Saturday, July 25, 2009

Toyota's 14 Principles : Key Success Factor

Many things to be learnt at Toyota. You can download the toyota 14 principles pdf here and read the analysis below from ezine.

Toyota is clearly a dominate leader in automobile manufacturing today. The principles employed at every level of the company have certainly led to a standard of quality that no one in the automotive industry can argue with. What these principles are and how they are implemented within the Toyota Corporation can certainly help the automakers of the United States and indeed the world achieve the same success.

When these 14 principles are listed and compared with some of the strategies that United States automakers have employed, it becomes clear why Toyota has succeeded as it has.

The 14 principles are known as the "Toyota Way" and are listed below:

1. Base your management decisions on long term philosophies, even at the expense of short term goals

2. Create continuous process flow to bring problems to the surface

3. Use pull systems to avoid over production

4. Level out the workload

5. Build in a method to stop and fix problems when they are discovered, this ensures quality the first time

6. Standardized tasks provide the foundation for continuous improvement and employee empowerment

7. Use visual control so no problems are hidden

8. Use only reliable, thoroughly tested technology that serves you people and processes

9. Grow leaders who thoroughly understand the work, live the philosophy and can and do teach it to others

10. Develop exceptional people and teams who follow your company's philosophy

11. Respect your extended network of partners and suppliers by challenging them and helping them improve

12. Go and see for yourself so that you completely understand the situation

13. Make decisions slowly by consensus, thoroughly consider all options; implement decisions rapidly

14. Become a learning organization through relentless self examination and continuous improvement

Just by a cursory examination of these fourteen principles, it is easy to understand why Toyota has experienced such a high level of success. The overall process does not allow for overlooking, either deliberately or by accident problems that exist anywhere in the chain of production. Every Toyota employee involved in the manufacturing process has the power to stop production if they see an issue developing. Just this one aspect alone works to ensure that quality vehicles are produced along the assembly line. The twelfth principle: go and see supports and encourages management to stay in touch with design and manufacturing concepts so that they stay in touch with what is actually occurring on the production floor. Number 13 inhibits the business as usual style that can strangle even the most creative of companies. By always encouraging employees to thing outside the box and bring the suggestions to upper level management, fresh new ideas are constantly stimulating innovative and original designs. This ensures that the product never goes stale.

By spending more time up front developing the correct process, the long-term goals of producing exciting affordable qualities vehicles is recognized. Unfortunately, for U.S. automakers, it many times seems that that they approach the production concept from the opposite direction. This might explain why Toyota has pulled away from United States as a leader in the car manufacturing industry. The philosophy appears to have worked well so far and one wonders why someone in America has not had the bright idea to adopt these strategies.

Could it possibly be that many Americans have grown fat and lazy with the early successes achieved by our ancestors? Let us hope that our philosophy as a nation changes quickly, for if it does not, we might find ourselves going the same way as our automotive industry. That is a scary thought indeed.

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1 comment:

Jason Shick said...

Wow! What a clear set of business ideas. The first one should be put into practice in all areas of life. We live in such a "right now" society. We want things quicker, cheaper, faster, and we don't want any headaches to get them that way. I am going to use that first strategy when it comes to my personal life, especially in the area of finances. Americans have a hard time (myself included) sacrificing short term goals and/or wants for long term results. Thanks for the post.