Best Practices of Lean Enterpriseiieom.org/tangkas.pdf · 2014-01-14 · India 4. Brazil 5....

LEAN ENTERPRISE : A KEY STRATEGY TO BUSINESS AND

INDUSTRY COMPETITIVENESS

MADE DANA TANGKASDirector

TOYOTA MOTOR MANUFACTURING INDONESIA

IECOM 2014Bali, 8 th January 2014

Best Practices of Lean Enterprise

Chairman of Indonesia Industrial Engineering Associ ation

1. WORLD CLASS INDUSTRY AND BUSINESS CHALLENGES

2. LEAN ENTERPRISE :- VALUE, SYSTEM & LEADERSHIP (TOYOTA WAY, TPS, LEADERS)

3. IMPLEMENTATION AND BEST PRACTICES OF LEAN ENTERPRISE IN TOYOTA COMPANY

OVERVIEW

Indonesia

APEC

MERCUSOR

Asia

GCC

EEC

COMESAAFTA

AFTA+3

APECNAFTA

Australia

Africa

Europe

North America

South AmericaINDONESIA

From Indonesia for Global Market

1. WORLD CLASS INDUSTRY & BUSINESS CHALLENGES

Current Situation of Global Toyota

North

America

11

Central &

South

America

4

Asia

9

Oceania

1

Africa

2

Middle

East

5

China

13

Europe

6

< World Class Enterprise : No. of Manufacturing companies & Distributors >

51 manufacturing companies in 26 countries51 manufacturing companies in 26 countries

170 importers / distributors in 140 countries170 importers / distributors in 140 countries

Current Situation of Global Toyota.

Portland

Multi – Polarization of Multi – Sourcing Companies Complexity of Supply Route.

Expansion of Logistics, Enterprise, Industry and Business TransactionExpansion of Logistics, Enterprise, Industry and Business Transaction

Long Beach

Long Beach

Jacksonville

Bristol

Singaore

Hongkong

Melbourne

KuwaitJeddah

THE CHANGE IN THE BUSINESS PERFORMANCE ENVIRONMENT

3S factors :

� SCALE : From national to global� The forces of democracy, trade

deregulation or free trade area,and technology changed

- Increased competition

� SPEED : From steady to fast and flexibility� Responsiveness and agility

- Reduced timeline for allactivities

�STANDARD : From local to world class standard� Measurement is by globally and

be world ’’’’s best

- Everyone must have a world classvalue - preposition

2010

1. United States

2. China

3. Japan

4. Germany

5. France

2030 Forecast

1. China

2. United States

3. India

4. Brazil

5. Indonesia

Optimism that the world economic power will shift from

West to East increasingly widespread

Triggers: large increase of markets in developing

countries, rapid industrialization , the supply of cheap

labor , urbanization and rising middle-class society,

as well as high economic growth

Estimated by Standard Chartered, 2010

World Economic Power will change in 2030

COMPETITIVE

ADVANTAGEValue – Cost

v c

(v) (c)

- Product quality meet with

Customer Requirement

(need & wants)

- Competitive price/cost

- On Time Delivery

-After Sales Service,

-Safety,Prod ’’’’y,Env, HR, etc.

- Cost Reduction

- Cost Saving

- Tight Budget

- VA/VE, etc

=

COMPETITION ASPETCS

The World Competitiveness Report :

COMPETITIVE COMPETITIVE WORLDASSETS/Resources X PROCESSES = COMPETITIVENESS

- Infrastructure - Quality - Market share- Finance - Speed - Profit- Technology - Customization - Growth- People - Service - Duration

Reference of key drivers competitiveness in some of ASEAN countries :-Thai : Kitchen of the world, tourism, trade & automotive center.-Singapore : Services industry & trade, tourism.-Malaysia : Agricultural, automotive, services & trade, tourism.

I urge every Toyota Team Member all over the world to take

Professional and personal responsibility for

Advancing the understanding and

Acceptance of the Toyota Way.

Fujio Cho, Former President, 2001

Common Managerial Values and Business Methods

The Toyota Way 2001 and Toyota Institute.

2. LEAN ENTERPRISE : VALUE, SYSTEM & LEADERSHIP (TOYOTA WAY, TPS, LEADERS)

The ““““4P”””” Model of Toyota Way

PROBLEM SOLVING(Continuous

Improvement &Learning)

PEOPLE & PARTNERS(Respect, challenge

and grow them)

PROCESS(Eliminate waste)

PHILOSOPHY(Long-Term Thinking)

Toyota’’’’sTerm

Respectfor People- Respect- Team Work

- Challenge- Kaizen- Genchi Genbutsu

The Toyota Way

ContinuousImprovement

Corporate Objectives

Management CONCEPTCONCEPTCONCEPTCONCEPT & Views Supporting TPSTPSTPSTPS

Develop business while keeping harmony with the international communities (through supply of

automobiles in the case of TOYOTA)

To Fulfill the social mission

� Offer people more civilized and affluent life

� Activate communities through corporate activities

� Promise employees stable basis for life

To this end, it is essential for the company to survive by securing profits

TPS : LEAN MANUFACTURING (= Lean OPERATIONS)

Cost Reduction is Absolute Requirement for Increased Profit

)1( Selling price = Cost + Profit

(2) Profit = Selling Price - Costs

Profit

Cost

)1 (Cost + Profit

Selling Price

Methods for increasing profit

Raise the selling price Demand > Supply

Reduce the costs Demand < Supply

Cost

)2 (Cost Reduction

Selling Price

Profit

Customers determine the selling price

Cost Reduction

Cost Dependent on Production Method

Raw material purchase

Part purchase

Labor Expense

Energy

Other

Cost in Common between companies

Cost caused by difference in production method

2

31

2

31

2

31

2

31

Process Flow

1 2 3 4

Process Flow

2

41

3

1 2

2

41

3

3 4

Cost change depending on the production flow/method, even with the same design, same equipment, and the same material

