Toyota Production System – Monitoring Construction Work Progress With Lean

Principles
Bala SK Paladugu and David Grau, Arizona State University, Tempe, AZ, United States
r 2019 Elsevier Inc. All rights reserved.

Introduction

Since the 1950s the Toyota Motor Corporation has honed an advanced method of production design, control, and management
referred to as the Toyota Production System (TPS). TPS is also referred to as a total, lean manufacturing, or just-in-time (JIT)
production system. It adds value to the (final) customer through the utilization of cost-effective resources, elimination of waste,
and continuous improvement (Brown, 2005). TPS has resulted in a quicker assembly of automobiles with high reliability and high
quality-to-cost, which were attained even with the high wages of Japanese workers before the internationalization of Toyota’s
production (Liker, 2004). Currently, Toyota stands as the largest automotive manufacturer and the sixth largest company by
revenue in the world (Fortune Global 500, 2018). The next section introduces the history behind TPS.

History

In the early 1900s, Sakichi Toyoda was an entrepreneur who designed and produced looms that were less expensive than and
superior in quality to those commercially available. Later on, Sakichi leveraged steam power to streamline the weaving process
through an automated loom. The weaving loom stopped when a string tore with the objective to reduce defects (Ohno, 1988;
Liker, 2004). The concept of a smooth production process through autonomation (Jidoka in Japanese) was the essence of Sakichi’s
innovation and was later adopted within TPS.
In 1926, Sakichi established the Toyoda Automatic Loom Works, Ltd. In 1929, commercialization rights of the patented loom
design were sold to Platt Brothers in London for £100,000 (pound value at the time). In 1930, Kiichiro Toyoda founded Toyota
Motor Corporation with the profits from this transaction (Ohno, 1988; Liker, 2004). Initially, the company focused on the
production of trucks (Liker, 2004).
Later, in the 1950s, Toyota’s Chief Officer Eiji Toyoda – cousin of Kiichiro Toyoda – and other corporate managers traveled to
the United States with the objective to learn from the direct observation of the assembly (production) lines at Ford Motor
Company and General Motors Company. Despite their business success, Toyota’s cohort of managers realized many inherent flaws
in the assembly processes. Examples of shortcomings included uneven workflow, large inventories, wait times, disorganized
workplaces, or quality issues. Upon return, Eiji Toyoda commissioned Taiichi Ohno with the design of a robust approach that
could boost Toyota’s production (Ohno, 1988; Liker, 2004).

Waste

Indeed, Taiichi Ohno, Toyota's chief production engineer, centered his analysis on differentiating value-added tasks and nonvalue-
added tasks from a customer’s perspective. Such perspective unambiguously enabled to ascertain the design aspects that added
value and tracked such value through design, supply, production, and management. Ohno, while conceiving TPS, determined
seven categories of waste or lack of value (Muda) (Ohno, 1988; Liker, 2004), which are detailed below.

(1) Overproduction. Production of goods or products before they are required by downstream production (intermediate products)
or customer demand (finished products).
(2) Waiting. Idle time of workers, for example, waiting due to machine time, lack of parts, or tool or machine issues.
(3) Unnecessary handling. Unnecessary handling of materials, parts, or goods/products. This is sometimes referred to as double- or
multiple-handling. In addition to the inherent waste associated with unnecessary handling, it is also at the source of damage
or quality issues and increased safety incidents.
(4) Overprocessing and inappropriate processing. Overprocessing refers to processing in excess of design specifications, quality
requirements, or customer expectations. Inappropriate processing reflects an inadequate use of methods, techniques, or tools
and equipment. Inappropriate processing can also result from a product design with poor manufacturability and/or omis-
sions and errors. Design omissions and errors eventually result in quality issues.
(5) Excessive buffers. Excessive inventories of materials, parts, and intermediate or finished products increase production and
storage costs, safety incidents, and can result in the damage of stored items.
(6) Unnecessary motion. The unnecessary motion of workers or equipment/machinery. It includes unnecessary traveling, bending,
reaching, or lifting. When routinely performed, unnecessary motion continuously builds waste and costs. Unnecessary
motion negatively impacts workers’ health and safety.

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2 Toyota Production System – Monitoring Construction Work Progress With Lean Principles

(7) Quality issues. Defects or quality issues in parts or products, or the work time and equivalent costs wasted reworking defects or
replacing parts or products.
Indeed, Taiichi Ohno summarized the foundation of TPS by stating that “all we are doing is taking a gander at the timeline
from the minute the client gives us a request to moment that we gather money. What is more, we are decreasing the timeline by
expelling nonvalue-added waste” (Ohno, 1988).

