Fast Company senior writer Charles Fishman wrote a very good book about Wal-Mart (excerpted in Salon) and, more recently, a feature about Wal-Mart's plans to push compact fluorescent lightbulbs that caught the imagination of the entire enviroblogosphere. Now he has a new story, on how Toyota unflaggingly works to constantly improve its manufacturing processes, that is likely to be of interest to How the World Works readers.
One of the very first posts here, almost a year ago, looked at the huge losses being reported by GM and Ford and compared those companies unfavorably to Toyota, primarily because Toyota was busy making cars that consumers found increasingly attractive as gas prices rose, while Detroit had stayed fixated on humongo-vehicles. Fishman fleshes out another part of the story -- Toyota's success in inculcating a top-to-bottom corporate commitment to incremental improvement.
Incremental improvement isn't sexy, but when you turn it into a way of life, you can achieve astonishing results. Fishman provides a slew of closely observed details of how it works from the factory floor at a huge Toyota plant in Georgetown, Ky. I especially liked these passages:
Lean manufacturing and continuous improvement have been around for more than a quarter-century. But the incessant, almost mindless repetition of those phrases camouflages the real power behind the ideas. Continuous improvement is tectonic. By constantly questioning how you do things, by constantly tweaking, you don't outflank your competition next quarter. You outflank them next decade.
What happens every day at Georgetown, and throughout Toyota, is teachable and learnable. But it's not a set of goals, because goals mean there's a finish line, and there is no finish line. It's not something you can implement, because it's not a checklist of improvements. It's a way of looking at the world. You simply can't lose interest in it, shrug, and give up -- any more than you can lose interest in your own future.
"People who join Toyota from other companies, it's a big shift for them," says John Shook, a faculty member at the University of Michigan, a former Toyota manufacturing employee and a widely regarded consultant on how to use Toyota's ideas at other companies. "They kind of don't get it for a while." They do what all American managers do -- they keep trying to make their management objectives. "They're moving forward, they're improving, and they're looking for a plateau. As long as you're looking for that plateau, it seems like a constant struggle. It's difficult. If you're looking for a plateau, you're going to be frustrated. There is no 'solution.'"
The sentence "there is no solution" has a friendly postmodernist feel. There is no truth! Process is all! It's the "bazaar" open-source software methodology that resulted in Linux, as opposed to the "cathedral" approach that is trying to pump out Microsoft Vista. It even captures the essence of how this blog works. I don't pretend to believe that there is one integrated answer that resolves all the contradictions and crosscurrents of globalization. I just try to understand a tiny little piece of the puzzle each day, and hope that in the long run it adds up to a compelling narrative.
But I digress. Back to Toyota. The obvious rejoinder to any paean to Toyota is that the company has much more freedom to make profits in the United States than do its American counterparts because it isn't crippled by huge pension obligations and mandated union wages. Fishman makes passing reference to this, acknowledging that "Toyota enjoys some structural advantages in the form of lower health care and pension costs" but then he asserts that Toyota is "offering union wages and good health insurance (to avoid being unionized)," to its American workers, without providing any figures or backup to support his claim. I find it difficult to believe that Toyota is offering wages to its workers in Kentucky that compare to the wages received by UAW members in Michigan or Ohio. The article would have been stronger if it had taken a harder look at exactly what the comparative costs of car-making are for Toyota and its fading rivals.
But as a prescription for how to face the huge challenges of the 21st century, for corporations and for individuals, Fishman's explication of "the Toyota Way" is worth pondering. We're not going to solve any of the problems we face in the future. At the very best, we can only hope to improve how we cope with them.
(P.S. I am off tomorrow, and won't be back until Monday. Enjoy the break.)
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