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EXTREME TOYOTA



By now, most of us figure we understand what makes Toyota Motor Corp. so successful. We've heard about - and Canadian companies have copied - its just-in-time inventory control, continuous improvement approach, and kaizen becoming a familiar word. And, awed by the fact Toyota can let any employee stop its production line to avoid producing defects, our companies have more cautiously tried to empower workers.


But after six years of research into Toyota, with unprecedented access to its people and plants, three professors at Hitotsubashi University, one of Japan's top business schools, have decided Toyota's secret is more complex than has been assumed. Indeed, they found it like peeling an onion but never getting to the centre.

There are six operating contradictions the researchers teased out and highlight because they seem central to Toyota's success:


Moving gradually and taking big leaps: The company known for slow, tortoise-like improvements, through kaizen, also took a grand leap forward for the auto industry with the hybrid car Prius.


Cultivating frugality while spending huge sums: Toyota's penny pinching rivals that of Wal-Mart Stores Inc., from its humble headquarters to its very low dividend payouts to paying executives on the low end of the compensation scale. But it is not shy about spending large sums on research and development, manufacturing facilities, brand equity, dealer networks, and human resources development.


Operating efficiently as well as redundantly: Toyota is the epitome of operational efficiency in many ways despite activities, such as big meetings, staff deployment, and the "up-and-in" policy, that would be considered inefficient.


Cultivating stability and a paranoid mindset: The company has experienced stable growth for 50 years and is known for its enduring cars, such as the Corolla and Camry, that maintain an image of stability. But its executives thrive on paranoia, constantly issuing messages about not being satisfied, and seeking Utopian goals. For instance, chairman Hiroshi Okuda has called for building a car that can make the air cleaner as it runs and can travel from one coast of North America to the other on one tank of gas.


Bureaucratic hierarchy while allowing dissent: The company is very hierarchical but, throughout the ranks, people speak up, confident that constructive criticism will be welcomed.


Maintaining simplified and complex communication: A web of networks aims to connect everybody, but the company expects communications themselves to be simple. This is exemplified by the use of a single 11-by-17-inch sheet of paper as a simplified format for presentations, forcing people to think through and focus their message.

http://www.theglobeandmail.com/servl...s/ROB_Managing

Shows why Toyota is so difficult to emulate.

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