New book argues Toyota owes success to curiosity
10-22-07, 10:11 PM
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New book argues Toyota owes success to curiosity
Though this week Toyota has unofficially dropped to No. 2 globally for year-to-date sales, it remains to be seen if GM can retain its top position in the face of Toyota's relentless pursuit. So how did a Japanese maker of weaving looms get to be the Japanese Juggernaut it is today? A new book by David Magee argues that the company owes its success to an internal culture of curiosity.
Toyota's founder, Sakichi Toyoda, was determined to create the world's finest weaving looms. He did so by checking out other company's looms around the world and using their advancements to improve his owncompany's products. And in the 1920s, a visit to a GM factory intrigued him, and the rest is history. Magee says in his book, "How Toyota Became No. 1", that Toyoda's philosophy of seeking out new ideas was fostered in his employees and remains one of the company's greatest attributes.
Keith McFarland talks about the book in his "BusinessWeek" column, suggesting that while other automakers focused solely on retaining their market share and satisfying stockholders, Toyota has for decades been straying from worn paths to find new ideas. So as GM and Ford fought over which company has the best truck for decades, Toyota's been developing hybrid technologies and perfecting the world's best-selling passenger cars. As for what's happening to the Tundra, well, there are risks when straying from the worn paths you know.
[Source: BusinessWeek]
Toyota's founder, Sakichi Toyoda, was determined to create the world's finest weaving looms. He did so by checking out other company's looms around the world and using their advancements to improve his owncompany's products. And in the 1920s, a visit to a GM factory intrigued him, and the rest is history. Magee says in his book, "How Toyota Became No. 1", that Toyoda's philosophy of seeking out new ideas was fostered in his employees and remains one of the company's greatest attributes.
Keith McFarland talks about the book in his "BusinessWeek" column, suggesting that while other automakers focused solely on retaining their market share and satisfying stockholders, Toyota has for decades been straying from worn paths to find new ideas. So as GM and Ford fought over which company has the best truck for decades, Toyota's been developing hybrid technologies and perfecting the world's best-selling passenger cars. As for what's happening to the Tundra, well, there are risks when straying from the worn paths you know.
[Source: BusinessWeek]
10-23-07, 06:02 AM
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Here's the BusinessWeek article itself:
How Curiosity Empowers Toyota
The carmaker's determined willingness to try new ideas has allowed it to build a commercial fortress and an astonishing record of success
by Keith McFarland - BusinessWeek
Pundits and professors have been trying for decades to figure out what makes Toyota so successful—but many may have been looking in the wrong places. In his new book, How Toyota Became #1 (Portfolio; November, 2007), David Magee convincingly argues that the spirit of Toyota people, as much as anything, has determined Toyota's success.
Toyota's performance has been stunning. The company has not lost money in a single quarter since 1951. As U.S. automotive powerhouses are drowning in red ink, Toyota earned its highest ever net profit in 2006—$17 billion.
So what keeps Toyota growing and improving year after year? In his book, Magee suggests the driver is a handful of principles embedded deeply in the company, including a respect for people, a willingness to take a long-term view, and the determination to improve the business a little bit every day.
As I read Magee's book one idea kept surfacing in my mind. Throughout its history, Toyota appears to have put an emphasis on an important but oft-overlooked characteristic: Curiosity. You can trace Toyota's institutionalized curiosity back to its founder, Sakichi Toyoda (1867-1930), who became interested in improving the effectiveness of weaving looms, and who went on to revolutionize weaving technology in Japan and secure more than 100 patents on his ideas. You might say Toyota's founder was "loopy" for looms. Not content just to build the best looms in Japan, Toyoda traveled to Europe, toured leading Western loom makers, and carried key ideas back to Japan. Son Kiichiro Toyoda carried on his father's tradition of curiosity—and a visit to a Detroit auto plant in the 1920s inspired him to move a renamed Toyota into the car business.
For more than 70 years, Toyota's curiosity has allowed it to build, brick by brick, a commercial fortress. It has scanned the globe for the best ideas—from styling to manufacturing to quality management—and imbued those ideas with a power that often surprises even the people who came up with them in the first place.
Late for a Meeting
Reading Magee's book I was reminded of the story of Bjarni Herjólfsson—the man who almost discovered the New World. En route to Greenland to visit family in 986, Herjólfsson was blown off course and ended up off the coast of Newfoundland. He and his crew sat in their boat and gazed at a huge, undiscovered continent—which, as it turned out, held some of the richest resources on earth. There was only one problem: Herjólfsson and his crew didn't go ashore. Instead, they turned their boats toward Greenland. After all, they were late for a meeting with family.
Herjólfsson told lots of people about this strange new land, but it would be more than 10 years before anyone would go to investigate—when Erik the Red would buy Herjólfsson's boat and explore, establishing the first European settlement in the New World.
What was the difference between the man who almost discovered the New World and the one who actually did? Simple. One was willing to go ashore, the other wasn't.
"Going ashore" appears to be a culture imperative at Toyota. W. Edwards Deming's concepts of quality management were in wide circulation in the 1950s, but it was Toyota engineers that "went ashore" with his ideas—developing the Toyota Production System, its patented manufacturing methodology. The conceptual ideas of quality management led the carmaker to pioneer such practices as design for manufacturing and lean production. In short, Toyota went ashore in the world of quality.
