As anyone who doesn’t live in a cave in the high Pyrenees knows, Toyota is likely to overtake GM this year as the biggest automaker in the world. It has long surpassed the big three US automakers (GM, Ford & Daimler-Chrysler) in profitability, having a market capitalisation greater than the big three, plus Nissan, plus Honda combined.
But why is Toyota so successful and what can other companies learn from its success? A couple of recent articles in Fast Company and the New York Times have shone a light under Toyota’s bonnet at some of the reasons why it is so successful.
One of reason the is its long-term thinking. Whilst other auto-makers think about the next quarter or the next automobile lifecycle, Toyota thinks 10-15 years ahead. And it invests in its long-term goals accordingly. Another reason is its focus on delivering superior value to customers. The ‘lean thinking’ first developed in the Toyota Production System and since applied upstream to its suppliers, and downstream to its sales & marketing organisation and to its dealers, is based upon understanding what is valuable to customers and then delivering it at low cost to Toyota. Yet another reason is its relentless pursuit of perfection (one of the five lean principles). There is no talk of bench-marking in Toyota, just the relentless improvement of its products, its processes and its people. This is a contrast with the complacency of many of the other automakers, particularly the German luxury manufactuers. And there are many other reasons for Toyota’s success that we can all benefit from.
Take a look at the two articles and think how the lessons they contain could help your company become the undisputed leader of the pack.
What do you think?
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(Disclosure: I have been consulting with Toyota in Germany for over three years and am an Interim CRM Manager at Toyota Financial Services in Germany)