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Project Report
On

TOYOTA PRODUCTION SYSTEM

Institute of Management Technology, Ghaziabad

Term – I
Operations Management

Submitted to: - Prof. Ankur Chauhan

Submitted by: - Group 9 (Sec. – A)
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CONTENTS

S. No. TITLE Page No.

1 Executive Summary 3
2 Acknowledgements 4
3 Introduction 5
4 Objective 7
5 Scope 7
6 Toyota Production System 7
6(i) Stability 9
6(ii) Heijunka 9
6(iii) Standardized Work 10
6(iv) Kaizen 10
6(v) Just-in-time 11
6(vi) Jidoka 13
7 References 13
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EXECUTIVE SUMMARY

Toyota is a worldwide famous and documented company due to its top-quality manufactured cars. For
several years, Toyota was the largest automobile manufacturing company in Japan. In 1982, the company
Toyota Motor Company was merged with Toyota Motor Sales Company Ltd, which gave birth to the
company's present name. Today the organization has assembly plants and distributors in most of the
countries. It is also into manufacturing steel, rubber and cork materials, synthetic resins and automatic
looms. Others deal in housing units, land and the import and export of raw materials.
Toyota Motor Corporation arrived in India in October of 1997 through a venture with the Kirloskar Group,
named Toyota Kirloskar Motor Private Limited. Headquartered in Bangalore, Toyota India is responsible for
handling the manufacture and sales of Toyota cars in India. It is presently ranked among India's best six car
manufacturers alongside Maruti Suzuki, Hyundai, Tata, Mahindra and Chevrolet. Toyota India has carried
forward its legacy of implementing eco-friendly production techniques, creating new employment
opportunities, playing a significant part in welfare and always "Putting Customer First".
The Toyota Production System (TPS) is a unified socio-technical system developed by Toyota to efficiently
organize manufacturing and logistics, including suppliers and customers, to reduce cost and waste. TPS is
also called as "Toyota Process Development System." The system was formed between 1948 and 1975,
with significant learnings and contributions from Taiichi Ohno, Eiji Toyoda, and Shigeo Shingo.
The critical elements of the Toyota Production System, namely, Stability, Heijunka, Standardized Work,
Kaizen, Just-in-time and Jidoka, have been described with a brief description of their implementation.
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ACKNOWLEDGEMENTS

Foremost, we would like to express our sincere gratitude to our advisor Prof. Ankur Chauhan for the
continuous support of project work our study and research, for his patience, motivation, enthusiasm, and
immense knowledge. His guidance helped us all in the time of research and writhing of the project report.
We could have never imagined having a better advisor and mentor for our project work.
We would like to thank our family and friends for constantly supporting us throughout our lives.

INTRODUCTION
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In 1933, Toyota was founded by Kiichiro Toyoda. In 1934 department of Toyota industries manufactured
the first product, the merchandise called A-engine and its first coach AA in 1936. Companies such as Scion,
Lexus, Daihatsu and Hino Motors are owned and operated by Toyota, and they possess shareholdings in
Isuzu, Yamaha, Mitsubishi Aircraft Corporation and Fuji heavy industry. All these and a few others in total
include around 522 subsidiaries.

The headquarters of Toyota is in Toyota City, Aichi and Tokyo, Japan. It also provides financial services
through Toyota Financial Services and is also into manufacturing robots for various industries. Toyota
Motor Corporation its financial services and Toyota Industries all at once form the majority of the Toyota
Group and one among the essential conglomerates within the world.

Toyota is a worldwide famous and documented company due to its top-quality manufactured cars. Toyota
is doing all right and growing in no time globally. They need their operations, manufacturing facilities and
valuable loyal customers everywhere on the planet. The new technology Hybrid in Toyota cars gave a
replacement pride to Toyota and therefore, the sales of Toyota rising day by day. In a previous couple of
years, Toyota became a favourite in the automotive industry and have become variety one is mostly selling
their cars worldwide.