Theoretical Underpinning of Toyota Production System

In reality, in Ohno’s broadest vision, everything between a client’s command (e.g., car dealer) and the delivery of the finished
product (e.g., cars) could be regarded as waste, whether it added value or not. In practice, though, nonvalue-added or actual waste
was the enemy and had to be continuously eradicated. The theoretical underpinning of TPS is embedded in such a vision and rests
on five main pillars. The organizational behaviors of elimination of waste (Muda) and continuous learning (Kaizen) support and
feed the technical components of autonomation (Jidoka), JIT, and standardization (Liker, 2004). The rest of this section details the
last four pillars that, when combined with waste elimination, result in the theoretical foundation of TPS. See Fig. 1.

Kaizen
Kaizen represents the organizational behavior aspect of continuous learning or improvement and sustains the work culture. Kaizen
techniques aim at promoting and reinforcing continuous learning, and ultimately enhance TPS, for example contributing to waste
elimination or increased efficiency. “5 Whys?” and “5S” are examples of continuous learning. “5 Whys?” is a simple technique that
triggers a search for the ultimate cause of problems. Instead of asking “why?” once, it seeks a response to six questions: Who?, What?,
Where?, When?, Why?, and How? (five Ws and one H) (TMMK, 2006). In addition, “5S” aims at organizing the workspace in a clean,
efficient, and safe manner, with the overall goal of a productive work environment. It includes five phases (Veres et al., 2018). Sort
(Seiri) removes what is not needed and clears the workspace. Set-in-order (Seiton) prepares the sequence of necessary items/tools/
parts so that they can be efficiently reached and returned. Shine (Seiso) aims at regularly clearing equipment and workplace and
including routine inspections during the clearing process. Standardize (Seikutsu) documents and standardizes processes and proce-
dures in support of 5S. Finally, sustain (Shitsuke) aims at continuously maintaining processes and procedures, inclusive of work
audits, so that these become habits within the work culture.

Just- in-Time
JIT aims at providing what is needed (i.e., materials, parts, products) in the required amount at the right location and at the right
time. JIT enhances efficiency and enables quick responses to changes (TMMK, 2006). JIT reduces inventory and rework and
improves quality by identifying and enabling the resolution of quality issues in real-time (Billesbach, 1987). JIT techniques
include Hejunka, Kanban, or value stream mapping (VSM). Hejunka seeks to level production both by volume and by product type

Fig. 1 Theoretical underpinning.

 Toyota Production System – Monitoring Construction Work Progress With Lean Principles 3

(e.g., car model) against variable customer demand (TMMK, 2006). Toyota’s managers envisioned that stable and lean production
required an average production by volume and product type based on long-term demand forecasts as opposed to production
responses to variations in short-term demand. In Hejunka, inventories of finished products represent buffers against sudden peaks
of demand so that customer orders can be met without altering production. In addition, Kanban is a scheduling approach that
matches inventories (e.g., parts) with actual consumption. Kanban is supported with signboards (such is its Japanese meaning) that
inform parts that need to be made available within the production unit/facility or by outside suppliers. Such visual signs are also
leveraged to control overproduction and uneven production rates (TMMK, 2006). Finally, VSM is a value improvement technique
that aims at optimizing human, material, and information resources to complete business and production processes efficiently.
Also, it results in the coordination of the major actors, for example, suppliers and distributors (Sundar et al., 2014).

Jidoka
Jidoka aims at the design of equipment that automatically detects production issues and stops when such issues occur. Examples
of issues are equipment malfunctions, quality problems, or worker late responses (TMMK, 2006). A visual system alerts workers
who assist the machine. In TPS, such type of interaction is called autonomation. Autonomation refers to “automation with a
human touch” (Ohno, 1988) or intervention. Thus, workers are empowered by sensing-equipped machines to intervene and
eventually stop production (e.g., with line-stop buttons), and thus prevent the flow of quality defects and production issues into
downstream tasks. Poke Yoke and Andon are instances of Jidoka. Poke Yoke avoids mistakes by workers. Thus, a worker cannot
make a specific movement or start a task on a machine if the predecessor movement or task has not been completed. Also, Andon
refers to the notification of quality or production issues to workers and management. A visual display board with the current state
of production, work instructions, issues, or progress information is an instantiation of Andon. Andon also enables a mechanism of
control that triggers quick corrective actions when issues arise (TMMK, 2006).

Standardization
Standard processes and procedures enable stable, predictable, and efficient production. The organizational behavior aspect of TPS
requires standardization of processes and procedures across work, supply, business, and management functions. For instance,
setting the sequence of human–machine motion is an example of standardization. TPS’s standardization also includes takt time,
work sequence, and standard work-in-process inventories (TMMK, 2006). Takt time is the average production pace between task or
workstations that matches customer demand. Takt time is calculated with the presumption of 100% machine production capacity
(TMMK, 2006). Second, work sequence defines the detailed step-by-step order of tasks in the production line that maximizes
production and minimizes waste. Finally, standard work-in-process represents the minimum inventory to maintain work.
Maintaining such a minimum inventory enables workers to perform routine work continuously (TMMK, 2006).
In addition, standardization is inclusive of processes and procedures within business partners, for example, suppliers. Overall,
lack of standardization precludes continuous learning.

