ADVANCED PRODUCTION, QUALITY & MANUFACTURING LESSON PLAN

Course Number: PQM 301 Module & Title: Lesson No. 5 – Lean Principles / Toyota Production System (TPS) Length (total): 4 Hours Lesson Overview: The lesson describes the 14 Lean Principles as outlined by Dr. Jeffery Liker, University of Michigan in his book “The Toyota Way,” and the “House of Lean” a model that explains the Toyota Production System. Terminal Learning Objective: Given the lecture, lesson materials, and classroom discussion students will analyze and describe Lean practices, tools, and concepts. Enabling Learning Objectives:

1. Describe and analyze the key concepts and major elements of the Lean “House” model.

2. Describe Lean production tools and techniques and their use and benefits within the Acquisition Lifecycle.

3. Describe and analyze the fourteen management principles associated with the Toyota Way Philosophy.

4. Identify and analyze Toyota priorities at the corporate, facility and shop floor levels.

5. Identify the benefits of Lean and their potential use and impact with the Department of Defense.

Learning Method: Lecture/discussion/Student Readings and Case Study Student Assignments/Readings:

• Read: New United Motors Manufacturing, Inc. (NUMMI), by Charles O’Reilly, Stanford Business School Case Study, 1998, Case No. HR11

• Toyota Motor Manufacturing, USA., Inc., 1995, by Professor Hazuhiro Mishina, Harvard Business School, Case No. 9-693-019

• Synopsis of “The Machine That Changed the World,” a Teaching Note by George Noyes, Professor of Systems Engineering, DAU 1997

Background References/Websites (optional):

Defense Manufacturing Management Guide for Program Managers, Chapter 5.4 Lean/Six Sigma at https://www.dau.mil/tools/t/Defense-Manufacturing-Management-Guide-for-Program-Managers-(PQM-for-PMs)

• Lean Thinking, Module 1.1 MIT Briefing, at http://ocw.mit.edu/courses/engineering-systems-division/esd-60-lean-six-sigma-processes-summer-2004/lecture-notes/1_1leanthinking.pdf

• Toyota Production System Basic Handbook, by The Art of Lean, Inc., at http://www.artoflean.com/files/Basic_TPS_Handbook_v1.pdf

Conduct of the Lesson: This lesson will expand upon the introductory material provided in PQM 201B expanding on the House of Lean and then having the students read and analyze the NUMMI and TMMK case studies. The students will examine through lecture and discussion:

• What is lean and it’s links to “value” • Discuss Dr. Jeffrey Liker’s concepts of the Toyota Way Philosophy as outlined in his book

“the Toyota Way” – and 4P’s • A discussion of Corporate, Facility and Operating Floor priorities • The seven forms of waste (muda) • An in-depth discussion of the “house of lean,” and it’s structure and elements…this is

the heart of the lesson.

Learn. Perform. Succeed

Lean PrinciplesToyota Production System

(TPS)

PQM 301

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Learning Objectives

Terminal Learning Objective: Given the lecture, lesson materials, and classroom discussion students will analyze and describe Lean practices, tools, and concepts.

Enabling Learning Objectives:

• Describe and analyze the key concepts and major elements of the Lean “House” model.

• Describe Lean production tools and techniques and their use and benefits within the Acquisition Lifecycle.

• Describe and analyze the fourteen management principles associated with the Toyota Way Philosophy.

• Identify and analyze Toyota priorities at the corporate, facility and shop floor levels.

• Identify the benefits of Lean and their potential use and impact with the Department of Defense.

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What is Lean ?

• Lean is the Toyota Production System:A manufacturing system which pursues optimum streamlining throughout the entire system through the thorough elimination of waste and aims to build quality in during the manufacturing process while recognizing the principle of cost reduction.

• Lean means right thing, right place, right time, right quantity.• Lean systems focus on maximizing the value stream while eliminating all

waste; no blind focus on cost reduction.• Lean is a way of thinking that focuses on constantly shortening the order

to delivery time by maximizing the flow of information and material while reducing cycle time.

• A total system of organizational learning:1. Never make the same mistake twice.2. Turn implicit (tribal) knowledge into explicit knowledge.3. Do not reinvent the wheel – reuse knowledge.