During war II the corporate suspended the production of passenger cars and targeting trucks. After facing
the wrecked facilities and a chaotic economy within the aftermath of war II, the corporate did not resume
making passenger cars until 1947 with the introduction of the Model SA.
From the 1950s, Toyota's automobile factories were back fully operational. With the spirit of
competitiveness, the organization began studying automobile manufacturers to tackle the perceived US
technical and economic superiority. Toyota executives toured the assembly facilities of corporations,
including the Ford Motor Company, to watch the newest automobile manufacturing technology and
successively implemented it in their facilities, yielding a nearly immediate increase in efficiency. After its
establishment in 1957, Toyota Motor Sales Inc. released the Toyopet Sedan in 1958, its first car to be sold
in the US. It was not well received due to its high price and lack of power. Its Land Cruiser, a utility vehicle
released in the same year, was more successful. In 1965, the Toyopet was utterly redesigned for US drivers
and renamed Toyota Corona, which became the company's first significant success within the US.
During the 1960s and '70s, the corporate expanded rapidly and commenced exporting automobiles to
foreign markets in large numbers. Later, Toyota acquired Nippondenso Company Ltd., an electrical auto
components manufacturer and Hino Motors, Ltd, a bus and trucks manufacturer. For several years, Toyota
was Japan's largest automobile manufacturing company. The company dominated the American market
also, having a reputation for its fuel-efficient, low-cost, and reliable vehicles like the Toyota Corolla, which
was released in the US in 1968.
In 1982, the company Toyota Motor Company was merged with Toyota Motor Sales Company Ltd, which
gave birth to the company's present name. In 1984, Toyota partnered with General Motors to create the
United Motor Manufacturing Inc., a dual-brand factory in Fremont, California, where Toyota began
production in 1986.
The company had remarkable growth in the 21st century, with notable revolutions like its luxury brand,
Lexus (1989). In 1997, Toyota introduced Prius, the first mass-produced hybrid-powered vehicle in the
world. Toyota got listed on the London stock market and the New York stock market in the year 1999. The
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company tried to expand to new markets by launching the Scion brand in 2003 and the world's first luxury
hybrid vehicle, Lexus RX-400h, in 2005.
Today Toyota has assembly plants and distributors in most of the countries. It is also into manufacturing
steel, rubber and cork materials, synthetic resins and automatic looms. Others deal in housing units, land
and the import and export of raw materials.
Toyota Motor Corporation arrived in India in October of 1997 through a venture with the Kirloskar Group,
named Toyota Kirloskar Motor Private Limited. Headquartered in Bangalore, Karnataka, Toyota India is
responsible for handling the manufacture and sales of Toyota cars in India. It is presently ranked amongst
the best six car manufacturers within India alongside Maruti Suzuki, Hyundai, Tata, Mahindra and
Chevrolet. Toyota India has carried forward its legacy of implementing eco-friendly production techniques,
creating new employment opportunities, playing a significant part in welfare and always "Putting Customer
First".
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OBJECTIVE
The Project's objectives are to study the methods and techniques invented and adopted by Toyota Motor
Corporation, which made them the market leaders globally in automobile manufacturing and production.
These methods are covered under the broad term Toyota Production System (TPS). The various methods
under TPS are described in the Project and a brief description of their implementation.

SCOPE
The scope of our Project is confined to the operations under the Toyota Manufacturing System. No
comparisons are drawn between Toyota Motor Company and other automobile manufacturers or any
other product manufacturers. However, the Project does point to the fact that the methods and
techniques developed by Toyota are also followed by other organizations to improve their operations.

