Table of Production Capacity by Process

Taguchi Loss Function

A graphic representation of how customer dissatisfaction increases exponentially as variation within specification limits increases. Unlike the common thinking around specification limits that the customer is satisfied as long as the variation remains within specification limits, the Taguchi Loss Function shows that customer dissatisfaction begins with any variation away from the nominal performance. As variation increases, the customer becomes exponentially more dissatisfied.

Taguchi Method

A set of statistical methods to improve the quality of goods and services. The Taguchi Method is comprised of three main applications of statistics, which are the Taguchi Loss Function, innovations in the Design of Experiments, and the philosophy of off-line quality control. Named after its developer Genichi Taguchi.

See also Taguchi Loss Function

See also Design of Experiments

Taiichi Ohno

Executive Vice President at Toyota who is considered the father of the Toyota Production System. He developed the concept of kanban, integrating the American supermarket system of resupply into the factory. He is credited with creating the 5 Why process, describing the 7 Types of Waste, the Ohno Circle or chalk circle, and in spreading TPS outside of Toyota by leading jishuken at supplier companies. Taiichi Ohno was born February 29, 1912, and died May 28, 1990.

Takt Image

A way of making it possible to sense heartbeat of takt time, even for processes that are shared or otherwise de-linked from the pace of customer demand. Takt image can be created by withdrawal of finished goods at a multiple of takt time proportional to pack-out quantity or conveyance size. For example, a production cell with a takt time of five minutes that conveys products downstream in pack-out sizes of 5 units would have a takt image of 25 minutes. In other words, the movement of goods would tell people in the area would every 25 minutes whether they were on-time or behind schedule.

Takt Time

The It is number calculated by dividing the available time to work by customer demand. For example, if a net working time was 450 minutes for a shift and the customer demand was 150 units, the takt time would be 450 minutes/shift divided by 150 units/shift, or 3 mintues/per unit. Takt time is used to balance workload, plan equipment capacity, and match production to customer demand. Takt is a German word for beat, musical meter or precise interval of time.

Target Condition

An interim goal on the way to the ideal condition. The target condition is more specific and near term than the ideal condition. Arriving at or near the ideal condition often requires attaining multiple successive target conditions.

Target Cost

The cost that a product or service cannot exceed to both delivery value that satisfies the customer and delivers an acceptable return on its investment.

Target Costing

An approach to determining a product's life-cycle cost be sufficient to achieve a specified functionality and quality while ensuring a desired profit. Target cpstomg involves setting a target cost by subtracting a desired profit margin from a competitive market price.

Team Leader

A person who leads a small team of front line workers. The first level of management. Team leaders are not responsible for taking disciplinary actions. They typically do not have full-time "line work" but provide support to other team members. Team leaders typically know the jobs performed by their team members and can assist or step in for them. The team leader is the first line of responding to abnormalities, and take a lead in problem solving.


Japanese for “hands-free”, this is the act of automating manual machines to free the hands to do more valuable or creative work that only a person can do.

Test for Two Variances

A hypothesis test to determine whether a statistically significant difference exists between the variance of two independent sets of normally distributed continuous data. Also known as F-Test.

Test of Significance

A statistical procedure for determining whether or not a process observation differs from the normal expected distribution by an amount greater than what is due to random variation.

Theory of Constraints

Abbreviated TOC, it is a management philosophy based on the premise that a system only produces as fast as the slowest step. TOC includes a set of methods and practices for increasing throughput via focused effort to improve the constraint.

The Theory of Constraints was developed bf Eliyahu M. Goldratt. He introduced it in The Goal (1984).

See also Drum Buffer Rope


The fundamental ‘motion cycles’ that combine to form work activities. The Therbligs are :

  • Search
  • Find
  • Inspect
  • Select
  • Grasp
  • Hold
  • Pre-Position
  • Position
  • Use
  • Assemble
  • Disassemble
  • Transport Loaded
  • Transport Empty
  • Release Load
  • Unavoidable Delay
  • Avoidable Delay
  • Plan
  • Rest

Therbligs were invented by industrial engineering pioneers Frank and Lillian Gilbreth. The name Therblig comes from a reversing of the name Gilbreth.

Three Elements of Demand

The three drivers of customer satisfaction are Quality, Cost, and Delivery.

Three Elements of Just-in-Time

The three elements of JIT are 1) takt time, 2) flow production, and 3) the downstream pull system.


