Toyota first caught the world’s attention in the 1980s, when it became clear that there was something special about Japanese quality and efficiency.
Japanese cars were lasting longer than American cars and required much less repair. By the 1990s it became apparent that there was something more special about Toyota compared to other automakers in Japan.
It was not eye-popping car designs or performance, though ride was smooth and the designs often very refined. Rather, it was the way Toyota engineered and manufactured the autos that led to unbelievable consistency in the process of the product.
Toyota designed autos faster, with more reliability, yet at competitive cost, even when paying the relatively high wages of Japanese workers.
Equally impressive was that every time Toyota showed an apparent weakness and seemed vulnerable to the competition, Toyota miraculously fixed the problem and came back even stronger.
Today Toyota is the third-largest auto maker in the world, behind Volkswagen and Renault-Nissan-Mitsubishi Alliance. However, Toyota is more profitable than any other auto makers.
Much of Toyota’s success comes from its astounding quality reputation. Consumers know that they can count on their Toyota vehicle to work right the first time and keep on working, while most U.S and European auto companies produce vehicles that may work when new but almost certainly will spend time in the shop in a year or so.
What is the secret of Toyota’s success? The incredible consistency of Toyota’s performance is a direct result of operational excellence, its strategic weapon.
This operational excellence is based in part of tools and quality improvement methods made famous by Toyota in the manufacturing world, such as just-in-time, kaizen, one-piece flow, jidoka and heijunka. These techniques helped spawned the “lean manufacturing” revolution. But tools and techniques are no secret weapon for transforming the business. It is their continued success at implementing these tools stems from a deeper business philosophy based on its understanding of people and human innovation.
Its success is ultimately based on its ability to cultivate leadership, teams, and culture, and to devise strategy, to build supplier relationships and to maintain a learning organization.