TOYOTA PRODUCTION SYSTEM

The Toyota Production System (TPS) is a unified socio-technical system developed by Toyota to efficiently
organize manufacturing and logistics, including suppliers and customers, to reduce cost and waste. TPS is
also called as "Toyota Process Development System." Most uses of the word "Lean" concern the Toyota
Production System (TPS).
The idea is to figure intelligently and eliminate waste so that only minimum inventory is required. This
increases income and reduces physical space needs, and makes it easier to deliver the desired results
uninterruptedly through internal processes one piece at a time to the tip customer.
TPS is also known by the more generic 'lean manufacturing' and 'just-in-time production' or 'JIT
Manufacturing.'
Over the other aspect of the corporate, this system is accountable for having made Toyota the corporate
it's today. Toyota has long been recognized as a pacesetter within the automotive manufacturing and
production industry. Within the early 1950s, the corporate faced near bankruptcy. At that time, the major
event that transformed the corporate, they needed to record steady sales and market-share growth, with
hardly any years that haven't been profitable.
The system was formed between 1948 and 1975, with significant learnings and contributions from Taiichi
Ohno, Eiji Toyoda, and Shigeo Shingo.
A member of the Toyota founding family, Mr Eiji Toyoda, an engineer, visited the River Rouge Ford Plant in
1950, which inspired him to create the Toyota Production System. Upon his return, he addressed his
partners that "there are some possibilities to boost the assembly system". The objective is to identify and
reduce the three primary obstacles from optimal allotment of resources within the system:

 Overburden (muri)
 Inconsistency (mura)
 Waste (Muda)
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TPS is based on two main conceptual pillars:

Just-in-time - Making only what is needed, only when it is required, and only in the amount that is needed
Jidoka – Refers to automation with a human touch
The main principles of TPS (called the Toyota Way) are as follows:
1) Continuous Improvement
i) Challenge
 Formation of a long-term vision and meeting challenges with courage and creativity to
realize our dreams.
ii) Kaizen
 Improvisation of business operations regularly, driving for innovation and evolution always.
iii) Genchi Genbutsu
 Reach the source (Gemba) to find the facts to make the right decisions.
2) Respect for people
i) Respect
 Respect others, make efforts to understand each other, take responsibility and do our best
to build mutual trust.
ii) Teamwork
 We try to stimulate personal and professional growth, share development opportunities,
and maximize individual and team performance.
Some of the key concepts used within TPS include:

 Jidoka
 Just-in-time
 Kaizen
 Andon
 Gemba and Genchi
Genbutsu
 Heijunka
 Level loading
 Kanban
 Muda, Mura, Muri
 Obeya
 Poka-yoke (error
proofing)
 5S
 Value Stream Mapping
 SMED
 5 Why's
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STABILITY (4M's)
Most companies work towards improvement with little success and instead with increased
frustration. Before even starting the journey of excellence, there is a need to assess if our
processes possess initial process stability. There is a high chance that many of the processes will be
unstable and incapable of producing desired results.
Stability is defined as the capacity to produce consistent results over time. Instability is thus the
result of variability in the process.
4Ms Man (people), Machine, Method and Materials are pre-requisites for a process to work
consistently.
1) Man (Skill, Technology, Organization, Resources)
 Do our employees have the skill (and the will) to do what is expected with safety,
consistency and effectiveness?

2) Machine (Equipment)
 Do our machines have the capacity of producing safe and reliable output at the desired
quality and rate? Do breakdowns, defects, or unplanned stoppages prevent them from
meeting our target?

3) Method (Process, Schedule, Procedure)

 Are there standard work methods in place which make sure and support consistent, safe
production?

4) Material (Information, Raw Materials, Consumables, Quality)

 Are they meeting the required specifications with no defects and shortages? Are we able to
reduce or eliminate excess handling or movement? Are they stored properly?

HEIJUNKA
Heijunka is a method for reducing the inconsistency in a production process and the chance of overburden.
It is a Japanese term and means levelling. It can help us react to demand changes and utilize our capacity in
the best way possible.
We can stop producing Work in batches and start processing orders according to customer demand by
applying this concept. This will reduce our inventory costs as we will have fewer goods in stock waiting to
be purchased when the market demand is low.
On the other side, our process and the team will not be overburdened when demand spikes up as we will
be producing value according to our takt time, i.e., our average sell rate.
It allows us to produce and deliver value to our customers at a balanced pace to adjust to variations
following our average demand. It has two ways of levelling production:
1. Levelling by volume
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2. Levelling by type

STANDARDIZED WORK
It is the base of everyday operations in TPS, providing standardized procedures that control every
single step in producing an automobile. Standardized Work focuses on human movements and sets up
the best work sequence and pattern for each manufacturing and assembling process. Once the most
efficient design has been determined, it is always repeated exactly the same way, avoiding unnecessary
movement and wasted effort, maintaining quality, assuring the safety, and preventing damage.