The amount of material, information or valued output passing through a system or process.

Throughput Time

The rate the system generates money through sales.

Time Analysis

The time required for a product to proceed from concept to launch, order to delivery, or raw materials into the hands of the customer.

Time Boxes

A defined maximum amount of time for to complete an activity or deliver an output.

Time Observation Sheet

A document used to observe multiple repetitions a process, record the cycle times, and identify improvement opportunities.

Time Series Plot


A way of remembering the 7 types of waste, TIMWOOD stands for:

  1. Transportation
  2. Inventory
  3. Motion
  4. Waiting
  5. Overproduction
  6. Over-processing
  7. Defects



Total Effective Equipment Performance

Abbreviated TEEP, this is a measure of equipment effectiveness that take the broadest view of potential. It measures the OEE rate against total calendar time. One hundred percent TEEP for a machine would be running without any losses, non-stop, 24 hours per day, 365 days per year.

Total Productive Maintenance

TPM is a comprehensive approach to improving business performance by reducing equipment losses and increasing the capability of people. TPM requires participation of all employees, not only maintenance personnel and machine operators. TPM activities involve managers and professional staff in equipment design, office work, quality, safety and training. TPM reduces the six major losses of equipment through a combination of focused improvement activity, prevention and daily autonomous maintenance by operators. There are eight pillar activities of TPM that are typically rolled out enterprise-wide over a period of several years.

Total Quality Control

An approach for involving all departments, employees, and managers in continuously improving quality. Total Quality Control (TQC) relies on employees working in small groups to set targets, identify problems, apply the plan-do-check-act (PDCA) cycle, and employ statistical tools to solve problems. The term “total quality control” was coined in 1957 by U.S. quality expert Armand Feigenbaum. By the 1980s, TQC was developed further by experts including Philip Crosby, Joseph Juran, W. Edwards Deming and Kaoru Ishikawa. Today TQC is known in practice as Total Quality Management or TQM.

Total Quality Management

The organization-wide effort to continuously improve the ability of people and processes to provide the products and services that customers will find of particular value. "Total" implies that all departments must be engaged in improvement. “Quality” implies not only product or process quality, but the quality of management itself. "Management" implies that senior leaders must be active designing, building and maintaining the culture and management system. TQM originates in TQC but draw widely on tools and techniques of continuous improvement.

Toyota Business Practice

The 8-step problem solving approach based on the PDCA cycle that is practiced at Toyota.

Toyota Kata

Routines and patterns of behavior practiced at Toyota for improvement and coaching.

Toyota Production System

The production system developed by Toyota Motor Corporation. The aim of TPS is to create sustainable profits by delivering the maximum value to customers, the best quality, the lowest cost, and shortest lead time. This is accomplished through the relentless elimination of waste and non-value-added activities.

TPS is often illustrated as a house. It is built on the foundation of heijunka, with cornerstones of kaizen and standardized work. Its two pillars of just-in-time and jidoka. Various other improvement tools, methods and systems maintain and improve TPS following the PDCA cycle and the scientific method.

Taiichi Ohno is credited with leading the development of TPS between the early 1950s until the late 1980s. His efforts started in the machining operations to address part shortages at final assembly. This resulted in the invention of the Kanban system. TPS spread throughout Toyota and its supply chain and then to other industries.

Toyota Way

The Toyota Way is a set of 14 principles and behaviors that are the basis of the Toyota Motor Corporation's managerial approach and production system. Toyota first articulated this 2001, calling it "The Toyota Way 2001". This consists of principles in two key areas: continuous improvement and respect for people. The emphasis is on a long-term philosophy, securing good results by establishing good processes, solving problems by addressing root causes, and increasing value by developing people. The 14 principles are:

  1. Principle #1. Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals.
  2. Principle #2. Create a continuous process flow to bring problems to the surface.
  3. Principle #3. Use ‘pull’ systems to avoid overproduction.
  4. Principle #4. Level out the workload (work like the tortoise, not the hare).
  5. Principle #5. Build a culture of stopping to fix problems, to get quality right the first time.
  6. Principle #6. Standardized tasks and processes are the foundation for continuous improvement and employee empowerment.
  7. Principle #7. Use visual controls so no problems are hidden.
  8. Principle #8. Use only reliable, thoroughly tested technology that serves your people and process.
  9. Principle #9. Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others.
  10. Principle #10. Develop exceptional people and teams who follow your company’s philosophy.
  11. Principle #11. Respect your extended network of partners and suppliers by challenging them and helping them improve.
  12. Principle #12. Go and see for yourself to thoroughly understand the situation.
  13. Principle #13. Make decisions slowly by consensus, thoroughly considering all options; implement decisions rapidly.
  14. Principle #14. Become a learning organization through relentless reflection and continuous improvement.

