Toyota Production System (TPS)
The TPS was created in the late 50’s to get the Japanese manufacturing economy moving after WWII. With assistance from the U.S., they focused on the auto industry to get the factories back to work. After an extensive study of American and European manufacturing techniques, they decided to focus on Flow production as opposed to the batch/scheduling production practiced in the West. The first reason is because of the productivity and quality benefits of Flow Manufacturing in addition to the potential inventory savings associated to Pull material systems (Kanban). One of the original creators of TPS, Taiichi Ohno, a Vice President for Toyota Motor Corporation, is credited as for the pull (Flow) production, and pull (Kanban) material system.
TPS is built upon a Flow and Pull Production Foundation. It is a fixed volume implementation but Toyota has an advantage of selling everything they can produce.
Pull Material Supply chain
Their Flow and Kanban process can pull Just-In-Time (JIT) material. They preferred pull as opposed to the American and European batch scheduling with massive inventories and warehouses.
Kaizen-Continuous Process Perfection is the easy part after the Flow process and pull systems are in place.
In discussion with Ohno, he stated, “They studied American batch manufacturing systems. However, he preferred the methodology of a single piece flow as opposed to batch (scheduling) production. He also preferred the replenishment method of the US supermarkets (Pull) to resupply material. They worked on their Takt line design to achieve their Flow goal of a single piece flow. Once that was achieved, he designed the Kanban pull system for materials and suppliers. Toyota Management is continuously trained on Flow and Pull techniques. They established a Flow production foundation, and THEN…they continue to perfect it with their Kaizen (never ending improvement) techniques.
“The more inventory a company has, the less likely they will have what they need.”
THE 7 WASTES
With Flow Manufacturing we design the process one time and we can change volume and mix every day. This is achieved without impacting operational work content or the materials pull process. With ERP scheduling, you are changing work quantity every time you schedule.
This explains part of the confusion as to why the Flow Manufacturing process perfection/Kaizen is so successful. On the other hand, the similar continuous improvement or Black Belt/Waste elimination rarely has a positive impact to the bottom line.
Ohno was quick to stress the importance of continuous improvement, but hesitant to openly discuss Toyota’s intellectual design property and focus toward Flow. They gave away Kaizan and the simple aspects of improvement, but did not advertise the “How To” foundation to TPS was Flow and Pull. He was a wealth of knowledge, and extremely professional toward us. He believed the management of Western countries could never evolve from batch/scheduling to a singe-piece-flow. He wrote about it in the introduction to TPS book.