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Japanese production systems have been regarded as one of the most successful systems in the global management aspect. To this, I could very well observe from the lectures consisting of different efficient production systems from various big Japanese companies. Due to the fact that Japan is well known for its technology advancement especially in terms of automobile industry, I, therefore, have chosen the aim to discuss this major topic. However, I believe it is interesting to provide the comparisons between one Japanese system and one Western style system. Hence, I would like to discuss about Toyota and Daimler.
As these companies are the world’s successful automobile producers, I would like to pay attention to this specific field of automotive industry. As we have stepped into globalization era, the economic growth has led mobility and motorization forward. In other words, I see that this is a growing industry with technology and inventions, which will be able to enhance our livings in further.
Toyota Way has been the most well-known and successful production system known in history among car producer companies. As such, I would like to discuss more in detail.
The 14 Principles of the Toyota Way is a management philosophy practiced by Toyota Corporation. This actually includes TPS or Toyota Production System, which will be discussed later on in this sector. The Toyota Way inspires and supports all the activities and regulations of the firm as a whole. This leads to building the foundation of Toyota’s culture that help TPS to function properly. Since this is the base for all values, beliefs, and business methods, it can bring competitive advantage to them with the following tools. The tools mentioned here are those four main sections divided from the whole 14 Principles, which are Long-Term Philosophy, The Right Process Will Produce the Right Results, Add Value to the Organization by Developing Your People, and Continuously Solving Root Problems Drives Organizational Learning.
Toyota Company has been in business successfully with their famous ‘Lean Production’, which is also known as ‘Toyota Production System’ (TPS). The meaning of Lean Production is just as simple as to do more but with less time, inventory, space, labor, and money. This process is to eliminate waste, simplify procedures and also to speed up production. However, not simple as it may seem, there are several activities and processes included to fulfill their management. This Lean Production is aimed to implement concepts of continuous flow and customer pull. The system shows benefits to organization
Kaizen is the essence idea of Lean Production. It enhances the ability of every member of Toyota in implement suggestions for improvement continuously. This covers from concerns for quality and safety to those related to productivity and environment. To improve productivity, Toyota believes that suggestions from their own members are the best source to execute and overcome challenges and be competitive among other opponents in the market.
For this famous Five Ss, it is inevitable to overlook the Toyota Way. Hence, in this part I would like to take Toyota case as an example of Five Ss. The Five Ss refer to 5 elements of workplace optimization, which are Seiri, Seiton, Seison, Seiketsu, and Shitsuke. This is a series of activities for eliminating wastes that can lead to errors, imperfection, and injuries. To this theory, the firm is required to make use all of the space provided efficiently and productively. It can help Toyota personnel to share workstations while able to deduct the time for searching tools, which results in improvement of work environment. The Toyota Way, we can also find good examples of the Five Ss as the following.
The first element is Seiri or sort. This is to sort out items not needed in workspace. To Toyota, they have organized to reduce report papers to one piece per one worker whenever possible to be more organized. This shows one way that they try to minimize as much as possible to enable convenience. Seiton or straighten for managing place for everything. They put components together orderly. In the workspace they tend to arrange stations in order while ensure that every necessary function can be provided and easy to access to. The third element is Seiso or shine. This aspect is as simple as to keep the area of workstation clean and nice of all time. This idea will basically enhance environment of workplace to be more suitable to come for work. Seiketsu or standardization helps create rules and standard operating procedures as Toyota Way creates paths for every firm member to follow effectively. The last objective is Shitsuke or sustain. This is the most important and the hardest feature to carry out. This effort keeps every other Ss go on by emphasizing on necessary education, training, and rewards to encourage workers to improve and maintain procedures and workplace environment continuously.
Daimler as one of the most successful automobile companies in the world, it has progressed more than a hundred years in cars and trucks production. The first thing that should represent the Daimler well must be a Mercedes Benz premium car. They do not focus only car production but also provide financial services for its customers for financing, leasing, insurance, and fleet management.
Daimler holds strong to their objective in inventing the automobile to passionately shape their future as a pioneer of automotive engineering. The principle of sustainable mobility to meet the demands of future mobility is the will to their achievements of leadership in automotive industry as they have quoted in their 2009 annual report for activities as ‘Pioneers of Sustainable Mobility’.
