The Toyota Way in Services: The Case of Lean Product Development

Executive Overview Toyota’s Production System (TPS) is based on “lean” principles including a focus on the customer, continual improvement and quality through waste reduction, and tightly integrated upstream and downstream processes as part of a lean value chain. Most manufacturing companies have adopted some type of “lean initiative,” and the lean movement recently has gone beyond the shop floor to white-collar offices and is even spreading to service industries. Unfortunately, most of these efforts represent limited, piecemeal approaches—quick fixes to reduce lead time and costs and to increase quality—that almost never create a true learning culture. We outline and illustrate the management principles of TPS that can be applied beyond manufacturing to any technical or service process. It is a true systems approach that effectively integrates people, processes, and technology—one that must be adopted as a continual, comprehensive, and coordinated effort for change and learning across the organization.