Toyota Way Fieldbook : A Practical Guide for Implementing Toyota's 4Ps

The Toyota Way seeks the same objective in terms of low cost; however, the
primary focus is on reducing the waste within the system (Figure 6-2). As such,
Toyota considers the development of standardization to be a baseline for contin-
uous improvement, meaning that future results are expected to improve from
the standard. The traditional method considers standards as the objective to
achieve, as if the standard were the ultimate level of performance, which pre-
cludes the possibility of improvement. This fundamental difference in thinking
is the basis for many of the paradoxical elements of a lean system. The objectives

Philosophy

Low Unit Cost

Performance

Measures

Unit Cost, Earned

Hours, Absorption

Principle

Improve Individual

Efficiencies

Strategy

Standard Costing and

Standard Hours

Reason

Verify Employee

Performance to

Standard and Cost

Estimating

Effect

Encourages behaviors

that increase Non-

Value-Added activities

Control Method

Management reviews

reports, adjusts

standards

Result

Waste is

increased and

Total System

Cost is higher

Method

Time Studies, Work

Standards

Tools

Computer Systems

(MRP), Time Clocks,

Reports

Figure 6-1. Traditional unit-cost-focused manufacturing

Chapter 6. Establish Standardized Processes and Procedures 115