Ad code

The contradictions that Drive Toyota's Success 5

Disseminate know-how laterally

The slogan “Let’s yokoten” is often heard in the corridors of Toyota. Yokoten, which is short for yokoni tenkaisuru, literally means unfold or open out sideways. At Toyota, communication is viral and knowledge is diffused in all directions. The company has found that one of the best ways to ensure good communications is to have everyone work together in a large room with no partitions (obeya). The concept originated in Japan because of the perennial shortage of office space, which we mentioned earlier, but the company now uses it all over the world. Project teams also post information on the walls of a dedicated situation room for everyone to see—a practice known as mieruka (visualization).

Give people the freedom to voice contrary opinions.

Toyota’s communication system works because the organization is open to criticism. Employees feel safe, even empowered, to voice contrary opinions and contradict superiors. Each individual in Toyota is expected to act according to what he or she thinks is right. Every employee enjoys the prerogative to ignore the boss’s orders or not take them too seriously. Confronting your boss is acceptable; bringing bad news to the boss is encouraged; and ignoring the boss is often excused. In many of our interviews, employees told us how local operations had succeeded by refusing to obey orders or ignoring what headquarters had advised. For instance, the head of Toyota Motor Sales, U.S.A., Yukitoshi Funo, told us candidly: “Before I was sent to the U.S. in 1997 [as senior vice president], I made the rounds of several top executives in Japan. They told me to increase the number of sales outlets. These were executive vice presidents and managing directors. I went to the market to see the situation. Increasing the number of dealerships would have caused more intense competition and threatened proper management of dealerships. I decided to ignore everything those top executives told me.”

Confronting your boss is acceptable; bringing bad news to the boss is encouraged; and ignoring the boss is often excused.

 Have frequent face-to-face interactions.

Although there are no reprisals if local operations don’t act on headquarters’ advice or if subordinates disobey orders from supervisors, refusing to listen to others is a serious offense. Toyota’s system functions only when information from the source is available to everybody in the organization. The emphasis is therefore on interactions at the scene (genba). For instance, Tony Fujita, former vice president of Toyota Motor Sales, U.S.A., believes that Toyota distinguishes itself from American carmakers by listening to dealers. “Other carmakers have meetings with dealers, but I think Toyota is unique in the frequency and the seriousness of what we discuss [with them].”

Make tacit knowledge explicit.

Another element in Toyota’s nerve system is the practice of converting experiential or tacit knowledge into an explicit form to be shared throughout the organization. When Fujio Cho was president, Toyota put into writing the founders’ wisdom that had until then been passed down orally. Senior executives evaluated sayings and anecdotes and identified two core values as the pillars of The Toyota Way 2001: continuous improvement (kaizen) and respect for people.

Create support mechanisms.

In 2002, the company set up the Toyota Institute and the Global Knowledge Center at Toyota City in Japan and Torrance, California, respectively. Together with the University of Toyota, established four years earlier at Torrance by Toyota Motor Sales, U.S.A., these formal mechanisms support Toyota’s communication networks by disseminating best practices and company values. In addition, employees are encouraged to join a wide variety of informal groups, as we mentioned earlier. Every employee belongs to several committees (iinkai), self-organizing study groups (jishuken), and other social groups, of which there are close to 20 in the company. This helps create a multilayered communication network at Toyota.

Emulating Toyota
People often ask us, “Tell me one thing I should learn from Toyota.” That misses the point. Emulating Toyota isn’t about copying any one practice; it’s about creating a culture. That takes time. It requires resources. And it isn’t easy. First, companies have no choice but to embrace contradictions as a way of life. Most enterprises stop growing because they stick to processes and practices their past successes have generated. However, old methods also lead to institutional rigidities. Companies can overcome them by trying to reach new markets or by tackling fresh challenges. Second, companies must develop routines to resolve contradictions. Toyota uses numerous tools such as the Plan-Do-Check-Act model, the eight-step Toyota Business Practices process, the A3 reporting system, and the widely known ask-why-five-times routine. Unless companies teach employees how to deal with problems rigorously and systematically, they won’t be able to harness the power of contradictions. Third, companies must encourage employees to voice contrary opinions. Top managements must be open to criticism and hearing opposing viewpoints if they want new ideas.

Should companies try to do as Toyota does? We believe they should. Toyota’s culture of contradictions places humans, not machines, at the center of the company. As such, the company will be imperfect, and there will always be room for improvement. In that sense, Toyota’s model mirrors human creativity. Can you say the same about your company?

This article appeared in the Business Review.

Post a Comment