TPS' Guiding Principles

Look at TPS first as a culture and as an enterprise process where the importance of long-term optimization goals transcend individual events along the way, says F. Norman Bafunno, senior vp/manufacturing planning and production, Toyota Motor Manufacturing Indiana Inc. TPS succeeds when managements build an enterprise culture capable of stopping to fix problems to get quality right the first time, Bafunno says. "Empowering production associates is the key to TPS success."

The apocryphal beginnings of TPS usually allude to a 1950s exposure of Toyota's Taichi Ohno to an American supermarket experience. The result: the demand-pull basis that guides TPS via a just-in-time philosophy. Routine carrying of inventory came to be known as a form of muda (waste). The voice of the customer (in terms of demand) becomes the determining factor of TPS.

With kaizen, the concept of continuous improvement, Ohno gave TPS a self-perpetuating power to move beyond the status quo temptations of conventional management.

Although the name TPS suggests that Ohno's system is no more than a set of production floor tools for car making, the concept is broader. The full potential of TPS is as an operational solution ready to remake entire organizations -- both at the process and management levels.

To begin the TPS journey, consider the guiding principles of operational excellence that Jeffrey K. Liker cites in "The Toyota Way." Then proceed to use operational excellence as a strategic weapon for any organization. Liker, a professor of Industrial and Operations Engineering at the University of Michigan, examines the broad cultural principles at work in TPS.

(To learn how TPS could be applied to health care, see Steven J. Spear's "Fixing Health Care From the Inside, Today" the Harvard Business Review, September 2005.)

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