TOYOTA MOTOR
MANUFACTURING
CASE STUDY ANALYSIS
GROUP #5 SECTION - F
COMPANY OVERVIEW
A Japanese automobile manufacturer
which was founded by Kiichiro Toyoda
in 1937.
Produces about 200 million vehicles
under 5 different brands : Toyota,
Hini, Lexus, Ranz & Scion.
The largest listed company in Japan by
market capitalization.
The 11th largest company in the world
by revenue
GROUP #5 SECTION - F
CASE OVERVIEW
Toyota's Georgetown, Kentucky plant was established with the aim of
providing flawless & high quality at low costs in 1985.
The Toyota Production System (TPS) was aimed at cost reduction by
thoroughly eliminating waste.
The TPS maintained two principles for facilitating the critical process :
1) The principle of just-in-time (JIT) production
2) The principle of jidoka.
They followed Kaizen (continuous improvement) in pursuing the
production system's goals continuously.
In Georgetown, assembly operations were performed along 353 stations
consisting of several connected line segments.
Every station on the assemble line embodied jidoka & kaizen tools.
GROUP #5 SECTION - F
CASE OVERVIEW
A standardized work chart was posted to show :
1) The cycle time of each workstation
2) The sequence of work tasks
3) The timing to perform them within one cycle
The mission of the production system (PC) department was to feed the
necessary parts into the TMM operations just-in-time
The planning process of PC reflected JIT in two ways :
1) The practice of hejinuka (balancing total order).
2) The use of kanban card (related with part production)
GROUP #5 SECTION - F
CASE OVERVIEW
TMM's quality control (QC) department pursued a mandatory routine of
tough quality standards.
The QC served two major functions :
1) Providing instant feedback to direct operations.
2) Preventing problems from occurring in the first place.
TMM's purchasing departments concentrated on managing cost over the
long haul.
In Georgetown's plant, TMM found some severe problems which they
wanted to work out :
1) Less productivity
2) Low line utilization rate than the projected target
3) The seat problem
GROUP #5 SECTION - F
IDENTIFYING THE
PROBLEM
Toyota Motor Manufacturing (TMM) faces
the problem of defective seats in their
Camry models at their Georgetown plant.
Kentucky Framed Seat (KFS) was TMM's only
seat supplier.
KFS had a problem in their seat
manufacturing associated with missing
parts.
Seat problems increased with the increase
in demand by introducing various car
models.
GROUP #5 SECTION - F
CONSEQUENCES OF PROBLEMS
Defective products with defective seats.
Production plan failed to meet estimated
targets.
Run ratio dropped from 95% to 85% (45 less
cars per shift)
Offline production increased.
Production cost increased
GROUP #5 SECTION - F
CAUSES, IDENTIFIED
TMM did not follow TPS philosophy but only
matched their tools.
KFS seats matched the TMM capacity but did not
implement the TPS philosophy in production.
TMM identified problems and tagged them in
storage for network
TMM did not provide real-time solution rather
increased work load for rework
GROUP #5 SECTION - F
PROPOSED SOLUTIONS
TMM needs to participate in the KFS's QC department
by :
1) Placing own personnel
2) Providing production guideline
Defective items need to be resolved in real-time in
the assembly line.
Review the seat designs for the newer & upcoming
models.
GROUP #5 SECTION - F
ALTERNATE RECOMMENDATIONS
Close relations should be maintained between
KFS, TMM & TMC.
TMM should be inspected all seats properly in
KSP before they are shipped.
TMM by doing this would be encouraged to :
1) To improve quality
2) To remove problematic seats even before they are shipped
GROUP #5 SECTION - F
ALTERNATE RECOMMENDATIONS
TMM should share the quality review report with
KSF
1) It will make the firm able to analyse areas with fundamental defect problems
TPS integration will benefit the Toyota supplier
network.
TMM should recommend a reduction in the
variety of seats with TMC.
GROUP #5 SECTION - F
CASE
QUESTIONS
GROUP #5 SECTION - F
AS DOUG FRIESEN, WHAT WOULD
YOU DO TO ADDRESS THE SEAT
PROBLEM? WHERE WOULD YOU
FOCUS YOUR ATTENTION AND
SOLUTION EFFORTS?
GROUP #5 SECTION - F
The deteriorating quality of seats continued to be the issue at Toyota Motor
Manufacturing, U.S.A., Inc. (T.M.M.) owing to the Just-In-Time policy followed
at their end.
The problems were ranging from the delivery of defective seats to failure in
seat replacement for the defective ones.
The introduction of numerous variants led to issues in seat quality
management as the operations at the end of KFS were initially streamlined
and in line with T.M.M.’s goals.
Postponement of customization of colors can lead to a reduction in the
variants during the production stage and can be customized after the seats
pass the quality check.
Quality Control needs to be performed either at the outbound stage of KFS (as
per T.M.M. standards) or at the inbound stage of Toyota Motor
Manufacturing, U.S.A.
GROUP #5 SECTION - F
Instead of keeping the faulty seats on the assembly line, it is better to move to the Code 1
Clinic Area immediately so that the problems in the seat can be identified and rectified.
It also helps in the company’s adherence to the Jidoka concept. Adoption of Just-In-Time in the
Code 1 Clinic Area for seat reworks as well to reduce the delay in the rework process.
Proper seat assembly needs to be cross-checked at the Inbound stage itself by T.M.M. for
special deliveries.
GROUP #5 SECTION - F
WHAT OPTIONS EXIST? WHAT
WOULD YOU RECOMMEND? WHY?
GROUP #5 SECTION - F
WHERE, IF AT ALL, DOES THE
CURRENT ROUTINE FOR HANDLING
DEFECTIVE SEATS DEVIATE FROM
THE PRINCIPLES OF THE TOYOTA
PRODUCTION SYSTEM?
GROUP #5 SECTION - F
WHAT IS THE REAL PROBLEM
FACING DOUG FRIESEN?
GROUP #5 SECTION - F
