Toyota Production

System

Toyota Production

System An Integrated Approach to Just-In-Time

Second Edition

Yasuhiro Monden

Institute of Industrial Engineers®

CHAPMAN &. HALL London· Glasgow· New York· Tokyo · Melbourne· Madras

© 1994 Yasuhiro Monden Softcover reprint of the hardcover 1 st edition 1994

ISBN-13: 978-1-4615-9716-2 e-ISBN-13: 978-1-4615-9714-8 DOl: 10.1007/978-1-4615-9714-8

Contents

Toyota Production System Japanese Tenns .......................................................... xi Foreword to the First Edition ............................................................................. xiii Preface ............................................... ...................................................... ............ xv Acknowledgments ............................................................................................... xvii

PART I TOTAL SYSTEM

1. Total Framework of the Toyota Production System ............... 1 Primary Purpose ............................................................................................ 1 Kanban System .................... ........................................................................... 6 Production Smoothing .................................................................................... 8 Shortening Setup Time ......................................................................... ........... 9 Process Layout for Shortened Lead Times .................. .................................. 10 Standardization of Operations .................................... .................................. 11 Autonomation ............................................................................................... 12 Improvement Activities ................................................................................. 13 Summary ...................................................................................................... 13

PART II SUBSYSTEMS

2. Adaptable Kanban System Maintains Just-Io-Time Production ........................................................ 15 Pulling System for JIT Production ............ .................................................... 15 What Is a Kanban? ....................................................................................... 16 Kanban Rules ..................... .......................................................................... 24 Other Types of Kanbans ............................................................................... 29

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3. Supplier Kanban and the Sequence Schedule Used. by Suppliers ................................................................... 37 Monthly Information and Daily Information ................................................. 38 Later Replenishment System by Kanban ....................................................... 39 Sequenced Withdrawal System by the Sequence Schedule Table ................... 42 problems and Countermeasures in Applying the Kanban System to Subcontractors ............................................................................................. 46 Guidance by the Fair Trade Commission Based on the Subcontractors Law and the Anti-Monopoly Law .......................................................................... 48 Supplier Kanban Circulation in the Paternal Manufacturer ... ...................... 53 Structure of the Supplier Kanban Sorting Office ...... ..................................... 56

4. Smoothed Production Helps Toyota Adapt to Demand Changes and Reduce Inventory ............................................. 63 Smoothing of the Total Production Quantity ................................................. 63 Smoothing Each Model's Production Quantity ............................................. 67 Comparison of the Kanban System with MRP ............................................... 71

5. The Information System Between Toyota, Its Dealers, and Parts Manufacturer-s .............................................................. 75 The Order Entry Information System ............................................................ 75 The Information System Between Toyota and Parts Manufacturers .............. 79 Production Planning System in Nissan ......................................................... 84

6. Computer Control System in an Automobile Factory ........... 89 Centralized Control System and Decentralized Control System .................... 89 Structure of a Hierarchical Decentralized Control System ....... ............. ........ 90 New ALC System at Toyota ........................................................................... 99

7. How Toyota Shortened Production Lead Time ................... 105 Four Advantages of Shortening Lead Time ................................................. /05 Components of Production Lead Time in a Narrow Sense .......................... 106 Shortening Processing Time through Single Production and Conveyance .. 107 Shortening Waiting Time and Conveyance Time ......................................... 114 Broad Approach to Reducing Production Lead Time .................................. I I 6

8. Reduction of Setup Time-Concepts and Techniques ........ 121 Setup Concepts ... ........................................................................................ 122

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9. Practical Procedure for Reducing Setup Time .................... 131 Analyzing Setup Actions .............................................................................. 131 Procedure for Setup Improvements ............................................................. 132 Informing Operators of Improvements ........................................................ 139 Organization Structure for Promoting Setup Time Reduction ..................... 142

10. Standard Operations Can Attain Balanced Production with Minimum Labor ........................................................... 145 Determining the Components of Standard Operations ................................ 145 Proper Training and Follow-Up: The Key to Implementing a Successful System ........................................................................................................ 158

11. Machine Layout, Multi-Function Workers, and Job Rotation Help Realize Flexible Workshops ........... 159 Shojinka: Meeting Demand through Flexibility ........................................... 159 Layout Design: The U-Turn Layout ............................................................ 161 Attaining Shojinka through Multi-Function Workers .................................. 166

