Pinnacle of the global auto industry Overtaken Ford Motor Co and General Motors Corp in

1. Pinnacle of the global auto industry • Overtaken Ford Motor Co and General Motors Corp in • vehicle sales • Has 40 vehicle assembly plants around the world and 12 • research, development and design centers and employs • 310,000 people.

3. Book Review Presented by

4. The current Toyota Mark consists of three ovals: The two perpendicular center ovals represent a Relationship of mutual trust between the customer and Toyota.  These ovals combine to symbolize the letter "T" for Toyota.  The space in the background implies A global expansion of Toyota's technology and unlimited potential for the future.

5. Guiding Principles at Toyota • Honor the language and spirit of the law of every nation and undertake • open and fair corporate activities to be a good corporate citizen of the • world. • Respect the culture and customs of every nation and contribute to • economic and social development through corporate activities in • the communities. • Dedicate ourselves to providing clean and safe products and to • enhancing the quality of life everywhere through all our activities.

6. Guiding Principles at Toyota • Create and develop advanced technologies and provide outstanding • products and services that fulfill the needs of customers worldwide. • Foster a corporate culture that enhances individual creativity and • teamwork value, while honoring mutual trust and respect between • labor and management. • Pursue growth in harmony with the global community through innovative • management. • Work with business partners in research and creation to achieve • stable, long-term growth and mutual benefits, while keeping ourselves • open to new partnerships.

7. Part I - Background to the Field book • Toyota has a reputation for excellence in quality, cost reduction • & hitting the market with vehicles that sell. • Contributed a new paradigm in marketing ‘’ Lean production’’ • Creating a ‘’learning organization’’ and pass on the DNA as they • expand globally through dedicated Sensei. • There is alwaysmore than one way to achieve desired result.

8. The 4 P Model – The Toyota Way PHILOSOPHY –Adding value to customers , society, community and its associates. PROCESS – Right process ,Right results Eg. Principle of creating flow PEOPLE AND PARTNERS – Add value to your organization by challenging your people and partners to grow. Toyota production system (TPS) was called ‘’Respect for humanity’’ system PROBLEM SOLVING –Solve root problems to drive organizational learning. When someone learns an important lesson, it is shared so that company can learn.

9. Overview of Toyota Way Principles • I Philosophy as the foundation • Base your management decisions on a long term philosophy, • even at the expense of short-term financial goals. II The Right process will produce Right Results 2. Create a continuous process flow to bring problems to the surface 3. Use ‘’Pull’’ systems to avoid overproduction. 4. Level out workload

10. Overview of Toyota Way Principles II The Right process will produce Right Results 5. Build a culture of stopping to fix problems, to get quality right the first time. 6. Standardized tasks and processes are the foundation for continuous improvement and employee empowerment 7. Use visual control so no problems are hidden 8. Use only reliable, thoroughly tested technology that serves your people and process.

11. Overview of Toyota Way Principles III Add value to your organization by developing your people and partners 9. Grow with leaders who thoroughly understand the work, live the philosophy and teach it to others. 10. Develop exceptional people and teams who follow your company’s philosophy. 11. Respect your extended network of partners and suppliers by challenging them and helping them improve.

12. Overview of Toyota Way Principles • IV Continuously solving root problems drives • organizational learning • 12. Go and see for yourself to thoroughly understand the situation. • Make decisions slowly by consensus, thoroughly considering • all options; implement decisions rapidly. • 14. Becoming a learning organization through relentless reflection • and continuous improvement.

13. Company Purpose Learning Community ST – Capable people LT – Learning to improve Learning Enterprise ST – Capable partners LT – Learning Enterprise Lean Systems ST – Capable processes LT – Value stream improvement Value-adding Contributor ST – Profitable LT – Growth & contribution to society PART II - Why Does Your Company Exist ? What is your Company’s Philosophy ? Survive ? Contributing to Society , Associates & Partners ? Profits ? Defining the Company’s Purpose

14. PART III – Creating Lean Processes Throughout Your Enterprise • Lean – Eliminating Waste • Toyota’s 7 major types of non-value adding • Activities in business or manufacturing processes – • Overproduction • Waiting (Time on hand) • Transportation or Conveyance • Over processing or Incorrect processing

15. Toyota’s 7 major types of non-value adding Activities in business or manufacturing processes – 5. Excess inventory 6. Unnecessary movement 7. Defects Eight Waste Unused Employee Creativity

16. PART III – Creating Lean Processes Throughout Your Enterprise • Developing a long – term philosophy of • Waste Reduction - “Get Lean” • Value Stream Mapping Approach • Beginning at the end of the flow • Strategies to create stability • Capability to produce consistent results over time.

17. Eliminate Waste 5 S and Workplace Organization Sort Clear out rarely Used items Sustain Use regular audits Straighten Organize and label a place for everything Shine Clean it Standardize Create procedures To maintain first 3s

18. Connected flow across the enterprise • Production in the entire facility & across multiple • facilities will be shut down if problems are not corrected • effectively. • Importance of equipment readiness, manpower availability • and material supply when thousands of people stop working • If there is a failure. • At Toyota – • Entire operation is connected and a problem will main • component halts the entire facility. • Sees it as an opportunity to identify weakness within the • system, to attack weakness and strengthen the overall • system.

19. Less is more – Reduce Waste by Controlling Overproduction Toyota considers overproductionto be the worst of seven types of wastes. Stopping overproduction- producing more, sooner or in greater quantity than next operation requires. Creating Pull between Separate Operations “Always satisfy the customer’’ ‘’ Never short the customer’’ Establish correct amount of WIP between supplier and the customer to buffer time requirement of the supplier to changeover and also to supply to second customer.

