Principle 6: Build a Culture of Stopping to Identify Out-of-Standard

Conditions and Build in Quality (JIDOKA)

● Stopping the line is necessary if you want to continually improve the process
● Jidoka (autonomation): equipment endowed with human intelligence to stop itself when
it has a problem
● In-station quality (preventing problems from being passed down line) is more effective
and less costly
○ Solving problems at the sources saves time & money downstream
● Andon (signaling system): when equip. shuts down, flags/lights used to signal help is
needed to solve a problem
● Team members are instructed to pull Andon cords when they identify any out-of-standard
conditions -> this enables continuous improvement
● Despite new technology with the Lexus production process, the principle remained the
same; bring problems to surface, make them visible, and immediately go to work on
countermeasures
● By continually surfacing problems & fixing them as they occur -> you eliminate waste, ↑
productivity, and blow past competitors whose problems accumulate
● Toyota competitors made the mistake of assuming the line-stop system stopped the whole
assembly line
○ Purpose of line-stops is to call attention to problems so they can be contained & solved,
NOT shut everything down
● Closer you are to one-piece flow -> the quicker problems will surface to be addressed
● Poka-Yoke (error proofing): devices that prevent errors
● Standardized work is a countermeasure to quality problems
● At Toyota, quality control is SIMPLE! They use visual charts/graphs to display quality
problems/causes
○ Main focus is addressing problems as they occur, one by one
○ Other companies use complex quality manuals/policies/procedures that are too diffciult
to follow
○ Toyota looks at quality audit through a different lens -> from the lens of a team
members on the shop floor (genchi genbutsu)
● Toyota used a quality crisis for long-term learning: the crash of the patrol officer driving a lexus
○ Media speculated it was electronic interference that caused the car’s computer to send
the car accelerating out of control BUT it was actually a wring size floor mat that caused
the crash
○ While most of the world has forgotten about this crisis, Toyota has continued to use it
as motivation to always put the customer first (theres a new Quality Learning Center
in all factories to raise quality awareness to all employees)
● Building quality is a PRINCIPLE & SYSTEM, not a technology
○ Getting the best and most $$ tech will not make the adon system work
 ○ Andon works only when you teach staff the importance of bringing issues to the
surface so they can be quickly solved
● Toyota prefers to use people & processes to solve problems, then support its people with
technology later
○ When improving quality, what matters is enabling the processes and people

Principle 7: Use Visual Control to Support People in

Decision-Making & Problem-Solving
● Sight is the most powerful sense for learning, recalling, and using that info
● Active visual info that gives you the ability to see abnormalities at a glance
● Obeya (big rooms): project management meeting rooms where the walls are filled with visual
controls so you can understand the status of a project
○ Any deviation from schedule or performance targets is immediately visible in
Obeya
○ Toyota has found that the Obeya system enables fast & accurate decision making, ↑
communication, speeds info gathering, and creates an important sense of team
integration
● 5S Program: series of activities for eliminating waste that contributes to
errors/defects/injuries
1. Sort: sort through items and keep only what is needed. Dispense what is not.
2. Straighten (orderliness): a place for everything and everything in its place
3. Shine (cleanliness): cleaning process acts as a form of inspection that exposes
abnormalities and conditions that could ↓ quality or cause machine failure
4. Standardize (create rules): develop systems & procedures to maintain and monitor the
first 3 S’s
5. Sustain (self-discipline): maintaining a stabalized workplace is an team-oriented
continuous improvement process as conditions change
● It is the ideal in a plant to predict what will be needed, and make it available when required and
be available within easy reach w/o turning away from work (surgeon in operating room
analogy)
● Visual Control: any communication device in the work environment that tells us at a
glance how work should be done and whether its deviating from standard
○ Are used to support people and processes
○ A well developed Visual Control System ↑ productivity, ↓ defects/mistakes, helps
meet deadlines, facilitates communication, ↑ safety, ↓ costs, and gives owkrers
more control of their environment
● Toyota uses an integrated set of visual controls designed to create a transparent &
waste-free environment
● Toyota supports their employees through visual controls so they have the best
opportunity to work efficiently & effectively
● Rather than use digital technology to replace human workers, Toyota utilizes the power and
benefits if tech to make the workplace visual and people-oriented
● Visual Control in a Service Parts Warehouse:
1. Warehouse organized into cells called “home positions”
2. Powerful custom-designed computer system where volume and location of parts are
stored
3. Process Control Boards (whiteboards): illustrate the power of visual control to pace
an operation with highly variable demand and monitor process vs. takt time
● These boards help enforce a continuous flow or work, which reinforces a
leveled workload (Heijunka)

