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Production strategies adopted by Toyota (Sunderland) to minimise wastage of material.

Prepared by Kashan Pirzada

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Ever since the company was founded in 1937, The TOYOTA MOTOR OR!ORAT"O# and their su$sidiaries %&TOYOTA'(, have continuous)y strived to contri$ute to the sustaina$)e deve)opment of society and the earth throu*h the manufacturin* and provision of hi*h+,ua)ity and innovative products and services- Throu*h these continuous efforts, they have esta$)ished a corporate phi)osophy that has $een passed down from *eneration to *eneration throu*hout the company and which has come to $e .nown as the &/uidin* !rincip)es at Toyota' %ori*ina))y issued in 1990, revised in 19971 the &/uidin* !rincip)es'- they have a)so put TOYOTA2s va)ues and methods in written form, in the &Toyota 3ay' %issued in 0441(- 5uch va)ues and methods must $e shared *)o$a))y amon* us to rea)i6e the &/uidin* !rincip)es' and they are* to pass these on to future *enerations- Throu*h these efforts and $y !assin* down corporate phi)osophy and va)ues and methods, they are steadfast)y strivin* to rea)i6e the &creation of a prosperous society $y* thin*s'- TOYOTA has )on*+demonstrated its dedication to contri$utin* to sustaina$)e deve)opment- As their $usiness operations have $ecome increasin*)y *)o$a), they need to reconfirm their corporate phi)osophy and have issued an e7p)anatory paper in 8anuary 0449 entit)ed & ontri$ution towards 5ustaina$)e :eve)opment'- This paper interprets the /uidin* !rincip)es from the stand point of how TOYOTA can wor. toward sustaina$)e deve)opment in its interactions with its sta.eho)ders- They $e)ieve that $y imp)ementin* the /uidin* !rincip)es in operation, TOYOTA wi)) successfu))y fu)fi)) its e7pected contri$ution towards sustaina$)e deve)opment- Therefore, as stated in the /uidin* !rincip)es and e7p)anatory paper, we must comp)y with )oca), nationa) and internationa) )aws and re*u)ations, inc)udin* the spirit thereof, and act with humi)ity, honesty and inte*rityompared to when the & ode of onduct for Toyota Emp)oyees' was first issued in 199;, TOYOTA2s presence in society has *reat)y increased and a)so new )aws and re*u)ations have $een esta$)ished, such as for the protection of persona) data- 3ith this $ac.*round in mind, we have revised the e7istin* code of conduct and created the &Toyota ode of onduct' in order to communicate the fundamenta)
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approach necessary to inspire continued confidence in TOYOTA, to respect and comp)y with the )aws, and to maintain our honesty and inte*rity- " wou)d particu)ar)y )i.e to as. each one of you, as a person* for TOYOTA, to $e aware that you are an essentia) contri$utor to the success of TOYOTA- "n this era of *)o$a) competition, $order)ess trade, and diversification, TOYOTA wishes to conduct $usiness in an open and fair way- TOYOTA aims to $ecome the most va)ued, respected and trusted company in the wor)d $y its customers and societyAccomp)ishin* this *oa) re,uires that each one of us is aware of TOYOTA2s respected reputation and standin* in the community, the *ratitude their owe to customers and society, and the necessary respect of )aws and re*u)ations- Therefore, they must each act in a &steadfast, sure+ footed, and thorou*h' way, and in accordance with common sense and *ood <ud*ment- " e7pect and as. you to carefu))y read this &Toyota ode of onduct' and to imp)ement the spirit within March, 044=After the 5econd 3or)d 3ar, the distri$ution of 3or)d economic power was tota))y rearran*ed>efore the war, Europe and the ?5A ru)ed the wor)d The mana*ement of 3estern companies was $ased on the @5cientific Mana*ement@ $y Arederic. 3ins)ow Tay)or %1;9=+ 1919( and on @Modern 5ocio)o*y@ $y Ma7 3e$er %1;=B+1904(- This inte))ectua) $asis characteri6es the $e*in of industria)i6ation, )ed to mass production and to tremendous productivity increases- Yet after the war, new p)ayers appeared on the p)ay*round, whose wor. was $ased on a phi)osophy, on methods and ru)es un.nown $efore- 3hi)st 3estern mana*ers turned to short+term* to satisfy shareho)ders and to end)ess restructurin*, the new actors concentrated on continua) improvement in the ,ua)ity of products, uniformity of processes and ,ua)ification of emp)oyees- Toyota is one of these new p)ayers, which despite the fierce competition due to e7cess production capacity in the automo$i)e industry of around 09 C outperforms 3estern competition in every aspect, in techno)o*ica) innovation, in customer satisfaction, in continuous *rowth and in profit- "n 044B Toyota passed Aord to $ecome he second )ar*est automo$i)e producer- >efore )on*, Toyota wi)) overta.e /enera) Motors $ecomin* the $i**est car company in the wor)d pro$a$)y havin* no )ess than 19C of the wor)d Toyota wi)) prevai)- Most others wi)) have the choice $etween* or*- This paper tries to shed )i*ht on the root causes of the Toyota !henomenon, which for some reason or

