Saturday, July 11, 2009

The Management Principles of the Toyota Way

All of us know what Toyota is. It is a giant automaker from Japan. This company was a small company in the rural areas of Nagoya during 1950s. Now with around 240,000 employees, Toyota Motor serves millions of car owners around the world.
Gemba is a Japanese term for "the actual place," while "kaizen" is the Japanese terminology for continuous improvement. So the phrase "gemba kaizen" means continuous improvements at the actual place. The main theme of Toyota Way management principles is the elimination of wastes along the production line of Toyota automaker to create the highest added value of the products to satisfy customers.
According The Toyota Way, a book which was written by Jeffrey Liker, Toyota has developed and standardized its management principles since 1950s when the Japanese were trying to recover from the ruins of Word War II.
After reading the book, I can conclude that the fourteen management principles can be applied to any business. Everybody who has not read the book might think that the Kaizen is only effective for automakers or manufacturing companies. But the principles such as grow leaders who thoroughly understand the work, live the philosophy and teach it to others are applicable to all companies.

When Toyota was still a small company it had to face many challenges during its operation, from the lack of capital to the competition with other world class automakers. It is amazing to see that Toyota now is a world leader in car industry producing the best quality cars for all market segments. Toyota tremendous achievements are reached through the application of Toyota Production System (TPS). Toyota emerges as the best automaker in the world that manufactures the most fuel efficient cars. The Toyota Way inspires many companies to streamline their operations. 
Also read: Car Manufacturers Develop Air Bag for Pedestrian