Toyota Production System

TPS encompasses an advanced method of production design, control, and management. TPS has been observed to become
“a superior way to provide better products in wider variety at lower cost, equally providing more challenging and fulfilling work
for employees at every level” (Womack et al., 1990). TPS implementation and success relies on continuous learning, and
knowledge consolidation and transfer within the organization and across partner organizations. There are 14 TPS principles. Each
of these principles is detailed below based on the discussion by Liker (2004).

• Principle 1. Make decisions on a long-term vision. Maintain and communicate a vision that sets a continuous direction and prevents
ever-changing responses to transient events. The long-term vision should be maintained even at the expense of lower short-term
profits.
• Principle 2. Maintain continuous flow. Create a continuous flow of materials, parts, products, and information that brings
problems to the surface.
• Principle 3. Use “pull” production. A task or activity signals its predecessor(s) when a feed (parts, product, and materials) is
needed. Pull production results in the right quantity of products to satisfy customer orders. Pull eliminates or minimizes
overproduction.
• Principle 4. Level out workload and reduce unevenness. Eliminate unevenness across production tasks (e.g., workstations) and
schedule. Leveling out eliminates the overburdening of workers and equipment. Takt time is the average production pace
between task or workstations that matches customer demand.
• Principle 5. Stop to fix problems. Design equipment that detects problems and stops when problems occur. Complementary, a
visual system alerts workers that assist the machine (i.e., autonomation). The worker has the authority and is accountable for
stopping the production/assembly line when an issue is identified.
4 Toyota Production System – Monitoring Construction Work Progress With Lean Principles

• Principle 6. Standardize. Adopt stable and repeatable processes and procedures that maintain timing, predictability, and outputs.
The organizational behavior aspect of continuous learning is also standardized through best practices.
• Principle 7. Control problems visually. Control problems with visual indicators that immediately communicate information. Visual
controls prioritize the identification and/or communication of information and thus do not need to be sophisticated, even
though they can be. Examples of visual controls include charts, mark tapes (e.g., on floors), arrows, colors, shapes, signboards,
or displays.
• Principle 8. Use reliable and tested technologies. Technology is to assist employees. Avoid a technology that can conflict with the
organizational culture, or that could disrupt stability, reliability, and predictability. Consider thoroughly tested technologies
(i.e., proven through trials) that can serve employees and improve processes and procedures.
• Principle 9. Grow leaders internally. Leaders must be grown internally. Provide continuous support for exceptional employees so
that they become a role model. Leaders should be embedded in the organizational behavior and understand the daily work
details.
• Principle 10. Develop exceptional people and teams. Train individuals and teams who believe in the organizational behavior to
work together and achieve outstanding results. Use cross-functional teams to enhance quality, productivity, and flow by solving
difficult technical challenges. Ultimately, success relies on the team.
• Principle 11. Respect your partners and suppliers. Respects partners and suppliers, but at the same time challenge them to do better
and help them to improve. For example, provide cross-functional teams to help and train suppliers to recognize and address
problems so that they can become exceptional partners.
• Principle 12. Go and experience by yourself. Managers and employees alike must go to the source of a problem to observe and
collect evidence as a first step to effectively solve the problem. This is sometimes referred to as Gemba Walks, in which
employees literally walk where the problem occurs and thus enhance observation, personal interaction, and verification of
issues and data. Hands-on experience is essential to resolve practical issues.
• Principle 13. Make decisions by consensus and rapidly implement them. Evaluate all possible solutions/alternatives before making a
decision, but when a solution is devised implement it quickly and cautiously. Although looking for possible alternatives is
often time-consuming, it enhances knowledge through discussions and often results in an optimum resolution.
• Principle 14. Set a continuous learning and innovation culture. Use relentless reflection and continuous improvement to become a
learning organization. Becoming a learning organization is the final goal of TPS and feeds and supports the previous principles.
A learning organization is characterized by an attitude of continuous improvement and innovation. At the same time, such
continuous improvement requires reflection and analysis of previous efforts and the communication of insights, for instance
through lessons learned or similar knowledge base. Continuous learning must become an intrinsic behavior within the
organization.

