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Affluent Investor | July 27, 2017

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How Learning By Suffering Built the Japanese Economic Miracle

Kiichiro Toyoda

Kiichiro Toyoda

In 1824 Reverend Charles Colton said that “imitation is the sincerest of flattery.”[1]  If true, then Americans should stand heads and shoulders above all with pride upon the accomplishments of the Toyota Motor Corporation.  Toyota is the embodiment of American principles, practices, values, and yes, even our Faith.  Capitalism, techniques, innovation, and the Puritan fortitude of faith and hard work make up the essence of Toyota.  Toyota’s character could, perhaps, best be described by the Romans 5:3-5:

Let us also rejoice in our sufferings, because we know that suffering produces perseverance; perseverance, character; and character, hope.  And hope does not disappoint us.[2]

“Lean manufacturing, as epitomized by the Toyota Production System, is an extension of Henry Ford’s production system.”[3]  Ford’s Highland Park Plant was the pinnacle of manufacturing as the Industrial Revolution came to its end and Toyota, through much effort and struggle, picked up the ball and ran with it, and was certainly not disappointed.

The Biblical reference from Romans, about how we grow ourselves spiritually and in life, is actually no different than how one grows himself in lean.  The process of hands-on, daily learning is key to this development.  For the lean enterprise it is termed, Learn by Doing, which came directly from the WWII Training Within Industry (TWI) program I discussed in two previous articlesLearn by Doing was the mantra used by TWI throughout its duration during the war and even during post-war efforts of the Occupation of Japan, which took TWI into Toyota in the early 1950s.

This daily experimentation is the process of learning.  Even the beginning of the Toyota Production System – or as it is referred to today, The Toyota Way – has its roots in daily failure (suffering) as the nexus to learning deep knowledge.

It started with Sakichi Toyoda.[4]  Even though Sakichi is renowned in Japan as the Father of Invention, his life was rife with failures and hardships.  In the book, Courage and Change: The Life of Kiichiro Toyoda; a book published by the Toyota Motor Corporation, it tells us, referencing from the Biography of Sakichi Toyoda, that “[b]eginning in 1892 and running into 1893 Sakichi was an extremely troubled person” and much of this was due to “the hardships of his personal life.” All of which “were weighing more and more heavily upon him.”[5]  Sakichi had failed multiple times in his businesses and with a number of his weaving loom inventions.  But as we discover, Sakichi’s road to success was paved by failure – he lived as proof of Romans 5, 3-5, suffering produces perseverance; perseverance, character; and character, hope, because this was his life.  Toyota’s DNA to this day is built upon this foundation of failure as the base support to success.  This is the premise of PDCA, which I discussed here.  PDCA’s premise is learning from the failure of each experiment and building the next experiment based on the previous failure (learning).  Kiichiro Toyoda[6] said his Father told him even when he expected failure, “Anyway, let’s give it a try,” [7] as well as encouraging his employees by saying, “Don’t be afraid to make mistakes.”[8]  This impacted Kiichiro for the rest of his life as he lived his work life with “his father’s attitude of ‘actually trying comes first’,” and “because for the rest of his life he had a strong dislike of the type of technician or engineer who would discuss things for discussion’s sake.”[9]

Kiichiro was known for and respected by the plant personnel for always stinking of cutting oil because he could not walk through the factory without diving into some machine problem.  When it came to developing the automotive business Kiichiro always “had to do his research and make things himself – in others words accumulate practical experience.”[10]  Yasuhiro Monden, who has studied Toyota’s practices and business methods for many years acknowledges that “to devise methods for their [manufacturing] solutions, [is] often by trial and error,” and that the ideas and solutions to production methods “have been created from such trial-and-error processes in the manufacturing sites.”[11]  In fact, as a boy, “Following in the footsteps of his father Sakichi, Kiichiro laid out a tatami mat in a corner of the factory and resolved to sleep there, immersed in his studies,” disassembling a small engine, sketching every part, and rebuilding it “with his own hands.”[12]

Risaburo Toyoda, the first President of Toyota Motor Corporation, in the early 1940s commented, “’What I learned from being president is that Toyota belongs to Kiichiro,’” Risaburo continued, “’Every last bit of that plant is coated in his sweat and tears.’”[13]

Kiichiro’s attitude descended directly from his father, Sakichi, who made statements like, “out of a hundred thousand inventions, you really can only obtain gain from two or three.”[14]  “Thus it was that even Sakichi would encounter several difficulties later, including (naturally enough) in his trail-and-error experimentation.”[15]

Kiichiro also completely embraced the value and importance of free-market competition.  During his university days in a conversation with his friends, where they were raging against capitalist (bourgeoisie) taking advantage of the workers (proletariat), which was even common in Japanese Universities in the 1910s, the typically mild and quiet Kiichiro spoke up to excoriate his friends.  Toyoda scolded them stating that the results “would have been the fruit of many years of effort and struggle by the owner,” and shared his own ideas of the great benefits of “capitalism and democracy.”[16]  Not a standard mindset for a young Japanese university student in the 1910s, but it was for Kiichiro.

