The Toyota Way

After Toyota's media launch of the TF106, each attending media member was presented with a rather smart padded computer bag, a comprehensive media guide, a copy of the team's One Aim quarterly magazine, and a hard-covered management book.

Entitled 'The Toyota Way' and written by Jeffrey Liker - a professor of industrial and operations engineering at the University of Michigan - this book, first published in 2004, seemed rather a strange gift for a bunch of hacks generally far removed from corporate matters and boardroom politics.

Still, the book made a welcome change from the baseball caps and chrome key rings normally distributed at such events, and it was telling that, after the main bulk of journalists had departed from the event venue, not a single copy of the book had been discarded by these normally ungrateful folk.

During the launch various speakers - from Toyota Motorsport GmbH chairman and team principal Tsutomu Tomita, through \president John Howett, to technical director (chassis) Mike Gascoyne and his engine counterpart Luca Marmorini, plus other speakers - spiced their speeches with management buzzwords.

'Toyota Way', 'Toyota's DNA', 'Toyota Production System', 'Lean Production' and 'One Roof Concept' were regularly mixed in with regular Formula One phrases such as 'optimization' and 'contractual reconfirmation'. The most used buzzword, though, was 'kaizen'.

In October last year, for the Japanese Grand Prix, Toyota introduced the TF105B. Sure, the car took pole position; predominantly, though, through assistance from climatic conditions. It was, thus, a fortuitous rather than fought-for pole. Of greater import, though, was that the team was able to introduce a new car, using a V10 engine, with two races to go, and then present its V8-engined successor just four weeks later when winter testing began.

It soon became clear that the TF106 was a development of the TF105B, which was a development of the TF105, in which each design represented a small but significant step to achieve the goal of eliminating waste that adds cost without adding value - in a nutshell, 'kaizen'.

And, given that the TF106 had effectively been introduced twice before as the TF105 and the TF105B, Saturday's 'launch' event was merely the pre-season presentation of a constantly evolving process. After all, why 'launch' in mid-January a race-car that has fundamentally run since October?

And, this trend is expected to continue into the future, with Toyota admitting that significant upgrades are planned for Monaco in May. In fact, up to four major revisions could be seen during 2006, and Toyota certainly won't be 'launching' the car each time...

A Japanese word, 'kaizen' has become known to western ears through its not insignificant role in aiding Toyota's push to overtake all motor manufacturers - bar only, at this point in time, General Motors - where annual production is the benchmark. Where productivity and profitability are concerned, 'kaizen' ensures Toyota remains the industry leader.

Fifty years ago, though, Toyota was bankrupt. In 1948 the company's debt-to-capital ratio was worse than eight-to-one, and it was forced to lay off workers and introduce pay cuts - in a country in which jobs were generally for life. With remarkable foresight, though born through desperation, the company adopted the teachings of American quality pioneer, W Edwards Deming, gradually applying these to all processes. It worked, and continues to do so: last year Toyota produced just one million cars less than Big Blue (8,1m versus 9,1m), yet turned a profit on every unit whereas GM posted record losses.

To quote from Liker's book: "Kaizen teaches individuals skills for working effectively in small groups, solving problems and documenting and improving processes, collecting and analyzing data, and self-managing within a peer group.

"It pushes the decision making (or proposal making process) down to the workers and requires open discussion and group consensus before implementing any decisions. Kaizen is a total philosophy that strives for perfection."

Production focus or not, Liker's words perfectly encapsulate 'team work' as required in Formula One. Initially kaizen was applied to pitstops, and the result is clear to see every fortnight during the racing season. Toyota seldom, if ever, drops the ball during those fraught seconds.

Next to be 'kaizened' were the operation's production processes - predominantly composite and engine related - where kaizen sped up development, cut down lead times, and improved efficiency. "There is no end to the improvement cycle," explained Howett, adding that the Toyota Way and Toyota Production System - both of which embrace kaizen - were crucial in enabling the testing of the TF106 within a month of presenting TF105B.

It is, however, the flyleaf and opening words of Liker's book - a textbook independently authored with neither commission or approval from Toyota - which best indicate exactly what benefits Toyota stands to realize by applying kaizen to its Formula One programme in the future.

The flyleaf states that Toyota achieved "the highest quality cars with the fewest defects of any competing manufacturer" (by) "fostering an atmosphere of continuous improvement and learning, getting quality right first time, and growing together with partners for mutual benefit."

That Toyota has improved continuously since first entering the sport is a given (the team placed tenth, eighth, eighth and fourth in the Constructors' Championship since 2002). That Toyota regularly achieves first-time quality is borne out by the latest finishing statistics of both Toyota-powered operations in 2005 (Toyota and Midland/Jordan-Toyota achieved 2005 finishing rates of 88% and 84% respectively, against championship winner Renault's 83% and McLaren's 77%). And Toyota's partner/sponsor retention rate has proven amongst the best in the business - as borne out by the car's consistent livery to date.

All of which points to the book's opening words being on the money, too: part one is entitled The World Class Power of the Toyota Way, with the first chapter sub-titled Using Operational Excellence as a Strategic Weapon. Those words alone should strike fear into the heart of all team bosses, who could do worse than replace their bedside copies of the Concorde Agreement with Liker's book.