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I imagine a fair number of you read the cover story on Toyota's success (reg. required) in The New York Times Magazine this past Sunday. What I loved was that much of what was highlighted about the car manufacturer's success had to do with their management team's more whole-picture/holistic view.
Throughout Jon Gertner's article, you read how Toyota takes the longer term view of pretty much everything. Michael Robinet, a vice president at CSM Worldwide, a consulting firm that focuses on the global auto industry, is quoted, saying: "The company thinks in years and decades. They don't think in months or quarters." And, Gertner later points to the Toyota product making the biggest news lately: "The Prius was not about a fast return on investment. It was about a slow and long-lasting one."
Of course, this seems to be the exact opposite of what the big three American car manufacturers have been doing -in a rush to beat the competition with a short term whizz-bang of some sort, or a lot of ads during the Super Bowl.
A little later in the piece, the Gertner discusses Toyota's typically intense research methods - walking, talking and literally living a day in the lives of their Tundra truck or Sienna customers, for example. Here's just a part of the description of the level of research conducted by the Tundra's chief engineer, Yuichiro Obu, and its project manager, Mark Schrage:
"By asking them face to face about their needs, Obu and Schrage sought to understand preferences for towing capacity and power; by silently observing them at work, they learned things about the ideal placement of the gear shifter, for instance, or that the door handle and radio knobs should be extra large, because pickup owners often wear work gloves all day."
(...and it continues from there.)
Further along, we learn that Toyota's focus goes beyond improving the vehicles themselves, and into that even more valuable area - improving process/production system overall. (What? "Means" gets as much emphasis as "end?")
Do you ever notice how the more typically feminine brain traits (which includes this holistic thinking I can go on about) seem to be behind today's biggest business successes? I sure do.
Linear/status/buzz (& fashion shows) for hip new model vs. holistic/common ground/long term vision for keeping in line with how often customers really buy new cars and where their wants/needs will be when they buy their next one in 10 years (wanting a hybrid seems to be the big theme).
I loved the way Takahiro Fujimoto, University of Tokyo management professor and longtime Toyota observer, put it in Gertner's NYT Magazine piece:
"Since almost everything that happened to this company in the past several decades has been evolutionary rather than revolutionary, there have been few surprises."
With a nod to Faith Popcorn's book, perhaps we should all try to run our businesses and approach our marketing efforts in a more Eve-olutionary manner.
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Comments
Good post Andrea. I feel that American companies are too focused on short-term results.
Because of Wall Street, we must plan for the short-term bottom line. But when our primary focus is on the short-term intead of the long-term, we lose out to foreign competition. To change that, our primary focus needs to be on long-terms goals and objectives.
Posted by: Lewis Green | 02.22.07
What we should really be paying attention to, as you rightly point out, is "the process". Toyota has refined and redefined the process of making an automobile--taking it to a whole new level.
This manufacturer is a good example of the value of incrementalism, however I still think that it's rare for incrementalism to lead to any break through or market changing event.
A good read on Toyota's process focus can be found at http://www.fastcompany.com/magazine/111/open_no-satisfaction.html
Posted by: Paul Barsch | 02.22.07
Andrea:
You had me -- I was with you completely -- Toyota is a wonderful company that has done things well, makes a car with 10% of the problems of most US makers, and has the ability, therefore, to look over the horizon.
Good Japanese companies do this better than good US companies do. I was a Sony guy for many years and lived in Japan for a good bit of my formative youth.
Their Super Bowl ads? Real world benefits to monster users. Not flashy, but right on message.
Good for Toyota. I'm a fan. When you're dealing with a culture that traces their current emperor back in a direct and unbroken lineage to Amaterasu, the Sun God, you're dealing with a fairly long term culture.
So what does any of this have to do with "eve-olution" and how all the good things seem to have feminine traits? Is this the 'cootie' argument? This ain't a boy/girl thing. You had me, but you lost me.
Posted by: Stephen Denny | 02.22.07
Paul - I recently read The Omnivore's Dilemma and so keep finding totally un-food-related places to apply its lessons (It really is a sort of life-changing book, if any of you haven't read it). One of its tales is about how a very integrated farm in Virginia has got all these systems for interconnecting the steps - taking a much longer term, process-oriented view of farming. One step that I remember offhand was that the farmer has his cattle graze on a certain field for a few days, and then moves them along - so a traveling road show of chickens can then come into that first field and eat the grubs from the dung among other things in the process of recycling fields over and over. All that stuff is process - the final delivery is the great beef and the eggs, etc. (I may not have all the details right, but it's the general idea I'm getting at...)
Do you think the breakthroughs happen so slowly that we can't necessarily point them out within a longer term process? Perhaps.. the slower evolution of process may not have as much to "announce" along the way because we won't see marketing-changing events unless we look back a bit historically.
I need to go read the Toyota article you suggest.
Posted by: Andrea Learned | 02.22.07
andrea, i see here two key concept:
- they are not slave of the quarterly frenzy
- they do not go through focus group but on field
both these concepts from time to time arise as significant limit to sounding strategic approach.
delivering good quartely result is a financial result, not industrial and not necessarily impacting on the long term company health.
on the other side, listening to customers or prospects at their work or life place is far better than stuck them in a room in an artificial environment and pose "routine" questions.
Posted by: gianandrea facchini | 02.23.07