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another 3estern companies find so hard to understand and much )ess on how to app)y, despite their stru**)e for its surviva)-



To be the ost respected and success!u" enterprise# de"i$htin$ custo ers %ith a %ide best techno"o$y&' In a nutshell the companys objective is to have:

ran$e o! products and so"utions in the auto obi"e industry %ith the best peop"e and the

Action Commitment Teamwork for becoming #1 in the world

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(uidin$ Princip"es at Toyota

1- Donor the )an*ua*e and spirit of the )aw of every nation and underta.e open and fair corporate activities to $e a *ood corporate citi6en of the wor)d-

0- Respect the cu)ture and customs of every nation and contri$ute to economic and socia) deve)opment throu*h corporate activities in the communities-

3- :edicate ourse)ves to providin* c)ean and safe products and to enhancin* the ,ua)ity of )ife everywhere throu*h a)) our activities-


reate and deve)op advanced techno)o*ies and provide outstandin* products and services that fu)fi)) the needs of customers wor)dwide-

9- Aoster a corporate cu)ture that enhances individua) creativity and teamwor. va)ue, whi)e

=- Donorin* mutua) trust and respect $etween )a$or and mana*ement-

7- !ursue *rowth in harmony with the *)o$a) community throu*h innovative mana*ement-

;- 3or. with $usiness partners in research and creation to achieve sta$)e, )on*+term *rowth and mutua) $enefits, whi)e .eepin* ourse)ves open to new partnerships-

9. The Toyota 3ay inc)udes a set of too)s that are desi*ned to support peop)e continuous)y

improvin* and continuous)y deve)opin*- Aor e7amp)e, one+piece f)ow is a very demandin* process that ,uic.)y surfaces pro$)ems that demand fast so)utions, or e)se production wi)) stop- This suits Toyota2s emp)oyee deve)opment *oa)s perfect)y $ecause it *ives peop)e the sense of ur*ency needed to confront $usiness pro$)ems- The view of mana*ement at Toyota is that they $ui)d peop)e, not <ust cars-

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Toyota Production Syste


Airst, of course, it tau*ht the modern car industry how to ma.e cars proper)y- Aew had heard of the Toyota !roduction 5ystem %T!5( unti) three academics in the car industry study pro*ramme run $y Massachusetts "nstitute of Techno)o*y %M"T( wrote a $oo. in 1991 ca))ed &The Machine that han*ed the 3or)d'- "t descri$ed the princip)es and practices $ehind the &<ust+in+time' manufacturin* system deve)oped at Toyota $y Taiichi Ohno- De in turn had drawn inspiration from 3- Edwards :emin*, an inf)uentia) statistician and ,ua)ity+contro) e7pert who had p)ayed a $i* part in deve)opin* the rapid+manufacturin* processes used $y America durin* the 5econd 3or)d 3ar- At the core of T!5 is e)imination of waste and a$so)ute concentration on consistent hi*h ,ua)ity $y a process of continuous improvement %.ai6en(- The catchy <ust+in time aspect of $rin*in* parts to*ether <ust as they are needed on the )ine is on)y the c)earest manifestation of the re)ent)ess drive to e)iminate mud waste( from the manufacturin* process- The wor)dEs motor industry, and many other $ranches of manufacturin*, rushed to em$race and adopt the princip)es of T!5- ToyotaEs success starts with its $ri))iant production en*ineerin*, which puts ,ua)ity contro) in the hands of the )ine wor.ers who have the power to stop the )ine or summon he)p the moment somethin* *oes wron*- 3a). into a Toyota factory in 8apan or America, :er$y in >ritain or Fa)entines in Arance and you wi)) see the same visua) disp)ays te))in* you everythin* that is *oin* on- You wi)) a)so hear the same <in*)es at the various wor. stations te))in* you a mode) is $ein* chan*ed, an operation have $een comp)eted or a $rief ha)t ca))ed- Everythin* is minute)y synchroni6ed1 the wor. *oes at the same steady cadence of one car a minute ro))in* off the fina) assem$)y )ine- Each operation a)on* the way that time- #o one ushers and there are cute s)in*s and swive)in* )oaders to ta.e the heavy )iftin* out of the wor.- >ut there is much more to the sou) of the Toyota machine than a dour, re)ent)ess pursuit of perfection in its car factories- Another triumph is the s)ic. product+deve)opment process that can ro)) out new mode)s in $are)y two years- As riva) ar)os /hosn, chief e7ecutive of #issan, notes in his $oo. &5hift' %a$out how he turned around the wea.est of 8apanEs $i* three(, as soon as Toyota $osses spot a *ap in the or a smart new product from a riva), they swift)y move in with their own version-

