Final answer:
Toyota's strategy that produces only the necessary items at the needed time in the precise amount is called lean manufacturing, which reduces waste and emphasizes quality control through just-in-time delivery.
Step-by-step explanation:
The strategy of Toyota that refers to producing only what is needed, when it is needed, and in the amount needed, is known as lean manufacturing. This production philosophy focuses on reducing waste within manufacturing systems while ensuring high quality and efficiency. Lean manufacturing contrasts with other production strategies like mass production, which relies on economies of scale where the cost per unit decreases as the quantity of output increases, resembling the approach of warehouses stores such as Costco or Walmart. Additionally, in lean manufacturing, the adoption of just-in-time delivery plays a critical role, emphasizing quality control and efficiency in the supply chain. This approach drives suppliers to be located within close proximity to the assembly plants to ensure timely delivery of parts.