In 1948, Toyota engineer Taiichi Ohno began working with Eiji Toyoda on ways to raise productivity and reduce waste at Toyota’s Koromo plant. These early efforts, shaped by postwar shortages, helped set the direction for what later became the Toyota Production System (TPS). The work emphasized solving day-to-day factory problems through repeated trial and error, rather than copying mass production directly.
During the late 1940s and early 1950s, Toyota reports that the foundations of TPS were built through experiments at the Honsha Machinery Plant. This period linked two key ideas: Just-in-Time (making only what is needed) and jidoka (building quality into the process by stopping when problems occur). These concepts became the system’s core “pillars” for organizing production.
In the early 1950s, Eiji Toyoda visited Ford’s River Rouge complex and studied large-scale U.S. auto production. The visit highlighted both the power of mass production and the risk of inefficiency and waste when production is not closely tied to demand. Toyota’s developing system increasingly focused on achieving high efficiency with smaller volumes and more model variety than Detroit factories were designed for.
In 1950, Toyota faced a major labor dispute triggered by financial stress and proposed workforce reductions. The strike and negotiations ended in June 1950, and founder Kiichiro Toyoda resigned as president as part of the settlement and leadership transition. The crisis pushed Toyota to strengthen management systems and cost control, creating pressure for more reliable, efficient production methods.
By the late 1950s, Toyota states that TPS practices spread beyond a single area to the full Honsha Plant. This mattered because it required more standardization: consistent work methods, clearer production signals, and stronger coordination between processes. Expansion also tested whether the approach could work beyond pilot areas and become a plant-wide operating system.
Toyota reports that implementation of TPS at all plants began in 1960. This shift from “one plant” to “many plants” required Toyota to translate local problem-solving into repeatable methods and shared expectations. It also increased the need for stable production planning and fast feedback when problems appeared on the line.
In 1963, Toyota adopted a kanban management system at all plants, using information cards to signal what parts were needed, where, and when. Toyota links kanban to making Just-in-Time practical by limiting overproduction and reducing in-process inventory. As kanban spread, Toyota also had to solve supporting issues like transport routines and standard work so lines could run smoothly.
By 1965, Toyota had expanded kanban beyond its own factories to include retrieving parts from suppliers. Toyota describes this as a key step in establishing TPS as a broader “production and logistics” system, not just an internal factory method. It also began changing supplier relationships, encouraging partners to adopt similar practices to improve performance on both sides.
In 1965, Toyota was awarded the Deming Prize, a major Japanese recognition for quality control practices. This reinforced the TPS emphasis on “built-in quality,” not relying only on end-of-line inspection. It also supported Toyota’s efforts to spread disciplined problem-solving and quality methods throughout the company.
In 1966, Toyota established a Purchasing Administration Division to promote Total Quality Control (TQC) across operations, including suppliers. Toyota describes this as a way to share lessons from winning the Deming Prize and to drive quality improvement beyond Toyota’s own plants. This helped connect production methods (like kanban and standardized work) with supplier capability and consistent incoming quality.
In September 1969, Toyota created the Toyota Quality Control Award to encourage quality control activity among Toyota-related companies, especially suppliers. Toyota explains that the award aimed to help quality methods “take root” across the broader production network. This was a governance step: it used shared goals and recognition to align many firms with TPS-style continuous improvement.
In 1975, Taiichi Ohno became an executive vice president at Toyota. By this point, TPS had moved from experiments and plant tools into a company-wide system supported by leadership, supplier coordination, and quality programs. Ohno’s promotion marks a clear “rollout outcome” for the 1948–1975 period: TPS had become central to how Toyota managed production.
Toyota Production System development and rollout at Toyota Motor Company (1948-1975)