Standardized Work provides direction for three central elements of a manned work process:
1. Takt Time
2. Working Sequence
3. Standard In-Process Stock

KAIZEN
The Shogakukan Dictionary defines the Japanese word "Kaizen" as "The act of making bad points
better". However, the popular translation is 'change for better, which also stands for improvement.
However, continuous improvement is not the only definition of Kaizen. In fact, it is the result of it.
Continuous improvement, when translated in Japanese, is however termed as "Kairyo".
It can be said that Kaizen is more of an internal process that happens within our minds. The target
is to realize our potential, break the status quo, and achieve improvement this way. A more
accurate way to define Kaizen would be "continuous self-development."
The word originated in the Toyota factories.
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Organizations face the modern dynamic and unsafe business environment today and are trying to
become more efficient by applying Lean Thinking. An essential part of it is the Kaizen.

JUST-IN-TIME

Just-in-Time is a management philosophy that emphasizes producing what the customer wants,
when they want it, in the quantities ordered, where they need it, without it being delayed in
inventory.

So instead of producing large stocks of what we presume the customer might want, we make
precisely what the customer asks for once they order. This allows us to concentrate our
resources on only fulfilling what we will be paid for rather than producing for stock. Every
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process in a Just-in-Time manufacturing system will only produce what the following process in
succession is calling for.

Benefits of JIT: -
1) Reduction in the order to payment timeline.
2) Reduction in Inventory costs
3) Reduction in space required
4) Reduction in handling equipment and other costs
5) Lead time reductions
6) Reduced planning complexity
7) Improved Quality
8) Productivity Increases
9) Problems are highlighted quicker
10) Employee empowerment

Pull system: - A pull system is a technique for reducing the waste of any production process. A pull system
allows us to start new Work only when there is customer demand for it. This allows us to reduce overhead
and reduce storage costs.
A pull system is implemented to manufacture products based on actual demand and not on forecasts. By
doing so, our company can focus on eliminating waste activities in the production process. As a result, we
will be able to use our resources efficiently and reduce the possibility of overstocking.
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Continuous Flow: This method allows us to move a single product through every step of our production
process instead of sorting work items into batches. It is called this way because it will enable us to send
goods to the market continuously. This allows us to deliver value more often to our customers. It may
sound less efficient than processing work in batches because we supply small amounts of value to the
market at a time. In reality, it allows us to provide value to customers more frequently and reduces the
time they have to spend waiting to receive their order.
Also, it is a great way to minimize the waste of our process. It is beneficial for reducing inventory costs and
the wait time of our work items.
Takt Time: To make the most of continuous flow, we need to define a takt time for our assignments. It is
the rate at which a product needs to be manufactured to meet customer demand. It originates from the
German word "takt", which means "pulse" or "beat". Briefly explained, Takt time is the sell rate of a
manufacturing facility. We can calculate takt time by dividing the total available time for production by the
required number of production units.
Sometimes confused with cycle time, takt time is one of the most critical metrics for maintaining a
continuous flow. It allows us to utilize our capacity in the best way possible to meet the customer demand.

JIDOKA
Jidoka is a method that is extensively adopted in manufacturing and product development. Also termed
autonomation, this is an easy way of safeguarding a company from delivering inferior quality products or
defects to the customers while trying to keep up the takt time.
It relies on four simple principles to make sure that a manufacturer would deliver defect-free products:
1. Discover an abnormality
2. Stop the process
3. Fix the immediate problem
4. Investigate and solve the root cause
These four steps can be applied in various ways depending on the industry and can serve as a stable
foundation for achieving continuous improvement of our processes.
By applying this concept, anyone in the company can stop the workflow when they notice a problem that
deteriorates the product's quality.

REFERENCES

 https://www.britannica.com/topic/Toyota-Motor-Corporation
 https://global.toyota/en/company/vision-and-philosophy/production-system/
 https://kanbanize.com/
 http://artoflean.com/wp-content/uploads/2019/01/Achieving-Basic-Stability-Article.pdf