By February 24, 2010 11 Comments Read More →

Akio Toyoda’s Testimony to Congress

I only watched a few minutes of Toyota CEO Akio Toyoda’s live testimony (thanks to online cable news streaming), but the first things I heard prompted me to Tweet about it and I’m following up with a quick post.

You can read his full prepared comments or a news article summary.

The very first words (I joined in progress) that I heard were ones I passed along in the first tweet:

Akio Toyota – “The key to making quality products is developing quality people” — the very 1st thing I heard in the webstream #lean

This is a familiar refrain from those of each teaching Lean management and the Toyota Way. How did Toyota lose sight of this?

The next quote speaks to the fact that Toyota got away from their core principles, things that are taught as Lean thinking. It’s not that TPS failed (or what some people think is TPS), Toyota got away from the TPS mindset.

Akio Toyoda blames growth that was “too quick.” Toyota priorities traditionally 1) safety 2) quality 3) volume. Priorities got confused.

So if TPS   / Toyota Way / Lean is about developing people so they can improve quality, Toyota got away from that when their goal was to become #1 in sales:

Akio Toyoda says they pursued growth over the speed at which they could develop people and org., he regrets that led to safety problems.

Since Toyoda is relatively new to the job, do we blame him?

Since taking the job, Akio Toyoda has placed focus on re-emphasizing quality over quantity. #lean (live testimony)

My colleague John Toussaint also blogged recently about Mr. Toyoda and his response to the recent challenges.

On Twitter, follow Matthew E. May and the NY Times’ Micki Maynard as they’re each tweeting about this from their perspectives.

And why is the company name not the same as the family? Find out from Jalopnik.

Updated: Random thought related to those from the Big 3 who are happy to see Toyota suffer, I think I’m coining a term (I can’t find it, or this spelling, via google anywhere):

I think I’m coining a phrase: “detroidenfreude.”


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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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11 Comments on "Akio Toyoda’s Testimony to Congress"

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  1. Gilad Langer says:

    You know, when thinking about all of this I started speculating that the Toyota organization has become brittle. It is so fine tuned that if it veers of course (as Toyoda suggests) then the effects are much more severe than for other organizations. Like a high performing sports vehicle that takes an off-road short cut? Anyways this is more of a brain fart, but I still wanted to put it out there :-)
    .-= Gilad Langer ´s last blog ..What is Intelligence, and why do we need it? =-.

  2. Mike Stoecklein says:

    I think you (and John Toussaint) are correct about this situation with Toyota. I was also thinking about some of your recent posts on W.E. Deming’s “Out of the Crisis”. My suspicion is that (if Dr. Deming were still alive) he’d have some harsh words for Toyota leadership, followed by some words of encouragement. My guess is that he’d say that they’ve been affected (infected?) by the forces of western management (short term thinking, focus on the competition) and he would encourage them to get back to their “constancy of purpose”. Of course, he’s not here to say it, but we can speak on his behalf, based on what he taught.

  3. Simon Ellberger says:

    Seeing the words “growth” and “develop” in Akio Toyoda’s remarks reminds me of some quotes from the late Russell Ackoff concerning the contrast between growth and development that may be worthy of reflecting upon by Toyota management (and the rest of us as well):

    “Growth and development are not the same thing. Neither is necessary for the other. A rubbish heap can grow but it does not develop. Artists can develop without growing.”

    “To grow is to increase in size or number. To develop is to increase one’s ability and desire to satisfy one’s own needs and legitimate desires and those of others. A legitimate desire is one that, when satisfied, does not impede the development of anyone else.”

    “Development of individuals and corporations is more a matter of learning than earning. It has less to do with how much one has than how much one can do with whatever one has.”

    “A lack of resources can limit growth but not development. The more developed individuals, organisations, or societies become the less they depend on resources and the more they can do with whatever resources they have. They also have the ability and the desire to create or acquire the resources they need.”

    “An individual can grow too much. Some people and many societies believe that a corporation can too. But would anyone argue that individuals, corporations, or countries can develop too much?”

