The contradictions that drive Toyota ..

We have heard of the Toyota Production and the 8 step Toyota Business Process. 

How does Toyota thrive in the midst of contradictions ? It is a great story spread over a century, when Sakiichi Toyoda went to US at the beginning of the twentieth century  and studied the US Supermarkets. He thought of ways to make the Toyoda textile mills textile output error free by carefully planning Jidoka (human automation) on looms to stop when the cotton fibre broke.

Click here for the 2008 HBR paper on the contradictions that drive Toyota's system.

There are three forces of expansion and three forces of integration.

The forces of expansion are 

• setting impossible goals
• local customization
• experimentation 

The forces of integration are 

• values from founders
• up-and-in people management
• open communication
  

Any organisation would need the forces of expansion and forces of integration to keep it properly focused and planning to grow. 

Setting impossible goals are being in every line of automobiles in the market is not the right strategy as per Micheal Porter, but Toyota believes in setting such impossible goals for its employees.

Toyota believes in customising its products in each country it enters with the result they remain highly customer focused with many models to choose from.

Any big goal is broken down into smaller ones and then experimentation is done on these small goals. Failure is not fatal, but leads to organisational learning, provided the employee follows the follow instruction culture.

Looking at the forces of integration, these help give the company a sense of direction and purpose.

The founders values include 

• continuous improvement
• respect for people and their limitation
• teamwork
• humility
• putting customers first and 
• importance of seeing things firsthand

People management  is very unique in Toyota. Any person who is incompetent is not sent away, instead is retrained with on-the-job training and put on the task, this ensuring employment for life, an alien concept in other automobile companies.The training it imparts to employees helps instill humility in them. 

Open communications enable information flows freely across the hierarchies, across functions and seniority, outside the organisation to suppliers, customers and dealers. Employees listen to opinions and comments in an open environment. The employees are encouraged to seek information from the source itself than having it from other sources, avoiding confusion and uncertainty in the communication.

The above six forces that tend to expand the company and unite it together are very vital to the success story of Toyota. These factors ensure the company stays on track of Continuous Improvement and Respect for People which forms the main two foundational principles of Toyota. 

The author has been interacting closely with Toyota plant in India, Toyota Kirloskar Motors in Bangalore since 2011 and is very much aware of the Toyota culture and contradictions as outlined above.

George.