The tablet-wielding executive out to tame Toyota
We want to go over every step in our processes – in order to raise the combat effectiveness of our business as a whole SHIGEKI TOMOYAMA
Over decades, Toyota built a corporate culture that was the envy of the manufacturing world.
Now the car industry’s most-emulated company is overhauling the way it brings its vaunted production system to every corner of the business.
The motor maker last month created a single group, staffed with 200 employees, to manage the Toyota Production System, centralising a function that was spread out through the organisation. Their task is to evaluate how core concepts like kaizen, continuous improvement, can be applied to new businesses that include car sharing and consumer robots. The person in charge is Shigeki Tomoyama, a career Toyota executive who wields a tablet computer during events, making him look more like a Silicon Valley software engineer than a car guy.
“We want to systematically go over every step in our processes – from R&D to manufacturing, sales and servicing – in order to raise the combat effectiveness of our business as a whole,” Mr Tomoyama says. “The backdrop to all this is [company] president Akio Toyoda’s extremely strong sense of crisis.”
While analysts expect Toyota will this week report net income dropped for the first time in three quarters, it is probably still on track to post annual profit growth for the first time in two years.
Toyota’s deliveries to fleets will be lower in the second half of the year and will likely end up at about 10 per cent of its total US sales in 2018, in line with past years, according to Amanda Roark, a company spokeswoman. The auto maker is also aiming for its namesake brand to lead the industry in retail sales for a seventh consecutive year, she said. Deliveries to fleets surged 69 per cent for Toyota last month, according to Cox Automotive. Of Toyota’s 24,281 vehicles sold to fleets in January, all but a few thousand were to rental-car companies.
Still, Mr Toyoda says the car maker his grandfather founded eight decades ago needs to move faster and take more risks to keep up with the likes of Google and Uber Technologies in the race to make cars connected, autonomous and electric.
“Toyota is developing electric vehicles and other new technologies, but at the same time they’re going back to basics,” said Seiji Sugiura, an analyst at Tokai Tokyo Research Center in Tokyo. “Their strength doesn’t just lie in hardware, but also in soft power. So reinforcing that by creating the TPS group to implement it across manufacturing and sales is a positive thing.”
In the past two years, Toyota has opened a Silicon Valley research centre, set up a $100 million venture-capital fund and started software companies in Japan and the United States with plans to add a European branch. The company says it will spend a record $9.7 billion on research and development in the 12 months to March. In December, Toyota announced plans to have at least 10 battery-electric vehicles in its line-up by the early 2020s, from zero now.
Last month, Mr Tomoyama was promoted to become one of six executive vice presidents at Toyota.
In addition to heading the TPS, he has a sweeping portfolio that includes being chief of information security, leading the car maker’s big-data drive, and helming the motorsports division.
Mr Tomoyama earned his kaizen credentials in the early 1990s, when he worked in the production research division, known within the company as the “temple” of the Toyota Way, where engineers scrutinised every inch of the manufacturing process.
In 1997, he was appointed by Mr Toyoda, then a mid-level manager, to lead a task force working on a knotty problem: despite the company’s success at shaving seconds off production times, cars tended to languish on lots before being shipped to dealers. Mr Tomoyama’s diligence earned him the nickname “kaizen man” from Mr Toyoda.