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In the sixth chapter of his book “How Toyota Became #1”, David Magee explains another important ingredient in Toyota’s success story, that of kaizen, or continuous improvement.    Toyota had a established its reputation in the United States with its small, affordable efficient cars.    This chapter tells the story of how they made the quantum leap to establishing a luxury division called Lexus.

1.  The Quality Lexicon of Lexus

In the 1980s, Toyota engineers were working on a project to set an entirely new standard for luxury vehicles.  Code-named F1, the project was about giving Toyota’s customers a luxury car to “graduate” into.   At that time they were not planning a new brand, but rather on building the best luxury vehicle in the world.    Toyota engineers visited the United States in 1985 to look at the preferences of American luxury-car buyers.   They learned from the mistakes that other automakers made when entering the luxury-car market.   The result of their efforts was the LS400, which made its debut at the 1989 North American International Auto Show in Detroit.

2.  The Brand

It’s one thing to build a luxury car, but how do you sell it?    Here Toyota relied on the expertise of Robert McCurry, one of Toyota’s earliest and most respected American employees.    Among his successes were the creation of a highly loyal and interactive partnership with dealers, which led in 1986 to Toyota becoming the first non-domestic automaker to sell more than 100,000 units.   He pushed for Toyota to create its first full-size American truck in 1993.

McCurry felt strongly that introducing the LS400 luxury car into the existing vehicle lineup would confuse buyers, and minimize the company’s profitability by shortchanging the phenomenal vehicle’s potential.   A luxury vehicle needed its very own brand with unique dealers and service.   Yukiyasu Togo, Toyota’s chief U.S. sales executive at the time, who spearheaded the luxury car project, agreed with McCurry.    The “Lexus” brand was launched in the United States in late 1989 with two models.   It is now the largest luxury brand in the United States, and receives more awards for quality and customer satisfaction from J.D. Power & Associates than any other automotive brand in the world.

Here’s how Lexus beat better-established competitors like BMW, Mercedes-Benz, and Jaguar:

• Unprecedented quiet ride while maintaining stability and control
• Elegant interior and exterior styling with highly functional controls
• Powerful, smooth-running engine yielding better gas mileage

Despite the successful launch of the Lexus brand, Toyota executives realized that the venture had been more costly than it needed to be, and that better planning, a more streamlined development process, and better cross-communication would all be needed in future product development.

2.  Redefine Classes with Standard-Setting Products (or Service)

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If you’ve been selected as an Area Governor, you finished the Area Governor training back in June, or you are taking the make-up training this month.    Among your duties, you are expected to do the following:

1. Club Success Plans–ask Clubs to provide Club Success Plans, which show what goals they plan to achieve in the Distinguished Club Program and how they plan to achieve them.
2. Provide Guidance to Clubs–contact Club Presidents monthly to discuss their progress in the Distinguished Club Program.  NOTE:  This can be done in the Area Council meetings–see item #4.
3. Area Success Plans–take Club Success Plans and create an Area Success Plan.
4. Area Council–hold at least two Area Council meetings each year, but optimally once a month,
5. Area Governor’s Club Visits–visit clubs at least twice a year, and fill out and submit an Area Governor’s Club Visit Report form for each visit.
6. Area Speech Contests–coordinate Area Speech Contest with the Division Governor and the various clubs in your Area.

This post discusses item #5, the Area Governor’s Club Visits.

BEFORE THE VISIT

1.   Get the Club Success Plan First

If you are not familiar with the clubs in your area, the easiest way to get to know the clubs is to look at the Distinguished Club Program dashboard on the Toastmasters International website for your club (all you need is the name and/or number of the club).    This will tell you how strong the club was last year.

Then you need to ask the clubs for the Club Success Plan.   In our District, we are asking the clubs for the Club Success Plan by 7/25, because the Area Success Plan is due to the Division Governor the following week, on 8/2.

2.  Arrange your Club Visit

Once you get the Club Success Plan from the Club, then make arrangements for your club visit.    It should be done by the middle of August, so you have about a three-week window to do the visit.   When you send an e-mail to the club officers asking for the best possible date for the visit, send them a copy of the Area Governor’s Club Visit Report form.   This will let them know what information you will need from them.    A lot of the information from the Club Success Plan, the goals and how they plan to achieve them, will be required for the Area Governor’s Club Visit Report anyway.

3.  Recommend the Moments of Truth Program

Recommend that the club officers get together before the club visit and do the Moments of Truth program from the Successful Club Series that they can download from Toastmasters International.   Why?   Because it tracks very closely what is asked for in the Area Governor’s Club Visit Report.   The program has the club come up with actions the club can take to improve its quality in six different areas, all of which are exactly the same six areas that are on the Area Governor’s Club Visit Report.   In other words, if the club has thought about the questions asked in the Moments of Truth program, the club will be able to answer most if not all the questions you have in your Report form.