TPM Activity Board

Visual displays in the workplace used to inform, educate and motivate continuous improvement throughout the deployment of TPM activities. There are three basic types of TPM Activity Boards, the Plant TPM Board, the TPM Pillar Boards, and the Small Group Activity Boards. TPM Activity boards are used as part of a Daily Management System, for periodic updates by project teams, or as the stand-up meeting location for improvement teams.


Two-sided pieces of colored paper used by operators to identify abnormalities, faults, unsafe conditions or problems on their equipment. These tags are attached directly or very near the problem spot on the equipment, and also used as slips to track maintenance and repair work.

Training Within Industry

A set of training programs developed to help U.S. companies hire and train large numbers of new industrial workers during WWII. There are three original areas of training in TWI called “J” programs:

  • JI: Job Instruction taught supervisors how to instruct workers to do their work safely, correctly and efficiently.
  • JM: Job Methods taught workers to how to make improvements so they could achieve more with the resources of machines, manpower and materials.
  • JR: Job Relations taught supervisors how to effectively and fairly handle interpersonal conflicts by gathering facts, weighing the facts, making a decision, taking action, and checking the results.

More recently JS or Job Safety was added. TWI concepts were mostly forgotten in the U.S. after WWII. Japanese companies, including Toyota, adopted them to rebuild their industries. The TWI Job Instruction program is still widely used by team leaders at Toyota around the world.


The movement of conveyance of materials and goods from place to place. Because transportation adds cause but does not add value, it is considered one of the seven types of waste.

Tree Diagram

A graphic representation of a strategy, tasks, a problem, a process failure, a statistical probability of events or other ideas that uses a branching structure to progress from general to increasingly specific details.


TRIZ is a theory of inventive problem solving. It is a method for problem-solving, analysis and forecasting derived from the study of patterns of invention in the global patent literature. It was developed by Genrich Altshuller and colleagues in 1946. They found that problems and solutions were repeated across industries and sciences, patterns of technical evolution were repeated across industries and sciences,and that the innovations used scientific effects outside the field in which they were developed. There is a set of 40 principles in TRIZ that are used to improve the design of systems, products and services. TRIZ is an abbreviation for the Russian phrase "theory of the resolution of invention-related tasks".

True North

A guiding strategy, vision or philosophical position that keeps the organization aligned and focused on its long-term purpose. It often includes both specific, measurable business objectives, and broader visionary business goals. Also known as North Star.


A method of brainstorming ideas and rapidly trying them out through simple experiments, prototypes, mockups or simulations.


A way to keep product flow continuous even when there are interruptions such as outside processing or batch operations. The tsurube system is often used when product leaves the flow line for processing through equipment that can not be placed into the cell (vendor operations, heat treat, plating, anodizing, etc.). Tsurube is a Japanese word for "pulley" used to draw water out of a well with a bucket, pulley and wheel.

Turnaround Time

Abbreviated TAT, the amount of time to fulfill a request or to complete a series of processes.

See also Lead Time

Turtle Diagram

A drawing of the inputs and outputs for a single process, including details of various resources, requirements and responsibilities to meet customer requirements. Turtle diagrams are useful for orienting new employees to specific responsibilities in their job. This diagram gets its name from a template which resembles the shape of a turtle.

Two-Bin System

An inventory control system that uses two bins or containers to determine when items or materials should be replenished. Once the items in the first bin have been consumed, the empty bin triggers a resupply order. The quantity in the second bin is set at a sufficient level to last until the the two bin quantity is resupplied. A simple, physical method of the pull system.

Two Proportions Test

Two Proportions Z-Test

A statistical hypothesis test that compares two proportions to see whether they are the same. The null hypothesis (H0) for the test is that the proportions are the same. The alternate hypothesis (H1) is that the proportions are not the same.

Two Sample T-Test

A statistical hypothesis test performed on the data of two random samples that are independently obtained from different populations. The two sample T-test is determines whether the difference between these two populations is statistically significant.