UNIT IV Quality Management at Toyota Motor Corporation

At the core of the company's success was the Toyota Production System (TPS), which made use of concepts like genchi genbutsu, Just-in-Time (JIT), Kaizen, Kanban, and Jidoka to reach a high level of efficiency in production. Toyota recognized quality as one of the most important factors affecting customer satisfaction and strove to achieve excellence in manufacturing quality products. To ensure zero defects in the finished product, Toyota set up quality assurance systems across various divisions, including development, purchasing, and production. To overcome quality assurance problems caused due to rapid globalization, Toyota adopted the "Toyota Way" - a set of management principles and communicated them to all its overseas manufacturing plants. Due to its efficiency in manufacturing, Toyota became one of the most trusted brands in the global automobile industry. But some analysts felt that Toyota had become a victim of its own success. In the mid-2000s Toyota expanded its production facilities rapidly in a bid to grow globally and to achieve its goal of becoming the number one auto maker in the world. Toyota's rapid growth affected its product quality with the company reportedly compromising on its manufacturing techniques. Customers began to face safety related problems in Toyota vehicles. Later a series of recalls followed which put the company's hard-earned reputation for quality at risk. Analysts opined that constant recalls had damaged the reputation and brand image of Toyota and hindered its return to profitability. In a quest for market share, Toyota had sacrificed its legendary quality and ignored its own management principles and customers, they said. To verify the cause of recalls and improve quality, Toyota set up a committee headed by its president Akio Toyoda in early 2010. The committee was to inspect every process in the Toyota Production System to ensure delivery of quality products to customers.

Questions for Discussion

1. Study quality management practices at Toyota that helped it earn a reputation for quality. 2. Analyze the importance of quality in the Toyota Production System. 3. Understand the manufacturing principles adopted by the Toyota Production System. 4. Examine the reasons for the quality-related problems faced by Toyota. 5. Discuss and debate whether Toyota was losing its quality edge. 6. Explore strategies that Toyota could adopt in the future to regain its quality edge

UNIT III
Inventory problems at Nike
In February 2001, Phil Knight (Knight), the co-founder and CEO of Nike Inc (Nike), announced that the company's profits for the third quarter of the fiscal year ending May 2001 would fall short of expectations by almost 24 percent. The reason for the shortfall was a failure in the supply chain software that Nike had implemented in June 2000. The supply chain software, implemented by i2 Technologies Inc (i2) had fallen prey to technical glitches that affected the company's inventory systems adversely, leading to a supply chain failure. Resultantly, Nike's production facilities around the world ended up manufacturing a far greater number of a less popular shoe model and not enough of those models that were in high demand. In the finger pointing that followed, Nike's management laid the blame for the problem squarely at the door of i2. During a press meet, Knight complained, "This is what we get for our $400 million huh?" On the other hand, i2 claimed that the mismatch was a result of Nike's haste in using the incomplete system and its unwillingness to use i2's standard systems and procedures. Regardless of who was to blame, Nike's reputation in the market took a beating. The company also lost considerable market share to rivals like New Balance and Reebok.

Questions for Discussion

1. As a manager how will u tackle the problem from Nike side if you are

a Phil Knight? 2. If you are in the place of i2 technology how will you defend yourself 3. What is your suggestion to increase the profit in the next quarter

UNIT I

Integrating RoMan Manufacturing by replacing Lean QMS

RoMan Manufacturing is a leading manufacturer of transformers, power supplies, switches, and inverters. Their multiple departments occupy 3 buildings in Southwest Grand Rapids, Michigan. RoMan began to explore making a commitment to a formal quality management program when one of their automotive customers put a group of its suppliers on a timeline for QS 9000 T&E. After discovering that the customers QS 9000 T&E requirement didnt apply to their operation, RoMan began to pursue ISO 9001 certification and contacted outside consulting firms to assist them. Early in the process they reviewed the Pinnacle Lean QMS and agreed that there were aspects of the Lean QMS that would simplify their certification and possibly be more appealing to present to the employees. However, they began normal preparation for their registration audit and development of a text based system. As the process continued and the quality manual grew in content, the certification activity began to feel like a management-only team exercise. There was no lack of process material available but according to Kendall Ymker, Management Representative, it seemed like just thatmaterial, that didnt have a feel linking it to the business. It wasnt that there was negative feedback regarding the ISO 9001 certification process, the personnel just werent in tune with what was taking place in the ISO 9001 implementation process. About 5 months into the process after a successful registration audit, RoMan decided to convert to Pinnacle Enterprise Groups visual Lean QMS. The conversion took about 5 more months, but the results were more than worth the effort, according to Operations Manager Greg Garthe. The text-based books and manuals were good, but no one really took the time to use them. It was difficult to look things up on the computer. The visual based system was much easier to follow. People can actually see whats happening. With the conversion to Pinnacle Lean QMS, the RoMan quality manual went from 100 pages of single spaced text, to a three page graphical overview, called the Lean QMS Map. The Lean QMS Map is then linked to 20 pages of process maps that describe every core and support process. It was like going from the dark ages to the enlightenment, stated Greg Garthe. The visual system is very powerful. With the visual system created by the Lean QMS, the ISO 9001 certification initiative was no longer a management team only exercise. The team began to receive input from a wide variety of personnel. People actually stopped just sitting around the table and became involved, said Kendall Ymker.

