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FORD MOTORS PHILOSOPHY vs TOYOTA MOTORS PHILOSOPHY

Keywords: comparison of ford and toyota philosophies

Introduction

A manufacturing/production system consists of a conversion system, which transforms inputs into output. Just how conversion is performed depends upon the nature of product/service and the nature of demand for such product/service. Thus the types of production are broadly classified into two categories, the continuous and the intermittent. The first category is suitable where large scale production is required and the second is suitable where demand is non-uniform and seasonal and the merchandise is not standardized.

Ford Motors, as it is poised for mass producing standardized automobiles, naturally embraced the continuous production system. This essay attempts to compare and contrast the production philosophies and systems adopted by Ford Motors during 1930s and Toyota Motor Company during recent times.

As Kanigal, Robert [1997] laid the basis for the idea of assembly line, Henry Ford, adopted the idea in1914 with due consideration to Adam Smith's philosophy of division of labour. He over simplified the tasks which resulted in specialization and business success (William A. Levinson, 2009). Alternatively, Toyota, which emerged as some other socio-industrial system, ironically had its roots in Henry Ford's philosophy (James P. Womack, Daniel T. Jones, Daniel Roos, 2007)

However, TMC digressed from the original Detroit philosophy predicated on the idea of lean manufacturing and therefore carved a niche for itself and grew to this extent that the American automobile industry shook.

Henry Ford's Contribution

Earlier, cars were a specialized luxury, available and then the elite. Ford's mass production scheme made the automobile accessible for the common man even, by virtue of Ford's vision, "a car for every man. " This philosophy got extended to the complete range of consumer products and services which came into the reach of each common man.

Henry Ford's team nurtured innovation in every the 4 'P's (Product, Process, Position and Paradigm) to happen concurrently. The T-Model, which Ford and his team evolved formed the foundation for emergence of an altogether new realm of thinking as regards manufacturing, which led to elimination of need for skilled labour (Joe Tidd, John Bessant, 2009). Although basic elements existed earlier, Ford's success lay in synthesizing them into a fresh form. The philosophy encompassed not only assembly operations, but supply chain and logistical aspects also.

Features of Ford System of Manufacturing

Standardization of products, components, equipment, process, tasks and tasks of control.

Time and work study, to recognize the optimum conditions for carrying out a specific operation and job analysis, to split up the duty into small, highly controllable and reproducible steps.

Specialization of functions and tasks within every area of operation. there was considerable narrowing and re-utilization of individual tasks and an extension of division of labor.

Uniform output rates and systematization of the whole manufacturing process.

Payments and incentive schemes based on results.

Elimination of worker discretion and passing of control to specialists.

Concentration of control of work in to the hands of management inside a bureaucratic hierarchy with comprehensive reliance on rules and procedures.

The Toyota production philosophy

The system of production which, though had its roots for the reason that of Ford Motors, has evolved as a distinctive one with original features such as lean manufacturing, is recognized as Toyota Production System [TPS]. Sakichi Toyoda, his son, Kiichiro Toyoda and Taiichi will be the founders of Toyota Motors. The founders and the engineer, Taiichi Ohno are the ones who appreciated and embraced the concept of Lean Manufacturing, founded on the initial concept, being, JIT production (Sorensen, 1956).

The founders of Toyota based heavily on the work of Edward Deming and the literature written by Henry Ford. Lean manufacturing (Simon, 1996) concept was even seen through the times of Benjamin Franklin.

The business success and opulence of Detroit drove the Toyota team to be inquisitive about witnessing the assembly line and mass production. If the Toyotan delegation visited the US, they were not impressed. The Toyotan philosophy (Shigeo, 1996) is aimed at rationalizing the look of the manufacturing process therefore it envisages elimination of three elements, being overburden [muri], inconsistency [mura] and waste [muda]. This entails that the process is flexible enough to get rid stress as it is supposed to create waste. The Toyota system determined seven types of wastes, popularly called the "Seven Wastes. " They may be over-production, motion (of operator or machine), waiting (of operator or machine), conveyance, processing itself, inventory (raw material), and correction (rework and scrap)

Of the three lapses, i. e. overburden, inconsistency and waste, the latter, muda, appears to dominate the thinking of man as they start to see the fruitful effects of TPS.

