“Toyota Culture” 20 Years Later: Why Liker’s Lessons Still Matter in 2026

TL;DR Twenty years later, Jeffrey Liker's message still applies: Lean fails when it's treated as a set of tools instead of a leadership system. Toyota's results come from developing people, creating stability, and fostering psychological safety–not from dashboards or templates. In 2026, sustainable improvement still depends on leaders doing the hard, human work.

Back in 2008, I recorded a three-part podcast series with Professor Jeffrey Liker about Toyota Culture, based on his (then) new book, Toyota Culture: The Heart and Soul of the Toyota Way (co-authored with Mike Hoseus; check out a podcast with him here). I've been thinking about those conversations again lately because–despite all of the changes in the world of work since then–the core message still lands with a thud:

If you treat “Lean” as a toolbox, you'll get some short-term gains… and long-term frustration. If you treat Lean as a management system grounded in respect for people, learning, and leadership behaviors, you might actually build something that lasts.

In 2026, that distinction matters even more than it did in 2008.

Why? Because the forces pushing leaders toward shortcuts are stronger than ever: higher turnover, “do more with less” pressure, hybrid work complexities, technology disruptions, and the temptation to replace leadership with dashboards, scripts, and (now) AI. Tools have never been easier to buy. Culture has never been harder to build.

So, I want to look back at all three parts of that Liker series (part 1, part 2, and part 3) and pull out a handful of themes–with direct excerpts–then connect them to what leaders need to be thinking about now.

The Episodes:

Jeffrey Liker on Toyota Culture and the Human Side of the Toyota Way (Part 1)

Why Lean Culture Is So Hard to Copy — Jeffrey Liker on Toyota Culture (Part 2)

How Toyota Develops Lean Leaders — Jeffrey Liker on Manager Development (Part 3)

Part 1: “Toyota Culture” isn't an add-on… It's the point

One of the big ideas from Part 1 is why Liker and Hoseus wrote Toyota Culture in the first place: because the “people side” wasn't getting nearly enough attention.

In the conversation, Jeff talks about how The Toyota Way used his 4P model (Philosophy, Process, People & Partners, Problem Solving) and the “people” element couldn't be covered adequately in a single chapter. The result was a deeper exploration: not just a description of practices, but the underlying assumptions–the “why”–and the human systems that make the tools work.

That's an important framing now because I still see organizations trying to “install Lean” the way you might install software. They roll out standard work documents, huddle boards, and a pile of templates… and then they're surprised when people don't use them (or use them performatively).

One phrase from that Part 1 discussion keeps echoing for me: the idea that many companies are trying to implement Lean “the wrong way” (or “the ineffective way”)–by focusing on tools while ignoring culture.

This isn't a “tools bad / culture good” argument. Toyota has tools. Toyota uses tools. But Toyota's tools are embedded inside a culture and management system that develops people and leaders over time.

For example, the andon cord “tool” (or method) doesn't work outside of an effective andon cord system that's built upon mindsets of Toyota.

Part 1: The “quality people value stream” and the waste of “people inventory”

Jeff introduces something in Part 1 that I wish every executive team would take seriously:

the “quality people value stream.”

He describes mapping the employee experience the way we might map a product value stream. In many organizations, a person gets a bit of onboarding… then sits in “inventory” for years from a learning and development standpoint. That's not just sad; it's costly. It's also one reason improvement efforts (or companies) stall.

In contrast, Toyota has deliberate systems for developing people–and Toyota treats that development work as core to management's job, not an optional extra.

This ties directly to what I see in 2026: many organizations are struggling with retention and engagement, while simultaneously underinvesting in the very thing that improves both–daily people development.

And that leads directly into Part 2.

Part 2: Culture is fragile–and short-term reactions can undo years of progress

In Part 2, I asked Jeff about whether Toyota's culture is resilient to the loss of key leaders. His answer was refreshingly unromantic:

Toyota isn't invulnerable, and culture can be weakened if different leaders come in who don't understand it. He even joked that Toyota has “kryptonite.”

But Jeff also emphasized something crucial: Toyota's “people value stream” is always running, developing leaders at multiple levels–not just relying on a heroic few.

Then he pivots to a contrast that's painfully relevant in 2026: how many organizations treat turnover as normal… even acceptable… while simultaneously claiming they want “Toyota-like” culture (or just the results, sadly).

Jeff shared a striking data point from the book era: Toyota's annual attrition rate in North America was 1.7% (keeping “over 98%”), and executive-level attrition was about 1.5%. He contrasted that with companies he was working with that were losing 35% of hourly employees annually.

Here's the line that matters:

When Toyota loses people, they don't shrug. They do problem-solving.
They ask what countermeasures would help keep people.

That is a profoundly different mindset than “people are replaceable.”

And in 2026, with labor markets tighter in some sectors and burnout higher in others, the idea that you can build a continuous improvement culture on a revolving door is… optimistic at best.

Part 2: Servant leadership, “no power,” and the manager-as-teacher idea

Another Part 2 thread that deserves more attention in 2026 is leadership.

Jeff contrasts Toyota's leadership philosophy with the celebrity-CEO model. He notes that in Toyota, leaders are described as practicing servant leadership.

Then he shares a story from NUMMI: a Japanese sensei tells Gary Convis, upon becoming a vice president,

“You realize now that you're vice president, it means that you no longer have any power.”

