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The Toyota Production System (TPS) is the philosophy which organizes manufacturing and logistics at Toyota, including the interaction with suppliers and customers. The TPS is a major part of the more generic "Lean manufacturing". It was largely created by the founder of Toyota, Sakichi Toyoda, his son Kiichiro Toyoda, and the engineer Taiichi Ohno; they drew heavily on the work of W. Edwards Deming and the writings of Henry Ford. When these men came to the United States to observe the assembly line and mass production that had made Ford rich, they were unimpressed. While shopping in a supermarket they observed the simple idea of an automatic drink resupplier; when the customer wants a drink, he takes one, and another replaces it. The main goals of the TPS are to design out overburden (muri), inconsistency (mura) and eliminate waste (muda). There are 7 kinds of muda targeted in the TPS:
Toyota was able to greatly reduce leadtime and cost using the TPS, while improving quality at the same time. This enabled it to become one of the ten largest companies in the world. It is currently as profitable as all the other car companies combined and became the largest car manufacturer in 2007. It has been proposedTheory of Constraints, Eliyahu Goldratt, North River Press, 1990, p 26 that the TPS is the most prominent example of the \'correlation\', or middle, stage in a science, with material requirements planning and other data gathering systems representing the \'classification\' or first stage. A science in this stage can see correlations between events and can propose some procedures that allow some predictions of the future. Due to this stellar success of the production philosophy\'s predictions many of these methods have been copied by other manufacturing companies, although mostly unsuccessfully.
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Toyota has long been recognized as a leader in the automotive manufacturing and production industry.[1] This system, more than any other part of the company, is responsible for having made Toyota the company it is today.[citation needed]
It may be surprising that Toyota received their inspiration for the production system in the United States, but not from its automotive production process. This occurred when a delegation from Toyota visited the United States to study its commercial enterprises. They first visited several Ford Motor Company automotive plants in Michigan, but despite Ford being the industry leader at that time, found the methods in use to be unappealing. They were mainly appalled by the large amounts of inventory on site and by how the amount of work being performed in various departments within the factory was uneven on most days. However, on their visit to a Piggly Wiggly, an American supermarket, the delegation was inspired by how the supermarket only reordered and restocked goods once they’d been bought by customers.
Toyota applied the lesson from Piggly Wiggly by reducing the amount of inventory they would hold only to a level that its employees would need for a small period of time, and then subsequently reorder. This is highly representative of a Just-in-Time (JIT) inventory system.
While low inventory levels are a key outcome of the Toyota Production System, an important element of the philosophy behind its system is to work intelligently and eliminate waste so that inventory is no longer needed. Many American businesses, having observed Toyota\'s factories, set out to attack high inventory levels directly without understanding what made these reductions possible.Theory of Constraints, Eliyahu Goldratt, North River Press, 1990, p 30 The act of imitating without understanding the underlying concept or motivation may have led to the failure of those projects. In the book The Toyota Way, the underlying principles are outlined as follows:
Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals. For more detail behind these following points see The Toyota Way.
The Toyota production system has been compared to squeezing water from a dry towel. What this means is that it is a system for thorough waste elimination. Here, waste refers to anything which does not advance the process, everything that does not increase added value. Many people settle for eliminating the waste that everyone recognises as waste. But much remains that simply has not yet been recognised as waste or that people are willing to tolerate.
People had resigned themselves to certain problems, had become hostage to routine and abandoned the practice of problem-solving. This going back to basics, exposing the real significance of problems and then making fundamental improvements, can be witnessed throughout the Toyota Production SystemA study of the Toyota Production System, Shigeo Shingo, Productivity Press, 1989, p236.
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