Principle 8: Adopt and Adapt Technology That Supports Your

People and Processes
● Automation at Tahara Plant Incident: Toyota launched th eLexus LS400 with advanced
automation, but when the investment bubble burst -> vehicle sales ↓ and the high-capital
investment in automation presented a high fixed-cost burden for Toyota
○ This caused Toyota to adjust its principles of production equipment to become
“simple, slim, and flexible”
● Adopt & Adapt Technology that supports your people and processes
○ Where are real needs that technology can address to help achieve your goals?
○ Pull in tech based on the opportunity instead of pushing tech b/c its the latest fad
● 1st rule of tech used in a business: automation applied to an efficient operation will
magnify the efficiency. BUT automation applied to an inefficient operation will magnify
the inefficiency
● Avoid the temptation to buy/implement the latest digital tools, and instead thoughtfully integrate
tech with highly developed people & processes
● Denso (Toyota supplier): demonstrated that tech has the greatest potential with highly
developed people who are continuously improving
○ Denso has made impressive progress in adapting data collection/IoT/data analytics to
support lean systems and amplify Kaizen
● Implementing the latest IT is NOT a business goal at Toyota
○ First work out the manual processes and then automate it
○ Try to build flexibility into systems so you can continue to Kaizen the process as your
business changes
○ Supplement info with Genchi Genbutsu
● The process of adjustment and problem-solving based on real circumstances were MUCH
MORE EFFECTIVE than trying to guestimate based on a math model
● Chaku Chaku: idea to have a semi-automated line where a person goes up and down
feeding parts into machine
● Automation & Equipment can be improved by Creative-Thinking People
 ○ Employees created “Key Kanban” in workshop: device that (1) acted as Kanban and
enabled replenishment of parts at low volume and (2) acted as mistake-proof device
(Poka-Yoke)
● If you go to plants and they show you a lot of monitors & dashboards (electronic wallpaper)
unless you show what actions you took from real time data and the data is true data, then it is
just electronic wallpaper
● IoT Applicants at Denso:
○ Dashboards based on continuous data collection by zone -> they show in realtime if
zones go over limit -> zones that go over limit get shut down -> this saves production
and wasted labor
○ Dasboards based on live data that continuously updates safety, quality, cost, and
lead-time measures -> shows where issues occured/what issues occured/what
countermeasurers have been taken -> if action isn’t taken within certain time -> problem
is automatically escalated
○ PREDICTIVE MAINTENANCE!!!: one of biggest successes
■ Denso hired vendor that attached wireless sensors to each fan motor in ovens
that monitored temp & speed -> this predicted when the machine was going to
fail and when it should be replaced -> saving production hours and costs
association with production stoppage
● Key to Denso success: Networking and Collaboration With a Startup for Motion
Technology
○ They collabed with Drishti technologies, which was a company that developed tech that
digitzes human motion and provides real-time data about standardized work
○ Multiple cameras continually recording and storing data, then an AI system analyzes the
video data
■ identifies times over the planned cycle time
■ Finds bottlenecks
■ System recognizes human actions and tells you where you are against Takt
■ Generates Yamazumi (work balance) charts that break down work elements for
each function
● Role of tech -> alerting people to issues so they can quickly respond w/ creative
problem-solving
● When tech is combined with ingenuity of developed people motivated towards goal of
serving customer/helping company -> it can multiply kaizen faster & better
● Whats the difference between Denso and other companies that create electronic
wallpaper?
○ Mindset! Denso starts with the problem, then builds social & technical systems to
help address the problem. It builds on its existing culture of disciplined execution
& problem solving
● 2 pillars of TPS are (1) automation with people and (2) Just-in-Time. What they both
have in common is that people are at the center. Machines can not improve unless
people do too.

