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Toyota’s JIT (just in time) manufacturing system keeps inventory at a minimum and is committed to avoiding overproduction. Only what is needed, when it is needed, is provided. “Overproduction may create excessive lead times, result in high storage costs and make it difficult to detect defects” (Harris, 2007, par.3). Whenever something is produced that is unneeded, that is a waste of both time and money. Waste also means the waste of storage space needed to keep inventory clean and in climate-controlled conditions. Waste also means that products which could have been valuable could have taken up the devoted time and money to the unneeded products instead.
But to operate a JIT system requires close relationships with suppliers. Suppliers must be trusted to be able to supply the raw materials in small quantities, as quickly as possible, when there is a spike in demand. A JIT system also requires highly trained workers. After all, another significant source of waste is product errors. Minimizing errors through enhanced employee expertise is another source of waste reduction. Employees also need to be highly skilled in JIT, to ensure that there are no delays or bottlenecks, given that the company is operating on a razor-thin margin of production, with no room for extraneous costs or items produced.
But just as employees must always be continually learning about their workplace and improving their skills, so must the organization as a whole. There must be a continual feedback loop. The workplace must continually learn about what practices work and what practices do not to maximize the value of the production process, and then institute new processes that emphasize the efficiencies and ideal conditions for people to do work. In theory, the more efficient the company becomes through such continual improvement and monitoring, the easier it becomes to enhance this efficacy over time.
Reference
Harris, L. (2007). Investing in our economy. Capacity Magazine. Retrieved from: http://www.rcbi.org/index.php/viewarticle/130-capacity-magazine/spring-2007/features/336-lean-manufacturing-made-toyota-the-success-story-it-is-todayinvesting-in-our-economy
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Toyota Corporation Company Overview Toyota Motor Corporation is a Japanese company which deals with manufacture of automobile. The company is among the largest companies in the world in manufacture of automobiles. In 2008, the company was ranked the largest company for the first time in automobile industry (Wankel, 2009). The company has approximately 600 subsidiary companies in various parts of the globe. These corporations are involved in the manufacture of automobiles, commercial
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Hence, these are "invisible" to the end user, but no less vital to the success of the company for it. Components of this type of competition include production lead time, development speed in research and development, production quality, and the capacity of group companies and parts suppliers (The Manufacturer, 2010). Production quality is one of Toyota's great success benchmarks, as the company's inherent philosophy is that quality is a
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Analysis of Toyota Opportunities and Threats Toyota is the world's leading patent holder in hybrid vehicle technologies, having over 85% of all patents registered in the U.S. Patent Office, in addition to holding over forty different patents in other registries throughout Europe and Asia. This is a formidable platform for growth in this high-growth emerging line of business. Hybrid technologies can reduce carbon emissions by over 60% in the latest engine
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Some also wonder where the six sigma term that is used so often in lean manufacturing came from. The sigma is a Greek letter which is used to represent the standard deviation of a targeted population (Gupta, 2003). The six sigma term therefore comes from the idea that, if one has six standard deviations that come between the mean result of any process and the nearest limit for specification,
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Figure 2, Guiding Principles at Toyota, shows the conceptual model of this initiative in the context of Toyota's strategic human resources plan. Figure 2: The Toyota Way 2001 Source: (Toyota Code of Conduct, 2007) Training a Core Cultural Component What has become accentuated in the Toyota culture is the intense focus on training and certifications. For production staff members to be promoted they must go through three weeks of pre-promotion training and review
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Kaizen is so engrained in the Toyota culture and the corresponding House of Quality that internally when planned results are not achieved it is considered more of a failure of process and execution (Gong, Wang, Lai, 2009). This is where the TPS varies significantly from American-based approaches to managing variation in results and failure to attain results as well. The Kaizen approach systematically analyzes why a process did not