That's not false humility. It's a reframing of the job:

• The higher you go, the more your role becomes supporting and teaching, not issuing orders.
• At some point, leaders must “pull [themselves] away” so the next generation can struggle a bit and develop.

In 2026, I see an uncomfortable mismatch in many organizations:

Leaders say they want empowerment and ownership… but they keep the “power” mindset. They still act like the solution is to tell people what to do faster, measure harder, and escalate more. It's what Dr. John Toussaint calls “white coat leadership” — and it's outdated.

Toyota's framing is the opposite: develop capability so problems get solved at the right level, with leaders coaching rather than controlling.

Part 2: Engagement data as “defects” (and not “defective people”)

One of my favorite moments in Part 2 is when Jeff talks about employee survey data and how Toyota treats it.

He describes Toyota's mindset as “zero defects”–so if 5% to 10% of employees are unhappy, Toyota doesn't wave it off as “pretty good.” They treat it as a problem to understand and address, using workgroup-level feedback and problem solving.

Then comes a key distinction (and this is right in my wheelhouse, given how often organizations slip into blame):

I noted there's a difference between “5% defects” and “5% defective people.”
Jeff agreed and said Toyota's bias is: what is it about the system that allows people to be unhappy, make mistakes, or get hurt–not “what is it about the person who causes them to screw up.”

That's a culture statement. That's also a psychological safety statement.

And it tees up Part 3 beautifully.

Part 3: Stability, rotation, and the “critical mass” needed for culture

Part 3 was triggered by a listener question about management rotation–how often leaders change roles–and the impact on relationships, respect for people, and culture.

Jeff's answer is nuanced.

First, he reinforces the long development arc: it can take “at least a decade” to develop an assistant manager, and leadership responsibility exists at every level down to team leaders, who support only five to eight people in a very “intimate” daily relationship.

Then he makes a point that hits directly at what many organizations do today:

If you turn leaders over every 18 months, you never have time to develop them into teachers and mentors.

He says you need a critical mass of people who stay, continue to learn, and carry the culture–then you can afford some turnover and movement.

And he gives a practical “rule of thumb” that many leaders should write down:

Three years is a minimum (and five years for a president role), because less than three years makes it hard to learn enough and gain trust to make a meaningful contribution.

That's a helpful counterweight in 2026 when some organizations treat rotational programs like a leadership factory–moving people fast, broadening résumés, and accidentally starving teams of stable leadership.

Part 3: Toyota does rotate–just not recklessly

Jeff is clear that Toyota rotates people internally to develop them–and that's part of the people value stream. Some people may stay in the same team leader role for decades; others move to maintenance, kaizen groups, or pilot teams.

But Toyota doesn't pretend rotation is free.

If too many changes happen at once–group leaders and team leaders all turning over–“that work group is gonna be in trouble,” and Toyota has to bring in experienced leaders from elsewhere… weakening those areas in the process. Domino effects are real.

In other words: Toyota manages rotation as a system, with deliberate preparation and succession–not as a casual HR policy.

That's a leadership lesson for 2026: development is not the same as churn.

Psychological safety: Toyota's system “dies” without it

One of the most explicit psychological safety moments connected to this whole series shows up in Toyota Culture:

“Toyota believes people must be treated fairly, they must feel psychologically and physically safe. And without trust in their employers, employees are reluctant to admit to the existence of problems and learn that it's safest to hide them.”

Whether Toyota uses the modern term frequently or not, the concept is foundational. Jeff points out that the whole system depends on surfacing gaps–problems defined as the gap between what should be happening and what is happening. If people don't speak up, the improvement engine stalls.

In 2026, psychological safety is not a “nice-to-have.” It's an operational requirement for any organization that wants:

• early detection of problems
• learning from mistakes
• experimentation and innovation
• continuous improvement that doesn't collapse into “low hanging fruit” projects

Why This Matters More in 2026 Than It Did in 2008

Many organizations today talk about agility, innovation, engagement, and continuous improvement. They also invest heavily in tools, dashboards, templates, and now AI. What Liker's conversations remind us is that none of those things substitute for the underlying system.

You cannot build a learning culture on constant churn.
You cannot expect continuous improvement without stability.
And you cannot separate results from the way leaders develop people.

Toyota's advantage was never a secret method or a perfect toolset. It was a management system that treated people development as real work, retention as a problem to be solved, and leadership as a teaching role rather than a power position. Those choices mattered in 2008, and they matter even more in 2026, when the pressure to chase shortcuts is stronger than ever.

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Questions Leaders Should Be Asking in 2026

If you say you want a Toyota-like culture in your own context, these are not rhetorical questions. They are operational ones:

• When people leave, do we treat it as normal or as a signal to improve our system?
• Do our managers see their job as delivering numbers or developing people who can improve the system?
• Are we rotating leaders in a way that builds capability without eroding trust and stability?
• Do people feel safe surfacing problems early, or have our reactions taught them to stay quiet?

How these questions are answered in practice will shape results far more than any Lean tool rollout.

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If you’re working to build a culture where people feel safe to speak up, solve problems, and improve every day, I’d be glad to help. Let’s talk about how to strengthen Psychological Safety and Continuous Improvement in your organization.