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The resu)t is a $ewi)derin* array of over =4 mode)s in 8apan and )oads of different versions in $i* overseas mar.ets such as Europe and America- Of course, under the, these share many common parts- Toyota has )on* $een the champion of puttin* o)d wine in new $ott)esG over two+ thirds of a new vehic)e wi)) contain the unseen parts of a previous mode)- >ut T!5 a)one wou)d not <ustify the e7traordinary success of the company in the wor)d

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+or"d C"ass Manu!acturin$

Many firms have tried to insta)) the Toyota !roduction system T!5- They set up the Han$an system, which is a too) for mana*in* the f)ow and production of materia)s in a Toyota+sty)e &pu))' production system- They p)u* in the andon, which is a visua) contro) device in a production area that a)erts wor.ers to defects, e,uipment a$norma)ities or other pro$)ems usin* si*na)s such as )i*hts, audi$)e a)arms, etc- Aina))y, with a)) these devices the wor.p)ace )oo.s )i.e a Toyota p)ant- Yet over time the wor.p)ace reverts to operatin* )i.e it did $efore- And this is e7act)y what many 3estern or*ani6ations have e7perienced- 3ith the set up of T!5, the rea) wor. of imp)ementin* T!5 has <ust $e*un- "n the Toyota 3ay, it2s the peop)e who $rin* the system to )ife $y*, communicatin*, reso)vin* issues and *rowin* to*ether- The Toyota 3ay encoura*es, supports and in fact demands emp)oyee invo)vement- The Toyota 3ay is much more than a set of improvement and efficiency techni,ues- "t2s a cu)ture dependin* on attitude to reduce inventory, identify hidden pro$)ems and to fi7 them with a sense of ur*ency, purpose and team wor.- The Toyota !roduction 5ystem can $e copied, the Toyota 3ay cannot"t has to $e $ui)t, maintained and refined over decades- The roots of the Toyota 3ay *o $ac. to 190=, when 5a.ichi Toyoda %1;=7 I 1934(, a $ri))iant en*ineer, )ater referred to as 8apan2s &Hin* of "nventors', founded Toyoda Automatic Joom 3or.s- Dis wor. ethics was si*nificant)y inf)uenced $y the $oo. of 5amue) 5mi)es, &5e)f+ De)p', first pu$)ished in En*)and in 1;99- The $oo. *rew out of the devotion, to he)p youn* man in difficu)t economic circumstances $y improvin* themse)ves- The $oo. chronic)es inventors whose natura) drive and in,uisitiveness )ed to *reat inventions that chan*ed the course of humanity- 3hen )* for instance at the success and impact of 8ames 3att, 5mi)es conc)uded, that $oth were not the resu)t of natura)
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endowment $ut rather trou*h hard wor., perseverance and discip)ine- These few words summari6e the spirit, which 5a.ichi Toyoda handed over to his son Hiichiro Toyoda %1;9B+ 1990(, the founder of Toyota Motor and director of Toyota Motor ompany, his son 5hoichiro Toyoda, Donorary hairman orp-, and on to his nephew Ei<i Toyoda %K1913(, !resident of