Origin of the concept of TPS

It is known that Toyota Motor Company has got its inspiration not from the Detroit Philosophy, but rather of their observations made on the visit to the US in 1950s. The Toyota delegation first visited the automotive plants of Ford Motor Company located in Michigan. But they convicted that many methods adopted by the industry leaders were not satisfactory or effective. Some of the lapses they identified were:

large levels of inventory on site,

the way the task was performed in various departments - uneven pattern, i. e. , with intervention of waiting between one procedure and another operation leading to islands of idleness,

re-work in huge quantities at the end of the procedure.

Later, the Toyotan delegation visited Piggly-Wiggly, the supermarket and observed how inventory management was completed. The supermarket maintained scanty amounts of stock sufficient to cater to the customers and its own employees for a short duration, stocks were reordered and instantly replenished. This indicated an important dimension, i. e. , eliminating the need to maintain huge stocks and it was all done just-in-time. Taking cue out of this philosophy, many US businesses made a primary attack on high inventory levels but ended in fiasco. This is because the American businesses did not understand the underlying issues. A principle of maintaining low levels of inventory also implies that proper alignment should be produced with the vendors such that they were able to supply materials and components just-in-time. A full delineation with the whole supply chain is essential. This important aspect was ignored by the American automobile industry. It can't be achieved overnight. Toyotans admitted that this took 20 years to allow them to implement JIT programme.

Tenets of Toyotan Philosophy

CONTINUOUS IMPROVEMENT

Challenge: Work without challenge makes people indolent and lackadaisical and nonchalant.

Kaizen: Capabilities, skills, efficiency and the like aren't constant. They keep bettering over time. Hence benchmarks need to be revised constantly. Innovativeness is an all natural propensity.

Genchi Genbutsu: Try to find the primary cause before making correction of the apparent defects.

RESPECT FOR PEOPLE

Respect: Others must be respected. There must be mutual understanding and a readiness to simply accept responsibility to generate mutual trust.

Team work: Working together to achieve organizational and individual objectives through commitment.

LONG-TERM PERSPECTIVE

Short-term goals are mere derivatives of the long-term ones and the former are dependent on the latter and hence, priority will be directed at pursue/revise long-term goals.

THE RIGHT PROCESS PRODUCES THE RIGHT RESULTS

Creation of a continuous process flow facilitates inherent problems to be apparent at surface. Lacunae, if any, will come to surface; unevenness in loading of work stations will be indicated. Adopting "pull system of production" prevents overproduction. Under pull system of production, production scheduling is not done for large scale manufacturing. Master production schedule is made based on the existing orders on hand. Once these orders are processed, the production process is stalled and rescheduled upon acquiring new orders. Thus, products are pulled from the system by customers.

As long as production goes, care should be taken to avoid unevenness of flow of the process. This requires every material, tool, equipment and labour to be easily available at the respective work station to avoid interruption. Defect to be nipped in the bud. This means that if the job on the assembly line or at a work center is available to be defective, the same can't be passed to the next work station/center without being rectified of the defect. Thus giving two-fold advantage; first, all the output that comes out will be defect free and secondly, you don't have to get on an excellent assurance system.

Line stopping - Where, by using an assembly line, if any defect is noticed by the operator[s], he's given discretion to avoid the assembly line by means of a switch and hold it till the defect is rectified. Continuous improvement is dependant on standardization of operations/tasks and employee empowerment. Standardization of functions facilitates fixing benchmarks for employees and thereby offers comparison of performance against benchmarks. Once they are met by the employees, the benchmarks will be revised. In this manner, performance and efficiency keep increasing year by year, leading to increasing performance and productivity.

Visual control system: This technique alarms the personnel of any lapse or defect that my arise through the production process. When the machine identifies a defect, it alarms the staff through visual devices. Using fool-proofed technology: The Toyotan philosophy calls for using equipment of proven technology to ensure a steady and uninterrupted flow of the procedure as well concerning find the output of the required quality.

DEVELOPING PEOPLE AND PARTNERS ADDS VALUE TOWARDS THE ORGANIZATION

Leaders should be developed from among the employees who relish the philosophy, understand it thoroughly and are willing to share it with others. Exceptional personnel and teams who imbibe and nurture the aspirations of the business should be developed. Network partners and suppliers by sharing expertise should be honored and challenging assignments should be given to help them improve.

