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Toyota Global Vision President’s Message Launching a New Structure Special Feature Review of Operations
Consolidated Performance
Highlights
Management and
Corporate Information Investor InformationFinancial Section
Page 23
NextPrev
ContentsSearchPrint
ANNUAL REPORT 2013
Toyota has grown from a single core concept that is still
shared by the entire Group: contributing to society by
making ever-better cars.
Some of the values and ideas that have defi ned
Toyota over its 75-year history are listed below.
The Toyota Production System (TPS)
TPS encourages the complete elimination of waste,
overburdening, and irregularities from the production
process. The system, originally employed in the textile
industry, is based on two fundamental concepts: jidoka,
which can be loosely translated as “automation with
a human touch,” and the Just-in-Time (JIT) principle.
Under these concepts, if a problem occurs, the equip-
ment immediately stops running, preventing the manu-
facture of defective products, and at each stage
production is limited to only what is needed, when it is
needed, and in the amount needed.
> Establish the facts through genchi genbutsu
(on-site, hands-on experience)
> Stop production lines when a problem occurs and
implement corrective and improvement measures
Kaizen (Continuous Improvement)
Representing a never-ending cycle of progress, the word
kaizen encapsulates a spirit of striving for continuous
improvement and a refusal to accept the idea that some-
thing cannot be made better. Toyota believes that acknowl-
edging the possibility of continuous improvement can make
tasks easier and more enjoyable. From an organizational
standpoint, kaizen involves the entire workforce while relying
on the extensive knowledge, skills, and experience of the
people working directly on the process. The concept is
based on individuals taking ownership of their work and
focusing on what should be done rather than on what can
be done. At the same time, the kaizen process is under-
pinned by thoroughgoing and direct communication. It is
essential to follow through once a decision has been
made upon thorough deliberation with the participation
of all. We consider this a valuable part of our corporate
culture. Taiichi Ono (1912-1990), a former Toyota executive
vice president and founder of the Toyota Production
System, once commented that while the wisdom of
humankind was infi nite, that wisdom tended to emerge only
during periods of adversity. When things are not going well
and a better method is discovered, it is critical that
> The improvement process is infi nite, and after-the-
fact improvements are in essence forward-looking
improvements
These directives, which form part of Toyota’s manage-
ment philosophy, are by no means limited to the
production front-line. They apply universally to all
endeavors. In effect, TPS represents the building blocks
of Toyota’s human resource development endeavors.
Genchi Genbutsu
(On-Site, Hands-On Experience)
The genchi genbutsu principle refers to much more than
merely visiting a site to examine something in situ. It entails
understanding and respectfully considering the opinions of
on-site individuals as well as of individuals who have exten-
sive relevant knowledge. Genchi genbustu is thus a key
concept in the improvement process. Furthermore, the
notion of “respect for people” is consistent with Toyota’s
founding philosophy, and is underpinned by the concept of
thoroughgoing and direct communication.
suggestions be made openly, discussed, and put into prac-
tice to ensure continuous improvement.
Building “true competitiveness”
To consistently deliver a higher level of quality and
competitive products to its customers, Toyota must
continue to nurture a corporate culture that places the
utmost value on quality, productivity, and cost effi ciency.
In addition to an unwavering commitment to JIT that
underscores our commitment to the development of a
short and effi cient supply chain, we realize that we must
also provide customers with a wide-ranging, compre-
hensive, and well-organized after-sales service network.
From a long-term perspective, we can only stay
competitive if we continue to focus on developing
human resources, fostering relationships of trust
between management and labor, and ensuring that
each employee remains committed to conscientious
manufacturing. For its part, Toyota will continue to hone
its true competitiveness, which provides the underlying
strength for its manufacturing platform over the medium
to long term. By doing so, we hope to ensure sustain-
able growth.
What Sets Toyota Apart
INSIGHT We want to build a sense of unity
INSIGHT We continue to improve the traditional process of sintering
INSIGHT We are striving to cut energy use in half
INSIGHT We aim to be valued for our trustworthiness
INSIGHT A smile from a customer is the sign of a job well done
The nature of the Toyota Production System
Making Ever-Better Cars Enriching Lives of Communities Stable Base of Business [4 of 4]