The Toyota Way

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There is a sense of urgency among Toyota senior executives in Japan, including president Katsuaki Watanabe, who have put top priority on teaching the secret management practices responsible for their stunning success, known as “The Toyota Way.”

This includes concepts and slogans such as “mutual ownership of problems,” and “genchi genbutsu,” or solving problems at the source instead of behind desks. Basically, a culture of exposing problems in order to find effective and timely solutions.

Toyota’s corporate culture has transformed it from a small manufacturer into a market-gobbling giant famous for quality circles and giving workers control over production lines. For years, aspiring factory leaders have come here to attend Toyota’s select technical high school, the Toyota Technical Skills Academy in Toyota City.

But Toyota — on course to become the world’s largest automaker — needs to sharpen its game to meet even larger challenges, including raising quality in the face of rapid overseas expansion and its largest recalls in history.

The nerve center for that task is a nondescript cluster of buildings in the lakeside town of Mikkabi, an hour away from the humble-looking headquarters of Toyota, in Toyota City.

It is the Toyota Institute, charged with preparing executives to enter the leadership class at Toyota by inculcating in them some of the most prized management secrets in corporate Japan. The institute sends off its executives to offices around the world as missionaries of sorts for the Toyota Way.

The institute does not quite aspire to be Japan’s answer to General Electric’s famed Crotonville training center in Ossining, N.Y., which spawned a generation of top executives across American industry. But it is Toyota’s best effort to avoid corporate short-sightedness and to keep the company true to its original mission of winning customers with quality cars, even as it comes under intensifying scrutiny.

“There is a sense of danger,” said Koki Konishi, a Toyota general manager who heads the institute. “We must prevent the Toyota Way from getting more and more diluted as Toyota grows overseas.”

From The New York Times.

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