12. Improvement Activities Help Reduce the Work Force and Increase Worker Morale ...................................................... 177 Improvements in Manual Operations .......................................................... 177 Reduction of the Work Force ...................................................................... 179 Improvements in Machinery ........... ............................................................ 183 Job Improvements and Respect for Humanity ............................................. 185 The Suggestion System ... ............................................................................. 186 Kanban and Improvement Activities ...................................................... ..... 190 QC Circles .................................................................................................. 193

13. 5S-Foundation for Improvements ..................................... 199 Visual Control ................ ............................................................................ 202 Practical Rules for Seiton ........................................................................... 207 Seiso, Seiketsu, Shitsuke .............................................................................. 214 Promotion of5S System .............................................................................. 217

14. "Autonomous Defects Control" Assures Product Quality ... 221 Statistical Quality Control .......................................................................... 222 Autonomation ............................................................................................. 224 Autonomation and the Toyota Production System ....................................... 227 Robotics ...................................................................................................... 236 Company-Wide Quality Control ................................................................. 237

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15. Functional Management to Promote Company-Wide Quality Control and Cost Management ............................... 239 Quality Assurance ........................................................................... ........... 240 Cost Management ...................................................... ................................. 240 Organization of the Functional Management System ............................ ...... 245

PART III QUANTITATIVE TECHNIQUES

16. Sequencing Method for the Mixed-Model Assembly Line to Realize Smoothed Production .......................................... 253 Goals of Controlling the Assembly Line ...................................................... 253

17 . New Sequence Scheduling Method for Smoothing .............. 265 Basic Logic of Sequence Scheduling ........................................................... 265 Sequence Scheduling Using Artificial Intelligence ...................................... 270 Diminishing Differences Between the Product Lead Times ......................... 275

18. Determining the Number of Kanban Pertinent to the Alternative Withdrawal Systems .......................................... 279 Constant Quantity, Nonconstant Cycle Withdrawal System ........................ 280 Constant Cycle, Nonconstant Quantity Withdrawal System ........................ 283 Changing the Cycle Time of Standard Operations Routine Instead of the Number of Kanban ..................................................................................... 285 The Influence of the Supervisor on the Total Number of Kanban ................ 286 Constant Withdrawal Cycle System for the Supplier Kanban ...................... 287

19. Computer System for Kanban System Support .................. 291 Technology Data Base Subsystem ............................................................... 291 Kanban Master Planning Subsystem ........................................................... 293 Actual Peiformance Collection and Transition Subsystems ........................ 300

20. Numerical Analysis for Productivity Improvement ............ 303 Analysis Method for Work Place Improvements .......................................... 303 Performance Analysis of Facility and Worker ............................................. 307 Evaluation of Overall Production Performance after Improvement ............ 3 11

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PART IV IMPLEMENTATION

21. Review of Kanban System Principles ................................... 313 Functions of a Kanban ................................................................................ 313 Controlling Production-Ordering Kanbans ................................................ 318 Control of Tools and Jigs through the Kanban System ................................ 322 Sequenced Withdrawal and the Later-Replenishment System Withdrawal .. 323

22. Prerequisites to Implementing the Toyota Production System .................................................... 327 Introductory Steps to the Toyota Production System ................................... 327 Introduction of llT at Toyo Aluminum-A Case Study ................................ 330

23. Applying the Toyota Production System Overseas .............. 335 Conditions for Internationalizing the Japanese Production System ............. 335 Advantages of the Japanese Maker-Supplier Relationship .......................... 337 Reorganization of External Parts Makers in the United States .................... 339 Solution of Geographical Problems Involving External Transactions ......... 340 External Transactions of NUMMI .............................................................. 342 Industrial Relations Innovations ................................................................. 343 Conclusion ................................................................................................. 348

Appendix 1: JIT Delivery System Can Ease Traffic Congestion and the Labor Shortage ........................................................ 349 JIT Will Contribute to Rationalization of Physical Distribution .................. 349 Genuine llT System Has Prerequisite Conditions ....................................... 350 External Environmentfor Physical Distribution Should Be Rationalized .... 351

Appendix 2: Goals Coordination Method .................................. 353 Experiment Outline ..................................................................................... 353 Conclusion ................................................................................................. 364

