Toyota Business School: 68 Details of Refinement Management

Author: Yang Juanzi
Publisher:
Publish Date: 2005-06-01
Features: In 2003, Toyota became the first Japanese company to achieve a pre-tax surplus exceeding 1 trillion yen (87.4 billion USD). Toyota President Fujio Cho was selected as one of the world's 15 outstanding managers by U.S. Business Week. In an interview with Business Week, he believed that the only solution for Japan to escape its was to break down the traditional industrial barriers and introduce the "Toyota-style lean management." So, what are the key principles of Toyota's lean management? Here they are:
Establish a Kanban System: This means re-engineering the process, changing the traditional practice where operators dictate production quantities to focus on customer demand. The downstream engineering staff uses Kanban to inform the upstream staff of their needs (e.g., how many parts are needed, when to replenish, etc.), essentially implementing an inverted control production supply chain model. This approach not only saves inventory costs (achieving zero inventory) but also significantly improves process efficiency.
Emphasize Real-Time Inventory Management: Produce what is necessary based on customer demand, at the right time, and in the right quantity. This unique production management concept, originally pioneered by Toyota, was adopted by American companies in the 1980s and has numerous successful cases.
Standardize Operations Thoroughly: Toyota has established strict specifications for all aspects of production, including content, sequence, time control, and outcomes. For example, it specifies how many seconds are needed to install tires and engines. However, this does not mean standards are fixed. If workers discover better, more efficient methods, they can modify the standard operations.
Eliminate Waste and Ambiguity: Eliminate waste of any material, labor, time, space, energy, or transportation. Every employee must repeatedly ask "Why" for each task and then figure out "How" to do it—this is the "5W1H" approach—and ensure they meticulously craft perfect manufacturing tasks with a rigorous attitude.
Cultivate Automation Habits: Here, automation is not limited to machines but also includes human automation, meaning the development of good work habits and continuous learning and innovation. This is also the responsibility of the company. Through the continuous improvement and motivation of production site education and training, the Toyota Institute was established to enhance personnel quality, responsiveness, and precision in actions.
Toyota Motor's most challenging work is not car research and technological innovation but the precise placement and operation of a single rope by technicians in the production process—neither too high nor too low, not too tight or too loose, without any twists or imperfections.
Toyota Motor's valuable and worth-mentioning management practices from the world's top 100 companies are compiled into a large-scale series of books for Chinese enterprises, creating a benchmark for corporate research.
The "Toyota" car, which is widely recognized, has become one of the world's top brands, and its roots lie in Toyota's lean management. Initially, when Toyota proposed the idea of refining management from the production line, the world's major automakers dismissed it. However, through relentless effort, Toyota eventually led the world in quality. Today, Toyota Motor has become the "world's most successful car manufacturer."
For those familiar with or working in manufacturing, lean management and its remarkable effects on improving corporate productivity may already be well-known. The practical results of lean management are astonishing: it can save 50% of production space, increase first-time quality inspection pass rates from 60-70% to over 90%, and boost output by 100% without significantly increasing labor intensity. Moreover, lean management is also applicable to product development, typically reducing process time by 50%.
Furthermore, lean management benefits all large enterprises and those aspiring to grow. Today, research on lean management has spread worldwide, and many companies that study and promote it have achieved significant results. According to Toyota, a former employee who worked at Toyota earned over a million dollars annually by teaching and guiding others in lean management across the world. To this day, scholars and experts in the U.S. and Europe still hold annual conferences on lean production.
This book provides an in-depth and detailed analysis of Toyota's operational system, product development, quality control, product sales, and other 9 major aspects with 68 specific details, revealing Toyota's lean management model and explaining how to apply lean management to other organizations to improve processes from sales to production, R&D, marketing, logistics, and more, establishing a lean management learning organization.