Toyota success honed by corporate culture

Special to the Courier & Press

Friday, February 17, 2006

The announcement of a new line of full-sized Tundra pickup trucks to be produced at the nearby Gibson County, Ind., Toyota assembly plant provides an opportunity to pause and consider the outstanding success the company has experienced in recent years.

While other U.S.-based auto companies are closing plants, taking salary concessions from top executives and laying off tens of thousands of workers all across the country, Toyota seems to continue its outstanding pace of growth and sales, well on its way to becoming the largest auto manufacturer in the world.

Toyota's success is no accident. It is based upon a carefully honed corporate culture of lean production, just-in-time delivery of subcomponents and a comprehensive mode of operation unique to the corporate world.

A new book titled "The Toyota Way: 14 Management Principles From the World's Greatest Manufacturer" by Jeffrey Liker tells a good part of the story. Liker, a University of Michigan professor and a 20-year student of the Toyota method of industrial and operational engineering, takes the reader through a culture that seeks to generate value for the customer, the society and the economy, with a long-term philosophical mission to constantly improve its people and the operating system in which they work.

Liker explains that this culture, steeped in the notion of self-reliance and trust in the company's abilities, stems from a corporate mission statement that differs greatly from those U.S. companies that are primarily motivated by short-term gain and the financial interest of stockholders.

The mission has three parts:

  • As an American company, contribute to the economic growth of the country in which it is located (external stakeholders).
  • As an independent company, contribute to the stability and well-being of team members (internal stakeholders)
  • As a Toyota group company, contribute to the overall growth of Toyota by adding value to its customers.
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    <>While the mission statement is instructive, the values of the company were more closely delineated in  a set of guiding principles published in an internal document that apply to the corporation as a global citizen. In it, Toyota pledges to:

  • Honor the language and spirit of the law of every nation and undertake open and fair corporate activities to be a good corporate citizen of the world.
  • Respect the culture and customs of every nation and contribute to economic and social development through corporate activities in the communities.
  • Dedicate itself to providing clean and safe products and to enhancing the quality of life everywhere through all its activities.
  • Create and develop advanced technologies and provide outstanding products and services that fulfill the needs of customers worldwide.
  • Foster a corporate culture that enhances individual creativity and teamwork value, while honoring mutual trust and respect between labor and management.
  • Pursue growth in harmony with the global community through innovative management.
  • Work with business partners in research and creation to achieve stable, long-term growth and mutual benefits, while being open to new partnerships.

    By adhering to a constancy of purpose embodied in these guiding principles, the company has developed an all new luxury line of vehicles - the Lexus - and pushed the envelope of technological advancement in bringing hybrid drive technology to market in the extremely successful Toyota Prius. This same technology will soon to available in several Lexus models and the extremely successful Camry sedan later this model year.

    With total year-end sales of 2,260,296 vehicles during 2005, an estimated $171 billion in global sales for the same period and plans to expand production capacity 10 percent to facilitate the production of more than 9 million vehicles annually, it appears as if the company is doing something right.

    David Coker is an Evansville free-lance writer.