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Toyota’s Lesson for Project Managers

by Hal on February 10, 2010

in collaboration, lean, project planning

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Looks like I hit a nerve with my previous post. For years I've been writing about the good example Toyota set for the design and manufacture of cars. I've been writing about the even better example they are as a model for modern-day management and leadership. At times, it might have appeared I was fawning over them…that I might not see their shortcomings. Perhaps. The one thing I know about Toyota is that they understand that their company is built on human beings…the greatness coming from the everyday ingenuity of people along with the limitations from our mistake-making.

I still choose to interpret both Lahood and Toyoda are sincere.Still, it is easy to interpret arrogance in Toyota's actions regarding unintended acceleration just like it's easy for some to interpret grand-standing from Ray Lahood. I feel no safer after listening to either Secretary Lahood tell us that he will hold Akio Toyoda to his promise to be more diligent regarding safety or to the apologetic TV commercials from Toyota. In making our interpretations we must acknowledge our predispositions just as we acknowledge Toyota's pattern of apologizing and the bluster of American politicians. Considering all of that, I still choose to interpret both Lahood and Toyoda are sincere. It will help us learn from this experience.

Unlike the vast majority of firms, Toyota's management approach goes to great lengths to rapidly discover mistakes without diminishing the creativity of the workforce. They couple rapid problem-solving with everyday kaizen. They implore managers to "go and see" for yourself with the role manager-as-teacher. The Lexus and Prius were born in the spirit of "no compromises" in customer experiences while meeting aggressive market pricing. These are remarkable pairings that bring out the best in people while attempting to prevent defects from escaping.

Manage in a way that every person observe, speak up and share freely and quickly what they learn.There are lessons in Toyota's troubles for everyone in business. I'll address a lesson for project managers. We live in an uncertain and unknowable world and there is far more that can be known than we have an ability to know. We can accept that as the basis of how we design our project environments or we can ignore that. When we do our project plans we can't know what will happen in 3 weeks, let alone 3 months. Our plans necessarily must change. People will make mistakes. People will learn something unanticipated. The circumstances for our customers will change. We therefore must manage in a way that every person on our projects and those concerned for our project success observe, speak up and share freely and quickly what they learn. Toyota is grappling with all of that. We must as well.

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{ 18 comments… read them below or add one }

1 Dr. Kervokian February 10, 2010 at 10:20 pm

In order to “apply” the lessons learned you have to hit the core. I hold to my assessment that we need a new Messiah with a new value system and One of the core precepts is shameless transparency.

This Messiah will be so flawed that the whole world knows of his/her failings, he fears not to tell the truth and nothing but the truth. No small problems shoved under the carper, only solutions to already identified and gloriously published flaws.

Denial is a Sin. In Project Management, it’s a Mortal Sin.

2 Glen B Alleman February 11, 2010 at 9:20 am

Hal,

They are sincere. They just took their (well not them personally) eye off the ball. They had a long run though.

3 Tony Baer February 11, 2010 at 2:20 pm

I’ve also long been a student of the Toyota Production System and their commitment to the principles of kaizen and continuous improvement. Unfortunately their management principles have not scaled with the size of the organization. Their mix of highly centralized/decentralized management has broken down under the strains of global expansion. Under pressure of aggressive growth, it seems like Toyota’s staff are more scared than ever of figuratively pulling the rope that stops the assembly line.

I’m in total agreement with Glen that in the past few years Toyota has taken their eye off the ball. And, not accustomed to the public airing of their faults, they have stood frozen like a deer caught in headlights.

4 Chet Frame February 11, 2010 at 2:54 pm

The true measure of their substance will be in how they recover from this failure and if they regain their focus.

5 Tariq Sami Abdelhamid February 12, 2010 at 8:43 am

I agree with your conclusion, Hal. For some reason, many people observing and studying Toyota Production System (TPS) took it for granted that it is a perfect system. If the heart and sole of TPS is continuous improvement, then it is clear that Toyota realizes that it is inherent that improvements will be needed on a continuous basis. It is almost second nature at Toyota to engage in improving product and process. They don’t wait for mishaps and tragic incidents as opportunities for improvement. If they did, then they would not be successful. However, incidents like the ones taking place are opportunity for radical improvements and realizing that perfeciton is an aim that is aproachable but not reachable.

6 Hal February 13, 2010 at 10:41 am

Tony makes the point that I made only succinctly. The loose-tight centralized/decentralized management approach didn’t scale. It’s not that a loose-tight approach can’t scale. Toyota might make some improvements to this. I think that Toyota’s strategy to make cars where they sell cars was out of sync with other ways they managed the company. Perhaps they didn’t anticipate that. Perhaps they didn’t recognize it as it was happening. Perhaps they don’t know what to do about it. But I doubt that hubris had anything to do with it. That’s just not consistent with the history of Toyota.

Look for my next post on loose-tight project organizations.

7 Hal February 13, 2010 at 10:59 am

Dear Dr. K,

Shameless transparency is one of Toyota’s aims. They say it differently, but they celebrate when people announce their own failings. In fact, not doing so is a reason for firing. But it is not in our nature, certainly not in Western society, to announce our mistakes in the moment we make them. It seems contrary to our human condition.