A SUSTAINED EFFORT TO RESOLVING ROOT PROBLEMS DRIVES ORGANIZATIONAL LEARNING

A personal involvement in times offers a thorough knowledge of an issue. Decision making will be done coolly through consensus, considering all possible options. Implementation shall be done quickly. That is based on the belief that collective wisdom is often superior to the individual's. Creating an environment in the business so, that each employee indulges in learning things and boosts performance over a sustained basis. This makes the complete organization, a "learning organization. "

How Toyota Is Comparable To And Discernible From Ford

 

Production Philosophy

Toyota - Depends on piece-meal design of production, i. e. , produces only when there exists pull from the customer

Ford - Whereas Ford manufactured in large scale to build stock based on estimated demand

Nature of work

Toyota - Designed the task so, that staff needed to be multi- skilled to perform complex tasks.

Ford - Over simplified complex procedures such that staff needed low level skills

Standardization

Toyota - Though was influenced by the writings of Edwards Deming and Henry Ford, was embarrassed on eye-witnessing the assembly lines of Ford Motors' facilities in Michigan.

Ford - Could demonstrate business success through the policy of standardization of products, components, equipment, process and control.

Pace of output

Toyota production system was continual and produced in small quantities as each customer merited. No accumulate of finished goods.

Ford - Held the policy of turning at uniform pace to make huge pile up of stocks.

Set up time & cost

Toyota - Fundamentally suitable for continual flow meriting frequent changeovers and set ups, but this could be offset by the extra costs of blocking capital in the form of huge accumulate of stocks, characteristic of Ford Motors.

Ford - As the scheduling is performed for continuous run, changeovers are less frequent and so, low setup time and cost.

Workers' discretion

Toyota - Allowed certain amount of discretion to personnel on the assembly line such as empowering them to inspect the job for defects also to stall the flow on the assembly line to rectify the defect then and there and then let it go to another work station to ensure zero defect situation and to get rid of the need of rework division.

Ford - Eliminated the scope for workers' discretion to be used at the task place since each worker on the assembly line had to perform only an individual task and the next task needed to be done by another worker. Workers had no authority to stop the flow of work as such, an incidence of defect is permitted to pass till the end of the process and the defective item is delivered to rework division.

Process design

Toyota - Focused on three conditions while designing its production system, i. e. , overburden, inconsistency, and waste. These words are simple, but have far reaching effects. The very last criterion is pivotal for the success of the business. The seven wastes concept indicates a treat amount of insight of the Toyotans which is unique of Toyota. But, ironically, Toyotan inspiration is rooted in the writings of Edward Deming, who happens to be the American. The fun is based on the fact that American automobile industry didn't pay heed to Deming's philosophy, but non-Americans exhibited faith in it.

Ford - Bureaucratized so far as administration/control is concerned. All employees have to see scalar chain and abide by the guidelines and procedures

Long-term perspective in planning

Toyota & Ford - Both companies consider far future.

Developing people

Toyota - Promotes development of exceptional individuals and teams.

Ford - Does not focus on developing experts as it offers over simplified the tasks, rather, workers might gain efficiency as they actually the single task repeatedly.

Pay and incentives

Toyota - Provides ample scope for personnel to grow as it nurtures innovation, employee participation etc.

Ford - The policy is to pay and provide incentives predicated on results.

Problem solving

Toyota - Employees are nurtured in that culture that they address a problem through the root cause instead of taking a perfunctory look.

Ford - Employees aren't trained along making deeper efforts in addressing problems. They used to leave the problem at perfunctory levels.

Summary

The world has witnessed a regular transformation in regards to the automobile production/operations philosophy. The Ford's mass production (produce to stock) philosophy received ample appreciation and was convicted to be your path by most other manufacturers (1914). It has been evidenced by the way the Big Three, (Ford Motors, General Motors and Chrysler) flourished during early and mid 20th century. However the onset of Toyota production system, which is based on the philosophy of "lean manufacturing", started sending tremors in to the well complacent American automobile industry's regime. The principle of Toyota Motor Company (TMC) to get rid of wastes and subsequent TMC's success attracted other manufacturers who tried to copy, however in vain. They could not imitate the whole TMC's philosophy as it is.

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