The modern theory of the toyota production system : A system inquiry of the wolrd's most emulated and profitable managament system

THE MODERN THEORY

OF THE TOYOTA

PRODUCTION SYSTEM

Phillip Marksberry, PhD, PE

A SYSTEMS INQUIRY OF THE WORLD’S

MOST EMULATED AND PROFITABLE

MANAGEMENT SYSTEM

A P ROD U CT I V I T Y PR E SS BOOK

K15434

“Dr. Marksberry looks at TPS in the context of organizational behavior, social

sciences, management science, and engineering sciences. He presents new insights

into how the elements of TPS work together as a system across an organization.

Both scholars and practitioners of TPS and Lean Manufacturing will nd this book

to be thought provoking and revealing about how successful TPS operates.”

—Larry Holloway, Professor and Chair of Electrical and Computer Engineering,

University of Kentucky

Numerous books have been written about Toyota's approach to workplace

improvement; however, most describe Toyota's practices as case studies or stories.

Designed to aid in the implementation of Lean manufacturing, The Modern Theory

of the Toyota Production System: A Systems Inquiry of the World’s Most

Emulated and Protable Management System explains that your organization

already has what it takes to succeed with TPS and what’s probably missing

is balance.

Bridging the gap between implementation and theory, this text is the rst of its

kind to use systems theory to study how the pieces of the Toyota Production System

(TPS) work together to achieve this much needed balance. Lean practitioners will

learn how to use system theory to improve overall decision making when applying

Lean or Toyota-like management systems.

Explaining that the glue that holds the pieces of TPS together is just as important

as the pieces themselves, the book provides you with invaluable guidance in the

implementation of Lean manufacturing from a management perspective. It outlines

a blueprint to help you develop a clear understanding of how the pieces of TPS

need to come together so you can achieve something greater than what’s possible

with the individual pieces.

THE MODERN THEORY OF THE TOYOTA

PRODUCTION SYSTEM

A Systems Inquiry of the World’s Most Emulated

and Protable Management System

THE MODERN THEORY OF THE TOYOTA PRODUCTION SYSTEM

A Systems Inquiry of the World’s Most Emulated and Protable Management System

Business & Management / Lean Methods & Implementation Marksberry

www.productivitypress.com

THE MODERN THEORY

OF THE TOYOTA

PRODUCTION SYSTEM

A SYSTEMS INQUIRY OF THE WORLD’S

MOST EMULATED AND PROFITABLE

MANAGEMENT SYSTEM

CRC Press is an imprint of the

Taylor & Francis Group, an informa business

Boca Raton London New York

THE MODERN THEORY

OF THE TOYOTA

PRODUCTION SYSTEM

Phillip Marksberry, PhD, PE

A SYSTEMS INQUIRY OF THE WORLD’S

MOST EMULATED AND PROFITABLE

MANAGEMENT SYSTEM

CRC Press

Taylor & Francis Group

6000 Broken Sound Parkway NW, Suite 300

Boca Raton, FL 33487-2742

© 2013 by Taylor & Francis Group, LLC

CRC Press is an imprint of Taylor & Francis Group, an Informa business

No claim to original U.S. Government works

Version Date: 20120605

International Standard Book Number-13: 978-1-4665-5675-1 (eBook - PDF)

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v

Contents

Foreword ............................................................................................... xv

Preface .................................................................................................xvii

Acknowledgments ...............................................................................xix

Introduction.........................................................................................xxi

About the Author................................................................................ xxv

Chapter 1 Systems Theory and the Relation to TPS ......................... 1

1.1 Why Systems Theory for the Toyota Production

System?...............................................................................1

1.2 Why Systems Thinking Is Not Popular When

Implementing TPS............................................................6

1.3 Systems Theory Background...........................................7

1.4 A Representation of Toyota’s TPS System

Properties...........................................................................8

1.4.1 Holism and Roles.................................................9

1.4.2 Goal Seeking, Industrial Engineering,

and Problem Solving...........................................9

1.4.3 Regulation and Jishuken.....................................9

1.4.4 Differentiation and Leadership........................10

1.4.5 Hierarchy and Hoshin Kanri...........................10

1.4.6 Transformation, Change Management,

and Kaizen..........................................................11

1.4.7 Entropy and Human Resources ......................11

1.4.8 Negative Entropy and Organizational

Learning..............................................................11

1.4.9 Requisite of Variety and Production

Leveling...............................................................12

1.4.10 Interrelationships and Supplier

Development ......................................................12

1.4.11 Equifinality, Multifinality, and

Maintenance.......................................................13

1.5 Summary..........................................................................13

References...................................................................................14

vi  •  Contents

Chapter 2 The Property of Holism in TPS....................................... 15