20. Establish Standardized Processes and Procedures Objective of Standardization – Maximize he entire system and considers ‘’Total Cost’’ via waste reduction as a primary indicator of success. Toyota considers development of standardization to be baseline for continuous improvement, meaning that future results are expected to improve from the standard.

21. Establish Standardized Processes and Procedures The Leveling Paradox “Heijunka” – Level or make smooth Produce smaller quantities more aligned with actual customer consumption. Points of Control Kanban – Point of control for inventory management

22. What Toyota does that makes their quality consistently better than other Car companies ? • Principle of building in Quality and decision to stop • and fix problems as they occur rather than pushing • them down the line to be resolved later. • Toyota has build in system that provides long-term • benefits of stopping the line and minimizes negative • effect by building a support structure to quickly • identify ,respond and correct problems.

23. The Toyota method of stopping to fix problems Philosopy Waste elimination Performance Measure First-Time Quality Principle Get quality Right the First time Strategy Stop to fix problems Result System waste and cost is reduced Lean Tools Jikoda, Problem solving Method Fixed position stop and Support structure Reason Increase urgency to Identify & correct problems Control methods Standardized work Quality audits Effect Long-term strengthening

24. Role Of Jikoda : Self Monitoring Machines • Jikoda – Intelligent machines • Machine’s ability to detect a problem and to stop itself. • Problem solving Cycle • Recognition • Elevate • Evaluate • Control • Containment • Prevention • Poka Yoke • “Mistake Proofing’’ or ‘’Error proofing’’

25. Make Technology Fit with People and Lean Processes Tailor Technology to Fit your People and Operating Philosophy Keep Technology in Perspective Toyota is an engineering-driven company and technology based company. Innovative product and process technology is at the core of Toyota’s success. People are at the core in creating and successfully implementing innovative product and process technology.

26. PART IV – Develop Exceptional People and Partners Success starts with Leadership Toyota views leaders as crucial elements and ratio of leaders to team members is one –to- 20 /30 Importance of Leadership within Toyota Toyota philosophy is to disperse responsibility to the lowest level possible. Three basic responsibilities – 1. Support for operations 2. Promotion of the System 3. Leading Change Four Key performance Results- 1. Safety 2. Quality 3. Productivity 4. Cost

27. Requirements For Leaders • Willingness and desire to lead • Job Knowledge • Job Responsibilities • Continuous Improvement Ability • Leadership Ability • Teaching Ability

28. Develop Exceptional Team Associates • “We Don’t Just Build Cars, We Build People’’ • People truly are the greatest assets. • Select the right people • Assimilating team associates into your culture • Training Plan and Tracking Performance • Quality Circles – Vital part of Kaizen • Toyota Suggestion Programme – Providing a sense of • ownership • Invest in Skill in all areas of company

29. Develop Suppliers and Partners as Extensions of the Enterprise • Supplier partners in a Globally Competitive World • Short term Cost Savings vs. Long term Partnerships • Supplier partnering at Toyota – • 1. Mutual understanding & Trust • 2. Control systems • 3. Compatible capabilities • 4. Information sharing • 5. Joint Improvement activities • 6. Continuous improvement and Learning

30. Building a Lean Extended Enterprise • Become a Role Model Lean Customer • You cant teach suppliers what you yourself • have not yet mastered. • 2. Identify your Core Competencies • Outsourcing entails more than simple make –buy • decision • 3. Develop your core suppliers • Make sure their systems and philosophies are • compatible with yours and they are at a comparable • level of operational excellence.

31. Building a Lean Extended Enterprise 4. Use control Systems for continuous improvement Manage supplier relationship by minimizing bureaucratic systems and procedures to a critical minimum 5. Favor an incremental approach Start small with selective outsourcing for a new supplier. 6. Develop mechanisms for Joint Enterprise Learning Learn together and capture learning in standardized routines.

32. PART V – Root CAUSE Problem Solving for Continuous Learning • Problem Solving The Toyota Way • Identify and remove obstacles on the path to perfection • Every problem is an improvement opportunity • Find the True Problem to get the most significant results “Yoi Shina,Yoi Kangai’’ – “Good thinking, good products’’ Plan – Do- Check – Act Plan : Develop an Action Plan Do: Implement Solutions Check : Verify Results Act : Make necessary adjustments to Solutions and to the Action plan

33. A3 Report Title and Description Problem Definition and Description Problem Analysis Results Future Steps A 3 Report Implementation Plan AUTHOR : _________ DATE:______

34. PART VI – Managing the Change Lean Implementation Strategies and Tactics 1.Philosophy 2. Process 3. People 4. Problem Solving Leading the Change

35. Lean Coach • Smart • Quick studies • Love to learn • Hands-on • Passionate about improving process • Leadership skills • Strong inter-personal skills • Excellent communicators • Basic technical skills • System thinkers • Natural problem solving skills • Read books • Open to new ideas • Personally organized

36. Participation & Ownership Structure Change Effort Committed Knowledgeable Leadership Lasting Results Accountability Learning by doing Education & Mentoring Lean Sensei - Sensei “Teacher ” Key Ingredients for Change

37. Learnings • Define company’s purpose and develop a long-term • philosophy • In a multi-national set-up create a culture adaptable • to people across countries. • Encourage the concept of being a “ Learning organization” • Create value systems with flow, standardized work, • and level production.

38. Learnings • Stop and fix problems – Take timely action • Develop leaders who promote and support the system • Find and develop exceptional people and partners • Lead the change process and transform the total enterprise

39. Thank You