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The Toyota Production System
High Quality and Low Cost
Readings;
James Womack, Daniel T. Jones and Daniel Roos,The Machine that Changed the World, 1990, Ch 3 and 4
Kenneth N. McKay, The Evolution of Manufacturing Control-
What Has Been, What Will Be Working Paper 03 2001
Michael McCoby, Is There a Best Way to Build a Car?HBR Nov-Dec 1997
COST VS
DEFECTS
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Consumer Reports
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Gains of imports
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The Toyota Production System
Historical View
Performance measures
Elements of TPSDifficulties with Implementation
Six Eras of Manufacturing Practice
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Three Major Mfg Systems
from 1800 to 2000
1800 1900 2000
Machine tools, specialized machine tools, Taylorism, SPC, CNC, CAD/CAM
InterchangeableParts at U.S.
Armories
MassProductionat Ford
ToyotaProductionSystem
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Key Elements for New Mfg Systems
Japanese
Banks
Taiichi
Ohno
CNC,Integrationof Labor
Jobs,
Security
Post WarToyotaProductionSystem
EarningsHenry
Ford
Moving
AssemblyLine,etc
$5/day
Immigrant
Trans-
portation
Mass
Production
U.S.GovtRoswellLee/
John
Hall
MachineTools,
Division of
Labor
YankeeIngenuityMilitaryInterchange-able Parts
ResourcesLeaderEnablingTechnology
WorkForceMotivation
Need ofSociety
Element/
System
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Q. By what method did these
new systems come about?
A. Trial and Error
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History of the Development of the ToyotaProduction System ref; Taiichi Ohno
1945 1975
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The Toyota Production System
Historical View
Performance measures
Elements of TPSDifficulties with Implementation
Six Eras of Manufacturing Practice
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Japanese Japanese in American in A ll Europei n J apa n North A me rica North A me rica
Performance:
Producvitity (hours/Veh.) 16.8 21.2 25.1 36.2
Quality (assembly
defects/100 vehicles) 60 65 82.3 97
Layout:
Space (sq.ft./vehicle/yr) 5.7 9.1 7.8 7.8
Size of Repair Area (as %
of assembly space) 4.1 4.9 12.9 14.4
Inventories(days for 8
sample parts) 0.2 1.6 2.9 2
Work Force:
% of Work Force in Teams 69.3 71.3 17.3 0.6
Job Rotation (0 = none,
4 = frequent) 3 2.7 0.9 1.9
Suggestions/Employee 61.6 1.4 0.4 0.4
Number of Job Classes 11.9 8.7 67.1 14.8
Training of New Production
Workers (hours) 380.3 370 46.4 173.3
Absenteeism 5 4.8 11.7 12.1
Automation:
Welding (% of direct steps) 86.2 85 76.2 76.6
Painting(% of direct steps) 54.6 40.7 33.6 38.2
Assembly(% of direct steps) 1.7 1.1 1.2 3.1
Source: IMVP World Assembly Plant Survey, 1989, and J. D. Power Initial Quality Survery, 1989
Summary of Assembly Plant Characteristics, Volume Producers,1989
(Average for Plants in Each Region)
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Cost Vs DefectsRef. Machine that Changed the World Womack, Jones and Roos
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Cost Vs AutomationRef. Machine that Changed the World Womack, Jones and Roos
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The Toyota Production System
Historical View
Performance measures
Elements of TPSDifficulties with Implementation
Six Eras of Manufacturing Practice
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How do you get this kind of
performance?Womack, Jones and Roos
J T. Blacks 10 Steps
Demand Flow Technologys 9 Points
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Womack Jones and Roos
New Technology? No silver bullet
Automation?
Yes, but integrated with system Standardized Production?
Not in the usual dont stop the line sense
Lean Characteristics?
