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Tag: Base Your Management Decisions
  • The Gutting of Chrysler’s Culture: A Cautionary Tale

    Anyone who witnessed the rebirth of Chrysler under Lee Iacocca knows that one of the best product decisions he made was to invest in the K-Car, the basis for all the new passenger cars introduced in the 1980s. It saved […]

  • Create a Constancy of Purpose and Place in History

    When I think about Toyota and how it operates, I keep on coming back to quality guru W. Edwards Deming’s famous edict: “Constancy of purpose.” Constancy of purpose explains why, in any given year, if you bet Toyota will make […]

Tag: Become a Learning Organization
  • Hoshin Kanri – Directing and Motivating Organizational Learning

    The adage that “you get what you measure” is in a sense true at Toyota as well. Toyota long ago realized that the key to organizational learning is to align objectives of all of its employees toward common goals. The […]

  • Process vs. Results Orientation: The Role of Metrics

    Believing they can get any behavior they can measure, companies wishing to emulate Toyota’s system often ask me about its metrics. To their inevitable disappointment, they learn that Toyota is not particularly strong at developing sophisticated and common metrics across […]

Tag: Build a Culture of Stopping to Fix Problems
  • Creating a Learning Organization Is a Long-Term Journey

    Anyone who has participated in creating a learning organization knows that it is a major undertaking. It has taken Toyota well over a decade to build an organization in North America that bears even a resemblance to the learning enterprise […]

  • Building in Quality Is a Principle, Not a Technology

    A story I heard from a plant manager at Reiter Automotive (supplier of sound-dampening materials) helped put into perspective what it takes to build in quality. He ran a plant that makes sound-dampening materials in Chicago and supplied them to […]

Tag: Build Your Own Lean Learning Enterprise
  • 13 Tips for Transitioning Your Company to a Lean Enterprise

    We can learn a great deal from the few companies out there run by experienced and talented lean leaders who have really been successful at effecting change at the cultural level. It is clear there are a variety of ways […]

  • Why Changing Culture Is So Difficult

    Culture change is a complex topic in its own right and the subject of many articles. This became most evident to Toyota in its efforts to globalize in the 1980s. To Toyota, globalization did not mean purchasing capacity in other […]

Tag: Create Continuous Process Flow to Bring Problems to the Surface
  • Why Creating Flow Is Difficult

    So, life is good and all your problems and pains simply disappear by creating one-piece flow cells. Not by a long shot! In lean thinking, life will get tougher for a while—at least until you learn how to continuously improve […]

  • Benefits of One-Piece Flow

    When you try to attain one-piece flow, you are also setting in motion numerous activities to eliminate all muda (wastes). Let’s take a closer look at a few of the benefits of flow. Builds in Quality. It is much easier […]

Tag: Develop Exceptional People
  • People Drive Continuous Improvement

    Toyota invests in people and in return it gets committed associates who show up to work every day and on time and are continually improving their operations. On one of my visits, I found that in the past year at […]

  • External Motivation Theories

    Taylor’s Scientific Management. Taylorism is the ultimate in external motivation. People come to work to make money—end of story. You motivate workers by giving them clear standards, teaching them the most efficient way to reach the standard, and then giving […]

Tag: Go and See for Yourself
  • The Way of Genchi Genbutsu Is Ingrained in a Country’s Culture

    It is easy to point to dramatic examples of genchi genbutsu, like driving all over North America to develop the Sienna minivan or standing in a circle all day in the factory, but what is most important is how it […]

  • Hourensou-Rapid Genchi Genbutsu for Executives

    As president of Toyota, Cho had to learn to rely more on trust than he did in the days of running a few manufacturing plants. He doesn’t have the time to go and see everything for himself. Instead, he surrounds […]

Tag: Grow Leaders Who Thoroughly Understand the Work
  • The Common Themes of Leadership at Toyota

    Toyota leaders have a distinctive approach and philosophy that fits the Toyota Way. The two-dimensional leadership matrix helps depict what distinguishes leadership at Toyota from leadership at other companies. On the one hand, leaders can either rule by top-down directives […]

  • The Chief Engineer: The Critical Link to Innovation, Leadership, and Customer Satisfaction

    In a traditional auto company, it is difficult to pin down where the real responsibility for a new vehicle development program lies. Many departments and many executives have partial responsibility. If you want to find who has responsibility for a […]

Tag: How Toyota Became the World’s Best Manufacturer
  • Creating the Manufacturing System That Changed the World

    In the 1950s, Ohno returned to the place he understood best, the shop floor, and went to work to change the rules of the game. He did not have a big consulting firm, Post-it® notes, or PowerPoint to reinvent his […]

  • One-Piece Flow, a Core Principle

    When Eiji Toyoda and his managers took their 12-week study tour of U.S plants in 1950, they were expecting to be dazzled by their manufacturing progress. Instead they were surprised that the development of mass production techniques hadn’t changed much […]