Toyota from 19=7 to 199B- 5pend some time with Toyota peop)e and after a time you rea)i6e there is somethin* different a$out them- The rest of the car industry raves a$out en*ines, *ear$o7es, acce)eration, fue) economy, hand)in*, ride ,ua)ity and se7y desi*n- ToyotaEs peop)e ta). a$out &The Toyota 3ay' and a$out customers- "n truth, when it is written down the Toyota creed reads much )i.e any corporate mission statement- >ut it seems to have $een a$sor$ed $y 8apanese, European and American emp)oyees a)i.e- Mr- ho thin.s that somethin* of the uni,ue Toyota cu)ture comes from the fact that the company *rew up in one p)ace, Toyota ity, 34 minutes drive from #a*oya in centra) 8apan, where the company has four assem$)y p)ants surrounded $y the factories of supp)iers- "n this provincia), ori*ina))y rura) settin*, Toyota wor.ers in the ear)y days wou)d often have sma)) p)ots of )and that they tended after their shiftMrho, who made his career in the company $y $ein* a pupi) of Mr- Ohno and $ecomin* a master of production contro), thin.s that the fact that Toyota mana*ers and their supp)iers see each other every day for a sort of hothouse cu)tureL rather )i.e 5i)icon Fa))ey in its ear)y days- 8im !ress is $oss of ToyotaEs sa)es in #orth America- De )eft Aord in frustration 39 years a*o, $ecause he did not thin. it hand)ed customer re)ations proper)y and he suspected that the upstart 8apanese company* its way in the American mi*ht do $etter- De was ri*htToyota shares a production p)ant in a)ifornia with /M- "dentica) cars come off the )ine, some $ad*ed as /M, the rest at)asG after five years, accordin* to one study $y >oston onsu)tin* /roup, the trade+ in va)ue of the Toyota was much hi*her than that of the American mode), than.s to the *reater confidence peop)e had in the Toyota dea)er and service networ.- Mr- !ress ta).s with a ,uiet, a)most re)i*ious, fervor a$out Toyota, without mentionin* cars as such- &The Toyota cu)ture is inside a)) of us- Toyota is a customerEs company,' he says- &Mrs- 8ones is our customer1 she is my $oss- Everythin* is done to ma.e Mrs- 8onesEs )ife $etter- 3e a)) wor. for Mrs- 8ones-' >ut not even the com$ination of its wor)d )eadin* manufacturin*, rapid product deve)opment and o$sess iona) devotion to customer satisfaction is enou*h to e7p)ain ToyotaEs endurin* success- There is one more in*redient that adds 6est to a)) these- Tetsuo A*ata dou$)es as *enera) mana*er of ToyotaEs Donsha p)ant in Toyota ity and as the companyEs overa))

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manufacturin* *uru- The ma*ic of ToyotaEs winnin* cu)ture was summed up for him $y an American friend who o$served that Toyota peop)e a)ways put themse)ves &outside the comfort 6one'G whenever they hit one tar*et, they set another, more demandin* one- That re)ent)ess pursuit of e7ce))ence certain)y e7p)ains much of what has $een happenin* to the company in recent years, at home and a$road-

Methods ,sed In Contro""in$ +aste

The purpose of T!5 is to minimi6e time spent on non+va)ue addin* activities $y positionin* the materia)s and too)s as c)ose as possi$)e to the point of assem$)y- The ma<or types of non+va)ue addin* waste in $usiness or production process are overproduction, waitin* or time on hand, unnecessary transport or conveyance, over processin* or incorrect processin*, e7cess inventory, unnecessary movement, defects and unused emp)oyee creativity- The drivin* force $ehind the 8apanese system of production is e)iminatin* waste, there$y ma7imi6in* process efficiency and the returns on resources- A wide num$er of princip)es and practices can $e emp)oyed to achieve this *oa)- As 5hin*o once noted, peop)e instinctive)y .now to e)iminate waste once it is identified as such, so the tas. of reducin* waste often centers first around identifyin* unnecessary uses of human, capita), or physica) resources- After waste is tar*eted, new processes or practices can $e devised to dea) with it-

-ust.In.Ti e )-it*
8ust+in+time %8"T( production or so+ca))ed )ean manufacturin*- The pioneers of these methods were Taiichi Ohno, a former Toyota e7ecutive, and 5hi*eo 5hin*o, an eminent en*ineer and consu)tant- "n his 19;9 $oo. The 5tudy of the Toyota !roduction 5ystem from an "ndustria) En*ineerin* !erspective, 5hin*o identified these $asic features of T!5G 1- "t achieves cost reductions $y e)iminatin* waste, $e it staff time, materia)s, or other resources0- "t reduces the )i.e)ihood of overproduction $y maintainin* )ow inventories %@nonstoc.@( and .eeps )a$or costs )ow $y usin* minima) manpower-

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3- "t reduces production cyc)e time drastica))y with innovations )i.e the 5in*)e+Minute E7chan*e of :ie %5ME:( system, which cuts downtime and ena$)es sma))+)ot productionB- "t emphasi6es that product orders shou)d *uide production decisions and processes, a practice .nown as order+$ased production-