Cruising Right By
People in the automobile business had been talking for years about hybrid vehicles, sailing along the shores of the New World of automobile fuel economy. Once again, Toyota stepped up—and is expected to sell 430,000 Prius cars in 2007, a 40% jump over 2006 sales.
Perhaps the most important thing a leader of any organization can do is to try to encourage a spirit of going ashore. Too often in the world of work, people hurry from commitment to commitment without noticing the landscape around them—people and companies cruise right by amazing opportunities that are under their noses.
And going ashore is not just important to the behemoths like Toyota. I spent the past five years studying the performance of more than 7,000 growth companies. When I identified the top nine performers over a 23-year period and compared their operations to similar outfits with less impressive performance, one point stood out: Companies achieving breakthrough performance employed workers with great curiosity. These companies pioneered new products, discovered new markets, and created innovative approaches at a much faster rate than their competitors. They went ashore, and reaped the benefits of doing so.
How Curiosity Empowers Toyota
The carmaker's determined willingness to try new ideas has allowed it to build a commercial fortress and an astonishing record of success
by Keith McFarland - BusinessWeek
Pundits and professors have been trying for decades to figure out what makes Toyota so successful—but many may have been looking in the wrong places. In his new book, How Toyota Became #1 (Portfolio; November, 2007), David Magee convincingly argues that the spirit of Toyota people, as much as anything, has determined Toyota's success.
Toyota's performance has been stunning. The company has not lost money in a single quarter since 1951. As U.S. automotive powerhouses are drowning in red ink, Toyota earned its highest ever net profit in 2006—$17 billion.
So what keeps Toyota growing and improving year after year? In his book, Magee suggests the driver is a handful of principles embedded deeply in the company, including a respect for people, a willingness to take a long-term view, and the determination to improve the business a little bit every day.
As I read Magee's book one idea kept surfacing in my mind. Throughout its history, Toyota appears to have put an emphasis on an important but oft-overlooked characteristic: Curiosity. You can trace Toyota's institutionalized curiosity back to its founder, Sakichi Toyoda (1867-1930), who became interested in improving the effectiveness of weaving looms, and who went on to revolutionize weaving technology in Japan and secure more than 100 patents on his ideas. You might say Toyota's founder was "loopy" for looms. Not content just to build the best looms in Japan, Toyoda traveled to Europe, toured leading Western loom makers, and carried key ideas back to Japan. Son Kiichiro Toyoda carried on his father's tradition of curiosity—and a visit to a Detroit auto plant in the 1920s inspired him to move a renamed Toyota into the car business.
For more than 70 years, Toyota's curiosity has allowed it to build, brick by brick, a commercial fortress. It has scanned the globe for the best ideas—from styling to manufacturing to quality management—and imbued those ideas with a power that often surprises even the people who came up with them in the first place.
Late for a Meeting
Reading Magee's book I was reminded of the story of Bjarni Herjólfsson—the man who almost discovered the New World. En route to Greenland to visit family in 986, Herjólfsson was blown off course and ended up off the coast of Newfoundland. He and his crew sat in their boat and gazed at a huge, undiscovered continent—which, as it turned out, held some of the richest resources on earth. There was only one problem: Herjólfsson and his crew didn't go ashore. Instead, they turned their boats toward Greenland. After all, they were late for a meeting with family.
Herjólfsson told lots of people about this strange new land, but it would be more than 10 years before anyone would go to investigate—when Erik the Red would buy Herjólfsson's boat and explore, establishing the first European settlement in the New World.
What was the difference between the man who almost discovered the New World and the one who actually did? Simple. One was willing to go ashore, the other wasn't.
"Going ashore" appears to be a culture imperative at Toyota. W. Edwards Deming's concepts of quality management were in wide circulation in the 1950s, but it was Toyota engineers that "went ashore" with his ideas—developing the Toyota Production System, its patented manufacturing methodology. The conceptual ideas of quality management led the carmaker to pioneer such practices as design for manufacturing and lean production. In short, Toyota went ashore in the world of quality.
Cruising Right By
People in the automobile business had been talking for years about hybrid vehicles, sailing along the shores of the New World of automobile fuel economy. Once again, Toyota stepped up—and is expected to sell 430,000 Prius cars in 2007, a 40% jump over 2006 sales.
Perhaps the most important thing a leader of any organization can do is to try to encourage a spirit of going ashore. Too often in the world of work, people hurry from commitment to commitment without noticing the landscape around them—people and companies cruise right by amazing opportunities that are under their noses.
And going ashore is not just important to the behemoths like Toyota. I spent the past five years studying the performance of more than 7,000 growth companies. When I identified the top nine performers over a 23-year period and compared their operations to similar outfits with less impressive performance, one point stood out: Companies achieving breakthrough performance employed workers with great curiosity. These companies pioneered new products, discovered new markets, and created innovative approaches at a much faster rate than their competitors. They went ashore, and reaped the benefits of doing so.
How Curiosity Empowers Toyota
10-23-07, 09:49 AM
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10-23-07, 10:00 AM
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I'm about halfway through and I am enjoying it greatly. He mainly talks about the specific errors and failures that made GM spiral down from the 1950s-1960s when they were so dominant, and the vast differences b/t domestic and japanese/euro company operations. The book is not as abrasive as the Dear Mr Toyoda thread written by him. IMO you can learn a lot of company operation principles just by reading this book, but it is mainly historical in content, but anyone can learn a lot from history as well
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