  4. Andrew Bishop
    Twitter:
    says:

    Anyone who is interested in these questions should go back to Mark’s Podcast Archive and listen to #19 from March 10, 2007: Jim Womack, “Machine Revisted”. I just heard this for the first time yesterday (by chance – I’m catching up after finally getting an iPod) and Womack all but puts his finger on the current situation three years ago. Diagnosis of the condition before the symptoms are obvious to the patient suggests an acute observer!

    He expresses concern not just for losing sight of management practices associated with key principles, but gets down to practicalities of supplier relationships and engineering at suppliers in the rapid expansion of recent years in this discussion of how Toyota might fail. He didn’t guess it would be and accelerator pedal, but otherwise hearing it yesterday in the midst of current events was pretty uncanny.

    There’s another telling podcast a little later in the series, too, in which Norm Bodek reports on a laborer in a Lexus plant in Japan putting the same 8 bolts on all day, in an awkward position, no less. His observation was something like “this wouldn’t happen in Georgetown KY” (heavy paraphrase).

    Managers are human. Systems tend to disorder. Nobody said this stuff was easy!

  5. Brian Z Jones says:

    Toyota has strayed from TPS (“Lean”, if you’re American). However, I believe Toyota has not been infected by Western Culture. Quite the opposite, they were insulated from it.

    Japanese culture has these unwritten tenets:
    Don’t question the boss (even if you know he’s wrong);
    Do by committee (don’t step out of line);
    Make goals & stick to them (whether they end up wrong or not);
    Outsiders are below you (Japanese know best).

    You can see how the Japanese culture is the infection. Recall that “Respect for People” is actually a new addition to the House of TPS. The true Japanese belief is “Respect Your Superiors” (tenet #1). I know from first-hand experience that Jim Lentz was not, in any way, mis-shaping the truth when he says “all decisions are made in Japan” (tenet #4).

    I also believe Akio is honest when saying they lost their way on becoming #1 in Sales (tenet #3). With quality & safety out of the picture, you do whatever it takes to hit target of #1 in sales – no strategy changes until it happens. Tenet #2 leads to boring looking cars (something Akio wants to fix) & pairs with #1to keep dissent down the chain, no matter the future possibilities of catastrophic failures.

    To sum up: Toyota has lost its way. It will recover. But, unless the Japanese-ness is removed, wholesale (or at least adapted significantly for the world stage), this will re-occur in the future. Toyota didn’t create “Lean” – they systematized it. They should not stop the kaizen of TPS, which includes negating cultural effects.

    -bZj

    Disclosure: I work for a Toyota subsidiary in the US, under a Japanese President w/40yrs in Toyota.

  6. Mark Graban
    Twitter:
    says:

    Brian – thanks for the comment. Lots to chew on there.

    I thought, though, the “Respect for People” pillar is a recent Western discovery, that the original name for TPS internally was the “Respect for Humanity” system.

    Those 4 points:
    Don’t question the boss (even if you know he’s wrong);
    Do by committee (don’t step out of line);
    Make goals & stick to them (whether they end up wrong or not);
    Outsiders are below you (Japanese know best).

    Don’t sound at all like modern “Lean” principles – going to show that you can’t say everything Toyota does is inherently “Lean”, that there is a difference between Lean and TPS although Lean is squarely based on TPS.

  7. Pete Abilla
    Twitter:
    says:

    Toyota is a company full of paradox: on the one hand, respect for the human is a pillar, on the other hand, temporary hourly employees are treated very poorly.

    Toyota will come back.

    In the mean time, lean moves forward and it is up to us how we make lean relevant and applicable in our industry and value-add to our customers.

    Let’s not diefy any one company. Lean principles remain relevant, even though companies fail in their attempt in implementing it.

    * I’m a former Queueing Researcher at Toyota Supply Parts Distribution.

  8. Brian Z Jones says:

    True, Mark, there are parts of ‘old TPS’ (pre-“Lean”) that refer to respect & kindness. But, recognize that the Japanese culture is far different from ours in respect to what is kind, or respectful, or proper.

    I agree, Pete. Constant struggle inside Toyota re: conflicted direction. But, being a Japanese company, that side wins. I very much agree that we should avoid deification. Toyota systematized TPS, but the world community can advance/adapt Lean.

    -bZj

  9. Brian Z Jones says:

    Glad I had something to contribute – I’ve been a casual reader of the Lean Blog for a while now.

    -bZj

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