Appendix 3: Quantitative Analysis of Stocks in a JIT Multistage Production System Using the Constant Order Cycle Withdrawal Method ................................................... 367 Introduction ................................................................................................ 367 Hypothetical Production System ................................................................. 367 Analysis of the Hypothetical System Using the Simulation Approach .......... 376

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Appendix 4: Quantitative Analysis of Lot Size in a JIT Production System Using Constant Order Quantity "Tithdra.wal Method. ............................................................. 381 Introduction ................................................................................................ 381 Hypothetical Production System ................................................................. 381 Modeling the Hypothetical lIT System ................ ........................................ 382

Epilogue ............................................................................................................ 401 Bibliography and References .............. ............................................................ ... 407 Index .................................................. ................................................................ 419

Toyota Production System Japanese Terms

Andon - a lighted sign giving information about work being done; for example,

progress

Ato-Hoju -later replenishment system

Bakayoke - see Pokayoke

Five S - Seiri, Seiton, Seison, Seiketsu, Shitsuke

Heijunka - smoothing

Ikko-Nagashi - single-unit production and conveyance

Jidoka - autonomation; autonomous defect control

Junjo-Biki - sequenced withdrawal

Kaizen - improvement

Kanban - tag-like card that communicates product information

Kinohbetsu Kanri - functional management

Mizusumashi - whirligig

Muda - slack or waste of resources

Ninben-no-aru Jidoka - see Jidoka

Pokayoke - foolproof

Ringi - circulation among top executives

Seiketsu - maintaining Seiri, Seiton, and Seison

Seiri - identifying & separating necessary items from unnecessary items

Seiso - maintaining a clean workplace

Seiton - neat placement and identification of needed work items

Shitsuke - instilling Seiri, Seiton, Seison, and Seiketsu in workers

Shojinka - flexible work force

Shoninka - reduction in the work force

Shoryokuka - reduction in work hours required to produce a unit

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So-ikufu - creative thinking or inventive ideas

Te-i-in-se-i - quorum system

Yo-i-don - ready, set, go

Foreword to the First Edition

The technique we call the Toyota production system was born through our various efforts to catch up with the automotive industries of western advanced nations after the end of World War II, without the benefit of funds or splendid facilities.

Above all, one of our most important purposes was increased productivity and reduced costs. To achieve this purpose, we put our emphasis on the notion of eliminating all kinds of unnecessary functions in the factories. Our approach has been to investigate one by one the causes of various "unnecessaries" in manufac­turing operations and to devise methods for their solution, often by trial and error.

The technique of Kanban as a means of Just-in-time production, the idea and method of production smoothing, and Autonomation (Jidoka), etc., have all been created from such trial-and-error processes in the manufacturing sites.

Thus, since the Toyota production system has been created from actual practices in the factories of Toyota, it has a strong feature of emphasizing practical effects, and actual practice and implementation over theoretical analysis. As a result, it was our observation that even in Japan it was difficult for the people of outside companies to understand our system; still less was it possible for the foreign people to understand it.

This time, however, Professor Monden wrote this book by making good use of his research and teaching experiences in the United States. Therefore, we are very interested in how Professor Monden has "theorized" our practice from his academic standpoint and how he has explained it to the foreign people. At the same time, we wish to read and study this book for our own future progress.

At no other time in history has the problem of productivity received so much discussion. No longer is it solely an economic problem; now it presents a serious political problem in a form of trade frictions. At such a time it would be our great pleasure if the Toyota production system we invented could be of service to the problem of American productivity.

Although we have a slight doubt whether our Just-in-time system could be applied to the foreign countries where the business climates, industrial relations, and many other social systems are different from ours, we firmly believe there is

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no significant difference among the final purposes of the firms and people working in them.

Therefore, we hope and expect that another effective American production system will be created utilizing this book for reference.

TAIICHO OHNO

FORMER VICE PRESIDENT,

TOYOTA MOTOR CORPORATION

FORMER PRESIDENT,

JAPAN INDUSTRIAL MANAGEMENT ASSOCIATION

FORMER CHAIRMAN,

TOYODA SPINNING AND WEAVING CO .• LTD.

Preface

The Just-in-time (JIT) manufacturing system is an internal system in use by its founder, Toyota Motor Corporation, but it has taken on a new look.

Toyota Production System, Second Edition systematically describes the changes that have occurred to the most efficient production system in use today. Since the publication of the first edition of this book in 1983, Toyota has integrated JIT with computer integrated manufacturing technology and a strategic informa­tion system.

