Many people know about the two pillars of the Toyota Production System (TPS): just-in-time and jidoka, and they probably know the two principles of TPS – continuous improvement and respect for people.
Less well-known, but just as important, are the Six Ideals of TPS: safe, on-demand, defect-free, one-by-one, immediate response, and lowest cost.
In this blog, I’ll explain why they are so important, how to implement them, and how they can help you unlock deep thinking about process improvement.
The six ideals of the Toyota Production System
First, let’s define each ideal of TPS. Understanding these ideals properly is critical to being able to apply them effectively.
Safe means that no process is ready until it’s been proven to be safe for those who work there. Sadly, workplace accidents happen every day leading to about 13 fatalities and 8,847 injuries on average daily in the United States, according to BLS data. But safety also applies to what’s been called “psychological safety,” which is when people feel they can bring up problems or disagreements without fear.
On-demand means that we produce something as a result of actual demand, rather than as a result of a forecast. This, of course, requires that our lead times are sufficiently low that the customer doesn’t have to wait long to get what they want from us.
Defect-free means exactly that: we produce perfect quality. Note the difference between “produce” and “deliver.” Producing perfect quality is within the scope of the six ideals, whereas delivery is outside the scope.
Defect free is different from six sigma. There is a difference between a zero-defect mentality and a 3.4ppm or "acceptable quality level" mentality. It's not at all the same to say "we're going to eliminate this defect” as it is to say "we're going to keep this defect below a certain level.” The only acceptable solution should be defect-free.
One-by-one means that we don’t process work in batches: as soon as one unit of work has been processed, it should go to get processed at the next process step. Batch production just adds to inventory and lead time, negating the on-demand principle.
Immediate response means that when abnormalities occur (as they will), we react immediately to understand the root cause of the problem. It is only by understanding and acting on the root cause that one can achieve defect-free production.
Lowest cost is something that stands apart in this list. All of the other principles are drivers of improvement. Having the lowest cost is more of a result than a driver, but it’s in this list because along with defect-free and on-demand, it forms part of the “magic triangle.” These are the three things that you must do better than your competitors if you want to dominate your market.
Being cost-conscious is a mindset. You could be practicing all the previous principles but be wasteful in other ways that would cause you to lose your competitive advantage.
Why the six ideals of TPS matter
So, what good are these six ideals? I see them as particularly useful for aligning your Lean, continuous improvement, and operational excellence efforts.
First, it’s not too difficult to remember the six ideals, which makes them a great communication tool within your organization, focusing minds at all levels.
Second, it’s easy to determine if you’re close or far from alignment with the six ideals.
Third, they’re a great way to question the status quo. Whenever you feel your team (or leadership) is a bit too satisfied with the current state, or is having difficulties identifying where to improve, use the six ideals as you would audit questions.
Any excessive satisfaction will disappear when people see how far they are from these “north stars.” The questioning that results should help the team align on what priorities to focus on as they seek to improve the process.
Example: How Veryable applies the six ideals
Here at Veryable, we encourage innovation with on-demand labor to spur the revitalization of American industry by enabling operational flexibility and agility.
That’s why we have a Lean Center of Excellence with the mission of applying innovative lean thinking and technology to accelerate and enhance the lean transformation for businesses of all sizes while providing operators the freedom to pursue their own path. These six principles relate to what we do and guide our work.
It’s not by accident that every operator gets rated on safety, along with quality, proficiency, attitude, and timeliness. Nor is it by accident that we provide rapid background checks before an operator can bid on ops. Operators are also asked to rate the businesses they worked at, and of course this includes a rating for “safe environment.”
In the sense that safe means free from fear, we help to create that sense of safety by removing fear so that businesses and Operators can take hold of opportunities. We do this by providing operators with the ability to “find work today and get paid tomorrow” and by giving businesses the means to grab opportunities they would have otherwise lost for lack of people.
This is the core of what we do: we are defined by our on-demand labor solution. We cannot emphasize this enough: it’s through flexibility that industry will win, and Veryable is part of the solution!
For us, complying with requirements is the test we use to continuously improve.
Whether it is working one op at a time and getting paid the very next day, or posting ops at whatever scale exactly meets the needs of a business, we are relentlessly pushing towards thinking in terms of “batch size one”.
Agility is the ability to react instantaneously and appropriately to the unexpected. This is a capability we prioritize, measure, and continuously improve.
Flexibility is the ability to change rapidly and extensively. Both are necessary, and immediate response to deviations is key to hone these capabilities.
Veryable focuses on enabling immediate response to demand by matching labor capacity to demand in real time.
On-demand labor enables businesses to decrease their cost per unit and keep it constant by matching labor capacity to demand precisely in real time. This decreases costs by eliminating overtime and avoiding paying for time spent not working.
Technology is key to achieving lower costs, not just in our core products, but more generally for manufacturing and distribution businesses. We believe we are at an inflection point where the integration of sensors, IoT, SaaS, and other new technologies will bring about greater flexibility and agility. Combined with on-demand labor, these signals will enable real-time response to decrease costs dramatically.
How to get started today
If you’re ready to apply the six ideals of TPS now, reach out to our Lean Center of Excellence. We will advise you on the implementation of these six ideals as they apply specifically to your organization. Email us at firstname.lastname@example.org today to get started.