According to Mercedes-Benz production system, I would like to bring up one of the Mercedes-Benz successful production plants in the world, which is Mercedes-Benz U.S. International Inc. (MBUSI). MBUSI has gathered a number of automotive talents from almost every car manufacturer in the U.S. For example Toyota, Ford Motor, General Motors, and Nissan. This plant is situated in Vance, the United States of America. The management board holds the view of this plant as their innovation. They have come up with many new introductions to the Mercedes-Benz’s firm as a whole and not to be transplanted from the old plant in Germany or other ones.
They were grouped with personnel from various backgrounds and perspectives creating difficulties in work place and production system. However, they would not agree on following the same route as often to be that of Toyota standard production system. As a result, the process of unique small-scale production with a new approach to the problem occurs.
In respond to the will above, MBUSI has innovated a lean manufacturing aiming to their specific needs such as cleanliness and safety, visual management, pull system, standard methods and procedures, and continuous improvement. To this, I see that they are still developing techniques mainly based on Toyota production system. It is because they utilize the same ideas of pull system, and lean manufacturing.
For a low-inventory pull system, the great distance from the assembly plant and the suppliers creates difficulties. Therefore, they have shipments from multiple suppliers go on the same truck. This then enables MBUSI to gain efficiency in maximum inventory daily.
This is in the contribution of their key procedure, modular construction. One of their suppliers, ZF Industries will supply assemblies with many differentials of the car. While another supplier takes responsibility of vehicle’s cockpit. This, they will ship the modules to the assembly site. MBUSI’s modular construction leads them to achieve several goals. The first one is that the delegating responsibility. They can reduce the assembly complexity of the construction modules. The next benefit is fewer suppliers. Due to the fact that MBUSI cannot attract that many suppliers because of the low-scale concern, there are not many suppliers are willing to do business with. However, due to their larger amount of monetary concern, the suppliers somehow are willing to provide them car parts. This helps the firm to reduce their costs because of the reduction of suppliers.
In developing new production plant, the firm, especially the giant company worldwide like Mercedes-Benz, needs to consider several aspects as to maintain or even master their standards compared to the existing mother-plant. For that reason, I agreed upon this new plant of Mercedes-Benz in the United States of America.
New Plant Development Strategy includes considerations of Consumer Market, R&D Sites, Lower Labor Cost, Industrial Market, and Existing Plants. Take MBUSI for example, they have built the new plant in the U.S. in order to support Mercedes-Benz consumers in the U.S. To this, they meet the quality of consumer market strategy as they can lower logistic cost with faster product delivery. The next feature of the strategy is Research and Development Sites. They have collected many experienced personnel for building effective production development process as mentioned earlier about the managers from various firms in collaboration of Mercedes-Benz modular system.
Thirdly, the new plant needs to focus on lower labor cost and mechanic resources. MBUSI is successful in meeting this measure. They have several skilled workers to be responsible in mechanic tasks, which all the workers are required to accomplish Mercedes-Benz standard trainings before the actual work. This shows great source of mechanic personnel.
The next section is Industrial Market. MBUSI has their strategy of fewer numbers of suppliers and providing closer distance between suppliers’ places to its assembly site. This enables them to spend less on logistics expense with faster product delivery. This also has been cooperated through suppliers to be more convenient in quality and production controls.
The last aspect that the new plant has to consider is their existing plants. Though I have mentioned earlier about them innovating new production system regardless about their existing plant like the one in Germany. Nevertheless, they still dispatch their workers to be fully trained in many specializations over Germany for a period of time to fulfill and ensure the standard quality of firm as a whole.
According to the information I have gathered and researched about, I can comprehend facts of actual production systems of world’s leading firms. I consider Toyota Way to have been chosen as the world’s most orthodox practice since Toyota is a very successful company. Furthermore, even Daimler also adopted this idea to be their basis in principal making and pursuit construction. As I go through this information, I realized they are related to lessons in class, which are proved by examples along with existent cases. Hence, I found them to be useful and very practicable.
In my perspective, these two organizations have accumulated their growth in business in their own effective ways. However, still I see that Toyota as a very unique Japanese production system to be very effective and can be a good role model for other firms worldwide. To some extent, Daimler as a pioneer of automotive has even relied on the so-called lean production system, which is another initial proof of this successful method.
In conclusion, I believe that these two high-reputation organizations can perform professionally due to their effective methods and beliefs of the firms. In addition, I see that the Toyota Way has been accomplished successfully through the Toyota people themselves and other firms who adopted the same idea to be their basis in workplace regulations and procedures. However, the effort requires all combination of management, training, and a culture, which will make improvement and bring continuous prosperity to the organization productively.
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