Thirteen years ago I joined The Neenan Company, a design-build firm in Fort Collins, CO, to be their COO. David Neenan understood that their only hope of competing and thriving rested on everyone in his company and on his projects to celebrate the learning that came from the mistakes we made and encountered. He had a large Chinese gong in the lobby to be used for announcing and sharing the learning from mistakes. As you might imagine new people would hesitate to bang the gong. I was hesitant. Small mistakes that were quickly addressed didn’t look like learning opportunities. Big mistakes were too embarrassing. It took courage to bang the gong…courage that was rewarded each time with praise.

Toyota, like Neenan, work on shameless transparency. Neither has achieved it. Neither is in denial about it. Neither just hopes that one day it will work. Both have complementary practices to stay close with their staff, partners and customers so they can avoid upsets. Still, it is not perfect.

8 Steve Romero, IT Governance Evangelist, PMP February 13, 2010 at 11:50 am

Nice advice for Project Managers. I just want to temper the expectation on Project Managers by including Project Sponsors in your quest for diligence and fostering open communication. Given the inevitable unknown you rightfully anticipate, Project Sponsors need to be open to change, tolerant of mistakes, and responsive to customer needs. If Project Managers are to have any chance of managing a team that speaks up and freely shares information, Project Sponsors must work with Enterprise Leaders to create a culture that values and rewards accurate information – whether the news is bad or good. I have seen few organizations with the audacity and courage to accept the unknown you describe, and even fewer with the tolerance, resilience and perseverance to overcome the types of challenges Toyota now faces.

Steve Romero, IT Governance Evangelist
http://community.ca.com/blogs/theitgovernanceevangelist/

9 Will Burden February 13, 2010 at 3:09 pm

The core of TPS is the awareness that the system is not perfect, but that it can always be made better. That is the role of the people in the process. Those who actually worked with Taichi Ohno, probably the key architect/implementer of TPS as we know it, all talk about his relentless role in keeping people focused on the system, and on the intense discipline of applying TPS precepts to any process. It is, for most of us, inherently counterintuitive. The fact that it works pretty well on the production floor does not mean that it will automatically transfer to the sales and marketing side of the business without the same discipline.
Those who have some experience with Toyota management will probably recognize, if they look closely, that kaizen can also be used to ignore or redefine problems, or to focus on solutions that meet other requirements than “customer first.” It’s not the tool, it’s the system.
The philosophy IS scalable. If the staff seems fearful of pulling the andan cord, that goes to the heart of TPS, not just its application in this case.

10 doc_usui March 13, 2010 at 12:18 am

I think lesson on this time is too much human error

According to the NHTSA, It looks like 95% or more root cause of the unintended acceleration is human error. It means people are depressing acceleration pedal instead of brake pedal when they try to stop.

If so, we can not fix these unintended acceleration problem even if we have non troubled car or we introduce brake prioritized control program. For example Prius have this control but still creating unintended acceleration problem.

To prevent this kind of human error, I think we must change our vehicle operation manner to suppress this kind of miss operation. I think miss operation caused by to use same foot and depressing action for both acceleration and braking. So one of possible counter measure is using hand for braking. Like installing a multiple braking grip around the steering column?

It looks funny but If we think seriously to prevent unintended acceleration accident, I believe we need this kind of counter measure. Also If we can eliminate human error and still have unintended acceleration problem then we must fund another root cause and counter measure. I think taking action from bigger matter is the basic of problem solving.

11 Freelance Project Manager March 13, 2010 at 3:07 pm

I think mistakes do happen in any organisation and we are all falleable and make mistakes. The same with any project, admit a mistake has been made, do your best to rectify it and document the lesson learned and make someone accountable for owning or actioning that lesson.

12 Paul Baybour March 13, 2010 at 5:26 pm

Every successful organisation makes the mistake of believing its own publicity. Toyota has come a long way from its birth a truly lean organisation. It was lean not out of choice but because it was the only affordable option. Ideas like these have a natural life cycle. Why so we expect more from Toyota than any other car manufacture.

13 Art October 8, 2010 at 2:01 pm

Hi Hal , we would be interested in interviewing you for our website. Please take a look at our site http://www.operationsmanager.com and send me an email if you would like to be interviewed .

Art
Manager
http://www.OperationsManager.com

14 Jessie Warner October 12, 2010 at 3:19 pm

I think Toyota has been and continues to be a good company and does many things right. Their mistake will pass in time and soon people won’t even remember that it happened. Lucky for us and them.

15 Project Manager October 27, 2010 at 3:11 pm

With the magnitude of his job I think it is safe to assume that he cannot be accused of having bad intentions. I’m sure his over-sight lapsed and certain things happened that shouldn’t have. We all make mistakes, but seeing how the company bounces back will be good learning material for all of us. Sincerely, Project Manager

16 LSS January 12, 2011 at 12:47 pm

It’s been interesting to see how Toyota’s been handling the recalls – there have been several.

I think they screwed up at first, but have made somewhat of a comeback, not completely, but to an extent.

Though I wonder how much that has to do with Toyota and how much has to do with the public beginning to forget since it’s not in front of them 24/7 any longer.

17 David March 11, 2011 at 5:07 am

Just wondering how Hal is: no blog action for months. If he’s not well, best wishes, and my thoughts are with him,

David

18 Itaz March 16, 2011 at 7:52 am

For an organization such as Toyota there are enough lessons to learn from this setback than from all their successful ventures.

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