adapt to demand changes.
3. Shortening of the setup time for reducing the production lead time.
4. Standardization of operations to attain line balancing.
5. Machine layout and multi-function workers for the flexible workforce concept.
6. Improvement activities by small groups and the suggestion system to reduce
the workforce and increase the worker's morale.
7. Visual control system to achieve the Autonomation concept.
8. Functional Managements system to promote company-wide quality control.

1.3.1 Kanban system

Kanban system is the way to manage the Just-in-time production method. Kanban
system is an information system to harmoniously control the production quantities
in every process. Unless the various prerequisites of this system are implemented
perfectly (i.e. design of processes, standardization of operations and smoothing of
production, etc.), then Just-in-time will be difficult to realize, even though the
Kanban system is introduced.

A Kanban is a card put in a rectangular vinyl envelope. Two kinds are mainly used:
withdrawal Kanban and production-ordering Kanban. A withdrawal Kanban details
the quantity which the subsequent process should withdraw, while a production-
ordering Kanban shows the quantity which the preceding process must produce.
These cards circulate within Toyota factories, between Toyota and its cooperative
companies, and within the factories of cooperative companies. In this manner, the
Kanbans can contribute information on withdrawal and production quantities in
order to achieve Just-in-time production.

Although the Toyota production system has the production management

philosophy that units could be producedwithout any slack or unnecessary stock by
regarding all of the human resources, machine, and materials as perfect, the risk
of variations in production needs still exists. The risk is handled by the use of
overtime and improvement activities at each process.

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1.3.2 Smoothing of Production

The smoothing of production is the most important condition for production by

Kanban and for minimizing slack time in regards to manpower, equipment, and
works in process; it is the cornerstone of the Toyota production system.

Production smoothing minimzes the variation in the withdrawn quantity of each

part produced at each subassembly, thereby allowing the subassemblies to
produce each part at constant speed or at a fixed quantity per hour. To promote
smoothed production corresponding to such a variety of products, it is necessary
to have general purpose or flexible machines. By putting minimum instruments
and tools on these machines, Toyota has specified production processes to
accommodate the general usefulness of these machines.

And advantage of smoothed production responding to product variety is that the

system can adapt smoothly to the variations in customer demand by gradually
changing the frequency (times) of lots with altering the lot size in each process, or
fine-tuning of production by Kanban.

1.3.3. Setup problems

The most difficult point in promoting smoothed production is the setup problem. In
a pressing process, for example, common sense dictates that cost reduction can
be obtained through continuously using one type of die, thereby allowing for the
biggest lot size and reducing setup costs. However, under the situation where the
final process has averaged its production and reduced the stocks between the
punchpress and its subsequent body line, the pressing department as a preceding
process must make frequent and speedy setups, which means altering the types
of dies for the pressing corresponding to a great variety of products, each
frequently withdrawn by the subsequent process.

At Toyota, the setup time of the pressing department had been about 2 or 3 hrs
from 1945 to 1954. It was reduced to a quarter hour in the years 1955-64, and
after 1970, it dropped to only 3 min.

1.3.4 Design of processes

According to Toyota production system, the layout of machines would be arranged

to smooth the production flow. Therefore, each worker would handle three types of
machines; for example, a worker might handle a lathe, a milling machine, and a
drilling machine at the same time. This system is called multi-process holding. In
other words, the single-function worker, a concept which previously prevailed in
Toyota factories, has become a multi-function worker.

The arrangement of multi-process holding line, leads to the following benefits:

• Unnecessary inventory between each process can be eliminated.
• The multi-process worker concept can decrease the number of workers
needed, and thereby increase productivity.

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• As workers become multi-functional workers, they can participate in the total

system of a factory and thereby feel better about their jobs.
• By becoming a multi-functional worker, each worker can engage in teamwork,
or workers can help each other.

1.3.5. Standardization of jobs

The standard operation at Toyota is a bit different from the usual operation in that
it shows mainly the sequential routine of various operations taken by a worker who
handles multiple kinds of machines as a multi-functional worker.

A cycle time, or tact time, is the standard specified number of minutes and
seconds that each line must produce one product or one part. This time is
computed by the following two formulas. The necessary output per month is
predetermined from the demand side.

Necessary output per day = necessary output per month

operating days per month

Cycle time = operating hours per day

Necessray output per day

Each production department will be informed of this necessary quantity per day
and the cylce time from the central planning office once in each previous month. In
turn, the manager of each process will determine how many workers are
necessary for this process to produce one unit of output in a cycle time. The
workers of the entire factory then must be repositioned in order that each process
will be operated by aminimum number of workers.

1.3.6. Autonomation

Autonomation means to build in a mechanism a means to prevent mass-

production of defective work in machines or product lines.

The autonomous machine is a machine to which an automatic stopping device is

attached. In Toyota factories, almost all machines are autonomous, so that mass-
production of defects can be prevented and machine breakdowns are
automatically checked. The so-called Foolproof (Bakayoke or Pokayoke) is one
such mechanism to prevent defective work by putting various checking devices on
the implements and instruments.

The idea of Autonomation is also expanded to the product lines of manual work. If
something abnormal happens in a product line, the worker pushes his stop button,
therby stopping his whole line. The Andon in the Toyota system has an important
role in helping this autonomous check, and is a typical examples of Toyota's
"Visual Control System", the purpose of detecting troubles inone process, an
electric light board, called Andon, indicating a line stop, is hung so high in a factory

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that it can easily be seen by everyone. Autonomation is a mechanism that

autonomously checks something unusual in a process.

1.3.7 Improvement activities

The Toyota production system integrates and attains different goals (i.e. quantity
control, quality assurance and respect-for-humanity) while pursuing its ultimate
goal of cost reduction. The process by which all these goals are realized is
improvement activities, a fundamental element of the Toyota system. This is what
makes the Toyota production system really tick. Each worker has the chance to
make suggestions and propose improvements via a small group called a QC
circle. Such a suggestion-making process allows for improvement in quantity
control by adapting standard operations routine to changes in cycle time; in quality
assurance, by preventing recurrence of defective works and machines; and lastly,
in respect-for-humanity, by allowing each worker to participate in the production
process.

2.0 Summary

The basic purpose of the Toyota production system is to increase profits by

reducing costs - that is, by completely eliminating waste such as excessive stocks
or workforce.

The Toyota production system is a unique, revolutionary system; however, there is

no problem for foreign companies in adopting this system except for the possibility
of union problems (i.e. the multi-function workers). In its simplest terms, the Toyota
production system might be interpreted as a special case of materials
requirements planning.

American and European companies could adopt this system, but might encounter
some difficulties if they used it partially. Many Japanese companies are already
using it in its imperfect form as well as its perfect form. The Kanban system and
the smoothing of production could be particularly inportant to American and
European companies. To implement it the Toyota system perfectly, however, top
management must proceed through the bargaining process with their union
people. Such a process has often been experienced by many Japanese
companies, too.