The document provides an overview of Lean manufacturing and the Toyota Production System. It discusses how Toyota implemented Lean principles beginning in the 1950s to become highly efficient and profitable. The core concepts of Lean include eliminating waste, reducing lead times, and continuous improvement. Lean aims to optimize flow and pull production using tools like just-in-time, standard work, and visual management. Kaizen events are used to rapidly improve processes by multidisciplinary teams identifying and eliminating sources of waste.
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History of Lean Production
After World War II, Shigeo Shingo & Taiichi Ohno
started modifying Toyota’s manufacturing processes
to form the Toyota Production System (TPS)
Hiroyuki Hirano called this as Just-In-Time (JIT)
Production
The term “Lean Production” was coined in 1990 by
Prof. James P. Womack in his book “The Machine
that changed the world”
Lean Production - Brief History
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• Fortune 500 ranked No.5, the highest ranked manufacturing
company
• Overtaken GM as top auto maker in the world – 2 years
ahead of schedule (was No.4 at start of 2003)
• No.12 in profitability , again the highest ranked
manufacturing company
• Net profit margin 8 times of industry average, profits more
than combined profits of next 3 competitors
Source: Fortune 500 list 2008
TOYOTA TODAY - 2008
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• TPS foundation laid in 1950’s – learning from supermarket
• Development and introduction of Lexus – taking on Benz
• Development and introduction of Prius – world’s first hybrid
car in 1997 ….the fruits are realized this year
Toyota Production System – the core philosophy
Believes in the Kaizen way of doing
HOW TOYOTA DID IT?
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KAIZEN - Original Definition
KAI
ZEN
Change
Good
(for the better
- next elevated state)
KAIZEN = Change for good
‘Continual Improvement’
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The worldwide Pressure on the Enterprise
Government
Regulation
Environ-
ment Society
Share-
holder
Value
Suppliers
EmployeesMarket
Competitors
Supplier
QCDTE
Customer
QCDTE
Q= QUALITY; C= COST; D= DELIVERY; T= TECHNOLOGY; E= ENVIRONMENT
TIME
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Lean Journey in all aspects of Business
Lean Manufacturing
Lean Supply and Delivery Chain
Lean Accounting
COMMENCE THE LEAN JOURNEY
Solution??
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• Lean Management focuses on eliminating waste in
processes
• Lean Management is not about eliminating people
• Lean Management is about expanding capacity by
reducing costs and shortening cycle times between
order and ship date
• Lean Management is about understanding and doing
only what is important to the customer
What is Lean?
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Lean Manufacturing is an all encompassing culture,
a behavior or mindset that focuses on the
Customer.
Anything that the Customer does not perceive as
adding Value is considered Waste.
Lean Manufacturing seeks a Continuous Flow for
all value-add process steps through the system by
Elimination of Waste, thereby reducing the
Time to Customer.
What is Lean Manufacturing?
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Lean Companies Traditional Companies
Keep suppliers in the dark regarding
growth, technology, product
introductions, etc.
Choose strategic suppliers that help
them grow in capacity, quality,
technology, flexibility, etc.
Ship to distributorsShip direct to customers
Have fixed, dedicated linesAdjust capacity by assigning
resources based on daily demand
Make products to forecast
(push system)
Let the customer pull –
this triggers production
Allow few changes to standard
products and follow-ups
(fixed lines – content & equipment)
Change quickly to the next model
and grow easily in prod. life cycle
(simple non-permanent equipment)
See inventory as a necessary
buffer for uncertain demand
Strive for zero inventories
Have long lead timesCan fill a customer order
very quickly
Lean vs. Traditional Companies
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* Data from: ‘The Machine That Changed The World’ (Womack, Jones, 1990, p. 83)
1
Toyota Takaoka (Japan)
2
General Motors Framingham Assembly plant – closed in 1989.
