Business Ethics

1. Introduction

Toyota is the seventh largest company in the world and the second largest manufacturer of automobiles with production facilities in 28 nations around the world (Lexus, 2007). In 1933, the direction of the founder’s son, Kiichiro Toyoda established history of Toyota.

Taichi Ohno, the Vice President of manufacturing for Toyota is generally credited as the father of Toyota Production System (TPS) (Vorne, 2010) TPS is synonymous with Lean Manufacturing and Lean Production. TPS is a manufacturing methodology. The goal of TPS is to maximize value by eliminating waste. TPS is perhaps the most powerful model devised to-date for efficient design and management of large-scale management ( Anonymous, n.d.) .

2. What are the basic principles of Toyota’s production system? To which areas of the organization do these principles apply?

2.1 Basic Principles of Toyota Production System (TPS)

According to Teruyuki Minoura (2003) that long-standing principles of the TPS will not change in the future but TPS will able and meet any challenge.

1. Just-In-Time

Just-in–Time (JIT) is one the concept of the TPS (2Toyota, n.d.). According to Minoura (n.d.), JIT is all about producing only what’s need and transferring only what’s needed. That means just producing only what is needed, when it is needed, and in the amount needed (2Toyota, n.d.; GDUT, n.d.).JIT also play important rule in a philosophy and human resources organization will evaluate performance with integrated management system. Besides that, JIT’s mandate to eliminate all waste, such as watching a machine run, waiting for parts, overproduction, machine breakdown, rework and others (GDUT, n.d.). Efficient production of 100% good units and produce only the required items, at the required time, in the required quantities are the goals of JIT (GDUT, n.d.).

JIT in finance and accounting is to improve profits. Besides that return on investment by reducing...