Impact on Industry Sectors

Many companies across distinct industries have supported and improved their production capabilities with TPS principles.
Instances of influence on manufacturing, medical, and construction sectors follow.
The adoption of TPS principles on distinct manufacturing industries indicates a unanimous positive impact. For example, a
sensor manufacturing company integrated TPS techniques and reduced lead time by 46%, work-in-process inventory by 83%,
finished inventory by 91%, overtime by 50%, and achieved 81% improvement in aggregate productivity (Liker, 2004). The
implementation of TPS principles in aerospace manufacturing resulted in 20% production capacity growth (Crute et al., 2003). The
implementation of lean principles in tile manufacturing increased profits by 63.4 % and productivity by 47.4 %, and reduced
labor cost in 11.3% and lead time by 50% (Lander and Liker, 2007).
In the health sector, the adoption of TPS principles has resulted in improved patient experience and enhanced medical
performance. The design of operating rooms with TPS principles reduced patient time and thus enabled an 11% increment in
surgical procedures (Castaldi et al., 2016). The use of lean principles in the design of a health care facility resulted in the
reduction of patient travel by 25%, staff travel by 27%, and the number of steps required to complete care procedures by 35%
(Hicks et al., 2015). A cardiac surgery program decreased mortality rate by 61% and major complications rate by 57% when
compared against similar programs in the geographical region (Culig et al., 2011). Savings of $3,497 per each coronary artery
bypass procedure were documented.

Impact on the Construction Sector: Lean Construction

Lean construction concepts and techniques were developed after TPS principles and in consideration of the unique challenges in
construction, such as on-site production, outdoor conditions, industry defragmentation, or workers moving through a static
product (such as a building or facility) to produce work. Construction is characterized by endemic low productivity rates when
compared with the rest of nonfarming industries (Bureau of Labor Statistics, 2018). Until the recent adoption of TPS concepts, the
traditional focus of management had targeted the completed product or project outcome (Grau et al., 2014; Grau and Back, 2015;
Grau et al., 2016, 2017). Thus, management techniques had been historically developed to target the conversion of outputs from
 Toyota Production System – Monitoring Construction Work Progress With Lean Principles 5

inputs while neglecting the production process required to achieve those outputs (Howell and Ballard, 1996; Koskela, 2000). The
so-called lean construction concepts and techniques emerged in the 1990s as an attempt to revamp endemic planning and
production shortcomings. For example, the Last Planner System (LPS) (Ballard, 2000) has become a mainstream planning
technique aiming at the improvement of workflow and minimization of variability and waste. Conceived in the early 2000s, LPS
measures the number of construction tasks completed against the total number of tasks initially planned within a specified period,
for example, typically a week. LPS focuses on removing constraints that can negatively affect work before supervisors commit to the
work plan. With LPS, the percentage of weekly completed activities consistently exceeds 80%.
In addition, new technologies have been tested to provide visibility and inform work status in an immediate manner
(Abbaszadegan and Grau, 2015). Thus, advanced sensing, computing, and information technologies have been leveraged to
provide fine-grained information on construction work (e.g., steel or concrete crews) in real- or near real-time, so that such
information can trigger immediate corrective actions from managers and workers when deviations occur.
Thus, the monitoring of a drywall installation activity for a new hospital facility indicated that the immediate communication
and analysis of workflow triggered proactive actions that resulted in the stabilization of flow when deviations occurred (Cruz-Rios
et al., 2015). When meaningful differences existed between actual and planned flows, the intervention of managers resulted in
reverting the actual workflow back to the planned flow rate or close to it. Deviations eventually reemerged and required additional
corrective actions. In addition, pilot participants indicated the need to leverage automation during field data collection and also
support information extraction and analysis with automated reasoning and alert mechanisms.
Overall, lean construction advocates envision that efficient and effective production must satisfy the three lean construction
axioms of transformation-flow-value (Koskela, 2000). The transformation of outputs based on inputs reflects the traditional
management focus on the finished product (Seppänen, 2009). The value aspect of production aims at optimizing the amount of
value delivered to the customer. Finally, the flow aspect of production aims at the minimization of nonvalue-added steps or the
simplification of production with the objective to eradicate waste. Even though far from trivial, the adoption of TPS principles
within construction promises to ultimately yield production, safety, and quality records close to those in other nonfarming
industries.

Conclusions

This article detailed TPS, which stands for an advanced method of production design, control, and management. TPS origin and
history were explained through the entrepreneurial and innovation mindset of Kiichiro Toyoda, who founded Toyota Motor
Corporation with financial resources generated through his father’s loom business. Improved quality, value-added to customer,
waste elimination, JIT, and continuous improvement are the main traits of TPS, which is sustained on 14 fundamental principles.
Such principles can be categorized between techniques, such as pull production and work leveling, and organizational behaviors,
such as continuous learning or making decisions through the lens of a sustained vision. Behavior principles result in a strong
organizational culture that not only sustains the implementation of TPS but also enables its continuous refinement through data
collection, analysis, and communication of lessons learned. The success of TPS is mirrored in its widespread implementation and
adoption across multiple and diverse industry sectors. The unique challenges in the construction sector make lean construction –
the TPS equivalent in the sector – a continuous focus for researchers and practitioners alike.

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