The JIT goal of producing the necessary items in the necessary quantity at the necessary time is an internal driver of production and operations management. The addition of computer integrated technology (including expert systems by artificial intelligence) and information systems technology serve to further reduce costs, increase quality, and improve lead time. The new Toyota production system considers how to adapt production schedules to the demand changes in the marketplace while satisfying the goals of low cost, high quality, and timely delivery.

The first edition of this book, Toyota Production System, published in 1983, is the basis for this book. It was translated into many languages including Spanish, Russian, Italian, Japanese, etc., and has played a definite role in inspiring production management systems throughout the world.

In parallel with the distribution of the first edition of this book, the Toyota production system (also known as Just-in-time) has been applied throughout the world. This is evidence that the JIT concept within the Toyota production system is applicable to any country regardless of location, economic, and civil develop­ment. Additionally, this production system can be utilized in any size company in any industry.

Although this book is based on my previous work, Toyota Production System, it was written as an entirely new book. Nine chapters have been added, and chapters from the first edition have been revised or enlarged. Written for practitioners and researchers alike, this new book will provide a balanced and broad approach to the Japanese production system.

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The major differences between the Toyota production system of a decade ago and the current system are twofold: (1) computer integrated manufacturing and strategic information systems have been integrated into the JIT approach to facilitate flexibility in responding to customer demand; and (2) continuous improvement activities ("kaizen") have been incorporated to maintain the integ­rity of the overall process and to increase worker morale.

Strategic Information System and elM Linkage of marketing, production (manufacturing), and suppliers through an information network (Toyota Network System) allows each component of the company to make timely decisions concerning volume and variety of end products. Changes in consumer preferences and sales trends for certain product types can be swiftly conveyed to the people in product development, sales, production, and parts manufacturing, who can quickly respond to the data. The end result is a more responsive company.

Within the Toyota Network System is a subsystem for in-house production information called the Assembly Line Control System (ALC). The ALC includes information used in computer-aided manufacturing and computer-aided planning systems.

In the development of this strategic information system, Toyota used the basic premises found in the JIT production system. The ALC works as a pull system in which each line and process in each plant requests, receives, and uses only the information it needs at the moment.

This book will show in detail how the above approaches are harmoniously integrated into JIT and how Toyota's new approach can be useful in many ways to a variety of industries.

YASUHIRO MONDEN

PROFESSOR, PH.D.

INSTITUTE OF SOCIO-EcONOMIC PlANNING

UNIVERSITY OF TSUKUBA

TSUKUBA, JAPAN

Acknowledgments

This book is the fruit of much guidance and cooperation of many people to whom I am very grateful. Above all, I am grateful to the original founder of the Toyota production system, the late Mr. Taiichi Ohno (former vice president of Toyota). Mr. Ohno shared generously his concept for the system and he authored the foreword to the first edition of this book. He was also my co-editor for a Japanese­language book titled New Development of Toyota Production System.

Mr. Joji Arai, executive directorofInternational Productivity Service (former director of U.S. office of Japan Productivity Center) kindly arranged the publica­tion and authored the introduction to the first edition of this book. The generosity of these two men will never be forgotten.

Further, I am indebted to the kind guidance of many manufacturing managers within and outside of Japan. It was these people that provided me with the most important information for this book. They allowed me opportunities to observe their manufacturing plants and to consult with many others.

From my research office at Tsukuba University in Japan, Ms. Waka Katagiri contributed to data collection and Ms. Masako Yoshinari contributed greatly to the preparation of the English draft.

Thanks also go to Dr. Mohammad Aghdassi, my graduate student at the University of Tsukuba, who collaborated on the quantitative analysis to evaluate the usefulness of the JIT system described in Appendices 3 and 4.

The English language version of this book was prepared while I was serving as a visiting professor of the School of Management and Economics, California State University, Los Angeles, during my sabbatical year from September 1991 to August 1992. I am indebted to Dr. John Y. Lee for arranging that opportunity.

Also, I wish to thank the Institute of Industrial Engineers. The contribution of Ms. Maura Reeves is greatly appreciated.

Through the network of communication and collaboration among all of these people, this book was born. I feel that the greatest pleasure in life lies in this kind of collaboration.

Finally, I would like to dedicate this book to my wife Kimiko whose daily support is the basis for my work in both Japan and in the United States.

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