The Toyota Production System – Not Just for Manufacturing

The Toyota Production System is Not Just for ManufacturingMany of us are familiar with the Toyota Production System and how it has helped build the foundation for what we call “Lean Manufacturing.” Did you know that the principles of this system also apply to organizations outside of manufacturing?

Two main principles of the Toyota Production System (TPS):

  1. Jidoka: This is a Japanese term that translates to “automation with a human touch.” By separating out processes that can be automated through software or Robotic Process Automation (RPA) and those that require more intensive human work we can maintain quality and high productivity.
  2. Just-in-Time (JIT): This means ordering only what is needed, when it is needed, and only in the amount it is needed. A crucial procurement tool for just-in-time is Kanban, which helps create a system that is highly responsive to the customer’s needs while also maximizing the company’s time and resources.

Additional TPS Principles:

  • Continuous improvement
  • Respect for people
  • Long-term philosophy
  • Root cause problem solving

A key tool that Procurement organizations can utilize from TPS is Standardized Work. In Standardized Work the best practice for a process is documented to form the baseline for how a process is completed. This allows us to reduce waste, ensure we are running efficiently, and understand variance in our process. By having Standardized Work in place, onboarding new employees or training those new to a process becomes a much simpler task with consistent results.

Additional TPS Tools:

  • 5S
  • 5 Why’s (Root Cause Analysis)
  • 7 Wastes
  • Kaizen
  • Kanban
  • Poka-yoke

Incorporating key elements of the TPS into your procurement organization, will allow you to reduce waste and help your team work smarter/ more effectively. In addition to improved efficiency, you can empower your team to improve their internal processes and drive down to the root cause of problems.

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