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Spear, S. and H. K. Bowen. 1999. Decoding the DNA of the Toyota production system. Harvard Business Review (September-October): 97-106.

Summary by Jason Burkett
Master of Accountancy Program
University of South Florida, Summer 2003

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Many companies have tried, but few, if any, have been able to duplicate the success of Toyota's Production System. This may be mostly attributed to the confusion that the tools Toyota uses in its system are the system itself. Adding to the frustration of these other companies is the paradox that Toyota's operations are both flexible and rigid. However, it is the principles that govern Toyota's operations - three rules of design and one rule of improvement - that allow for and encourage dynamic growth and improvement. Toyota has created a workplace of scientists, each employing the scientific method to evaluate processes and create plans for improvement. The rules guide the experimentation that is performed to improve processes that are not meeting expectations.

Rule One: All work is highly specific in content, sequence, timing, and outcome.

All processes are done in the same order, with the same tools, according to the same specifications. This exactness is the capstone of how Toyota evaluates quality. At a Toyota plant, a task has a specific time in which it should be completed, section by section. Even the floor of each work area is marked in tenths, so if a worker has not completed a section of a task before crossing the next point on the floor, a manager can tell exactly where a problem has arisen. Because each task has a prescribed measurement for success, it can be tested like a hypothesis, giving rise to the use of the scientific method. If a criterion is not met, either the person performing the task is not capable, or the performance of the activity does not actually create the expected outcome. Since the hypothesis being tested has been shown to be false, either the worker needs more training or the activity needs to be redesigned.

Rule Two: Every connection between employees must be standardized, direct, and unambiguous.

When a Toyota employee makes a request, there is a specific way to state the need, and there is a specific person who will meet the need. Toyota uses the kanban system, in which a card tells the part number, the quantity needed, and the worker who will use it. In other companies, there is often no one who is specifically assigned to meeting needs and answering requests. Rather, the first available person will do what is needed. But often in these companies, no one takes responsibility and the need is left unmet.

Toyota also recognizes that employees will need help from each other. Other companies often have an unwritten policy that employees should try to resolve problems on their own before seeking help. Toyota, however, expects workers to ask for assistance immediately. A designated assistant then must respond immediately because response within a specific amount of time also reduces variability. If help cannot be delivered within the given time, then the time specification hypothesis is false and the system needs to be improved.

Rule Three: Every product and service flows along a specified, direct path.

There are no twists in the assembly line to disorder Toyota's operations. If a request is made for more supply, this request is not made to the next available person, but to a pre-specified person. Because of this method, each time a request is made for help or supplies or otherwise, the hypothesis that the receiver of the request will be available is tested. If the receiver is unavailable for any reason, then the system needs to be evaluated and improved.

Rule Four: All improvements will be made according to the scientific method.

Toyota employees are not taught the above rules when they begin work with the company. Rather, they discover the rules through problem solving, led by their supervisor. Supervisors ask questions that make the employee critically evaluate the work being done. Examples of these questions are, "How do you know you are doing this work correctly?" and, "What do you do if you have a problem?" Because workers are taught from the very beginning how to evaluate their work and the processes that are used, Toyota encourages and expects that ideas for improvement are stimulated by line workers, with the assistance and coaching of managers. Even changes at higher levels are made in this way, by including on improvement teams people who are directly involved with the pathways and procedures that are being changed.

Toyota's Big Picture

When changes are made in Toyota's operations, or in any company seeking to implement Toyota's system, new standards must be created to test the new procedures. If the procedure later fails to meet these standards, it is reworked and improved on, until at some point Toyota reaches its ideal state. This perception of the "ideal" is critical to understanding why Toyota has been so successful. Toyota's ideal output should be free from defect, created to meet specific criteria, supplied immediately on demand, without wasting resources, and created in a safe environment. "Toyota's ideal plant would indeed be one where a Toyota customer could drive up to a shipping dock, ask for a customized product or service, and get it at once at the lowest possible price and with no defects." Anything short of this goal leaves room for improvement in Toyota's operation system.

The rules of its operations are what allows Toyota to make improvements while still continuing to run production lines. The responsibility for changes and improvements are pushed to the lowest level possible. Toyota, in its aggregate form, never has to stop its assembly lines to make changes, because small, specific improvements are being made at the most basic levels constantly. This "nested, modular structure" allows changes in one part to not affect other parts of the system.

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