For Toyota to continue to grow, it is essential that it remains committed to achieving the world's highest quality, despite the difficulty of the business environment. This commitment to continuous improvement in the areas of "technology," "production & supply," and "sales & marketing" that drives our growth, and of the "product quality," "cost," and "human resources" that sustain it, has long been a guiding principle at Toyota. We plan to realize future growth by establishing solid foundations for product quality, cost, and human resources. This strategy will enable us to offer the world's best products, the world's fastest and the lowest-cost manufacturing, and the world's best sales and services.
In 2005, we established a CF* Activity Promotion Committee to create the ideal environment for putting "customers and quality first" and to ensure that defects do not reach the market.
Since January 2007, we have returned to the roots of our CF policy and renewed awareness that "quality must be built-in within each process." This means that quality is confirmed at each stage of the production process, so that only top-quality work is permitted to move on to the next stage. This concept is fundamental to all processes, and although originally applied primarily to manufacturing operations, it is now being applied to our management-related divisions and suppliers as well.
Toyota staff checking a manufacturing process at a supplier
In recent years, the structure and performance of vehicles has become increasingly advanced and complex. At the same time, customers' needs and vehicle usage have become increasingly varied. In response to these trends, we are working to improve quality from the very first phase of development. For example, to improve long-term quality we recover vehicles that have been in use for over 10 years to study how age and use affect various components. We then feed that information back into the design process to further improve quality related to long-term durability. We also drive new cars 100,000?200,000 kilometers in a single year to identify problems and implement countermeasures.
We have increased the use of in-line measurement in production lines to strengthen our ability to "visualize issues." This helps us to prevent defects and understand where and why problems occur. To identify the cause of quality-related issues and implement fundamental solutions, we continuously monitor and analyze product-precision trends that formerly relied on operator skill and intuition.
In our supply chain, Toyota's purchasing division is focused on working with suppliers to improve quality. Through this initiative, Toyota employees in the development, production, and purchasing divisions work together with suppliers to identify and resolve problems so that we can secure high-quality components.
As a result of these efforts, the initial quality of our vehicles continues to improve steadily. However, to provide customers with the world's best products we still have many issues to address. Going forward, we will further strengthen our commitment that "quality must be built-in within each process," to work even more closely with suppliers and overseas companies, and to strive to instill an even higher level of quality awareness in each and every employee to maintain and improve the world's highest quality standards.
In-line measurement process
In-line measurement using infrared laser
In recent years, cost competitiveness has become an even more important issue to the automotive industry due to rising raw material costs, increased demand for compact cars, and the introduction of new environmental and safety technologies. We are applying a broad range of cost reduction efforts to absorb the impact of these factors and improve profitability.
To offer better products at lower prices, Toyota launched CCC21*1 cost reduction activities in July 2000. Through the project, which has already resulted in cost reductions, we review the cost of producing major vehicle components around the world. With the lowest cost as our target, we then work closely with suppliers from the initial design phase to ensure that each component is produced at the lowest possible cost.
In addition, in April 2005 we began VI*2 activities?an evolved form of CCC21 activities?in which we look at cost reduction during the development phase, even prior to blueprints. Through VI activities, we consider individual "components" as well as multiple component "systems." We strive to reduce the number of components by integrating components and systems with similar functions and reviewing the functions and placement of systems, such as engine and safety systems. We have also reduced the number of components and the amount of material used without reducing product quality by reviewing production processes that have until now been standard. The effectiveness of VI activities began to materialize with the redesigned Crown in February 2008. In the future, we will give priority to improving the profitability of compact cars and cars manufactured overseas, and will continue to promote cost reduction activities to further increase our cost competitiveness.
Construction of Cost Competitiveness for the 21st Century
At Toyota, we strive to further human resources development based on our philosophy that "making things means making people." In line with our expanding business operations, our employees are more diverse and global human resource development efforts have become a priority issue. So that Toyota employees around the world share the same values, we have codified and shared globally the Toyota Way, our values and methods that were formerly passed on as tacit knowledge.
To provide a stable supply of high-quality products to the world in a timely manner amid fluctuating global demand, we are working to increase the self-reliance of our overseas manufacturing companies.
Historically, human resource development for Toyota's overseas production bases took place primarily at plants in Japan, using a "mother plant system." We found, however, that as the number of overseas manufacturing companies grew, disparities in training content began to arise. So, in July 2003 we established a Global Production Center (GPC) at our Motomachi plant in Japan. The goal of the GPC was to instill in employees the awareness that all of our vehicles should offer the same "Made by Toyota" quality regardless of where in the world they are manufactured. At the GPC, skilled technical personnel from plants in Japan teach the standard production methods that form the Toyota production system. They use technical training devices, animations, and other visual aids to enable overseas staff to quickly acquire necessary skills. Between its founding in 2003 and May 2008, approximately 13,000 workers underwent training at the GPC.
In 2006, overseas branches of the GPC were established in the United States, the United Kingdom, and Thailand. This marked a transition from the previous phase, in which Japanese trainers taught overseas personnel, to a new phase in which local trainers pass on their skills to local personnel, as well as personnel from other countries, to promote the spread of technical skills on a global basis.
In addition, our three-year Pro-WIN* program for global human resources development in production-related fields, such as production preparation, production management, logistics, plant operation, and various other fields, trains professional production staff to support greater self-reliance at overseas manufacturing companies.
Technical training at GPC in Thailand
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