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“Nobody Believes Us” - Toyota executive

• Strategic policy deployment (Hoshin kanri) – alignment with “True North”• Respect for people & teamwork• Develop people: train everyone to be a problem solver• Let people use their minds• Entire organization exists to support the people actually doing the work• “Go and see” (genchi-gembustu); actual part, actual place, actual

situation (ground truth), personally verified, hard data vs. reliance on reports, meetings and IT systems

• Process orientation vs. results orientation; METRICS DRIVE BEHAVIOR• Putting good people in a bad process is the best way to produce “bad”

people• Continuous improvement (kaizen) = Develop Countermeasure -

Determine root cause - Permanently solve - Repeat

The Toyota Way Philosophy

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14 Principles of TPS

14. Continual organizational learning through Kaizen.13. Go see for yourself to understand the situation (Genchi Genbutsu).12. Make decisions slowly by consensus, considering all options…then implement rapidly.

4 Ps

Problem Solving

(CPI and Learning)

People & Partners (Respect,

Challenge and Grow Them)

The Right Process Will Produce the Right Results

(Eliminate Waste)

Long Term Philosophy(Long Term Thinking)

11. Grow leaders who live the philosophy.10. Respect, develop, and challenge your people and teams.9. Respect, challenge, and help your suppliers.

8. Create process “flow” to surface problems.7. Use pull systems to avoid overproduction.6. Level out the workload (Heijunka).5. Stop when there is a quality problem (Jidoka).4. Standardize tasks for continuous improvement,3. Use visual control so no problems are hidden.2. Use only reliable, thoroughly tested technologhy.

1. Base management decisions on a long-term philosophy, even at the expense of short-term financial goals.

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Customer Focus at the CORPORATE Level

• SAFETY & ENVIRONMENTALRESPONSIBILITY

• HIGHEST QUALITY as defined by the customer

• LOWEST MFG COST

• SHORTEST LEAD TIME

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Lean Priorities at the FACILITY Level

1. Environmental, Safety and Occupational Health

2. QUALITY

3. PRODUCTIVITY

4. COST

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Operating Rules for the SHOP FLOOR

• Safety first.• Make only what is needed, when it is needed.• Make work and problems visible. Make normal and

abnormal situations immediately obvious.• Never produce a defect – never pass a defect on.

Problems are solved in space & time as close as possible to where the problem occurred. “One-by-one confirmation” and “zone control”.

• Eliminate all waste

FOCUS ON FLOW AND CYCLE TIME REDUCTION

Reduce Batch Size

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Toyota Production System

Just-In-Time“Right part, right amount,

right time”

Jidoka(In-station quality)

“Make Problems Visible”

Leveled Production (heijunka)Stable and Standardized Processes

• Takt time planning• Continuous flow• Pull system• Quick changeover• Integrated logistics

• Automatic stops• Andon• Person-machine

separation• Error proofing• In-station quality control • Solve root cause of

problems (5 Why?)

Waste Reduction• Let’s go see (Genchi

Genbutsu)• 5 S / 6 S

• Eyes for Waste• Problem Solving

People & Teamwork• Selection• Common Goals

• Ringi decision making• Cross-trained

Continuous Improvement

Visual ManagementToyota Way Philosophy

Best Quality - Lowest Cost - Shortest Lead Time - Best Safety - High Moralethrough shortening the production flow by eliminating waste

The House of Lean

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Summary of the TPS (Lean)

• It always begins with the customer.• The customer wants the right thing, at the right time,

right place, right price, with perfect quality: value.• Value is always the end result of a process.• Each process step must contain zero waste.• To achieve zero waste, each process step must be

valuable, capable, available, adequate and flexible.• A truly lean process is a perfect process.• Perfection is not possible, but lean enterprises behave

as if it is.• People make it happen – not the tools.

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NUMI Case Exercise

• Practice participation phase to review TPS system and prepare for the TMM graded event on Thursday.

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TMMK Questions

• Q1. What is the real problem facing Doug Friesen? Address a minimum of 3 of the 14 Principles or Priorities of TPS to support your position.

• Q2. As Doug Friesen address the seat problem. Where would you focus your attention and solution efforts? What would you recommend? Why? Provide a minimum of 3 specific shop floor level changes.

• Q3. Where does the current routine for handling defective seats deviate from the principles of the Toyota Production System? Identify at least 3 deviations from the TPS Model associated with problem prevention or solving.

• Q4. Describe what the 4 key elements of the human infrastructure from the TPS Model are and how they are used in this case? If used correctly describe their benefit. If used incorrectly describe the impact and how you would restore the element(s).

• Q5. What is Level Loading (Heijunka) and how does it help set the conditions for JIT, In Station Quality, Problem Solving and Teamwork to be more easily executed? Give at least one example for each area from the case.