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How Toyota Become the World's Best Manufacturer: The story of Toyoda Family and the Toyota Production System Chapter 2 The Toyota Way: Chapter2 1
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The Toyota Way: Chapter2 1

How Toyota Become the World's Best Manufacturer: The story of Toyoda Family and the Toyota Production System

Chapter 2

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The Toyota Way: Chapter2 2

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The Toyota Way: Chapter2 3

Kiichiro Toyoda

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The Toyota Way: Chapter2 4

The Toyoda Family Generation of Consistent leader • Toyoda learned carpentry with father• In 1894 he make loom that were cheaper but

worked better than existing loom

• First develop • Why there have no power to run the loom ? • Steam engine

In 1926 Start Toyoda Automatic loom workIn 1987 Stop a loom whenever a thread broke

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I plan to cut down on the slack time within work processes and in the shipping of parts and materials as much as possible. As the basic principle in realizing this plan, I will uphold the "just in time" approach. The guiding rule is not to have goods shipped too early or too late."1 —Kiichiro Toyoda, founder of Toyota Motor Company, 1938

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The Toyota Way: Chapter2 6

1.Automation with human touchJidoka ?

Toyota Production System (TPS)

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The Toyota Way: Chapter2 7

2. Building in quality as you product the material or “ mistake proofing “

“ Value Added Work”

Toyota Production System (TPS)

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The Toyota Way: Chapter2 8

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The Toyota Way: Chapter2 9

The Toyota Automotive Company

1929

Sold the patent rights of Toyoda Automatic Loom to “Platt Brother”.

Mr. Sakichi Toyoda

Mr. Kiichiro Toyoda

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The Toyota Way: Chapter2 10

The Toyota Automotive Company

1929

Sold the patent rights of Toyoda Automatic Loom to “Platt Brother”.

1930

The beginning of “Toyota Motor Corporation”.

Power Loom: Yesterday’s Technology

Automotive: Tomorrow’s Technology

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The Toyota Way: Chapter2 11

The Toyota Automotive Company

1929 Sold the patent rights of Toyoda Automatic Loom to “Platt Brother”.

1930 The beginning of “Toyota Motor Corporation”.

1937

-1945

“World War II”; Japan lost,Toyota start building trucks to rebuild Japan.

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The Toyota Way: Chapter2 12

The Toyota Automotive Company

1929 Sold the patent rights of Toyoda Automatic Loom to “Platt Brother”.

1930 The beginning of “Toyota Motor Corporation”.

1937

-1945

“World War II”; Japan lostToyota started building trucks to rebuild Japan.

1948 The post-war: rampant inflationToyota adopted “strict cost-cutting policies”• Cut in pay for all employees• Voluntarily retire 1,600 workers

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The Toyota Way: Chapter2 13

The Toyota Automotive Company

Mr. Eiji ToyodaOne of Toyoda Family Leaders to shape Toyota

The Next President and Chairman (1967)

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The Toyota Way: Chapter2 14

Philosophies of Toyoda Family

• Learn to get your hands dirty

• Learn the spirit of innovation

• Understand the values of company in contributing to society

• Have the vision of creating the special company in future

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The Toyota Way: Chapter2 15

The Development of the Toyota Production System

(TPS)

• 1930s visited Ford and GM Mass Production System – Ford

Model T

• After 1950 WWII, Toyoda aimed to improve manufacturing process.

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The Toyota Way: Chapter2 16

The Development of the Toyota Production System

(TPS)

Excess of supply and inventory Wasteful cost and man power to control

excess inventory and production process

Ford Toyota

Production capability 9,000 units/mth

900 units/mth

Capital and Resource High Low

Market size Large Small

Customer demand Large Small

Inventory storage cost High Low

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The Toyota Way: Chapter2 17

One-Piece Flow

• One-Piece Flow is fundamental process of one unit in assembly line with efficient that flexibly changed according to customer demand • Continuous material flow• Standardizing process• Eliminate waste

• Improving Toyota’s manufacturing process High quality Low cost Short lead times Flexibility

One-Piece Flow

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Creating the Manufacturing System That Changed the World

• 1930s Taiichi Ohno return to work on the shop work.

Decades of practice, he had come up with “The New Toyota Production System”.

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The New Toyota Production System

• Pull System

“ Overproduction happens all the time in mass production”

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The New Toyota Production System

• Deming’s principle

“The next process is the customer”

Atokotei wa o-kyakusama• Deming Cycle or Plan-Do-Check-Act (PDCA)

• Kaizen : Continuous improvement

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Toyata way : The Machine That Changed the World• After WWII, focused on cost, cost,

cost “Economics of scale”

• 1980s, focusing on quality actually reduced cost more than focusing only on cost.

• Finally 1990s, MIT’s Auto Industry Program “lean production”- shortening lead time by eliminating waste in each step of process leads to best quality and lowest cost, while improving safety and morale.