sustainable competitive advantage
is based on a corporate
philosophy, an integrated socio-technical management system and
known as the Toyota Production
The Essence of TPS
Toyota Production System (TPS) is an integrated
socio-technical system, developed by Toyota, that comprises its management
philosophy and practices.
As a management system, TPS organizes manufacturing and logistics for the
automobile manufacturer, including interaction with suppliers and customers.
The system depends in part on a human resources management
stimulates employee creativity and loyalty but also on a highly
efficient network of suppliers and components manufacturers.
The Focus of TPS
Toyota Production System (TPS) is
not just about “5Ss” or
“pull production” or “flow”” or "load leveling".
It is a
holistic approach to
efficiency, generating sustainable
satisfying the customer with the highest possible
quality at the
lowest cost in the shortest lead-time, while developing the talents
and skills of its workforce through rigorous improvement routines
problem-solving disciplines. This stated aim is mixed in with
the twin production principles of
Just in Time (make and deliver the
right part, in the right amount, at the right time), and
(build in quality at the process), as well as the notion of
continuous improvement by standardization and elimination of
waste in all
operations to improve quality, cost, productivity, lead-time,
safety, morale and other metrics as needed.
Specific Factors Underlying Toyota's Success
Toyota corporate culture
An effective and efficient human resources management system, the
cornerstone of which is a high level of employee loyalty and
commitment to quality
A state-of-the-art assembly system incorporating the latest robotic
A well-coordinated network of world-class suppliers
A highly effective and efficient
just-in-time (JIT) inventory system
Suggestion System: Typical Annual Results
More than 700,000 improvement
were submitted by Toyota's employees.
That is an average of over 10
improvement suggestions per employee per year.
Over 99% of suggestions were