1. The Toyota Way
by Jeffery Liker
Book Review Competition
Harish Verma
IIM Raipur
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2. The Toyota Way
In 2004, Dr. Jeffrey Liker, published "The Toyota
Way."
In his book Liker calls the Toyota Way, "a system
designed to provide the tools for people to
continually improve their work.”
It consists of principles in two key areas:
1. continuous improvement
2. respect for people
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3. The 14 principles of The Toyota Way are organized in four
sections:
 Continual organizational learning through Kaizen
 Go see for yourself to thoroughly understand the
situation. (Genchi Genbutsu)
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 Make decisions slowly by consensus, thoroughly
considering all options; implement rapidly
(Nemawashi)
Problem
Solving P’s
(Continuous
Improvement and Learning)
 Grow leaders who live the
philosophy
People and Partners  Respect, develop and challenge
(Respect, Challenge and Grow Them) your people and teams
 Create process “flow” to surface  Respect, challenge, and help
problems
your suppliers
 Level out the workload (Heijunka)
 Stop when there is a quality problem
(Jidoka) Process
 Use pull systems to avoid (Eliminate Waste)
overproduction
 Standardize tasks for continuous
improvement  Base management
 Use visual control so no problems are decisions on a long-term
hidden Philosophy philosophy, even at the
 Use only reliable, thoroughly tested (Long-term Thinking) expense of short-term
technology financial goals
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4. Philosophy - Principle 1
Base management decisions on a long-term
philosophy, even at the expense of short-term
financial goals.
The Right Process Will Produce the Right Results
1. Generate value for the customer, society and the
economy.
2. Align the organization toward a purpose greater than
“making money.”
3. Be responsible. Accept responsibility for your
conduct and maintain and improve the skills that
enable you to produce added value.
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5. Process - Principle 2
 Create continuous process flow to bring
problems to the surface.
1. Redesign processes to achieve continuous flow.
2. Create flow to move material and information fast.
2. Link processes and people so that problems surface right
away.
3. Make flow obvious throughout your organizational culture.
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6. Lean manufacturing
is a manufacturing philosophy which shortens the time between the
customer order and the product build / shipment by eliminating
sources of waste.
Business as Usual
CUSTOMER Waste PRODUCT
ORDER BUILT & SHIPPED
Time
Lean Manufacturing
CUSTOMER PRODUCT
ORDER BUILT & SHIPPED
Waste
Time (Shorter)
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7. Product Lead Time
Casting
W aiting Machining Assembly
Transportation Staging Inventory
Staging
Time
Raw Finished
Material Parts
= Value Value Added Time is only a very small
Added Time percentage of the Lead time.
Traditional Cost Savings focused on only
= Non-Value
Value Added Items.
Added Time
(WASTE)  LEAN FOCUSES ON NON-VALUE
ADDING ITEMS.
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8. Before Lean: Organization By Machine
Type With Convoluted Flow
No Organization and No Control
LATHE LATHE LATHE
LATHE
PART FLOW
500pcs.
MILL MILL MILL
MILL MILL
750pcs.
GRINDER GRINDER
GRINDER
250pcs.
DRILL
DRILL DRILL
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9. After Lean: U-Shaped One-
Piece Flow Cell
Organization and Control
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10. Process - Principle 3
Use “pull” systems to avoid
overproduction.
1. Provide downstream customers in the
process with what they want, when they
want it, and in the amount that they want.
2. Pull vs Push
Material replenishment initiated by
consumption is the basis for just-in-time.
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Just-in Time - an organized system of inventory
buffers

11. Process - Principle 4
 Level out the workload (heijunka)—work
like the tortoise, not the hare.
 Meeting the demand without
overproducing.
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12. Process - Principle 5
 Build a culture of stopping to fix
problems, to get quality right the first
time.
 This will ensure that the same problem
doesn’t arises again i.e. problem is fixed
on permanent basis.
