Toyota Product Development System

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GENE DOBBS BRADFORD
EMBA 30
BOOK REPORT: “The Toyota Product Development System”

Toyota’s innovation process in not the result of a few well-implemented initiatives, rather, it is a highly integrated system that constantly reinforces itself and is woven through the fabric of the entire organization. Many companies try to copy elements of Toyota’s Lean Product Development System (LPDS), but it is not that easy. All aspects of LPDS work together in harmony, and the process is reinforced by a culture that perpetuates it.

Toyota’s LPDS starts with the customer who is represented by the Chief Engineer. Toyota uses the Chief Engineer’s concept paper as a guiding tool to align thinking on the planning process. They very efficiently use the Obeya (big room) to bring together the members of divergent teams and allows them to function as a unit. The teams are structured so that all of the voices that need to be heard, from the designers to the managers of the factory, who can provide input on the impact decisions will have on the workers and the final produce, are there. One of the advantages to Toyota’s process is that it allows them to retain valuable employees. Their system of “Creating a Leveled Product Development Process Flow” means that workers will not be overworked and will be able to focus their full attention on the project at hand. When the project is finished, they are provided with new challenges to help them grow. The process of innovation is woven into the fabric of the organization. Toyota supplements its processes with a culture that is finely aligned with the process. They have also developed a number of tools to serve the process such as the already mentioned Obeya, a system of checklists which until recently were kept in three ring binders, Hansei, teardowns, A3 reports which summarize problems and help to ensure alignment. All of the processes at Toyota are highly standardized, and their culture ensures that the standardization process continues.

Toyota has a corporate structure that reinforces and perpetuates itself. Sakicki Toyoda learned the loom business from the ground up, and this instilled in him a belief that to be successful, one must understand all aspects of the business. He used this knowledge to build an empire and it his conviction that one must learn by doing that still guides the thinking of Toyota employees. Power is gained through merit with all engineers working their way up “through the ranks.” Unlike other automakers who hire the best and brightest out of college and immediately give them a great deal of responsibility, Toyota takes the best and brightest (discovered through a rigorous and highly selective process) and has them go through a mentoring system where they are judged at each phase of the training. It is a socialization process that produces an employee who is trained in Toyota standards and procedures. It takes many years for a newcomer to be given a large responsibility such as a Chief Engineer. Consequently, the Chief Engineer is imbued with respect, as the entire organization knows that person has obtained the rank through perseverance, hard work, accomplishment and a deep understanding of the “Toyota Way.”

Toyota is fiercely loyal to its employees, retaining them even in times of economic downturn. Even employees who are not living up to Toyota’s exacting standards are retained, however, they are given jobs with no responsibility; a great humiliation in an environment that values achievement. This has given Toyota a reputation as an excellent employer, and jobs there are highly prized. One realizes when one takes a job at Toyota that you are a highly valued part of the family, and the success of the rest of the family rests directly with you.

This surely makes new employees dig into their work with great zest and humility. By studying from the ground up, the workers are able to gain insight into the whole development process....
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