TPS Benchmarking

Comments on Toyota President Watanabe's New Year's Greeting

By Jon Miller Published on January 1st, 2008

Toyota entered the popular consciousness in 2007 by overtaking General Motors as the number one automobile manufacturer in the world by vehicles sold. Those of us who study lean manufacturing know that Toyota with its production system has been the best in the world for a few decades. The media spotlight on Toyota in 2007 had to do with the two areas of increasing sales and declining quality. We’re making no predictions, but Toyota President Watanabe’s 2008 New Year’s greeting singles out the idea of sustainability. Watanabe says:

“…last year we announced that we would pursue three areas of sustainability as a part of our efforts to contribute to the sustainable development of society and the earth in the future. The three areas are research and development, manufacturing and social contribution. This year, we will continuously tackle measures addressing environmental issues with a focus on these three areas of sustainability.”

In addition to further development of hybrid gasoline-electric vehicles and environmental education for the community, Watanabe discusses sustainability in manufacturing:

“…in the area of sustainability in manufacturing, we are currently implementing our sustainable plant activities, which emphasize the role of nature in creating production sites that are in harmony with their natural surroundings.”

To this end Toyota selected model plants in various regions, including the plant in Mississippi currently under construction.
“The main feature of the sustainable plant concept is plant development from the following three perspectives: achieving groundbreaking environmental performance by introducing innovative technology and kaizen (improvement) activities; using renewable energy, including biomass and natural energy sources, such as solar power and wind power; contributing to the local community and conserving the environment by planting trees in and around plants.”

We have learned to switch our thinking from “guaranteeing 100% quality is costly” to “quality is free,” to borrow a phrase from Philip Crosby. Likewise lean thinkers think of safety as a prerequisite for a productive, high quality work environment and strive for safety first and zero accidents, rather than accepting that accidents happen. Yet it sometimes seems that many manufacturers, policymakers and ordinary citizens in the United States have not quite made the shift in thinking when it comes to the issue of environmental protection, pollution prevention and sustainability as a way to improve our quality of life rather than as a cost.
Some people have asked, “What’s next?” after lean manufacturing has been fully implemented by the book and they are at a mature state as a learning enterprise. Avoiding the “you never arrive” argument of the lean journey for the moment, we can reflect on the message from Toyota, half a century after they began their lean transformation in earnest. Toyota may be emphasizing the sustainable manufacturing just to do the right thing for the planet. Or they may be doing sustainable manufacturing to develop their people by focus them on a new horizon for kaizen – the environment. Or perhaps Toyota figured out that sustainability is free.

  1. Alberto

    January 3, 2008 - 7:57 am

    that is a great article and really answers the “What’s Next?” Question.
    At first improvements were only measured on the economic impact, like Goldratt said, the bussiness of bussiness is to make bussiness, but now it seems that Toyota is beyond that, and we should too.
    Kaizens impact has yet to be seen on the enviroment. If we can save millions of dollars by improving a single process, imagine what we could do if we focus on the enviroment.

  2. Rob

    January 5, 2008 - 1:32 am

    A timely post.
    The Stern Review and Climate Change Bill highlight the serious consequences of continuing to pursue a high carbon economy. The required shift in industrial practices is potentially as significant as the Industrial Revolution. Aside from energy issues, establishing ‘green’ credentials is fast becoming a commercial necessity as well as a legal requirement.
    I’ve implemented several ISO 14001 management systems and obtained an MSc in an environmental discipline and have a deep understanding of how little most engineers and associates really understand the impact of their activities on our world. I post a about this regularly here:

  3. John Santomer

    January 27, 2008 - 10:39 pm

    The first step looks promising. Focusing deeper into the driving point of this aim would still uncover that Toyota’s main goal of reducing the cost of sustainability by financing high end, cost saving and environmental friendly renewable sources of energy will provide lesser cost of production and assure, in the long term, additional funds for research and development(one that gorges more on funding), manufacturing(one that rejuvenates and sustains the business) and contributing to the community (one that assures customer delight). Admirable considering that Toyota can now claim as the world’s number one automobile manufacturer by vehicle sold.
    The next vision will now lead to a new vehicle design running on a totally carbon and emission free alternative energy source. Given long term returns on “green” production aided process designs powered by all natural alternative energy sources would really make Toyota the “One that stood out”. A more promising future assuring its sustainability, an monolithic increase in sales and a brand name to recognize in innovation.

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