What’s Driving Toyota? by Mel Duvall is an interesting, long article discussing Toyota overall and focusing on Toyota’s Information Technology systems.
Technology does not drive business processes at Toyota. The Toyota Production System does. However, technology plays a critical role by supporting, enabling and bringing to life on a mass scale the processes derived by adhering to TPS.
“What strikes me about Toyota is, if you were to ask them if they have a technology strategy, they would probably say no, we have a business strategy,” says Philip Evans, a senior vice president at the Boston Consulting Group who has studied Toyota. “They have a very clear understanding of the role technology plays in supporting the business.”
This is such a simple point but so hard for many to truly adopt. IT is a support function. IT is a means to an end.
As with almost all of its technology implementations, Toyota started small, carefully rolling out the portal to its Lexus dealers as a test. While it worked out the bugs, it continually expanded the offering, eventually making it available to all 1,200 of its U.S. Lexus and Toyota dealers.
Great way to deploy software: nice use of PDSA methodology.
Related posts: Toyota IT for Kaizen - Planet Kaizen - Toyota Robots - management blog posts on information technology
While no exact figures are available, Toyota says Dealer Daily saves the company and its dealers tens of millions of dollars. Toyota also surveyed 3,000 of its dealership employees and found that the average person who had been using the text-based system saved 1.8 hours per day by using Dealer Daily.
Marshall says at other companies, a worker might have been afraid to step forward—shutting down the assembly line is a serious error—but Toyota strives to make sure that workers will not be punished for bringing errors, defects or problems to the surface. As a result, Marshall says the department put more countermeasures in place—the technology version of PokaYokes—to ensure the database backup is run and checked properly.
Yet again showing the importance of respect for people, the focus on fixing the system, waste of affixing blame to people and value of poka yoke.
Technology vendors and suppliers to Toyota all seem to agree on one point: The automotive company can be a difficult, challenging and uncompromising partner. Difficult in the sense that it is very meticulous in the way it implements new technology, spending much longer than most organizations evaluating systems before coming to a decision. And challenging in that it demands that the software or technology be flexible and adapt, often by customizing the code, to its business processes, and not the other way around.
customizing the code, to its business processes, and not the other way around. Yes. Yes. Yes. IT should support your processes not dictate them. I am a big fan of avoiding inflexible, proprietary (off the shelf) software. I am willing to spend money on in house developers to create customized IT solutions that support the business processes instead of IT solutions that dictate business processes.
Base Technologies: It’s Proprietary provides some insight into the proprietary commercial software Toyota uses (in addition to proprietary in house software Toyota manages internally). Wikipedia definition of proprietary software.
September 15th, 2006 at 9:02 am
[...] I don’t actually think this is right in Toyota’s case anyway; Toyota seems to have resisted adopting poor management practices form the west (an IT example - see the end of the post). They just need to keep trying to do better. It is very easy for management to lose its way, wherever the compnay is located. For a time, American and European executives flocked here to learn Japanese quality-control concepts like “kaizen,” or improvement. [...]
October 23rd, 2006 at 1:03 pm
[...] The words hardly seem revolutionary. The importance, I believe is understanding how differently Toyota acts upon what it says. For more on Toyota IT see: Toyota IT Overview. [...]
December 12th, 2006 at 7:05 pm
[...] For those visiting from the award site you may want to take a look at our popular posts including: Stop Demotivating Employees - New Rules for Management? No! [...]
January 29th, 2007 at 7:40 pm
[...] The videos don’t provide as much insight as that article but have some interesting points.
May 4th, 2007 at 8:08 am
The IT solutions should support the organization and help the organization improve performance. The technology should not tie the organizations hands (as it can so easily do when implemented without an understanding of systems thinking, variation, process improvement, sub-optimization, psychology…)…
November 22nd, 2007 at 8:39 am
That’s an idea Toyota imported from Japan, where the company asks retiring engineers to stick around to mentor young employees. The ranks of these old-timers are growing rapidly as the company tries to safeguard its culture.
February 19th, 2008 at 8:44 am
“with the amazing power and relative ease of web based applications creating solutions that are specifically designed to the organization are often relatively easy…”
April 24th, 2008 at 1:43 pm
“for Hao Tien, chief information officer (CIO) at Toyota Canada Inc. those two Japanese phrases – Genchi Genbutsu (go and see) and Kaizen (continuous improvement) really capture it all…”