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In the ninth chapter of his book “How Toyota Became #1:  Leadership Lessons from the World’s Greatest Car Company,” David Magee talks about always aligning a company’s strategy with the business case, meaning the fulfillment of customers’ needs.    One of the ways to do this is not to presuppose that you know what the customer wants:   you have to actively listen to the customer.

1.  Avoid Hubris

The nineteenth-century self-help expert Samuel Smiles, who inspired the original founder of Toyota, Sakichi Toyoda, believed in “business through humility.”   Another inspiration for the Toyota family, W. Edwards Deming, believed in management principles that were focused on the customer.

If you look at Toyota’s vehicle lineup, it’s pretty stable with new models occurring infrequently, but improved upgrades of the existing models occurring frequently.   This is because products are developed with direct customer research and input.

One of the times Toyota departed from this strategy was Project Genesis, where it developed models intended to attract more youthful buyers, based on Toyota’s internal beliefs about where the market was going rather than on marketplace research.   All three products within Project Genesis were canceled within five years.   The company ended up retooling Project Genesis as an independent brand called Scion that was launched in 2003.    This time Toyota learned its lesson, and recognized that significantly more market research was needed to better understand young buyers, in the same way that it had done significant market research to understand its original mainstream customers and then its luxury customers with the Lexus brand.

2.  Take to the Streets and Observe

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