Tag: Implementing Toyota's 4Ps Guide
  • Develop Suppliers and Partners as Extensions of the Enterprise

    Supplier Partners in a Globally Competitive World It’s a tough time to be talking about supplier “partnerships.” With companies throughout the Western world looking at the prices of parts from China, India, Vietnam, Russia, Eastern Europe, and other low-wage countries, […]

  • Toyota Supply Systems

    Companies working to learn from Toyota to build high performance supply systems seem to want to skip over the hard work of developing effective supplier partnerships, looking for easy solutions through supply chain software and aggressive price reduction approaches. Toyota’s […]

Tag: Level Out the Workload (Heijunka) Tag: Make Decisions Slowly by Consensus Tag: Managing Supply Chains
  • Coordination and Lean

    Going back 20 years, the national bestseller The Machine that Changed the World: The Story of Lean Productionby Womack, Jones, and Roos devotes three chapters to supply chain coordination, dealing with customers, and managing the lean enterprise. The main ideas […]

  • The Practice of Learning

    Learning requires optimism and the spirit to take up challenges. The Toyota Way document states that: “We accept the challenges with a creative spirit and the courage to realize our own dreams without losing drive or energy. We approach our […]

Tag: Moving Toward a Target Condition
  • How Toyota Utilizes PDCA

    So what actually constitutes one PDCA cycle in real life? Consider the process of getting up and going to work, and a target condition of being in the car and ready to drive to work 60 minutes after waking up. […]

  • This Is PDCA (Plan-Do-Check-Act)

    Because the target condition lies beyond the reach of our flashlight, the path to attaining it cannot be predicted with exactness. Thus, we have to find that path by experimenting. This is the scientific method, which consists of formulating hypotheses […]

Tag: New Century
  • Other Toyota Way Principles from the Prius Story

    Notably missing from my recounting of this story are Principles 2-6 of the Toyota Way (under the category, The Right Process Will Produce the Right Results). These deal more with the processes used at Toyota to do the detailed work. […]

  • Toyota’s New Product Development Process

    The seemingly impossible deadlines set by top leadership for the Prius project and the numerous technical challenges faced by the Prius engineers dramatically improved Toyota’s already excellent product development process in two key ways: 1. The cross-functional team and chief […]

Tag: Origin and Effects of Our Current Management Approach
  • What Happened to Management By Objectives?

    Origin and Effects of Our Current Management Approach Much of our current managerial template comes out of the United States automobile industry of the 1920s, and a short, focused look back at the early history of its two giants, the […]

  • The General Motors Approach (1920s to Present)

    A New Direction in Management Early Ford put emphasis on and effort toward a vision that described a condition—the production flow ideal—but ultimately focused too little on product development and on organizing and managing the company in systematic ways. In […]

Tag: Planning: Establishing a Target Condition
  • Establishing a Target Condition

    A target condition is developed out of a detailed grasp of the current condition, through direct observation and analysis, coupled with an understanding of the direction, vision, target, or need. You need to adequately understand the current condition in order […]

  • Target Condition Thinking

    Over time and with practice you should be able to develop a kind of target condition thinking, and Toyota’s concept of “standardized work” helps illustrate what I mean. A “standard” is a description of how a process should operate. It […]

Tag: Reflections of Supply Chain Participants
  • Automobile Supply Chain in Europe Versus North America

    Interview on August 15, 2008, with Achim Paechtner, Former Senior Manager at Toyota of Europe The purpose of the interview was to understand the differences of the automobile supply chain in Europe versus North America. Achim Paechtner identified four major […]

  • How Toyota and Suppliers Work Together as Partners

    Interview on September 23, 2008, with Jeffrey Smith,Vice President and General Manager, Toyota Business Unit, Johnson Controls The purpose of the interview was to discuss how Toyota and suppliers work together as partners. Jeffrey Smith described the forecasts shared by […]

Tag: Respect Your Extended Network
  • Developing an Extended Learning Enterprise Means Enabling Others

    While musing over American Auto’s debacle with suppliers and wondering why it wanted to take an elevator to the top without stopping at any of the floors in between, I began to conceptualize the problem as a pyramid or hierarchy. […]

  • Saving “Sick” Suppliers Through TPS

    The TSSC by design is not part of the business relationship with suppliers. It is there to educate through projects. Toyota purchasing has its own quality and TPS experts to work with suppliers when there are problems, the most severe […]

Tag: Seeing Lean Techniques in a New Light
  • Pull Systems (Kanban) – Lean Techniques

    The traditional approach for regulating production, which is still in wide use, is that each process in a value stream gets a schedule. These schedules are based on predictions of what the downstream processes will need in the future. Since […]

  • Heijunka (Leveling Production) – Lean Techniques

    It is a misconception, perhaps stemming from the pull system idea, that Toyota assembles vehicles in the same order in which customers buy them. Someday Toyota would like to have achieved that kind of 1×1 flexibility in its production operations […]

