If Lean is So Great, Why Toyota's Recent Meltdown?

On the subject issue, there is a insightful column at lean.org based on an interview with a top Japanese Toyota watcher, Professor Takahiro Fujimoto of the University of Tokyo. His bottom line -- increasing complexity, commercially and technically, with a large dollop of arrogance thrown in. This is not a new lesson to any student of history.

The current series of problems represents a massive failure on the part of Toyota. And Toyota must take full responsibility for ending up where it is today. But the root causes of these problems are not easily identified. Many internal and external factors have combined in a complex mix. These include misjudgments by Toyota, and overconfidence in its own quality. The factors also include increasingly complex vehicle design, production increases and globalization, and the resulting explosive rise in the number of related problems. While some of these factors are specific to Toyota, others affect the industry as a whole....

Toyota has absolutely made its own errors: clearly there are specific aspects of Toyota's organizational culture that lurk behind its poor decision-making. Moreover, I have observed an air of arrogance that may certainly have weakened Toyota in recent years. Yet it must be noted that Toyota faces the same huge challenge as any other company of its scale, in terms of product, market, and production complexity - all the challenges of globalization. The automobile companies of developed countries have been and will continue battling what we might call the demon of complexity - a long-distance obstacle course on which they are challenged to build their capabilities....

Having spent the '90s being admired for producing the world's best quality, an arrogance born of overconfidence started to appear in certain sections of headquarters. The signs of that unfortunate arrogance are clear. The number of customer complaints received by the company is significant. And yet even as quality problems and accidents occurred, Toyota leadership clearly responded by saying, "our quality is perfect - it's the user's fault." This attitude is a severe departure from Toyota's true management philosophy and demands correction.

I visited Toyota in 2001 as a representative of GM to look at their benchmarking activities. We were treated politely, but condescendingly, as they made it clear that they had nothing to learn by looking at anything GM did. That may have been true, but it was presumptuous, close-minded, and, it is plain now, a precursor to the arrogant thinking that recently got them in trouble. It is also thinking that is counter to the open, inclusive mind-set that is integral to the Lean Management they perfected. They got away from their roots.