The Toyota Way: 14 Management Principles From the World's Greatest Manufacturer

by Jeffrey K. Liker

In the 1950s, Ohno returned to the place he understood best, the shop floor, and went to work to change the rules of the game. He did not have a big consulting firm, Post-it® notes, or PowerPoint to reinvent his business processes. He could not install an ERP system or use the Internet to make information move at the speed of light. But he was armed with his shop-floor knowledge, dedicated engineers, managers, and workers who would give their all to help the company succeed. With this he began his many "hands-on" journeys through Toyota's few factories, applying the principles of jidoka and one-piece flow. Over years and then decades of practice, he had come up with the new Toyota Production System.3 Of course, Ohno and his team did not do this alone. Along with the lessons of Henry Ford, TPS borrowed many of its ideas from the U.S. One very important idea was the concept of the "pull system," which was inspired by American supermarkets. In any well-run supermarket, individual items are replenished as each item begins to run low on the shelf. That is, material replenishment is initiated by consumption. Applied to a shop floor, it means that Step 1 in a process shouldn't make (replenish) its parts until the next process after it (Step 2) uses up its original supply of parts from Step 1 (that is down to a small amount of "safety stock"). In TPS, when Step 2 is down to a small amount of safety stock, this triggers a signal to Step 1 asking it for more parts. This is similar t...