Toyota’s New Material-Handling System Shows TPS’s Flexibility
Toyota Motor Corporation has introduced a new material-handling system based on kitting to
reduce complexity and improve quality in assembly areas. The new approach was introduced in
Japan and China, according to Art Smalley, author of the Lean Enterprise Institute workbook
Creating Level Pull. Smalley saw the new system in action on an engine assembly line during a
recent tour of Toyota facilities in Japan. He was one of the first Americans to work for Toyota in
Japan in the 1980s and helped transfer Toyota’s equipment and lean manufacturing methods
overseas. A spokesman for Toyota Motor North America said the kitting system was being
introduced on “more and more lines” at the Georgetown facility and elsewhere in North America.
He said it was “not a complete sea change” in parts presentation and wasn’t applicable to all
production areas. Smalley said the system, called the set pallet system (SPS) in Japan, appeared
best suited to automated lines, rather than cells. The new approach removed line-side storage
racks, often called flow racks, so operators no longer walked from their assembly stations to get
parts. Instead, electronic signals told material handlers what parts to select from bins separate
from the line. They then selected and placed the parts on pallets traveling with the engines being
assembled (see diagrams below). “Visually, it’s quite a difference because the flow racks are
gone,” said Smalley. “I was surprised. It was a much more open and clear area than the
traditional scenario with all the material around the line, which can block you from seeing. The
line is so wide open now.”
More Value-Added Work
At Georgetown, the correct parts for a particular Camry or Avalon are selected into a tray that is
placed inside the car as it heads down the line. Because part selection is done upstream,
assemblers can “focus on the quality of installation,” according to the Toyota spokesman. Variety
and the resulting complexity have proliferated as more and more features are offered to
customers. For instance, before the new system was introduced for the current generation Camry
and Avalon, team members had to choose between 24 varieties of sun visors.
The change means operators now focus nearly 100% of their time on the value-added work of
installing parts because they no longer have to perform the nonvalue-adding task of walking a few
steps to retrieve parts from flow racks, Smalley noted. “Operators stay in a very tight zone, doing
almost 100% value-added time.” The switch also eliminates reaching, stretching, and searching
for parts by assembly operators. The new arrangement also makes training operators and
material handlers easier because the job responsibilities are narrower.
The new system concentrates walking and parts selection on the material handlers who are
positioned every seven to 10 stations along the engine assembly line, Smalley said.
Although the new system increased the number of material handlers, he commented that, on
average, Toyota estimated that the total productivity change was neutral due to the more effective
use of direct labor. A minor drawback to the new approach was that it made adding or subtracting
pickers incrementally as takt time changed somewhat harder to do.
Advantages and Disadvantages
The big advantage of the new material handling system is simplicity and quality improvement
through error avoidance. Smalley explained that Toyota Japan had about 5% seasonal or
temporary workers when he was there in the 1980s. “Now the figure is up to 40% in some plants,”
he said. “Also the work force is younger than it was 20 years ago and labor law changes allow for
more women to work in assembly.”
All these trends create a workforce that is less experienced with factory work and less familiar
with automotive components than in the past. Combined with the proliferation of component
variety, part selection errors were occurring and small quality problems, like assembly errors and
bolts not being sufficiently torqued, were getting downstream. “I guess they just couldn’t pokayoke
everything and
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