Toyota has been enjoying much success in the automotive industry. In fact, they are already poised to take over General Motors' spot as the world's largest car manufacturer. They may even take the claim as the world's best corporation. This success being enjoyed by the Asian carmaker has recently been covered by the New York Times Magazine. The story focuses on the car manufacturer's lean business system which is the reason for the continuing success of Toyota. The business principle acts just like Volvo tune up parts that are used to increase the efficiency of the company as much as the parts increase the efficiency of a car when employed.
The production philosophy employed by Toyota focuses mainly on the elimination of wastes in the production process. The reduction or elimination of such wastes increases the efficiency of the production of Toyota products and at the same time, it is also capable of increasing the overall customer value. In this management philosophy, wastes in transportation, inventory, motion, waiting time, over-production, processing itself, and defective product are reduced to give the company better efficiency. If the aforementioned, wastes are reduced or eliminated so much so that the quality of the products is improved and the production time and cost will be significantly reduced too.
Toyota has implemented different tactics to deal with wastes in the production process. One of these tools used by the car manufacturer is constant process analysis. The Japanese call it "kaizen" or change for the better. The aim of this tactic is to eliminate wastes, in-time delivery of goods, production load leveling of amount and types, standardized work, paced moving lines, right-sized equipment, and other activities which reduce the waste of money, time and effort . The Japanese defines kaizen as the process "to take it apart and put back together in a better way". This means that the conventional process has been taken apart and rearranged to make it more efficient. If this practice is done perfectly, this will lead to humanizing of the workplace, and eliminates hard work, both mentally and physically for the workers.
Another tool being used by Toyota to reduce the wastes in the production process is the pull production process. This philosophy is centered on the production based on the current demand of the market. This reduces over production which can seriously hurt a manufacturing company. While Toyota does not employ demand forecast in their production process, these works to their advantage. Since demand is hard to forecast, Toyota created a system that can easily and quickly produce products when there is a need for it. This means that they only produce cars according to the current demand, and if their supply runs out, they have the ability to quickly refurbish their stocks.
The third tool used by Toyota in reducing or eliminating wastes in the production process is mistake-proofing. This means that before they go into production, designs are studied carefully to assure perfect first-time quality. This zero-defect strategy aims to discover faults in the design before they are put into production. This way, costs, time, and effort executed in the production is not wasted. Toyota also eliminates activities which do not add to the value of their products. Streamlining the production process gives the Asian car manufacturer the advantage of focusing their efforts on those activities which directly improves the efficiency of their process.
The lean business philosophy being used by Toyota has been so successful that they have already overtaken Ford Motor Company as the second largest car manufacturer in the US and is poised to take over GM's post. The further implementation of the said strategy will no doubt increase the popularity of Toyota among car buyers.