Management of Technology and Innovation in Japan

Implementing Process Innovation – The Case of the Toyota Production System 195
immediate requirements of the next manufacturing stage. Empty containers are returned
to the previous processing stage which is the automatic signal to produce
more parts (Ohno 1988). Essentially, this just-in-time system is oriented towards
intracompany and intercompany processes. A just-in-time system would not be
thinkable without the conscious implementation of collective strategies in the organization.
Toyota undertook to guarantee its suppliers a certain volume of orders
over a certain period and furthermore, was prepared to share with them the profits
achieved with the cost savings if the partner adopted the Toyota production system
– in this particular case the just-in-time principle of pulled material flow.
Teams
Another modification to work organization which affected the whole production
process at Toyota was the grouping together of design and manufacturing engineers
in teams and the encouragement given to group-based success. Learning and
knowledge boundaries within the organization were abandoned and the knowledge
available on different hierarchical levels and the associated methods for solving
problems were put on a broader plane. As a result of this change to work organization,
development time for new car models fell dramatically and product quality
again improved. This structural change also represented a considerable advantage
from the marketing policy point of view. It was possible to respond more quickly
to changes in customer requirements and penetrate a number of niche markets intensively
and at a low cost.
Organizing a team as an independent and accountable business unit initiates
learning where performance gaps are identified and makes knowledge available so
that team members can carry out their work. Each team member has the ability to
carry out many, in some cases different, types of work within the group and the
resulting redundancy creates a very flexible company (Hyodo 1987).
With shared knowledge bases, organization as a team forms the basis and is a
catalyst for organizational learning in Japanese companies (Ducan and Weiss
1979).
Quality Management
At Toyota, quality is at the centre of the product and process-oriented efforts towards
improvement and innovation integrated in the kaizen company philosophy.
Economic success only comes when the customer is convinced of the quality of
the product. The high quality of Toyota products and the quality management systems
in his production system are considered exemplary today.
Originally the development of production-oriented quality procedures derives
from American ideas and industrial applications (Deming circle and quality control).
The process of continuous improvement is based on the PDCA cycle which
was developed in the 1950s by W. Edwards Deming, an American. Following
World War II, these American ‘achievements’ were methodically developed into