Integration of Tasks (opposite of deskilling) Identification and removal of defects (stop the line!)
kaizen institutionalizing change
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J T. Blacks 10 StepsRef; JT. Black Factory with a Future 1991
1. Form cells
2. Reduce setup
3. Integrate quality control
4. Integrate preventive maintenance5. Level and balance
6. Link cells KANBAN
7. Reduce WIP
8. Build vendor programs
9. Automate
10. Computerize
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Demand Flow Technologys
9 Points1. Product Synchronization
2. Mixed Model Process Maps
3. Sequence of Events
4. Demand at Capacity5. Operational Cycle Time
6. Total Product Cycle Time
7. Line Balancing
8. Kanbans9. Operational Method Sheets
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Current Value Stream Map
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Future Value Stream Map
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J T. Black 1, 2
1. Form Cells
Sequentialoperations, decouple
operator frommachine, parts infamilies, single pieceflow within cell
2. Reduce Setup
Externalize setup toreduce down-time
during changeover,increases flexibility
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TPS Cell
ToyotaC
ell,onepartisproduced
forevery
triparound
thecell
J T. Black
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Standardized Fixtures
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J T. Black 3, 4
3. Integrate qualitycontrol
Check part quality at
cell, poke-yoke, stopproduction whenparts are bad
4. Integrate preventivemaintenance
worker maintains
machine , runs slower
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J T. Black 5, 6
5. Level and balance
Produce to Takttime, reduce batch
sizes, smoothproduction flow
6. Link cells- Kanban
Create pull system Supermarket
System
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Balancing and Leveling
Balanced line: each process has the samecycle time. Match process time toassemble time, match production rate torate of demand (Takt time)
Leveled Line: each product is produced inthe needed distribution. The process must
be flexible to do this.
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J T. Black 7, 8
7.Reduce WIP
Make system reliable,build in mechanisms
to self correct
8. Build Vendorprogram
Propagate low WIP
policy to yourvendors, reducevendors, make on-time performance part
of expectation
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Some Basics Concepts of TPS
Smooth Flow and Produce to Takt Time
Produce to Order
Make system observable and correct
problems as they occur
Integrate Worker Skills
Institutionalize change
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Two Examples;
Takt Time
Pull Systems
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Takt Time:
demand time interval
DemandProduct
TimeAvailableTimeTakt =
Calculate Takt Time per month, day,year etc. Available time includes allshifts, and excludes all non-productive time (e.g. lunch, clean-upetc). Product demand includes over-production for low yields etc.
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Takt Time
Automobile Assembly Line; Available time = 7.5 hr X 3shifts = 22.5 hrs or 1350 minutes per day. Demand =
1600 cars per day.Takt Time = 51 sec
Aircraft Engine Assembly Line; 500 engines per year.2 shifts X 7 hrs => 14 hrs/day X 250 day/year = 3500hrs.
Takt time = 7 hrs.
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Engines shipped over a 3 month period
at aircraft engine factory B
0
2
4
6
8
10
12
7-Jun 15-Jun 23-Jun 30-Jun 7-Jul 15-Jul 24-Jul 31-Jul 7- Aug 15-Aug 24-Aug 31-Aug
Weeks
en
sp
p
we
month 1 month 2 month 3
Factory B
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Engines shipped over a 3 month periodat aircraft engine factory C
0
1
2
3
4
5
6
7
may june july augustweeks
enginesshipped
Factory C
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On-time performance of engine
plants
A B C0%
20%
40%
60%
80%
100%
enginesdelvered
A B C
on
time
late
on
time
on
time
late
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Push and Pull Systems
Machines
Parts Orders
1 2 3 4
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Push Systems Order (from centralized decision process) arrives at the front of the
system and is produced in batches of size B.Q. How long does it take to get one part out of the system?
1 2 3 N
Time = T3
Time = T2
Time = TN
Time = T1
Time = 0
..
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Push Systems
Time = 0
1 2 3 N
Time= TN
..
If the process time per part is t at each of
N processes, and the batch size is B,it takes time TN =NBt to getone part through the system.
Comment; Of course, thispart can come from inventoryin a much shorter time, but thepoint is that the push systemis not very responsive.
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Pull Systems-The order arrives at the end of the line and is pulled out of the
system. WIP between the machines allows quick completion.
Q.How long does it take to pull outone part?
A.The time to finish the last opetration t.
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Comparison between
Push and Pull SystemsPush system characteristics: Central
decision making, local optimization ofequipment utilization leads to largebatches, large inventories and a sluggishsystem.
Pull system characteristics: Local decision
making, emphasis on smooth flow,cooperative problem solving.