2.1 System Property: Holism...............................................15

2.2 Holism and the Toyota Production System ................15

2.3 The Role Concept............................................................16

2.4 The Difference between Roles and Job

Descriptions.....................................................................18

2.5 Role Prescriptions...........................................................19

2.6 Role Theory and Analysis..............................................19

2.6.1 Role Components and Features...................... 20

2.7 The Emergent Properties of TPS: Teamwork............. 20

2.8 The Emergent Properties of TPS: Collaboration

and Trust among Members...........................................26

2.9 The Emergent Properties of TPS: Workplace

Consistency......................................................................27

2.10 Summary......................................................................... 30

References...................................................................................31

Chapter 3 The Property of Goal Seeking in TPS, Part 1 ................ 33

3.1 System Property: Goal Seeking ....................................33

3.2 Goal-Seeking Properties of the Toyota

Production System......................................................... 34

3.3 Background: TPS and the Industrial

Engineering Connection ...............................................35

3.4 The Role of Industrial Engineering..............................36

3.5 Industrial Engineering Theory .....................................37

3.6 Literature Review of Industrial Engineering

Methods ...........................................................................38

3.6.1 The Scientific Management Era.......................38

3.6.2 Skill Sets of Industrial Engineers in the

Era of Scientific Management..........................39

3.6.2.1 Skill Set: Scientific Method...............39

3.6.2.2 Skill Set: Importance of Direct

Observation........................................ 40

3.6.2.3 Skill Set: Work Sampling ................. 40

3.6.2.4 Skill Set: Questioning Attitude ....... 40

3.6.2.5 Skill Set: Standardization..................41

3.6.2.6 Skill Set: Standards Engineer...........41

Contents  •  vii

3.6.2.7 Skill Set: Systems Thinking ..............41

3.6.2.8 Skill Set: The Process Flowchart ......41

3.6.2.9 Skill Set: Work Distribution

Charts................................................. 42

3.6.2.10 Skill Set: Time Study......................... 42

3.6.2.11 Skill Set: Testing, Adaptive One

Factor at a Time................................. 42

3.6.3 Contemporary Industrial Engineering ......... 42

3.6.4 Skill Sets of Contemporary Industrial

Engineering ....................................................... 43

3.6.4.1 Skill Set: Systems Engineering

and Optimization.............................. 44

3.6.4.2 Skill Set: Process Design and

Reengineering.................................... 44

3.6.4.3 Skill Set: Experimental Design,

Design of Experiments, Taguchi

Methods...............................................45

3.6.4.4 Skill Set: Six Sigma.............................45

3.6.4.5 Skill Set: Lean Sigma .........................45

3.6.5 Literature Review Summary ........................... 46

3.7 What Type of Industrial Engineering Identity Is

TPS?................................................................................. 46

3.7.1 Differences between TPS, the Efficiency

Expert, and Traditional Lean...........................50

3.8 Adapting Scientific Management to TPS and the

Comparison to Contemporary IE ................................52

3.8.1 Standardization or Kaizen (Business

Process Reengineering)?...................................52

3.8.2 Knowledge by Observation (Genchi

Genbutsu) or by Inference (Data)?..................53

3.8.3 Scientific Method or System

Optimization?................................................... 54

3.9 Summary......................................................................... 56

References.................................................................................. 56

Chapter 4 The Property of Goal Seeking in TPS, Part 2 ................ 59

4.1 Problem Solving: The Identity of the Toyota

Production System..........................................................59

viii  •  Contents

4.1.1 Problem Solving versus Kaizen

(Improvement).................................................. 60

4.2 Structured Problem Solving..........................................61

4.3 Toyota’s Eight-Step Problem-Solving

Methodology ...................................................................62

4.4 Human Problem-Solving Background........................65

4.5 Literature Review of Problem-Solving

Methodologies.................................................................67

4.6 Limitations with Problem-Solving Methodology

Research ...........................................................................74

4.7 Problem-Solving Theory and Core Thinking

Skills .................................................................................75

4.8 Criteria for Evaluating Effective Cognitive

Processes..........................................................................76

