The Origins of the Toyota Management System

The Toyota Management System (TMS), often interchangeably referred to as the Toyota Production System (TPS), is an iconic example of innovation and operational efficiency. Its impact resonates beyond the automobile industry, having been adopted and adapted by various sectors worldwide. To appreciate its significance, let’s delve into its roots and the events leading to its establishment.

1. The Humble Beginnings

Toyota started as a textile company under Toyoda Automatic Loom Works in the 1920s, led by Sakichi Toyoda. Sakichi was an inventor who focused on enhancing the efficiency and quality of automatic loom designs. It was here, in the realm of textile machinery, that the first seeds of lean thinking and continuous improvement took root.

2. Transition to Automobiles

In the 1930s, Sakichi’s son, Kiichiro Toyoda, envisioned a transition from textile machinery to automobile manufacturing. Recognizing the future potential of the automobile market and the challenges of entering a competitive field, Kiichiro began to implement innovative production techniques to ensure quality and efficiency.

3. Lessons from Abroad

After World War II, Kiichiro traveled to the U.S. to study the automotive industry, especially the production methods of Ford, the leading automaker of the time. While he admired Ford's mass production system, he realized that it wasn't entirely suitable for the Japanese market, which required smaller production volumes and a wider variety of models due to varied consumer preferences.

4. Birth of Just-In-Time (JIT)

In response to the challenges posed by limited resources and the need for varied production, Toyota developed the Just-In-Time system. JIT aimed to produce the necessary items, in necessary quantities, at the necessary time. This meant minimizing waste, reducing inventory costs, and increasing efficiency by ensuring parts and components arrived just when they were needed on the production line.

5. Emphasis on Quality: Jidoka

While JIT dealt with efficiency, Jidoka, often translated as “automation with a human touch”, ensured quality. Jidoka's primary goal was to integrate quality checks within the production process. If a machine detected an error, it would stop, thereby preventing the production of defective products and allowing workers to identify and correct the root cause.

6. Influence of American Experts

In the post-war era, quality control experts like Dr. W. Edwards Deming and Joseph Juran visited Japan. Their teachings, emphasizing quality, statistical process control, and the need for management commitment, resonated with Toyota's leaders. These ideas dovetailed nicely with Toyota's emerging practices and helped refine TMS.

7. Continuous Improvement: Kaizen

The 1950s and 60s saw the formal integration of Kaizen, or continuous improvement, into the Toyota ethos. This principle encouraged every employee, regardless of rank, to seek ways to improve processes, enhance efficiency, and ensure better quality.

8. TMS Takes Shape

Through the 1960s and 70s, the various principles — JIT, Jidoka, Kaizen, and others — coalesced into a formalized system. The Toyota Management System was not just about production but encompassed a holistic approach to managing all facets of the organization, from production to human resources.

9. Global Recognition and Adoption

By the 1980s, the effectiveness of TMS was undeniable. Toyota's rise as a global automotive powerhouse drew attention to its unique management and production practices. Companies from various industries began to study and implement elements of TMS in their operations.


The Toyota Management System is the result of decades of continuous evolution, learning from both successes and failures. Rooted in a rich history and influenced by diverse factors — from early textile machinery to global automotive challenges — TMS stands as a testament to Toyota's commitment to quality, efficiency, and continuous improvement. In understanding its origins, we gain insight into the profound impact of visionary thinking and the relentless pursuit of excellence.