Component of COST

Realization embodying “Customer First”discipline

Providing customers with well made products at reasonable price in a timely manner

Taking back the investigation promptly in the limited capital resource

Elimination of waste Muda (Non-value Added ) Mura (Uneverness) Muri (Overburden)

Timely

J.I.T

Jidoka

Well-made product at reasonable cost

Summary of TOYOTA Production System

BALI

MALUKU

MALAYSIA

JAWA

PAPUASULAWESI

KALIMANTAN

Aceh

SUMATRA

MALAYSIA

SINGAPORE

PHILIPINE

BRUNEI

AUSTRALIA

TERITORY OF TOYOTA DEALER(under TAM as Distributor) :

1. A-20002. NEW RATNA MOTOR3. HADJI KALLA4. AGUNG AUTOMALL5. HASRAT ABADI

• Indonesia Population = + 230 Million• Jakarta Population = + 13 Million• TMMIN - Employees = 5400 person• 5 Main Dealers �� A-2000 ( 80 % )

�� NRM ( 6,5 % )�� H K ( 5 % )�� AAM ( 3 % )�� H A ( 3,5 % )

• Component Supplier = 69 suppliers

Manufacturing Base & Domestic Market

Manufacturing Base

In Jakarta & KarawangNUSA

TENGGARA

3. IMPLEMENTATION OF LEAN ENTERPRISE IN TOYOTA-INDO NESIA

(CBU, Engine, CKD, Component, Dies, Jig)

GCC

Australia

South Africa

India

Pakistan

Japan

Philippines

SPI

PNGEast Timor

Brunei

Thailand

Malaysia

Taiwan

VietnamVenezuela

Argentina

Brazil

•CKD ( )� Malaysia, Philippine, Vietnam, Taiwan, South Africa, ( Argentina )

•CBU ( )� Thailand, East Timor, PNG, Brunei, SPI, ( GCC )

•Engine � Malaysia, Philippine, Vietnam, Taiwan, Japan

•Component � S. Africa, India, Pakistan, Malaysia, Thailand, Vietnam, Taiwan, Philippine, Venezuela, Brazil, Australia

•Dies � India, Pakistan, Taiwan

•Jig � India, Pakistan, Malaysia, Vietnam, Philippine, Taiwan, Japan, Venezuela, Brazil, Australia

5 Suppliers265.5 m3/day60 – 108 Km to Sunter130 – 178 Km to Karawang


5 Suppliers38.1 m3/day

66 – 71 Km to Sunter102 – 107 Km to Karawang



14 Suppliers207 m3/day


14 Suppliers207 m3/day






9 Suppliers70 m3/day66 – 77 Km to Sunter4 – 22 Km to Karawang

9 Suppliers70 m3/day66 – 77 Km to Sunter4 – 22 Km to Karawang



(JABOTABEK REGION)

8 of 13

Business Activity : Lead Lime for a CompanyBusiness/ Product Plan

Design

Procure equipment & Tools

Production Plan

Production

Distribution

Sales

Investment

Collectmoney

SimultaneousEngineering

ToyotaProductionSystem

The key in our business is how to collect money qu ickly,to increase cash flow for the company.

Yearly Production Planning

Monthly Production Planning

Daily Production Planning

Sequential Planning

Production Planning

Body Prod.Start

Body Prod.Finish

PaintingFinish

LineOff

WeldingForging

MachineProcess

assemblyCasting

PartMaker

DomesticOverseasDealers

PaintingStarting workProduction

Sequential table

Heijunka

Information

Daily Order System

Daily Order System

Flow Parts

Flow ProductionInformation kanban

Flow signal kanban

Flow part withdrawalkanban

Body Final Assembly

No 3No2No1

a b

Press

Parts

High Freq. Delivery

High Freq. Delivery

Cost increase ...

Cost increase ...

How goes together ??How goes

together ??Short L/TShort L/T

Sup

Plant

Sup

1 del/day

( 1.0 day )

1 del/day

( 1.0 day )

Sup

Plant

Sup

2 del/day

( 1.5 day )

Sup

Plant

Sup

4 del/day

( 3.0 day )

Direct delivery Milk run 1 Milk run 2

Sup

Sup

TOTAL L/T = 3.0 day TOTAL L/T = 2.5 day (O) TOTAL L/T = 3.5 day (X)

With keeping cost

LOGISTIC OPTIMATION

PART ORDER, PRODUCTION AND LOGISTIC SYSTEM

Parts procurement L/T (Timeline)

SupplierAssembler

[Flow image]

(1)Order

(3)Preparation & Supply

(2)Order receiving

(4)Transportation (5)Yardarrival

(6)Unload/Rec. area

(7)Line side(Parts Usage)

[Timeline image]

Order

Orderreceive

Shipping

Yard arrival

Unload

Line side

Supplier L/T

External logistics L/T

Internal logistics L/T

L/T of External Log.

supplementary

Sample e-Kanban Document in TMMIN

X

Supplier

ORDER

Weld

Paint

Assembly

VLT – Release<D - 4>

e-Kanban Image

D <Del Time>

Monitor ScrapFor adjustment order

Physicalusage

SCRAP Reflection

Next Order

Veh. Flow = Parts Flow

Best Practices of Lean Enterpriseiieom.org/tangkas.pdf · 2014-01-14 · India 4. Brazil 5....

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Transcript of Best Practices of Lean Enterpriseiieom.org/tangkas.pdf · 2014-01-14 · India 4. Brazil 5....