Assembly Hours Per Car 16.0 31.0 51.6%
Defects Per 100 Cars 45.0 135.0 33.3%
Floor Space Per Car 4.8 8.1 59.3%
Average Parts Inventory 2 hrs 2 wks 2.5%
Key Performance Metrics*
Toyota1
GM2
%
The difference
Benefits of Lean Production
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Lean Concepts
SDCA
PDCA
Next Process
is customer
Quality
first
Market in Upstream
management
Variability
control
Lean Concepts
Speak with
data
S
u
p
p
l
i
e
r
s
C
u
s
t
o
m
e
r
s
ZERO
WASTE
Total
Employee
involvement
Process
flow
Process
Effectiveness
Lean
Support
Systems
QCDTE QCDTE
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LEAN PRODUCTION
Step 5
Standardized Operations
Step 4
Leveling
Step 3
Flow Manufacturing
Step 2
The 5S’s for factory improvement
Step 1
Awareness revolution:
Jikoda
Autonomation
SMED
Multi process
operations Kanban
TQC
TPM
ManpowerEffectiveness
VisualControl
SOURCE: HIROYUKI HIRAO – JIT MANUAL
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1. Define or specify value from the point of view of
Customer
2. Identify the Value stream – sequence of processes
– e.g from raw materials to final customer -
3. Make Value Flow and Reduce Lead time
4. Produce only to satisfy the PULL
5. Synchronize all processes (Perfection)
Lean Steps
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Defects
Wastes
Losses
Path Ahead - Develop LEAN Journey
LEAN Leadership
Time
I
m
p
r
o
v
e
m
e
n
t
3 - KAIZEN Strategy
Today
1 - Current State Diagnosis
2 - Vision for the Future
Past
LEAN FoundationsEliminate: Losses Eliminate: Waste
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LEAN Road Map
Change mind Change method Change process Change result Change culture
Phase 1
Introduction
Foundation
Phase 2
Demonstration
Workshops
Phase 3
Structured
Deployment
Phase 4
Upstream
Integration
Phase 5
Established
System
Phase 6
DBMS
Prize
Month/ year Summer 2006 2006 2007 2007 2008
Word class
performance
Best in class
Month/ year
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What are we changing?
Measurement
& Control
Lean
Strategy
Efective Kaizen
Processes
Change Capability
Sr. Management
Lean
ImplementersChange AgentsLean Leaders
Improvement
Pillars
Roadmaps
& Plans
Kaizen
Events
Knowledge
Sharing
Audit and
Evaluation
Targets
Deployed
KPI´s
Budget & HR
Integration
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LEAN MANAGEMENT: Roles and Responsibilities
Top Management design value inImprove and set waste-free
Processes and environment for KAIZEN
Support through KAIZEN Methods in all areas
Middle Management /
Supervisor
take waste out
of the processes
identify wastes and losses/
improve current operations
Workforce: Employees,
Operators, Staff
keep waste out
of the processes
standard work and
avoid waste and losses
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Effective Process to implement Lean - Kaizen Event
A Kaizen event is a focused effort used to “make a leap” A multi-functional team is
formed and for a 3-5 day period they focus on resolving a problem.
It is characterized by the following:
• A short burst of intense activity & effort (3 to 5 days only)
• Biased toward action over analysis
• Focused on improving the value stream and achieving flow
• Driven to resolving a specific problem or achieving a specific goal
• Focused on a specific area or process (either plant or office)
• Managed with daily reviews of progress
• Aimed at achieving specific improvements in a short time
• Managed to resolution
A kaizen is driven to two imperatives: - Solving Problems- Solving Problems
- Eliminating waste (Muda)- Eliminating waste (Muda)
During a kaizen event the team will:
Identify problems & areas of waste
Ask Why?, Why?, Why?, Why?, Why?, Why?
Figure out ways to fix the problem or eliminate the waste
Implement solutions
1. Take Apart
2. Think about
3. Make new
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What is a Kaizen Event?
Document
Reality
Plan
Countermeasures
Identify
Waste
Reality
Check
Make Changes Verify Change
Measure
Results
Make this
the Standard
Celebrate
Do It
Again
In a week or less.
A new way of lifeA new way of life
The elements of a Kaizen event are:The elements of a Kaizen event are:
SAY: This slide tells us what Kaizen actually means. We all know Kaizen is a Japanese word. The word consists of two parts KAI and ZEN as you may have noted in the previous slide.
KAI means ‘CHANGE’ and ZEN means ‘FOR GOOD’. So when we say KAIZEN, it means Changing for the better or Change for good or we can call it Change to the next elevated state. But Japanese masters say that ‘The way we today is the worst way of doing things and hence we need to change’. Hence when we Change for better everyday, it leads to continual improvement in our work, operations, products, information systems, personal life, professional life and social life. In brief the Kaizen philosophy believes that our way of life be it social life, personal life or professional life deserves to be constantly improved.
FI: Ask the participants to repeat ‘CHANGE FOR GOOD’