Tag: Standardized Tasks Are the Foundation
  • Standardization as an Enabler

    The critical task when implementing standardization is to find that balance between providing employees with rigid procedures to follow and providing the freedom to innovate and be creative to meet challenging targets consistently for cost, quality, and delivery. The key […]

  • Standardizing Work for a New Product Launch

    The Toyota Way of handling the chaos of getting an army of people involved in creating and launching a new vehicle is to standardize the work in a balanced way that doesn’t give complete control to any group of employees. […]

Tag: The Toyota Way in Action
  • Achieving No-Compromise Objectives

    Since so much of the success of Lexus depended on achieving these breakthrough performance objectives for the engine, and since this depended so heavily on production engineering, Suzuki presented a number of strict requirements to the engine production engineers, whose […]

  • Listening to the Customer and Benchmarking the Competition

    Developing a good concept, with its associated targets, will make or break any vehicle development program. If the concept is not well thought through and does not properly identify the market and how the vehicle will hit the market just […]

Tag: Toyota Kata
  • Developing Improvement Kata Behavior in Your Organization

    The second overarching question mentioned in the introduction to Toyota Kata is: How can other companies develop similar routines and thinking in their organizations? At this point we have a basic awareness of what Toyota is doing to achieve continuous […]

  • Written Document to Support Toyota Mentor/Mentee Dialogue

    Cycles of coaching should ideally be frequent, short, and conducted face-to-face. In the case example, Tina and Dan’s communication was all verbal. However, it is often advisable to use a simple, one-page written document in support of mentor/mentee coaching. Verbal […]

Tag: Toyota Learning
  • The Beer Game and the Toyota Supply Chain

    The beer game was introduced as an exercise in industrial dynamics in 1960. And what has beer to do with automobiles? The beer game is used as a fun way to illustrate some of the pitfalls of operating a supply […]

  • How to Apply Toyota Way Principles to Nonautomotive Supply Chains

    The underlying principles associated with managing variety, velocity, and variability across the supply chain—the focus of Toyota’s supply chain leadership and management process—are found in many different industrial contexts. We provide several examples from service industries such as health care, […]

Tag: Toyota Production System: Eliminating Waste Tag: Transform Technical and Service Organizations
  • It’s All About Supporting the Core Value Stream

    I have illustrated throughout the article applications to service operations. Some of the specific, detailed tools of TPS may be harder to apply. It would not make sense, for example, for a lawyer to sit at his or her desk […]

  • Visual Control of Engineering at Genie Industries

    A central issue for many service processes is controlling the process. Some successful kaizen workshops have focused on creating the system of tracking and controlling the process using visual controls. Genie Industries is an example of this. Genie makes many […]

Tag: Use “Pull” Systems to Avoid Overproduction
  • Using Pull in a GM Office

    You can effectively use pull-replenishment systems in the office to save money and help avoid shortages of supplies. Most offices use some form of pull system already. Nobody knows exactly how many pencils, erasers, or reams of paper will be […]

  • Push Scheduling Has Its Place

    The Toyota Way is not preoccupied with adhering to Principle 3, Use “pull” systems to avoid overproduction. There are many examples of push scheduling throughout Toyota. One example is when dealing with parts shipped from Japan to the United States […]

Tag: Use Only Reliable
  • The Role of Technology – Adapting It Appropriately

    In industry today, the watchword is flexibility. Everyone wants to be as flexible as possible and Toyota is no exception. Originally, what allowed Toyota to compete with global players was its flexibility. To Toyota, flexibility does not mean pushing the […]

  • IT in Toyota’s Product Development Process

    In the early 1980s, the trend among automakers was to develop their own internal computer-aided design (CAD) system for designing parts on a computer rather than on paper blueprints. Toyota did this like everyone else, but in a way that […]

Tag: Use Visual Control
  • Keeping It Visual Through Technology and Human Systems

    In today’s world of computers, information technology, and automation, one of the goals is to make the office and factory paperless. You can now use computers, the Internet, and the corporate intranet to call up large storehouses of data, both […]

  • A3 Reports: Capturing All You Need to Know on One Sheet of Paper

    When I interviewed David Baxter, vice president at the Toyota Technical Center, he was a bit nervous about a report he was working on. It was the proposed budget for the entire center. The whole time he talked about the […]

Tag: Using Operational Excellence as a Strategic Weapon
  • Using the Toyota Way for Long-Term Success

    Critics often describe Toyota as a “boring company.” This is the kind of boring I like. Top quality year in and year out. Steadily growing sales. Consistent profitability. Huge cash reserves. Of course, operational efficiency by itself can be dangerous. […]

  • Why Companies Often Think They Are Lean—But Aren’t

    When I first began learning about TPS, I was enamored of the power of one-piece flow. The more I learned about the benefits of flowing and pulling parts as they were needed, rather than pushing and creating inventory, the more […]