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Why study Toyota?• In 2002, Lexus outsold BMW, Cadillac and Mercedes
Benz in the US for the third year in a row.
• In 2003, Toyota sold more vehicles than Ford and Chevrolet.
• The company has made profit every year over the last 25 years and has approximately $20-$30 billion in cash on a consistent basis.
Where they are today ?• Largest automaker and most profitable • Produce a vehicle every 6 seconds• Brands: Toyota, Lexus, Scion,Prius• Automotive business accounted for 90% of
revenues• Other 10%: housing, marine telecommunications,
ITS, Biotechnology and Afforestation• Success attributed to Toyota Production System
How did it happen?• Incredible consistency comes from operational
excellence.• The operational excellence is based on the
quality improvement tools and methods developed by Toyota (under the TPS): such as JIT, kaizen, one-piece-flow, jidoka, and heijunka!
• These technique triggered a “lean revolution” in the manufacturing sector.
INTRODUCTION• Toyota motor corporation’s vehicle production
system is a way of “making things” that is referred to as “lean manufacturing system”.
• Objective: “making the vehicles ordered by customers in the quickest and most efficient way, in order to deliver the vehicles as quickly as possible”.
• Toyota Production System
•Just-in-Time• Pull System• Continuous Flow Processing• Takt Time• Kanban• 3 M• 5 S
Heijunka Kaizen (Continuous Improvement)
•Jidoka (Automation)
• Andon- to indicate operation status• Genchi Genbutsu
ELEMENTS OF TPS
JUST IN TIMEOne of the two main pillars of TPS.
Just-in-Time means PRODUCING:a) Only what is needed
b) in necessary quantity
c) at necessary time
Pull System (Don’t Push) Produce only when your customer demands
the product in the required quantity. Run the production according to this demand.
Continuous Flow Production In TPS it means arranging work inside each
process to flow smoothly from one step to other.
Takt Time Takt is a German word meaning “meter”. It is the time to finish a given amount of work-
doing a single operation, making one component, or assembling an entire car.
Takt time =Total daily operating time
Total production requirement
JIDOKA• Jidoka (never letting a defect pass to the next station;
and freeing people from machines)• Jidoka is also referred to as autonomation .• Employee Empowerment - Jidoka.• Multi-tasking - Shojinka.• Andon Cord – to inform everyone about any
problem.
• Jidoka prevents the production of defective products, eliminates overproduction and focuses attention on understanding the problem and ensuring that it never recurs.
KANBANKanban is a simple but effective control that helps JIT production work.The word KAN= card BAN=signalsIt is a Japanese word for card & the use of card is central to many Japanese control systems including one at Toyota whose kanban system has received.
KAIZEN• Countinual Improvement• Minute Observation – “Go to gemba.”• Eliminating excessive movement.• No spending on Kaizen activities.• Poka-yoke – Error proof• This is performed by all employees rather than
by specialists.
5S1. SEIRI = SIFTING
2. SEITON = SORTING
3. SEISO = SWEEPING
4. SEIKETSU = SPICK ‘N’ SPAN
5. SHITSUKE = SUSTAINANCE
SIETON = SORTING Arranging wanted items in proper order, which
means place for every thing and every thing in its place.
SIESO = SWEEPING AND CLEANING Sweeping and cleaning means surface and other
areas free from oil and chemicals that may or may not cause slippage, fire or any other possible hazard.
SEIKETSU = SPICK ‘N’ SPAN• Spick ‘n’ span means visible neatness. A nice,
clean and tidy workplace• Affects directly to the performance and quality
of workforce.
SHITSUKE = SUSTAINANCE Instilling supreme attitude and constantly
reminding the workforce about 5 S philosophy through training, competition, encouragement by the top management.
ELIMINATION OF WASTE• The Toyota Production System teaches that
waste, “muda” is one of the evils that should be avoided.
• SEVEN ELEMENTS OF WASTE Overproduction Waiting Unnecessary transport Over-processing Defect Inventory Motion
REDUCTION OF WASTE• Reduce Setup Times • Small-Lot Production• Employee Involvement and Empowerment• Quality at the Source• Equipment Maintenance • Pull Production
14 Toyota-Way Principles• SECTION 1:LONG TERM PHILOSPHY• PRINCIPLE 1: BASE YOUR MANAGEMENT DECISION
ON A LONG TERM PHILOSPHY,EVEN AT THE EXPENSE OF SHORT TERM FINANCIAL GOALS.
• SECTION 2:RIGHT PROCESS RIGHT RESULTS• PRINCIPLE 2:CREATE CONTINOUS PROCESS FLOW
TO BRING PROBLEMS TO THE SURFACE.• PRINCIPLE 3:USE ‘PULL’SYSTEM TO AVOID OVER
PRODCTION
• PRINCIPLE 4:LEVEL OUT THE WORK LOAD.• PRINCIPLE 5:BUILD A CULTURE OF STOPPING TO FIX
PROBLEMS, TO GET QUALITY RIGHT THE FIRST TIME.• PRINCIPLE 6:STANDARDISE TASK ARE THE
FOUNDATION FOR CONTINUOUS IMPROVEMENT AND EMPLOYEES 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 3:ADD VALUE TO THE ORGANISATION BY DEVLOPING YOUR PEOPLE AND PARTNERS.
• PRINCIPLE 9:GROW LEADERS WHO THOROUGHLY UNDERSTAND THE WORK,LIVE THE PHILOSPHY AND TEACH IT TO OTHERS.
• PRINCIPLE 10:DEVELOP EXCEPTIONAL PEOPLE AND TEAMS WHO FOLLOWS YOUR COMPANIES PHILOSPHY.
• PRINCIPLE 11:RESPECT YOUR EXTENDED NETWORK OF PARTNERS AND SUPPLIEDBY CHALLENGING THEM HELPING THEM TO IMPROVE.
• SECTION 4:CONTINOUSLY SOLVING ROOT PROBLEMS DRIVES ORGANISATIONAL LEARNING.
• PRINCIPLE 12: SEE FOR YOURSELF TO THOROUGHLY UNDERSTAND THE SITUATION.
• PRINCIPLE 13:MAKE DECISION SLOWLY BY CONSENSUS ,THOROGHLY CONSIDERING ALL OPTIONS, IMPLEMENT DECISION RAPIDLY.
• PRINCIPLE 14:BECOME A LEARNING ORGANISATION THROUGH RELENTLESS REFLECTION AND CONTINOUS IMPROVEMENT.
CONCLUSION Global adaptation• Since Toyota production system has been
created from actual practices in the factories of Toyota, it has a strong feature of emphasising practical effects, and actual practice and implication over theoretical analysis.
• This system can play a great role in the task of improving the constitutions of the companies world-wide.