TPM Fundamentals - TPM Part I, II, III ~One of the Most Effective Business Improvement Tools

TPM is an acronym for Total Productive Maintenance or Total Production Management.

TPM is not only about improving the efficiency of equipment, but also about pursuing the ultimate efficiency of the entire production system. In short, it is an activity for improving corporate performance and participatory management.

The purpose of TPM is to "improve the efficiency of the production system and create a profitable corporate structure."

TPM is about "reducing all actual and potential losses in the production system to zero with the participation of the entire company (i.e. all employees)."

TPM is divided into three parts, and defined as: 

TPM Part I:

Centered on the gemba (shopfloor or manufacturing site). This Part 1 activity aims to thoroughly eliminate and prevent potential losses that are hidden in the manufacturing cost, thus creating a profitable structure.

The initial target is the reduction of manufacturing costs since

production sites are beset by a large number of hindering factors, such as: 

• Losses that hinder capacity utilization
• Losses that hinder material unit cost efficiency 
• Work organization losses arising from personnel allocation
• Work in progress inventory losses

TPM Part II:

Focusing on the whole production process. The aim is to thoroughly eliminate and prevent potential losses in product costs (total production costs) in cooperation with production-related departments and other related departments, thereby making the company even more profitable.

The aim of Part II is to Lower "product costs"

by eliminating losses across all production management processes, such as: 

• Lost opportunity and product inventory losses caused by "poor coordination" between sales and production divisions 
• Losses caused by the failure to achieve new product target costs due to lack of action on the part of the development and design divisions
• Losses caused by excessive material procurement by the purchasing divisions and purchasing target cost losses 

TPM Part III:

Part III is the final stage of creating a profitable corporate structure by eliminating and preventing potential losses in the company's cash flow. It is aiming to improve the entire business process and to  "improve cash flow" through four major points.

• Continuing to maintain the basic capabilities of production sites (sustaining the improved condition) 
• Establishment of QCD with R&D and trial and production preparations prior to mass production 
• Strengthening and enhancement of added value creating activities on a company-wide basis
• Environment and resource maintenance activities

The complete status at TPM Part III, inherits the approach employed in Part II, and moreover aims to establish conditions that allow companies to cope with a highly uncertain environment and thrive. It aims to create a profitable management structure that grows and expands sales, and maximizes the efficiency of invested resources, rather than just focusing on generating profits within allotted sales.

Part III concept requires achieving No. 1 in the world for a large number of indeces, such as the share of new products, cost competitiveness, quality, and the maintainability of resources. 

Also, TPM activities are not only limited to production processes, but they aim to also optimize business processes as a whole, and to create a corporate management structure that truly generates profits. Overall, the aim is to maximize the efficiency of invested resources, such as ROA, through the yardstick of increased company-wide cash flow resulting from management productivity.

The advantage of TPM is not just that it reduces losses, but that it also creates preventive (maintenance) mechanisms on the ground that foster a reality that doesn't generate losses.

This is what sets it apart from other activities, and what makes TPM unique. And with TPM, it is possible to achieve zero losses.

The overall picture of TPM activities, divided into the 3 Parts mentioned above: