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Toyota’s Secret

Toyota’s Secret



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Published by geelickvb

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Published by: geelickvb on Jan 09, 2009
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 TOYOTA’S SECRETIf you enter the lobby of Toyota’s headquarters in Japan,you will see two small portraits and one big one hanging there. The two small ones show the founder and the current chairman of the company. The large portrait shows an American. It is Dr.Edward Deming. Who is Edward Deming you might ask? Andindeed who is he? But it’s a long story and one cannot explainwho Edward Demings is without involving characters like the Japanese, the Americans and the Toyota Company. So heregoes…Long Ago and Far Away…World War II had barely ended, the Japanese were left witha devastated country, ruins that were previously houses and abattered economy. But there was something left that helped themovercome all this destruction. They did not sit and lament theirfates but began thinking…where do we go from here and to getthere what do we need to do? Factories began production againfirstly to supply all the basic necessities and after around 15years when everyone had the basic goods they needed, theyturned their energies towards overcoming the surplus of imports. Japan needed to offer something more in their goods if they hadto succeed on foreign shores.... The Japanese car manufacturers namely Toyota wanted to startoperations in America. That was all very well. But how could theymake the Americans buy their cars rather than local ones. EnterDr. Edward Demings and hey presto! They had the secret recipe! The man who according to his biographer RafeelAgumayo(1) is the American who taught Japan what qualitymanagement is. Dr. Edwards Deming was a physicist specializedin the field of statistics and worked in United States Bureau of Census. His greatest contribution on the evaluation of statisticalmethods for ensuring the quality of census assessmentestablished him as a leader in the field of Total QualityManagement. In fact he is considered as the "Guru" of TotalQuality Management. Deming also enunciated 14 principles for
quality management which include innovation, the philosophy of quality to be inculcated in all individuals, appropriate andcomplete supervision, absence of fear and openness, ensuringquality from design through to maintenance, work standards inproduction, training of every worker in statistical methods,retraining people to new skills and so on.The world saw Toyota take over America by storm, theyoffered better, faster, more comfortable and more efficient carsand Americans came to buy cars from them in droves. ButAmerica was not the only stop, in fact Toyota quickly became thelargest car Manufacturer in the world. And there has been nolooking back since.(1). Rafeel Agumayo, Dr. Deming, the American Who Taught the Japanese About Quality, Carol Publishing Group, New York.How Toyota Does It—EverydayFewer man-hours. Less inventory. The highest qualitycars with the fewest defects of any competing manufacturer. Infactories around the globe, Toyota consistently raises the bar formanufacturing, product development, and process excellence. The result is an amazing business success story: steadily takingmarket share from price-cutting competitors, earning far moreprofit than any other automaker, and winning the praise of business leaders worldwide. How do they do it?One of their secrets that gives them an edge over other carManufacturers is the ‘Toyota production System’. Toyota haddiscovered earlier on that the key to their success was TotalQuality Management (TQM) . To make sure that they incorporated TQM in every stage from designing to car manufacturing to aftersales service they developed the Toyota Production System (TPS).Initially developed in Japan, TPS or the Toyota Production System,was transplanted to the United States nearly two decades ago,when Toyota launched a joint venture with General Motors Corp.,called New United Motor Manufacturing, Inc., or NUMMI, based inFremont, Calif.One of the aspects of the Toyota Production System (TPS)
that tends to be overlooked--or is at least not mentioned asfrequently as subjects such as kanban or kaizen--is the fact thatthere are people involved. Instead, TPS is discussed almost asthough the practices are what's essential.But when you talk to a key practitioner of TPS, such as MikeDaPrile, vice president-Manufacturing, Toyota MotorManufacturing-Kentucky, people come first. As in, "One of thethings that we do for efficiency and lean manufacturing is puttingresponsibility in worker's hands. I know that sounds naive, but itis not."He adds, "I really believe in giving people responsibility. Efficiencycomes from improving processes--from people kaizening theirown processes." Of course, there is something else that must betaken into account: "There is little concern here about being laidoff." Should a person improve him- or herself out of a position,they stay on their team for six months, then transition over to akaizen team.According to DaPrile, there are several keys to leanmanufacturing, all of which relate to the people who are actuallydoing the work. For example, there is never a situation where amachine is in control of a person; a person always controls themachine. The andon system--the cord that the worker can pull tostop the line--is an example of a person being in charge of anassembly line. (Contrast this to places where the speed of the linepaces the worker, where it is up to the worker to keep up with themachine, where the machine keeps going regardless of thequality being produced. "The andon system allows the person tostop the line to incorporate good quality in the product.")Safe & Engaged. Further, DaPrile states with emphasis, "Wefeel strongly that safety is a top priority." And by creating a safeworkplace, there is improvement inmorale. And as morale rises, there are gains in both quality andproductivity. This is not the proverbial double win (managementand workers), but actually a triple win, in that the customerreceives a better product (which explains, in large part, why theCamry is continuing a run on the top of the best-selling car inAmerica list). To keep the people engaged in their work, they do a number of things at the Toyota plant in Georgetown, KY. For example, theylevel the production. This is a means by which there is assurancethat people can get their jobs done in the amount of timeavailable without having them waiting around. "People don't like

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