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History of Lean Production, The Toyota Production System

Toyota Motor Corporation grew out of Toyoda Automatic Loom Works founded in 1926 in Japan. In the late 1940s Toyota was producing just 200 cars per year compared to Ford's 7,000 cars per day. Eiji Toyoda visited Ford's Rouge plant in 1950 and saw opportunities to improve their production system. This led to the development of the Toyota Production System (TPS), aimed at eliminating waste and focusing on value-adding activities. TPS was developed in the 1950s and 1960s under Taiichi Ohno and focuses on quality control, waste reduction, and continuous improvement. The core elements of TPS include minimizing batch sizes, establishing standard processes, creating transparency to identify problems, and emphasizing employee skill building

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117 views2 pages

History of Lean Production, The Toyota Production System

Toyota Motor Corporation grew out of Toyoda Automatic Loom Works founded in 1926 in Japan. In the late 1940s Toyota was producing just 200 cars per year compared to Ford's 7,000 cars per day. Eiji Toyoda visited Ford's Rouge plant in 1950 and saw opportunities to improve their production system. This led to the development of the Toyota Production System (TPS), aimed at eliminating waste and focusing on value-adding activities. TPS was developed in the 1950s and 1960s under Taiichi Ohno and focuses on quality control, waste reduction, and continuous improvement. The core elements of TPS include minimizing batch sizes, establishing standard processes, creating transparency to identify problems, and emphasizing employee skill building

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Lecture 1.

1 History of Lean Production, the Toyota Production System…

This extremely interesting history, which affects manufacturing worldwide, cannot be done justice in
this course, so we hope that you will all have a chance to do some more research on the important
personages and developments, which led from mass production to the Toyota Production System. Our
learning objectives are:

to outline the history of the Toyota Motor Corp. from the Toyota automatic loom works,

to describe the historical drivers for the development of the Toyota Production system at Toyota,

and to identify the important contributors to TPS.

We also want you to list the core elements of the Toyota Production system.

Toyota Motor Corporation grew out of Toyoda Automatic Loom Works founded in 1926 in Japan by the
innovator and inventor Saki chi Toyoda. The firm manufactured state-of-the-art power looms,
incorporating Toyoda's innovative ideas, which drastically improved the weaving productivity at the
time. A particular feature of the looms, a feature which we need to remember for the rest of this course,
was that they would stop automatically as soon as a thread broke. In other words, a defect would stop
the production immediately and automatically.

In 1933 before World War II, the company established its automobile department, led by Kichiro
Toyoda, the eldest son of Sakichi Toyoda. Starting in 1935 it began producing trucks for the military and
then moved to automobile production. After World War II's end, with a devastated Japanese economy,
the company was faced with unique business challenges for automobile production. First, the domestic
market was simply too small to justify the mass production that was ongoing in America. Due to the lack
of capital, investment in tooling and equipment was also not possible. Eiji Toyoda, the man who
transformed the Toyota Motor Company was his uncle had founded into a global powerhouse, was
searching for a model production system to adopt in order to improve the Toyota production facilities
that he was given charge to manage at that time. In the late 1940s the Toyota Motor Company was
producing cars at a rate of about 200 per year when the Ford Motor Company at the Rouge plant in
Detroit was making seven thousand cars per day. The system that Eiji Toyoda witnessed at the Rouge
plant during a visit 1950 offered a model he could adopt, but he saw several drawbacks in the system.
He saw those drawbacks, though, as opportunities for improvement, and he built a new system which
sought to eliminate all possible wastes in production and focus on value- adding functions. The term
"Lean Manufacturing" refers to the production system created by the Toyota Motor Corporation to
deliver products of right quality, in the right quantity, at the right price to meet the needs of the
customer. Taiichi Ohno, the Toyota engineer and creative genius who became VP of manufacturing is
mainly credited with creating the system, which is also known as the Toyota Production System. He had
received assistance from Dr. Shiego Shingo, an industrial engineer and author of the Single Minute
Exchange of Die (SMED) procedure, who helped in strengthening parts of the system.
TPS specifically focuses on quantity control, quality control and improvement, and waste and cost
control. And what resulted from continuously improving the system over two decades in the 1950s and
1960s is now referred to as the Toyota Production System or TPS or the Lean Manufacturing system.
Just a note: the term "Lean" is actually from a 1988 article by John Krafcik, "The Triumph of Lean
Production Systems" which appears in the Sloan Mannagment Review.

The core elements of TPS are to maximize a share of value-adding activities, which means elimination of
waste and striving to minimize batch sizes, ideally that you have single piece flow through your
production, and building processes based on true customer requirements. It also requires stable,
standardized process implementation, which can be done through workplace organization, establishing
standard operating procedures, and fail-safe processes known as judoka, which reminds us then about
the automatic looms which stopped as soon as a thread broke. TPS also requires creating a self-learning,
continuously improving organization, through creating transparency on problems facilitating immediate
identification, conducting rigorous root cause problem solving, and making continuous improvement as
part of the daily work. It also requires taking a holistic supply chain perspective. This means taking a
customer-driven perspective, considering the customer requirements and also using backwards
integration to include the suppliers. And finally, critical for TPS, is the people development. Employee
skill building is.,an important part of the Toyota Production System. Now in our course we, cannot look
in detail into all of these elements. We are concentrating on the quantitative parts of Lean Production.
However it's important to look at all of these core elements of TPS and to take the time to go into more
depth and to read and experience more about every element that is important in a Toyota Production
System.

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