Process I pro/e ent

An important aspect of e)iminatin* waste is desi*nin* efficiency into production processes and methods- Aor e7amp)e, in the Toyota system heavy emphasis was p)aced on )owerin* the time and comp)e7ity re,uired to chan*e a die in a manufacturin* process- A time+consumin* die+ chan*in* process is wastefu) in two ways- Airst, whi)e it is happenin* production is often at a standsti)), increasin* cyc)e times and a)) the costs associated with )on*er cyc)e times- %Dowever, it is important to note that id)e time for individua) machines in a system is not a)ways viewed as wastefu) under the T!5 phi)osophy-( 5econd, wor.ersE time and effort are spent on activities that arenEt direct)y re)ated to production %i-e-, no va)ue is $ein* added $y chan*in* a die(- As a resu)t of such concerns, the push at Toyota was to reduce si*nificant)y the time it too. to chan*e dies-

0A1,E A22E2
T!5 and simi)ar 8apanese manufacturin* techni,ues distin*uish $etween activities that add va)ue to a product and those that are )o*istica) $ut add no va)ue- The primaryLeven the so)eLva)ue+ added activity in manufacturin* is the production process itse)f, where materia)s are $ein* transformed into pro*ressive)y functiona) wor. pieces- Most other activities, such as transportin* materia)s, inspectin* finished wor., and most of a)), id)e time and de)ays, add no va)ue and must $e minimi6ed- 3hen processes are e7amined for potentia) improvements and cost cuttin*, reducin* non+va)ue+added activities is often the hi*hest priority- onverse)y, processes that add the most va)ue, even if they are e7pensive, wi)) usua))y not $e compromised to achieve )ower costs at the e7pense of ,ua)ity-

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3ua"ity by 2esi$n
Another feature thou*ht to $e definin* in 8apanese manufacturin* is a mar.ed attention to ,ua)ity throu*hout the production process- 5pecifica))y, under the inf)uence of such )uminaries as 3Edwards :emin* and 8oseph M- 8uran, 8apanese manufacturers have sou*ht to achieve ,ua)ity $y desi*nin* it into the production process rather than simp)y tryin* to catch a)) the errors at the end- As noted, can serve this function either $y ha)tin*Mcorrectin* a fau)ty process or $y a)ertin* a to a pro$)em as it occurs- 3hi)e p)enty of traditiona), defect+monitorin* sorts of ,ua)ity contro)s are sti)) used, phi)osophies such as T!5 ho)d that the resu)ts of ,ua)ity inspections shou)d $e used to informLand improveLthe manufacturin* process, not <ust to descri$e it- This means the feed$ac. from a ,ua)ity inspection is e7pected to $e immediate and, often, to resu)t in some chan*e in the process so that the )i.e)ihood of simi)ar pro$)ems in the future is reduced-

Order.4ased Production&
A natura) and necessary e7tension of the non+stoc. *oa) is that manufacturers need specific customer information to drive their production decisions- O$tainin* this information necessitates effective researchMforecastin* and communication with customers- As much as possi$)e, production under the 8apanese system is *uided $y actua) orders, rather than anticipated demand $ased on )ess re)ia$)e information such as past sa)es- The order+$ased system is said to provide production @pu))@ from the actua), as opposed to @push@ that stems on)y from the manufacturerEs con<ecture-

The Toyota !roduction 5ystem a)so reco*ni6es waste in the e7cess movement of items or materia)s- "n *enera), the more transportation re,uired, the )ess efficient the process, since movin* *oods $ac. and forth is norma))y not a va)ue+addin* procedure- Transport waste is usua))y addressed $y chan*in* the )ayout of a factory, its *eo*raphic )ocation re)ative to its customers, and so forth- 3hi)e sometimes transportation pro$)ems can $e miti*ated throu*h automation, the idea) under the 8apanese system is to minimi6e it a)to*ethermanufacturin* )ayouts are one approach to contro))in* transport wasteBahria University

e)) and f)e7i$)e

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Mar5et.2ri/en Pricin$
"n contrast to the traditiona) practice of settin* prices $y* up some percenta*e over the cost of manufacturin*, the 8apanese system attempts to identify the price for a *ood and then en*ineer the manufacturin* process to produce at this price profita$)y- ?nder this princip)e, increases in costs are not passed on to the consumer in the form of hi*her pricesAs a coro))ary, the on)y way for a firm to increase profita$i)ity is $y )owerin* costs1 )ower costs may a)so a))ow the company to $e profita$)e yet de)iver products at the )ow end of the pricin* spectrum, a practice centra) to the rise of the 8apanese auto manufacturers in the ?-5-