Principle 9: Grow Leaders Who thoroughly Understand the Work,

Live the Philosophy, and Teach It to Others
● Growing Humble Leaders From Within:
○ At Toyota, new presidents dont come in and take charge to move the company in a
radically new direction. Leadership focuses more on community than change.
Toyota leaders are not always exciting, but highly effective
○ Since a critical elements of the culture is genchi genbutsu, leaders must
demonstrate this ability and understand how work gets done at front lines
■ A superficial impression of the current situation will lead to ineffective
decision-making and leadership
○ Toyota expects its leaders to teach their subordinates the Toyota Way, which means
they must first understand and live the philosophy
○ The people who know the gemba (where the actual work is done) are the most
respected
● Growing “Level 5 Leaders” Instead of Purchasing Level 4 Leaders:
○ Level 4 Leaders: CEOs are often “portable” and take some recipe that worked for them
in thh past and impose it on whatever new companies they take over
■ They talk about “broken culture” and explain how they will install their new
performance culture
■ Main goal is “splashy short-term results”, see job as stepping stone to next gig
○ Level 5 Leaders: personal humility, understated, transformational, dedicated to building
enduring & great company
■ Looks in the mirror to assign self-blame, looks out the window to assign
credit
● Changing culture every time a new leader takes over -> jerks around the company, and fails to
develop depth or loyalty from employees
○ The “shared” part in culture is missing
● Toyota strives for “constancy of purpose” throughout the organization, which lays the
groundwork for consistent and positive leadership as well as an environment for
learning
● Toyota culture is influenced by Japanese culture: mutural dependence, obligation to help
others, and determination to reach a goal together
● Dr. Edwards Deming had a big impact on Toyota: a deep belief that most problems are
system problems that are the responsibility of management
○ Toyota leaders are taught that team members are rarely to blame for an error, but
rather there is something about the system that allowed the error to occur
● Leadership & Culture are so intertwined that one cannot exist w/o the other
○ Consistency across leaders & over time is key to building a healthy organizational
culture
● Go and See for Yourself to Thoroughly Understand the Situation:
○ Toyota way requires that employees and managers deeply understand the processes of
flow, standardized work, etc., as well as have the ability to critically evaluate and
analyze what is happening
○ 1st step of Genchi Genbutsu: the power of deep observation (evaluate what is
learned through your senses)
○ Think and speak based on verified, proven info and data
○ Take full advantage of the wisdom & experiences of others to send, gather, or discuss
info
● Hourensou — Daily Report, Inform, Consult
○ Hourensou: to report, inform, and consult in a timely manner
■ Important approach is to teach subordinates to communicate efficiently and give
brief daily reports on key events that happened during the day
● 1st Management Principle — Put the Customer First
○ Customer-first philosophy: customers first, then dealer, and lastly manufacturer. This
attitude is the best approach in winning the trust of customers & dealers, and ultimately
brings growth to the manufacturer
○ Teaches employees how to see and understand the customer’s perspective
● Why the 2004 Sienna was PIVOTAL for Toyota:
○ The primary market for the vehicle was in the U.S, Canada, and Mexico
○ Yuji Yokoya went to each of these areas and deeply observed & learned
■ b/c Canada gets ↑ snow, roads are bowed up in the middle -> he learned that
controlling the “drift” of the vehicle was important
■ When driving over Mississ. River, a gust of wind shook the car -> he realized
that side-wind stability was very important
■ When driving in narrow streets of Santa Fe, it was hard to turn the corner -> he
reduced the turning radius of vehicle
■ He learned the value of cupholders in the U.S -> designed Sienna with 14 cup
holders
■ Learned U.S custom of eating in vehicles -> put in a flip-up tray accessible for
eating
● What traits do all great leaders in Toyota history have in common?
○ Focusing on long-term purpose as a value-added contributor to society
○ Staying consistent with the Toyota Way DNA and living/modeling the behaviors
for all to see
○ Going to the Gemba (the place where the real value-added work is done), getting
their hands dirty
 ○ Seeing problems as opportunities to train and coach people
● “Before we build cars, we build people”
○ A leaders goal at Toyota is to develop people so they are strong contributors who can
think and follow the Toyota Way at all levels in the organization

Principle 10: Develop Exceptional People and Teams Who Follow

Your Company’s Philosophy
● Servant Leadership: Toyota flipped the organization chart upside down where leadership
roles were at the bottom and people doing value-added work were at the top
○ Only people doing value-added work at the workers, placing them at the “top”
● Why does Toyota think of floor workers (doing repetitive manual work) as the drivers of
continuous improvement?
○ Toyota’s answer: what really matters is making improvements at the gemba, and
the teammembers are the ones at the gemba, personally expeirnicng the
processes and living with the equipment
● At Toyota people aren’t hired for their expertise or tech skills, instead people are hired for
their potential to learn those skills/ability to work in teams/ability to learn to think
critically and solve problems
○ “Growth Mindset”; assumes that we can learn and grow throughout our lifetime.
People with this mindset are willing to try new things even if they fail at first
○ This reflects the human-resource philosophy of Toyota -> hire people who are good raw
material and then grow them through challenging experiences and coaching to guide
them along the way
● Power of Team Members & Work Groups:
○ All systems at Toyota are there to support the team doing value-added work
○ Toyota’s assumption is that if you make teamwork the foundation of the company
and develop strong leaders -> individual performers will give their hearts/souls to
contribute to the team and make the company successful
■ Its about simultaneously challenging and respecting team members
● The Upside-Down Organization Chart:
○ At Toyota shop floor workers are the focal point for daily problem solving in the TPS
○ Team members are at top of hierarchy, with the rest of the hierarchy there to support
them
○ The largest quantity of Kaizen activity happens at the production work group
level
○ Engineers/Managers introduce/lead new technologies or processes, but these systems
often have problems
■ It is the responsibility of the work groups to work through the fine details ->
they make the difference between good and great
○ Roles/responsibilities of positions:
 ■ Team Members: perform manual jobs to standard and are responsible for
surfacing problems and aiding in problem solving
■ Team Leaders: prime role is to keep the line running smoothly to produce quality
parts (repsonse to andon) and to resolve problems when there are deviations
from standard
■ Group Leaders: Administrative/HR functions (appraisal, attendance, training,
safety, discipline)
● Four to One: Work groups
○ Toyota’s view of the role of the team leader is not to discipline & react to problems, BUT
to plan, lead by example, and coach
○ Ideal standard is 4:1 ratio (4 Team Members for each Team Leader, 4 TL’s for each
Group Leader)
○ If the production is really lean then team leader is the first problem solver for
worker in case alarm (andon) is activated and help is needed. In close
cooperation team leader and operators solve problems in work place, in other
words execute kaizen principle.
● Group leaders have the most challenging role