Not only did everyone begin sharing ideas for the certification process, but the system became an important tool for running the business. Even though there was no longer a customer requirement driving the need for certification, the leadership team and personnel alike felt the Lean QMS truly represented the operation, and at the same time became the operation. RoMan uses it to run the business because its both the easiest way and the best way. We live it, its what we do, states Garthe. For RoMan, beginning with the Lean QMS also provided an important economy of scale for their Environmental Management System. They were able to pick any core process and develop its environmental aspects easily and visually. Using Pinnacle Enterprise Groups Lean EMS, RoMan was able to complete their ISO 14001 certification in less than 4 months, thanks to the system and culture which evolved during the ISO 9001 implementation process. When asked whether using the Pinnacle system is cost effective, Ymker says, Its not even a question mark.just get it done! Both the company leadership and personnel agree that it is easy to see the value.

Questions for Discussion 1. Whether ISO 9001 is a value added for the company or not? 2. What is your opinion about the decision taken by RoMan? 3. What do you understand by ISO 14001 and which way it is useful for the company?

UNIT II Working conditions in Deere and company

Deere and Company manufactures farm equipment. Workers in their construction department perform a number of manual jobs that involve heavy objects. Workers needed to work while being on their knees and bent over assembling machinery parts. Using hand tools like a wrench was also being used repetitively and with difficult postures for their wrists. At one workstation, employees had to lift a heavy lawn mower deck to attach it to the tractor. They had to kneel while fastening the deck with one hand and also holding it with their other hand. These tasks were verified as hazardous by OSHA first-aid logs and forms. They revealed a huge amount of lost time and money due to the work environment not being ergonomic. It was verified by an increasing loss of productive work time due to back injury of workers which increased up to 31% in 1979. It also escalated workers medical compensation costs by 15% per year. There were 12 cases of first-aid during one year. Four of the cases were due to sprains, back injury and strained muscles. A worker assembling parts had to suffer back problems because of working in awkward position for long hours. The company also lost 28% more time due to workers' over-exertion and back strains in 1984. For the same reason, the company had to pay a 70% more medical compensation to workers in 1978. The reasons and risk factors for these workers health issues were lifting and carrying heavy objects weighing around 75 pounds, bending and kneeling of workers for prolonged times, workers with hand tools like wrenches with awkward wrist positions. The hand job was also highly repetitive further risking the workers' wrists. As a solution to these problems, the company initiated some ergonomics programs using the NIOSH education for lifting. They started an 8-hour ergonomics training program. The production design department was assigned a full time ergonomist. They carried out a review of the office furniture and laid down guidelines for new purchases. The company also trained their employees on the use of video displays. As part of the engineering controls, the company put restrictions on lifting objects manually which were heavier than 40 pounds. They redesigned the workstations at assembling plants to workers did not have to bend or kneel. They changed the hand tools to save the workers from wrist strains and installed a hoist at the assembly line for lifting of the lawn mower decks. Benefits of these ergonomics initiatives showed as a reduced exposure of the workers to back injury risks. It also increased their workers productivity substantially

along with their efficiency. Workers compensation cost was also decreased due to fewer cases of injury. Effectiveness of these ergonomic initiatives resulted in 83% reduction in cases of back injury which saved them considerable lost time. It also showed a 32% reduction in workers' healthcare compensation during the last 10 years. Workers participation and contribution in these initiatives helped the company achieve these benefits.

Questions for Discussion

1. What do you understand by the term ergonomics and what is

your opinion about this case? 2. Is the training offered by NIOSH on Saturday alone is enough for the employees?

UNIT V
UMT plus software used to increase productivity at Avon
For nearly 70 years, Kurt Salmon Associates (KSA) has been implementing payfor- performance programs in manufacturing and distribution facilities throughout the world. Currently, Avon Products is implementing KSA's Base Plus, incentive program throughout its North American network in addition to using Laubrass' UMT Plus software. Avon's goal is to combine pay-for-performance programs with KSA's coaching of Avon's management and engineering teams. This goal will offer the company tremendous labor savings in five years. Additionally, the programs will enhance the culture within the facilities by creating fair, performance-based environments. KSA recognized the need for new technology that would provide better study capabilities and streamline data collection to allow engineers to spend time on other tasks. Realizing this, they chose to implement UMT Plus work measurement software on PDAs. UMT Plus allows KSA consultants and Avon Engineers to watch each task more carefully, capture more discrete elements, study several subjects at once and upload their

studies quickly by syncing PDAs with computers at the end of the day. KSA consultants use the random study and multi-study features of UMT Plus to create performance standards for traditional time-work positions. The software is easy to use and training is minimal, allowing quick ramp-up for everyone on the project team. The Base Plus programs with the UMT Plus software at Avon have earned the project teams the President's Award, which recognizes contributions for dramatic improvements in the supply chain. Avon is realizing productivity improvements of 25% to 70% in some areas. At the same time the associates are enjoying incentive payments of 10% or more in their paychecks. KSA and Laubrass Inc. will continue to work together to find new ways to make technology support important to corporate engineering efforts.

Questions for discussions 1. What is your observation from the summary and your suggestion regarding the existing method? 2. If the KSA and Laubrass Inc. will continue to work together to find new technologies who is getting benefited more