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13. Process - Principle 6
 Standardized tasks are the foundation
for continuous improvement and
employee empowerment.
 Standardized task is the prescribed,
proper and exact way of doing any
particular task.
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14. Process - Principle 7
 Use visual control so no problems are hidden.
5 S for elimination of
waste
Sort
What to
keep and
dispose
Sustain Straighten
 Simple visuals to support maintain (orderliness)
stabilized place for
 work flow workplace everything
 Determine deviation
 from standard
 Reduce report size
Standardize
Shine
procedure
maintain 1st inspection
3 affect quality
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15. People & Partners - Principle 8
 Use only reliable, thoroughly tested technology
that serves your people and processes.
Add Value to the Organization by Developing
Your People and Partners
 Support people not replace them
 Analyze impact of new technologies on existing
processes
 Encourage to consider new technologies while
seeking for new
approach
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16. People & Partners - Principle 9
 Grow leaders who thoroughly understand the
work, live the philosophy, and teach it to others.
 Don’t buy leaders from outside
 Leaders job: not only
• Accomplishing task
• Having good people skills
 Role models of company’s philosophy
 Must understand daily work in great details
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17. People & Partners - Principle 10
 Develop exceptional people and teams who
follow the company’s philosophy.
• Create Strong stable culture.
• Train Exceptional Individual & Teams to work with corporate
philosophy.
• Use Cross Functional Team
• Make a Continuous effort towards Teamwork.
• Understand & Use OB theories.
• Maslow’s Need Hierarchy theory
• Herzberg’s Job Enrichment theory
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18. People & Partners - Principle 11
 Respect your extended network of partners and
suppliers by challenging them and helping them
improve.
 Continuously Solving Root Problems Drives
Organizational Learning
• Maintain Principle of partnership
• Acquire new suppliers.
• Enhance relations with existing suppliers.
• Teach “ The Toyota Way”
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19. Problem Solving - Principle 12
 Go and see for yourself to thoroughly understand
the situation (genchi genbutsu).
• Genchi (actual location) genbutsu (actual material or
product)…also known as going to the gemba.
• Confirm the fact yourself.
• Solve problem by going to root causes.
• Think & speak based on personally verified data.
“Common sense will tell you the answer, but collecting
data and then understanding the facts will tell you
whether your common sense was correct.”
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20. Problem Solving - Principle 13
 Make decisions slowly by consensus,
thoroughly considering all options: implement
decisions rapidly.
Group
Consensus,
With Full
Group Authority
Consensus,
Seek Group Management
Input, then Approval
Level of Involvement
Decide and
Seek Individual Announce
Input, then
Decide and
Announce
Decide and
Announce
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21. Problem Solving - Principle 14
 Become a learning organization through
relentless reflection (hansei) and
continuous improvement (kaizen).
 All these principles should be inculcated
strongly into the organization.
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22. Best Quality – Lowest Cost – Shortest Lead Time –
Best Safety – High Morale
Through shortening the production flow by eliminating waste
Just-in-Time People & Teamwork
Right Part, Right • Selection Jidoka
Amount, Right Time • Common Goals (In-station Quality)
Make Problems
• Take Time Planning Visible
• Continuous Flow
• Pull System Continuous Improvement (kaizen) • Automatic Stops
• Error Proofing
• In-station Quality
Waste Reduction Control
• Genchi Genbutsu • Solve Root Cause of
• 5 Why’s Problems (5 Why’s)
• Eyes for Waste
• Problem Solving
Leveled Production (Heijunka)
Stable and Standardized Processes
Visual Management
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23. My Learning:
 To achieve proper results from applying Toyota’s
approach we need more than tools and that lean
needs to ‘permeate an organisation’s culture’.
 The concept of learning by doing.
 I liked the idea of poka yoke – devices used to
make it impossible for an operator to make a
mistake. The emphasis is on fixing the process
rather than blaming the person.
 Focus on customers and its requirements.
 The idea of continuous improvement.
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24. Thank you !
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