4.9 Applying Human Problem-Solving Theory to

Toyota’s Eight-Step Process.......................................... 80

4.9.1 Goal Clarity in A3 Thinking............................81

4.9.2 Productive Thinking in A3 Thinking.............82

4.10 Putting It All Together.................................................. 86

4.11 Summary......................................................................... 88

References.................................................................................. 88

Chapter 5 The System Property of Regulation in TPS.................... 91

5.1 System Property: Regulation.........................................91

5.2 The System Property of Regulation and the

Toyota Production System.............................................95

5.3 Literature Review of Jishukens .....................................97

5.4 Literature Review of Quality Circles............................97

5.5 Using Quality Circles and Jishukens to Create a

Shared Vision ................................................................. 99

5.6 The Weakening and Strengthening of TPS using

Shared Visions...............................................................102

5.7 The Regulation Cycle of TPS.......................................105

5.8 Jishuken and Quality Circle Implementation

Concepts.........................................................................106

5.8.1 Asking for Help and Promoting Waste

Elimination.......................................................107

Contents  •  ix

5.8.2 Starting Point for Workplace

Improvement....................................................110

5.8.3 The Team Structure of Jishukens and

Quality Circles.................................................110

5.8.4 Significance of Roles in Management￾Directed Activities...........................................112

5.8.5 Support Functions in QCs and

Jishukens...........................................................113

5.8.5.1 Coach and Facilitate Problem

Solving ...............................................113

5.8.5.2 Jishukens and QCs Must

Advance Stability through

Standardization................................114

5.8.5.3 Model the Company’s Approach

to Work..............................................115

5.9 Summary........................................................................116

References.................................................................................117

Chapter 6 The System Property of Differentiation in TPS........... 121

6.1 System Property: Differentiation................................121

6.2 Toyota Production System and System

Differentiation.............................................................. 123

6.3 Literature Review of Leadership................................ 124

6.3.1 The Distinction between Management

and Leadership.................................................125

6.4 Literature Review of Leadership Theory ...................127

6.5 Leadership Theory for TPS......................................... 128

6.6 The What Function of TPS Leadership .....................129

6.7 The Why Function of TPS Leadership...................... 134

6.8 The How Function of TPS Leadership.......................136

6.8.1 What If Leadership Is Not on Board with

Defining, Coaching, or Implementing

Lean?..................................................................139

6.9 The Where Function of TPS Leadership....................140

6.10 The When Function of TPS Leadership.....................141

6.11 Summary........................................................................146

References.................................................................................147

x  •  Contents

Chapter 7 The System Property of Hierarchies in TPS................. 151

7.1 System Property: Hierarchy ........................................151

7.2 The Hierarchical Property of the Toyota

Production System........................................................152

7.3 Decision Making in Hierarchies ................................153

7.3.1 Vertical Decision Making...............................153

7.3.2 Horizontal Decision Making ........................ 154

7.3.3 Interdependent Decision Making .................155

7.3.4 Interdependent Performance .........................156

7.3.5 Monitoring and Progress................................157

7.3.6 Routine Work and Nonroutine Work

in Hoshin..........................................................157

7.4 Literature Review of Strategic Planning....................158

7.4.1 Problems and Challenges in Strategic

Planning............................................................160

7.5 Strategic Planning Theories ........................................161

7.6 A System of Hierarchies: The Hoshin Process..........163

7.6.1 Planning Phase of Hoshin..............................163

7.6.2 Preparation Phase of Hoshin.........................167

7.6.3 Hoshin Implementation Phase ......................171

7.6.4 Hoshin Evaluation...........................................174

7.6.5 End-of-Year Evaluation...................................176

7.7 A Theoretical Interpretation of Hoshin.....................176

7.8 Summary........................................................................179

References.................................................................................179

Chapter 8 The System Property of Transformation in TPS.......... 183

8.1 System Property: Transformation..............................183

8.2 The Conversion Process in the Toyota

Production System........................................................186

8.3 Literature Review of Change Management...............187

8.4 Conversion Process: Ingestor......................................196

8.5 Conversion Process: Motor.........................................198

8.6 Conversion Process: Converter.................................. 200

8.7 Conversion Process: Producer................................... 203

8.8 Conversion Process: Supporter.................................. 205

8.9 Conversion Process: Distributor................................ 208

Contents  •  xi

8.10 Conversion Process: Matter–Energy Storage............210

8.11 Summary........................................................................210

References.................................................................................211

