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The cynical view of the problems that have engulfed Toyota, the world’s largest car manufacturer, in the past week is that this all looks suspiciously like the revenge of Detroit. The beneficiaries from Toyota’s woes, in the short term at least, are likely to be those other, mostly US-owned, mega-corporations that got overtaken by Toyota’s devastating combination of market nous and its production and supply chain efficiency. In present market conditions, the other carmakers are unlikely to be laughing all the way to the bank. But they’d be less than human if they weren’t smiling just a bit.
The irony of Toyota’s position won’t be lost on those people across manufacturing and engineering who have seen the Toyota Production System as the inspiration for a wide range of business efficiency moves under the “lean” banner. Toyota was the group that synthesised all the ideas about making things to customer demand, raising quality, and reducing the various forms of waste that were endemic to most previous production processes.
The concepts of lean have featured heavily among winners of the MX Manufacturing Excellence Awards and have also found their way out into non-manufacturing businesses. You could argue that if the banks had stuck to lean principles, and had done rather more of what their customers wanted, then many of the business world’s troubles might have been averted.
The other aspect where Toyota has appeared to be smart has been in innovation and leading the market. The Prius has been the world’s first big-selling hybrid car, and if some of the automotive purists cavil that it’s not that much more environmentally friendly than a standard vehicle, they can at least give Toyota credit for kick-starting the sector. There’s barely an auto manufacturer in the world now that doesn’t have a hybrid or full electric vehicle programme in development, while Prius sails away as a top seller already – in Japan, at any rate.
So should we infer from Toyota’s problems that these principles of lean manufacturing and product innovation are somehow flawed, or even wrong? Absolutely not. Those were the factors that got Toyota to be the world’s No 1 carmaker.
But what the current difficulties do indicate is that if you aspire to be the best, then you can never afford to relax. For all the grand policies and principles, the devil really is in the detail, and that demands ceaseless vigilance.