By December 9, 2006 2 Comments Read More →

New WSJ Article on Toyota

As Rivals Catch Up, Toyota CEO Spurs Big Efficiency Drive – WSJ.com

Not sure if there will be a free version online (if so, I’ll try find it or someone post a link).

Welcome, WSJ readers who found me via the Technorati link. I hope you’ll check out the blog and learn more about Lean and the Toyota Production System. If you have any questions, email me.

Here’s another article that emphasizes Toyota’s emphasis on continuous improvement and never being satisfied on how they are today.

Toyota’s chief executive officer is a worried man. He thinks Toyota is losing its competitive edge as it expands around the world. He frets that quality, the foundation of its U.S. success, is slipping. He grouses that Toyota’s factories and engineering practices aren’t efficient enough. Within the company, he has even questioned a core tenet of Toyota’s corporate culture — kaizen, the relentless focus on incremental improvement….

Mr. Watanabe, 64 years old, wants kakushin, or revolutionary change in how Toyota designs cars and factories. He is pushing Toyota to reduce the number of components it uses in a typical vehicle by half — a radical idea that would usher in a new chapter in car design. He also wants to create new fast and flexible plants to assemble these simplified cars.

Jon Miller, at the Gemba blog, has a nice analysis of the Japanese terms, so you can read that here. I think he’s not thrilled that yet another Japanese buzzword has possibly been created. Kevin Meyer also has a post at the Evolving Excellence blog.

This story has been told before, but I love the story about how the CEO started by managing an employee cafeteria and reducing waste with creativity and process change:

Mr. Watanabe started his career at Toyota in 1964, after graduating from Tokyo’s prestigious Keio University, and was put in charge of employee cafeterias. He took the job seriously and embarked on a mission to cut down on rice wastage. The cause of the problem, he figured, was that Toyota’s cafeterias, like other canteens across Japan, served the same amount of rice in a big bowl to all comers.

The article covers a number of innovations that Toyota is putting into place:

  • Watanabe is pushing Toyota to reduce the number of components it uses in a typical vehicle by half — a radical idea that would usher in a new chapter in car design. “For the future, Toyota wants to change the way it produces cars to prevent each efficiency drive becoming outdated whenever the company alters its designs. The goal is to halve the number of components.”
  • Toyota worked with casting suppliers to rethink the equipment: how could it be made smaller? “Smaller and simpler machines are less expensive to install, take less energy to run, are less likely to break down and are easier to fix if they do.” They also applied this concept to car assembly lines.
  • Major innovations in how cars are painted: “Smaller and simpler machines are less expensive to install, take less energy to run, are less likely to break down and are easier to fix if they do.

Dan Markovitz emailed me with some criticism of the article:

The article once again demonstrates how shallow is the understanding of Lean in the US (even though the journalist is Japanese and based in Japan). According to the article, around 2002, “[Katsuaki] Watanabe and his colleagues began pushing the company’s powerful manufacturing gurus to re-think Toyota’s much-admired “lean production.” Lean production is a flexible production system where, among other things, workers are able to switch between different tasks.”

Let’s leave aside for a moment the facile description of Lean (workers able to switch between different tasks) — this piece probably isn’t the right place to go into a full description of Lean philosophy. More importantly, the author misses the point entirely when he claims that Mr. Watanabe forced the company to “re-think Toyota’s much-admired ‘lean production’ system.” Constant re-thinking, continual improvement, relentless striving for increased efficiencies and reduced waste — that’s EXACTLY what Lean is all about. And in fact, the article goes on to describe improvements made in their assembly line machine tools as a result of Mr. Watanabe’s push for improvement.

As long as US companies and the US media continue to think of lean production as simply a matter of eliminating muda, or enabling workers to switch between different tasks, efforts to catch up to Toyota will come to naught. People need to understand Lean as an entire system, predicated upon respect and empowerment of the individual, that leads to increased efficiencies.
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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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2 Comments on "New WSJ Article on Toyota"

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  1. Anonymous says:

    Mark ends with “People need to understand Lean as an entire system, predicated upon respect and empowerment of the individual, that leads to increased efficiencies” which makes me wonder if we don’t need to repeat, on a monthly basis, some semblance of the tenets of the Toyota Way, with its two pillars of Continuous Improvement and Respect for People?

  2. B Baker says:

    First, I would suggest that a CEO who ‘frets’ and ‘grouses’ is a good thing. It should be the natural thing.

    I was going to write about how nothing about the specific innovations mentioned are really just manifestations of the same old Toyota way. I am not going to do that.

    I am just going to say that innovations, small incremental ones that happen inside the TPS as well as the big ones like the prius, 40% reduction in stamping ‘hits’ to make the rav4, nor the LX300 (1999, many consider the first modern crossover)are what Toyota is all about.
    Flexible, right sized equipment is old news in the TPS.
    Halving the number of components to make a car is innovative. It is should be expected from a company with a history of innovation like Toyota.

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