Chapter 9 The System Property of Entropy in TPS....................... 215

9.1 System Property: Entropy............................................215

9.2 Entropy in Organizations............................................217

9.3 Entropy in the Toyota Production System................219

9.4 Literature Review: The Human Resource

Function.........................................................................221

9.4.1 Japanese Management Techniques in

Human Resources .......................................... 222

9.4.2 Japanese Management Practices and

Toyota............................................................... 225

9.5 Minimizing Entropy Using the Human

Resource Function in TPS.......................................... 225

9.6 Hygiene Theory and TPS: The Essential Needs

of the Individual .......................................................... 227

9.6.1 Stable Employee Relations............................. 228

9.6.2 Fair Appraisal and Treatment....................... 229

9.6.3 Improve the Terms and Conditions of

Employment.....................................................232

9.6.4 Workplace Communication...........................233

9.7 Motivation Theory and TPS: The Intrinsic Needs

of the Individual ...........................................................235

9.7.1 Decision Making ............................................ 238

9.7.2 Teamwork .........................................................239

9.7.3 Workplace Competence..................................241

9.8 Summary....................................................................... 243

References................................................................................ 244

Chapter 10 The System Property of Reversibility in TPS ............... 247

10.1 System Property: Reversibility................................... 247

10.2 Minimizing Entropy in the Management and

Labor Relationship (Reversibility)............................. 249

10.3 Literature Review: The Birth of the Toyota

Production System as a Union....................................251

xii  •  Contents

10.3.1 The Role of Trade Unions and the

Human Resource Function in the United

States..................................................................255

10.3.2 The Use of Lean in Human Resource

Development ................................................... 256

10.3.3 A Difficult Implementation of Lean

in Union Environments in the United

States................................................................. 256

10.3.4 Union Problems and Lean Production in

the Automotive Industry............................... 258

10.3.5 A Successful Case of Lean Production

in the Automotive Sector in a Union

Environment ................................................... 260

10.3.6 The Influence of Labor Unions in Japan

on Lean Production........................................ 262

10.4 Internal Reversibility in TPS: A Union

Perspective .................................................................... 263

10.4.1 Larger Employment Issues............................ 267

10.5 External Reversibility in TPS: A Union

Perspective .....................................................................272

10.6 Summary........................................................................275

References.................................................................................276

Chapter 11 The System Property of Negative Entropy in TPS....... 279

11.1 System Property: Negative Entropy ...........................279

11.2 Negative Entropy and the Toyota Production

System............................................................................ 280

11.2.1 Exceptional Creativity, Mundane

Creativity, and Lifelong Learning .................281

11.3 Organizational Learning and Communication:

Some Basic Similarities with TPS.............................. 284

11.4 Literature Review of Organizational Learning

and Communication................................................... 285

11.5 Organizational Learning Theory............................... 288

11.6 Connecting the Kaizen Mind .................................... 292

11.7 The Preferred Learning and Communication

Style for the Kaizen Mind........................................... 296

Contents  •  xiii

11.8 Summary....................................................................... 298

References................................................................................ 299

Chapter 12 The System Property of Requisite Variety in TPS ....... 303

12.1 System Property: Requisite Variety........................... 303

12.2 A Theoretical Response to Complexity and

Variety ........................................................................... 304

12.3 Toyota Production System and the Law of

Requisite Variety.......................................................... 306

12.4 Literature Review: Production Leveling................... 308

12.5 The Technical and Social Structures of

Production Leveling .....................................................311

12.5.1 Technical System: Prevention........................313

12.5.2 Technical System: Reactive ............................315

12.5.3 Social System: Prevention...............................319

12.5.4 Social System: Reaction ..................................323

12.6 Summary....................................................................... 324

References.................................................................................325

Chapter 13 The System Properties of Interrelationship and

Interdependence in TPS................................................. 329

13.1 System Properties: Interrelationship and

Interdependence............................................................329

13.2 Interrelationship and Interdependence in the

Toyota Production System...........................................332

13.3 Literature Review: Supplier Development.................333

13.4 A Review of Toyota’s Supplier Development

Practices.........................................................................337

13.5 Building Positive and Interdependent Structures

in TPS ............................................................................ 344

13.6 Summary........................................................................352

References.................................................................................353

Chapter 14 The System Property of Equifinality in TPS................ 357

14.1 System Property: Equifinality and Multifinality .....357