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The Principle-Growing Your Leaders Rather than Purchasing Them

Even when Toyota promoted someone from an unusual part of the company to save it from impending doom, there has never been a sudden change of direction. Perhaps this is the concept of eliminating muri (unevenness) at work at the executive level. It seems that, throughout Toyota’s history, key leaders have been found within the company, at the right time, to shape the next step in Toyota’s evolution. They have been there across the enterprise—in sales, product development, manufacturing, and design.

Hiroshi Okuda was the first non-Toyoda family member to take the reins in decades and came at a time when Toyota needed to globalize the company aggressively. After this aggressive period, Fujio Cho, in a calmer, quieter way, continued the globalization of Toyota, building on his experiences in the United States and focusing on reenergizing the internal Toyota Way culture. Despite major differences in personal style, neither of these leaders deviated from the basic philosophies of the Toyota Way. Behind the scenes, the Toyoda family has always been there, carefully grooming and selecting the new leaders. Perhaps it is no coincidence that there has always been an internal leader ready to step up to the plate.

Toyota does not go shopping for “successful” CEOs and Presidents because their leaders must live and thoroughly understand the Toyota culture day by day. Since a critical element of the culture is genchi genbutsu, which means deeply observing the actual situation in detail, leaders must demonstrate this ability and understand how work gets done at a shop floor level within Toyota. According to the Toyota Way, a superficial impression of the current situation in any division of Toyota will lead to ineffective decision-making and leadership. Toyota also expects its leaders to teach their subordinates the Toyota Way, which means they must understand and live the philosophy.

Another important leadership tenet of the Toyota Way is the effort leaders make to support the culture year after year so it can create the environment for a learning organization. In Western companies with revolving door leaders, no one leader is in place long enough to build a mature culture to match their personal vision. (Some of the most successful companies are exceptions as we will discuss in Build Your Own Lean Learning Enterprise, Borrowing from the Toyota Way.) So changing the culture each time a new leader comes into office necessarily means jerking the company about superficially, without developing any real depth or loyalty from the employees. The problem with an outsider leading radical shifts in the culture is that the organization will never learn—it loses the ability to build on achievements, mistakes, or enduring principles. This affects the ability of leaders to make effective changes. On the other hand, in Deming’s terms, Toyota uses “constancy of purpose” throughout the organization, which lays the groundwork for consistent and positive leadership as well as an environment for learning.

There is no doubt that Toyota’s leadership culture was shaped by the personalities, values, and experiences of its founders in the Toyoda family. There is a long line of distinguished and remarkable leaders from this family, beginning with Sakichi Toyoda, who built Toyota Automatic Loom into one of the premier loom manufacturers in the world, and his son Kiichiro Toyoda, who founded Toyota Motor Company. As discussed in How Toyota Became the World’s Best Manufacturer, they helped to shape the Toyota Way. Among their profound impacts on the company, they epitomized the spirit of innovation that drives Toyota and the hands-on philosophy of Toyota leaders. The characteristics of Toyota leadership, particularly the drive to meet seemingly impossible targets and the requirement to understand the work by getting your hands dirty, evolved from the leadership of these two company founders.

Eiji Toyoda, nephew of Sakichi Toyoda, was the president and then chairman of Toyota Motor Manufacturing during the company’s most vital years after the war and through its growth into a global powerhouse. He played a key role in selecting and empowering the leaders who shaped sales, manufacturing, and product development. He seemed to have a sixth sense for identifying individuals who possessed the profound leadership qualities needed to shape Toyota’s future. Arguably, a maverick like Taiichi Ohno would never have survived, let alone prospered, within a conservative company like Toyota without the executive sponsorship of Eiji Toyoda (Womack, Jones, and Roos, 1991). But Toyoda was like the owner of a basketball team who needed someone like Ohno to turn the franchise around, a headstrong and passionate coach with a bold vision, a disciplinary motivator who knew the game of manufacturing inside and out and could teach it to others.

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