Global Issues: Japan/Globalization/The Toyota Way

Overview

The Toyota Way is a book written by Jeffrey Liker. This book describes the management principles and business philosophy behind Toyota's success. Toyota is a car manufacturer in Japan who raised the bar for quality and excellence in manufacturing, production development and process excellence, by their approach. Why? This is because: they are the most profitable car manufacturer, they are consistently producing high quality cars, they have fewer man hours and they have less on hand inventories.

For many companies this book has become the bible for improving their company. This book explains Toyota's approach to lean production and it explains more about the 14 principles to go for quality and excellence. Not only it contains the theory but it also explains how you can adopt the principles to improve your own business processes by cutting down on operation and production costs.

Overview of the book

The book is divided into three parts. The first part is about the success and history of Toyota. The second part describes the 14 business principles of the Toyota way. The last part is about how an organization can apply this theory to their own company. All together it's a journey with steep hills but the final result is worth it.

The 14 business principles of the Toyota way

1 Base your management decision on a long-term philosophy, even at the expense of short-term financial goals

2 Create continuous process flow to bring problems to the surface

3 Use the 'Pull-System' to avoid overproduction

4 Level out the workload (Heijunka)

5 Build a culture of stopping to fix problems, to get quality right the first time

6 Standardized tasks are the foundation for continuous improvement and employee empowerment

7 Use visual control so no problems are hidden

8 Use only reliable, thoroughly tested technology that serves your people and process

9 Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others

10 Develop exceptional people and teams who follow your company's philosophy

11 Respect your extended network of partners and suppliers by challenging them and helping them improve

12 Go and see for yourself to thoroughly understand the situation (Genchi Genbutsu)

13 Make decisions slowly by consensus, thoroughly considering all options; Implement decisions rapidly

14 Become a learning organization through relentless reflection (Hansei) and continuous improvement (Kaizen)

The 14 principles are divided into four sections. It starts with the long term philosophy, by focussing on the long term everyone knows what to do. All investments and changes should be adding something to their final goal. The second section is about the right process that will produce the right results. The main focus should be on the process. Starting with the single flow concept in order to improve the quality of your product. The third section is about to add value to the organization by developing your people and partners. By developing your people and partners they will continue to grow and feel involved. The last section is about the fact that continuous solving root problems drives organizational learning. Once a rootcause is determined the problem can be solved for ever. This means that the focus stays on the real problems.

Global impact significance

This book is the first book in English that describes the business principles and the philosophy that made Toyota famous about their quality and reliability. Currently, this philosophy of The Toyota way is used all over the world. This approach is adapted not only for the car industry but it is used in various kinds of industries. Every company can learn from Toyota and their approach in order to make your company lean and mean.

Impact on the author

This book has made a great impact on myself as for some years I have been working with various improvement processes which all have their basis in the Toyota way. In the beginning I was quite sceptical about it as it seemed yet another program from management in order to improve my process. However, during the first journey I really became a believer as the results were amazing. The Toyota way is not only focussing on the process but also on the people as they make the change. It really is a great way of thinking in order to make the change.

During my visit in Japan I had the pleasure to visit a factory and see the Toyota Way of working in real practice. On my question to management: 'Can you show me your program?' the Japanese people started laughing. This was not because my question was funny, but it was because in Japan it's not an improvement program but it's their normal way of working. So we still have a lot to do in order to become as successful as Japanese companies or Toyota.

For me this book is really the bible for improving my production process at work.

References

Book 'The Toyota Way' written by Jeffrey K. Liker.