DURING THE VISIT

4.   Area Governor Visit

Ask the club officers if there are any members receiving awards or getting any accolades for achievements on the day of your visit.   Ask if you can be the one to give the award; this will be a tremendous morale boost for the person getting the award(s).   It also shows that you are there not to “tell the clubs what to do”, but rather you are there to help the clubs and their members achieve their goals.   Ask if you get have a few minutes on the agenda to introduce yourself to the club.

AFTER THE VISIT

5.  Follow Up!

If there are any items which the club officers cannot answer at the time of the visit, then you need to follow up with them so that your report is complete.    You could go back for a second visit, but the second half of August is usually taken up by the Club Speech Contests.   So your follow up will have to be by telephone and/or e-mail.

Many Area Governors are so eager to do their visits that they try to bring the Report form with them and have everything answered at the meeting.   Trust me; it is almost impossible to do!

Once you get a draft of the report, share it with the President BEFORE you send it to the District.   If they have any additions, amendments, or dispute any of your findings, you can clear this up BEFORE it becomes “public knowledge.”

In this way, if you follow these steps, your visit will be spent more in making connections rather than your becoming a scribe as if you are auditor.    Try them and see your standing as an Area Governor rise in the eyes of both your clubs and your Division Governor!

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As a new Area Governor, I went to the first District Executive Committee (DEC) meeting of the new Toastmasters year, which goes from July 2014-June 2015.    The DEC meeting took place in the morning, and I carpooled with someone who had to stay for the afternoon in order to go to the make-up Area Governor training.    I had gone the previous month, but rather than just sit in the cafeteria while she went through her training, I decided to join in the training and my experience led me to the revelation that is the subject of this post.

The Area Governor training I went to in June was the tradition training that District has put on in the past.   We got a huge stack of documents, each of which was explained by a lecture given from a Powerpoint presentation.

The Area Governor training I went to today was a kind of experiment.   Since all the Division Governors had completed their training in June along with most of the Area Governors, the District leadership tasked them with taking over the training of the remaining Area Governors.    Their approach was more interactive, enjoyable, and left a deeper impression than the training in June.

1.  Interactive Training

Rather than present material from a presentation, there was a brief introduction to the material of each section followed by

• questions from the Division Governors to individual Area Governors
• breakout brainstorming sessions where each small group would come up with items that answered the question posed by the Division Governors to each group
• more dynamic presentation styles where the Division Governor would move throughout the meeting space, and reflect back what each person said in order to reinforce it

2.  Enjoyable

One of the reasons why it more enjoyable was because the Division Governors would break up the hour-long sessions by small, five-minute bathroom or networking breaks, or sometimes short sing-a-longs to get the group to interact in a fun way.    This increased the attention paid to the material, and started the Area Governors to interact with each other.

3.  Impressionable

The breakout sessions created a lot of input from the various Area Governors.   For example, in answer to the question “what can you do to further your club’s educational and leadership goals”, I had thought of about half-a-dozen items to answer the question, but by the time we all put our heads together, we had about two dozen items, divided into six categories.    Then one person from the group had to present their findings, or a small summary of them, to the group.

Of course the material reinforced what I had already learned in the June training.   But the June training consisted of one source of information (District leaders) dispersing to individual Area Governors, who were left to struggle with the material on their own.   Here, Division governors were dispersing information to Area Governors as individuals and as small groups.   This had the Area Governors interact with each other and reinforce the material, or answer each other’s questions.   This ultimately saved time, because in the June session, a lot of the time at the end of the session was taken up by a lot of questions from confused Area Governors.   In today’s session, we answered a lot of our own questions, and so the number of questions the Division Governors had to answer at the end of each session was a lot fewer than in June.

I just thought that today’s way of training Area Governors could be carried over into the training of Club Officers in the Toastmasters Leadership Institute.    I hope that I can get involved with the next TLI and try to use these methods to enliven and enrich the TLI that takes place in the winter of this year!

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In the fifth chapter of David Magee’s book, “How Toyota Became #1”, David Magee describes the next important component of the Toyota Production System, that of not just exposing defects, but identifying their root causes.    It is only by eliminating the root causes that you will eliminate the defects once and for all.

Toyota team members are taught three core steps to ensure quality:

1. Speak up immediately when problems are recognized, no matter what.
2. Ask why (at least five times), to reach the root cause.
3. Go to the source of the problem and see for yourself.

1.  Pull the Cord (or Pay the Price)

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I’m going through David Magee’s fascinating book called “How Toyota Became #1”, and I am summarizing parts of the chapter that I find most salient as I read through the book.    This post is a condensation of the fourth chapter, and it concerns the Toyota approach to muda or waste which can be summarized in the phrase “Rid All That Adds No Value.”

