Why you should read about Toyota's production system

BUSINESS CLASSIC: Managers can learn a lot from Taiichi Ohno's 1988 tome.

by Stefan Stern
Last Updated: 20 Oct 2016

Toyota Production System: Beyond Large-Scale Production

Taiichi Ohno

Productivity Press, 1988

Just-in-time production, the marriage of automation with human input, the driving out of waste through a process of continuous improvement: these now familiar concepts were first explained and popularised by Taiichi Ohno, one of the architects of Toyota's extraordinary success.

The Toyota Production System (TPS) is a disciplined, rigorous philosophy and approach. 'Re-improve what was improved for further improvement,' Ohno said. 

Ohno stated that managers had to go and see for themselves ('genchi genbutsu') to understand what was and was not working. Decisions should be taken slowly and collectively. But, once taken, they must be pursued relentlessly.

As a Toyota manual says, 'The TPS is a framework for conserving resources by eliminating waste. People who participate in the system learn to identify expenditures of material, effort and time that do not generate value for customers... lasting gains in productivity and quality are possible whenever and wherever management and employees are united in a commitment to positive change.'

Toyota grew, became the number one global manufacturer, overreached itself and ended up recalling dodgy vehicles in the hundreds of thousands. It seemed, temporarily at least, to have forgotten Ohno's message.

As the late rock singer Ian Dury might have put it: what a waste.

Stefan Stern is visiting professor at Cass Business School. Follow him on Twitter: @StefanStern

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