See HP Video
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HP Video
Dots Tacks Tape Pack
Inventory in the system = L
Time in the system = W
Littles Law L = W
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0.210.120.15Production Rate
= L / W
VisibleVisibleHiddenQuality Problem
31026Rework Units
WIP
0:191:403:17Cycle time = W
41230WIP = L
1 Table2 Tables2 TablesSpace
Pull (1)Pull (3)Push system (6)
HP Video Results
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So what are the advantages of
the pull systems? quick response low inventories
observable problems(if stopped = problem)
sensitive to state of the factory
(if no part = problem)
possible cooperative problem solving
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The Toyota Production System
Historical View
Performance measures
Elements of TPSDifficulties with Implementation
Six Eras of Manufacturing Practice
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TPS Implementation
Physical part (machine placement,
standard work etc)
Work practices and people issues
Supply-chain part
Corporate Strategy (trust, job security)
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Work practices and people
issues Failed TPS attempts; GM Linden NJ,
CAMI, GM-Suzuki, Ontario Canada.
Successes GM NUMMI, Saturn. Toyota
Georgetown, KY See MacCoby article
Other Ref: Just Another Car Factory Rinehart,Huxley and Robertson, Farewell to the Factory,
Milkman
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Work practices and people
issues Innovative Work Practices Ref; C.Ichniowski, T. Kochan et al What
Works at Work: Overview and
Assessment, Industrial Relations Vol35 No.3 (July 1996)
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Examples of Innovative Work
Practices Work Teams
Gain Sharing
Flexible Job Assignments
Employment Security
Improved Communications
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What Works at Work: Overview
and Assessment, Conclusion 1; BundlingInnovative human resource management
practices can improve business productivity,
primarily through the use of systems of relatedwork practices designed to enhance workerparticipation and flexibility in the design of workand decentralization of managerial tasks and
responsibilities.
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What Works at Work: Overview
and Assessment, Conclusion 3; Partial ImplementationA majority of contemporary U.S. businesses now
have adopted some forms of innovative work practices
aimed at enhancing employee participation such as workteams, contingent pay-for-performance compensation, orflexible assignment of multiskilled employees. Only asmall percentage of businesses, however, have adopteda full system of innovative work practices composed of
an extensive set of these work practice innovations.
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What Works at Work: Overview
and Assessment, Conclusion 4; Barriers to ImplementationThe diffusion of new workplace innovations is limited,
especially among older U.S. businesses. Firms face a number ofobstacles when changing from a system of traditional work practices
to a system of innovative practices, including: the abandonment oforganization change initiatives after limited policy changes have littleeffect on performance, the costs of other organizational practicesthat are needed to make new work practices effective, long historiesof labor-management conflict and mistrust, resistance of supervisorsand other workers who might not fare as well under the newer
practices, and the lack of a supportive institutional and public policyenvironment.
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Barriers to Implementation
Early abandonment
Costs (training, commitment, benefits..)
History of conflict and distrust
Resistance of supervisors
Lack of supportive infrastructure
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Six Eras of Manufacturing
Practice, Ken McKayPioneeringSystemization
Technology and ProcessInternal Efficiency
Customer Service
Systems Level Re-engineering
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Ken McKay 1, 2
1. Pioneering - sellersmarket, competition isnot by manufacturing,
large marginsemphasizethroughput notefficiency
2. Systemization - firmgrows and system getscomplex, grossinefficiency becomes
apparent, competitionbegins to make itspresence felt. Need forstandard operatingprocedures, demand stillhigh, inventory used tobuffer against instabilities.
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Ken McKay 3, 4
3. Technology andProcess competition isincreasing, sales aresoftening, manufacturing
is still in early maturityand competition is limitedto firms in similarsituation. Product optionsgrow. Mfg focus shifts toefficiency.
4. Internal Efficiency -competition cherry pickersenter the market they dontoffer all of the options andparts service but focus on the
20% which yields 80% of therevenue stream. Internal plantis put into order, problems arepushed outside to suppliers,best in class, bench markingidentifies the silver bullet. Still
using inventory to cushionproduction support variety, andmaintain functional features.
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Ken McKay- 5, 6
5. Customer Service -talk to the
customer, identify
core competency,outsource, beresponsive, reducelead time, eliminate
feature creep,focused factory etc.
6. System Level Re-engineering - firmshave addressed theinternal system and
factory no more tosqueeze out look toimproving indirect andoverhead, supply chaindevelopment.
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Toyota Summary
High quality and low cost
Relationship to previous systems (seeMcKay paper), yet new,. in fact
revolutionary Many elements
Overall, see The Machine that Changed theWorld
Cells, next time
People, see Maccoby Article
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Summary .. continued
Autonomation automation with a human
touch
Worker as problem solver
TRUST