Progress comes not just from moving forward, but by removing any obstacles that you may encounter along the way.   Sakichi Toyoda, the founder of Toyota, taught his son Kiichiro Toyoda that waste was the great inhibitor of both man and machines.   The practice of elimination of waste started on the factory floor, but became to be practiced in all areas and at all levels of the company.   The bottom line at Toyota is:  if a process or an activity does not add value, get rid of it.

1.  Reduce Clutter, Reduce Ills

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This posts summarizes the third chapter of David Magee’s book How Toyota Became #1.   The purpose of these notes is to clarify the material in my own mind, and also to whet the reader’s appetite so that they go and read the book for a fuller comprehension of the material.    There are many fascinating anecdotes and statistics in the book that illustrate the material which I am omitting for brevity’s sake.

1.   Humility, not Humiliation

Although Mr. Magee does not use the word, much of the corporate culture in the United States is involved with giving perks to executives which act as a way of separating the executives both physically and mentally from the workers they are in charge of leading.     By creating a culture of inequality, it lends itself to the executive gaining an attitude of entitlement and superiority, which can be perceived by the worker as a passive form of put down or humiliation of their own status.

As opposed to the American corporate culture, the Japanese corporate culture has the principle of humility, not of humiliation.   Their corporate culture is designed not to increase the physical and mental gap between executives and workers, but to decrease it.

The Toyota Executive Vice President Gary Convis is an example of this.  He flies commercial airlines rather than a company jet, walks the manufacturing facility floor daily in order to remain accessible to team members, and drives around in a $15,000 compact.    His lifestyle is designed not to distance himself from his workers.

2.  Don’t Give Others Reason to Doubt

One of the more contentious aspects in manufacturing in the United States is the issue of executive perks such as corporate jets at a time when restructuring implies the elimination of thousands of jobs for ordinary workers.    In the Toyota company culture, this would be seen as muda or waste.    There are executive perks in Toyota, such as chauffeur-driven cars in Tokyo, or larger, private offices rather than the open, obeya-style offices where lower-level executives work at the head of a table where all of their staff are seated.    However, the Toyota culture of humility is so strong that these modest perks do not engender executive arrogance.

This culture of humility grows out of a national character which encourages modesty and mutual respect, and is nurtured by the small-town attitude that Toyota has maintained over the year given that its largest concentration of manufacturing plants is in the suburban countryside community of Toyota City outside of Nagoya.    The Toyoda family maintains a significant influence on the culture and ongoing operations of the company, in a way that is similar to the Ford family’s involvement with Ford Motor Company in the United States.

3.  Maintain Proper Perspective

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This post covers the second chapter of David Magee’s book on Toyota’s philosophy of lean production called “How Toyota Became #1.”    In this chapter, he introduces the Toyota Production System, or TPS. 1.  Toyota Pr0duction System or TPS TPS is a commitment to continuous improvement or kaizen through the elimination of waste or muda.    The continuous improvement is not dictated by management, but is rather cultivated through creative employee contributions.   It is definitely a bottom-up, rather than top-down, flow of ideas.   The TPS is not just a lean production tool, but rather a guiding principle by which to live and work. TPS is a collection of manufacturing methods that incorporate three key philosophies:

• Customer first
• Employee satisfaction
• Company stability

2.  Bigger is Not Necessarily Better

GM tried to learn about TPS from the joint venture between Toyota and General Motors called NUMMI (New United Motor Manufacturing, Inc.).   However, General Motors saw TPS as a tool for making products at lower costs.   However, at Toyota, TPS is an extension of the Toyota’s basic founding principles of respect, thrift, and perseverance.  TPS is not just its approach to manufacturing, but its approach to business as a whole.   Kaizen, the principle of continuous improvement, is applied in offices as well as in factories.

One enthusiastic adherent of TPS was Gary Convis, who left Ford after being an employee for 18 years to take a job with Toyota in 1984 as plant manager at NUMMI.    Toyota was making inroads in the US market by selling value-priced compact cars, while the US carmakers continued to focus instead on more upscale, luxury sedans.   When Convis went to Japan to tour Toyota’s Takaoka plant to see TPS in action, he was an immediate convert.    Convis learned from some of the world’s best implementers of TPS and use them to transform NUMMI into a thriving automotive assembly site.

The best way to describe the culture change that TPS made at NUMMI was the fact that Japanese bosses were not were referred to as bosses but as sensei (teachers). The surface level of lean production is when it is used a tool to create products at lower costs.   However, TPS goes deeper; there lean production began as an extension of the company’s basic founding principles of respect, thrift, and perseverance.   TPS is not just Toyota’s “unique approach to manufacturing”, but rather it is its unique approach to business as a whole.

The three objectives of TPS are

• Highest quality
• Lowest cost
• Shortest lead time

3.  Understand the Evolving System

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