+or5er 6"e7ibi"ity
Ma7imi6in* returns on human capita) is another *oa) of 8apanese manufacturin* practices:riven $y the theory that human time is more va)ua$)e than machine time, the 8apanese system attempts to optimi6e )a$or efficiency $y dep)oyin* wor.ers in different ways as order+$ased production re,uirements f)uctuate- The main two dimensions of this f)e7i$i)ity are s.i))s and schedu)in*-

1ean Princip"es

!recise)y define va)ue $y specific product"dentify the va)ue stream for each productMa.e the va)ue f)ow without interruptionsJet the customer pu)) va)ue from the producer!ursue perfection

Princip"es Adopted 4y Toyota To Achie/e Their (oa"s

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Toyotas business practices differ from those of Western automobile manufacturers in a number of aspects
Operations are strict)y *overned $y a sustaina$)e $usiness po)icy, which is passed on from one *eneration to the other and not $y short+term decision* or $y the attitudes of chan*in* mana*ement teams and varia$)e customer tastes /rowth comes from the inside out and not throu*h mer*ers and ac,uisitions, in other words, *rowth throu*h continua) improvement of products and services and not throu*h continued restructurin*-

!roduction is contro))ed $y customer demand %&pu))' system( not $y production capacity %&push' system(-

Nua)ified emp)oyees are attracted with the possi$i)ity to participate in the company2s strivin* to meet and e7ceed customer e7pectations with products of unpara))e)ed ,ua)ity and not with compensation schemes- Toyota emp)oyees wor. for a winner- 3ho wants to wor. for an emp)oyer, whose products have to $e forced onto the customers with discounts and incentivesO 3ho wants to wor. for a )ooserO

#o unions are admitted which force $oth mana*ement and emp)oyees to defend their own interests and $y so doin* distract from the shared responsi$i)ity to satisfy customers-

Aor more than 94 years, Toyota e7perienced an e7traordinary history of continuous *rowth without ma<or )ayoffs

>ase your mana*ement decisions on a )on*+term phi)osophy, even at the e7pense of 5hort+term financia) *oa)sBahria University

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reate continuous process f)ow to $rin* pro$)ems to the surface>ui)d a cu)ture of stoppin* to fi7 pro$)ems, to *et the ,ua)ity ri*ht the first time5tandardised tas.s are the foundation for continuous improvement and emp)oyee Empowerment-

?se visua) contro) so no pro$)ems are hidden?se on)y a re)ia$)e, thorou*h)y tested techno)o*y that serves your peop)e and !rocesses-

/row )eaders who thorou*h)y understand the wor., )ive the phi)osophy, and teach it to others-

:eve)op e7ceptiona) peop)e and teams who fo))ow your company2s phi)osophyRespect your e7tended networ. of partners and supp)iers $y cha))en*in* them and he)pin* them improve-

/o and see for yourse)f to thorou*h)y understand the situation %*enchi *en$utsu(Ma.e decisions s)ow)y $y consensus, thorou*h)y considerin* a)) options1 imp)ement decisions rapid)y-

>ecome a )earnin* or*anisation throu*h re)ent)ess ref)ection %hansei( and continuous "mprovement %.ai6en(

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As one of the )eadin* automo$i)e manufacturers in the wor)d, Toyota ran.s within the top three wor)dwide- :ue to their uni,ue $usiness mode), they are now havin* a share of 1BC in the first four months of this year- That is an astonishin* 0-3C <ump from the previous yearAccordin* to Autodata-com, the Toyota sa)es3e have determined that their $usiness mode) is an "nte*rated Jow ostO :ifferentiated ity $ased ran.s fourth in ?nited 5tates

5trate*y- "t invo)ves findin* the )owest operationa) cost a)on* with a uni,ue niche or strate*y that separates them from the competition- Toyota2s new statementO Movin* AorwardO Ref)ects their p)ans and e7pectations for the future- This inc)udes the .nown and the un.nown factors that a $usiness must face- "n 0444, Toyota )aunched a new cost effective strate*y ca))ed 01 % onstruction of ost ompetitiveness for the 01st century(, for Jow ost operationa) e7penses3ith this aspect Toyota p)ans to advance such initiatives *)o$a))y, $ased on its po)icy of purchasin* the wor)d2s $est parts at the )owest cost with the shortest )ead times-

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