“Toyota’s focus on JIT is a continual problem-solving process (not an
inventory reduction plan) illustrates why the automaker is a JIT leader
not only in its industry but all of industry.”
“Toyota is the benchmark in manufacturing and product development”
- General Motors Officials
The Toyota Production System (TPS) is an integrated socio-technical
system, developed by Toyota, that comprises its management philosophy
The TPS organizes manufacturing and logistics for the automobile
manufacturer, including interaction with suppliers and customers.
The system is a major precursor of the more generic "Lean manufacturing.
1897:- Sakichi Toyoda diversified his business.
1926:-He formed Toyoda Automatic LoomWorks (TALW) to manufacturing
1933:-Established an Automobile department within TALW.
1935:-First Passenger car prototype was developed.
1936:-Sakichi sold the patent rights of his Automatic loom to a UK based
1947:-The passenger cars production began.
1950-1955:-Foundation of Kanban System.
1957:- Eijji Renamed Toyota as “The Toyota Company”
1968:- Toyota’s first export to the USA.
1970s:- Major boost in the Japan due to oil crises.
1980s:- Toyota brought TPS in the USA with a Joint Venture to The GM.
1983:- Company’s name changed to Toyota motor Corporation.
1988:- Toyota Opened its New plant in Georgetown.
1999-2000:- Toyota listed on NYSE & LSE and become one of the top
manufactures of cars in the world.
A LEGENDARY PRODUCTION SYSTEM
More than 50 executives and engineers visited Toyota Motor
TPS aimed to produce world-class quality
Two main principles: Just-in-Time (JIT) production and Jidoka.
1. JIT (the most visible and highly publicized characteristics of TPS)
2. Jidoka (never letting a defect pass to the next station; and freeing
people from machines)
3. Heijunka is leveling out production schedule for both volume and
JIT - BACKGROUND AND HISTORY
Initially, JIT was used as a method for reducing inventories in Toyota's
shipyards, but later it evolved into a Japanese management philosophy
First developed and perfected within the Toyota manufacturing plants by
JIT would only be successful
JIT has the capacity to strengthen the organization’s competitiveness
Aimed at avoiding waste, reducing inventories and increasing
THE EXPERIMENTS OF THE TPS
Rule Problem Signals Responses
1 How People
document all work
sequence, timing and
>Modify the work
2 How Work
signals directly link
every customer and
>Responses do not
keep pace with
>Supplier is idle
>Determine true mix and
>Determine true supplier
3 The Physical
>Every product and
service travels a
single, simple and
direct flow path.
>A person or
machine is not
>Determine reason for
4 How To
>Workers at the
lowest feasible level,
guided by a teacher
their own work
>Actual result varies
from expected result.
>Determine why the
actual result differed
from the prediction.
>Redesign the change.
>Integrated failure tests
deviations for every
activity, connection &
>Defects are passed
through to the next
>Analyze and institute
new or improved
JUST-IN-TIME PRODUCTION SYSTEM
What it is
'Pull' System through the plant
What it does
Attacks waste (time, inventory,
Exposes problems and bottlenecks
Achieves streamlined production
What it requires
Total quality control
Small lot sizes
What it assumes
ADVANTAGES OF JIT
Reduction in product variation,
Quick response to customers' demands,
High quality products at low cost for consumers,
JIT IN SERVICES (EXAMPLES)
• Organize Problem-Solving Groups
• Upgrade Housekeeping
• Upgrade Quality
• Clarify Process Flows
• Revise Equipment and Process
• Level the Facility Load
• Eliminate Unnecessary Activities
• Reorganize Physical Configuration
• Introduce Demand-Pull Scheduling
• Develop Supplier Networks
TRENDS IN SUPPLIER POLICIES
Locate near to the customer
Consider establishing small warehouses near to the customer or
consolidating warehouses with other suppliers
Use standardized containers and make deliveries according to a precise
Become a certified supplier and accept payment at regular intervals rather
than upon delivery
Essential component of Toyota's JIT concept.
Japanese referred to Kanban as a simple parts-movement system that
depended on cards and boxes/containers to take parts from one
workstation to another on a production line.
Ohno had developed the idea in 1956 from the super markets in the US.
Kanban developed into a sophisticated information system.
Ensured production in required quantities at the right time.
A chain process in which orders flowed from one process to another, the
production or delivery of components was 'pulled' to the production
Withdrawal Kanban is carried when going from one process to the
Three types of information were exchanged using Kanban
Pick up information
To make the Kanban system effective, Ohno framed six rules:
Later process went to the earlier process to pick up products.
The earlier process produced only the amount withdrawn by the
Should not pick or produce goods without a Kanban.
A Kanban should be attached to the goods.
100% defect free parts were required.
Reduce the number of Kanban.
ADVANTAGES OF KANBAN
A simple and understandable process
Provides quick and precise information
Low costs associated with the transfer of information
Provides quick response to changes
Limit of over-capacity in process
Control can be maintained
Delegates' responsibility to workers
Problems with JIT
• Based on the key assumption that sources and channels of supply were
reliable and dependable at all times
• Did not take into account the possibility of labor strikes at automotive
• JIT involved high set up costs
• Special training and reorganization of policies and procedures were
• Increases the risk of inventory shortage.
• Difficulty of removing the 'human element'
Ʊ Did not make frequent changes in production planning
Ʊ Forecasting procedures should be reliable
Ʊ Depended on highly experienced, highly motivated managers.
Ʊ A network of capable suppliers that operated in sync
Future of JIT
o Being a philosophy, JIT does not restrict itself to high technology
o Valid in any manufacturing environments
o Not limited to any specific type of industry nor does the size of the
o Service sector as growing very fast in developing countries like India but
poorly managed, JIT can be very useful in improving the performance
Companies currently using JIT
o Harley Davidson
o Toyota Motor Company
o General Motors
o Ford Motor Company
o Manufacturing Magic
o Hawthorne Management Consulting
o Strategy Manufacturing Inc.