In 1937 at a shareholders meeting for the young Toyota Motor Company, he would state in a speech that “[he] was of the opinion that in a new industry like [automotive] everyone should compete freely and the strongest would come out on top; letting those that proved themselves capable acquire the right to manufacture automobiles would be the most advantageous approach.”[17]  This comment from a man who’s company was 9 times less productive than the Ford Motor Company.  Toyoda and his new company had their work cut out for them, but he was up for the task in a pure free-market, Puritan work-ethic order.  And who, in 1935, “had one headache after another as he tried to sort [his newly manufactured car engines] out and get on with making a complete automobile.”[18]  The Toyota Motor Corporation would evolve from this attitude and work-ethic.

 

[1] Charles Caleb Colton, 1824, Lacon, or, Many Things in Few Words; Addressed to Those Who Think, (New York, NY: Printed by S. Mark), p. 114.

[2] Guideposts, The Guideposts Parallel Bible (Carmel, NY: Guideposts), New International, Romans 5:3-5, p. 2860.

[3] Takahiro Fujimoto, 2007 (Japanese edition originally published in 2003, Noryoku Kochiku Kyoso: Nihon no Jidosha Sangyo wa Naze Tsuyoi no ka), Competing to be Really, Really Good: The behind-the-scenes drama of capability-building competition in the automobile industry (Tokyo, Japan: International House of Japan), p. 143.

[4] Sakichi Toyoda founded several weaving loom companies including in 1895 (Toyoda Shoten), 1902 (Toyoda Shokai), 1907 (Toyoda’s Loom Works), 1918 (Toyoda Spinning & Weaving Co., Ltd.), before founding Toyoda Automatic Loom Works, Ltd., in 1925.  See Toyota Motor Corporation, 1988, Toyota: A History of the First 50 Years, (Toyota City, Japan: Toyota Motor Corporation), pp. 28-35.

[5] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 12.

[6] Kiichiro Toyoda Founded the Toyota Motor Corporation in 1937.

[7] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 12 and p. 130.

[8] Toyota Motor Corporation, 1988, Toyota: A History of the First 50 Years, (Toyota City, Japan: Toyota Motor Corporation), p. 37.

[9] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 130.

[10] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 293.

[11] Yasuhiro Monden, 1993, Toyota Production System: An Integrated Approach to Just-In-Time, 2nd Ed. (Norcross, GA: Industrial Engineering and Management Press), p. xiii.

[12] Masaaki Sato, 2008, The Toyota Leaders: An Executive Guide, (New York, NY: Vertical, Inc.), p. 61.

[13] Masaaki Sato, 2008, The Toyota Leaders: An Executive Guide, (New York, NY: Vertical, Inc.), p. 77.

[14] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 133.

[15] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 19.

[16] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, pp. 52-53.

[17] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, pp. 264-265.

[18] Kazuo Wada and Tsunehiko Yui, 2002, Courage and Change: The Life of Kiichiro Toyoda, Toyota Motor Corporation, Toyota City, Japan, p. 252.

Jim Huntzinger began his career as a manufacturing engineer with Aisin Seiki (a Toyota Group company and manufacturer of automotive components) when they transplanted to North America to support Toyota. Over his career he has also researched at length the evolution of manufacturing in the United States with an emphasis on lean’s influence and development. In addition to his research on TWI, he has extensively researched the history of Ford’s Highland Park plant and its direct tie to Toyota’s business model and methods of operation.

Huntzinger is the President and Founder of Lean Frontiers and a graduate from Purdue University with a B.S. in Mechanical Engineering Technology and received a M.S. in Engineering Management from the Milwaukee School of Engineering. He authored the book, Lean Cost Management: Accounting for Lean by Establishing Flow, was a contributing author to Lean Accounting: Best Practices for Sustainable Integration.

 

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