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Thank you, Tatsuro Toyoda

by John Y. Shook
January 8, 2018

Thank you, Tatsuro Toyoda

by John Y. Shook
January 8, 2018 | Comments (16)

Tatsuro Toyoda died over the holidays in Toyota City.

Tatsuro led the company as president for a time in the 1990s, but many of us will remember him especially for his role at Toyota’s joint venture with General Motors, NUMMI, where he led the launch of the most important factory of a generation. Without NUMMI and its lessons, I doubt whether the Detroit Three would have even survived until the Great Recession when two of the three filed for bankruptcy.

I met Tatsuro immediately upon joining Toyota in 1983, probably my second or third day on the job in Toyota City. He was head of what was then called the “Fremont Project Office.” This was the team that had just begun working on the project to reopen the old GM Fremont, CA, plant (now the home of Tesla) to produce a variant of the Corolla, rebadged as the Chevrolet Nova. Tatsuro was polite, telling me of his time studying under Dr. Deming at NYU, and animated in relating stories of driving across the USA in a rented Chevy as a young man.

This clipping from a now-defunct Fremont newspaper shows Tatsuro preaching his key message just a few days before NUMMI produced its first car in early December 1984. Of NUMMI’s many lessons, none were more important than to show that a new type of working relationship between labor and management was possible. More than possible – necessary.

In the book, Smarter Faster Better author Charles Duhigg tells the story of Tatsuro inspiring NUMMI’s grizzled union workforce with the message that it was okay to admit you’ve got a problem. More than okay, it was requested. NUMMI’s, as all of Toyota’s famous assembly lines, was characterized by every worker being empowered to notify whenever they struggled or encountered a problem. Whenever a worker spotted a problem, he or she would send a signal (by pulling on an overhanging rope) – an SOS call for help – which would trigger a sequence of actions.  Help would come immediately, the problem would be contained, and corrective actions taken. If the problem couldn’t be solved immediately, the line would stop. Before long, the entire line, the entire plant, would shut down. That’s a big deal. Not unexpectedly, the NUMMI’s union workers – having worked long years under a GM regime that explicitly did NOT ask for their input – needed some convincing that it really was okay to pull the rope, which would bring help and even stop the line. Tatsuro’s words and actions were instrumental in winning their trust. In Duhigg’s account, word of Tatsuro’s personal encouragement to pull the rope spread through the plant like wildfire. Mutual trust were words that were on the lips of everyone, from Tatsuro on down. And more than words, actions turned the ideas into reality. Under Tatsuro’s leadership, the Fremont plant went from GM’s worst to its best, with the same supposedly “bad” workforce. Tatsuro and his team proved that it wasn’t a workforce problem, it was a leadership problem. A system problem. A trust problem. Under Tatsuro’s leadership, NUMMI really was a place of mutual trust.  

It was 35 years ago that Tatsuro and his team worked their magic at NUMMI.  If those factory walls could talk, the stories they could tell! Those walls witnessed momentous transformations – from GM’s worst factory producing its worst quality (at a time when GM’s quality was horrendous) with the UAW’s worst workforce (even UAW national and international leadership had thrown up their hands in frustration in dealing with them) – to NUMMI’s revolutionary operational and labor management practices to today’s high-tech wonderland of Elon Musk. Unfortunately, the lessons of NUMMI seem to have been lost within those four walls.  I don’t know exactly, but I guess Tesla may have around a thousand or so robots. And I don’t know exactly but I guess it has about five times that many workers. The long-promised day of the lights-out factory may yet arrive, but I don’t expect it in my lifetime. Building great cars is still a matter of using people in the right way. Engaging their hearts and minds as well as their feet and hands. A Toyota-run factory like NUMMI is a wonderland of a very different kind -- of effort to work with harmony between man and machine, labor and management, company and customer. That is the legacy of Tatsuro Toyoda and his team in Fremont.

Tatsuro Toyoda, son of company founder Kiichiro, younger brother of honorary chairman Shoichiro (now 92), and uncle of current company president Akio, died on Dec 30, 2017, at the age of 88. Rest in peace.

The views expressed in this post do not necessarily represent the views or policies of The Lean Enterprise Institute.
Keywords:  history,  leadership,  NUMMI,  problem solving,  Toyota
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Jeff Smith January 08, 2018
3 People AGREE with this comment

So true NUMMI walked the talk inspired by true leadership. Thank you for letting us know.

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John Shook January 09, 2018
5 People AGREE with this reply

NUMMI walked the talk. I said "greatest factory of a generation," but that could be an understandment. One of most important factories ever. Lessons still being digested and spread. -john

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Vickie Stone January 08, 2018
1 Person AGREES with this comment

Thank you John on the great article on Mr Toyoda and the great mention of Nummi...I went to Japan with you in 84 and remember the begining of something special. I worked at Nummi 26 years,  in the quality control department right to the end. Both my children worked there 22 years, Toyota provided my family with a great job, with many chances of advancement within the company. There will never be a job like that again, it wasn't just a job, it was a family, thanks to facebook many of the team members still keep in touch. Sal created a memorial page so we can share our condolences and share stories with our Nummi family members that have passed on.....Don't know if you know this but Doug Katco passed away 5 days before Mr. Toyota...to our foundling fathers....rest in peace 

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John Shook January 09, 2018
2 People AGREE with this reply

Hi, Vickie! Hard to believe almost 35 years have passed. Yes, NUMMI was like a family and you are a liviing example of that with both of your children working there for 22 years, after your 26! Do either of them work at Tesla? 

Thanks for letting me know that Doug Katko passed away. Doug and the whole quality activity that you were a part of were critical to NUMMI's success. Bill Childs, too, passed away last year; Bill and the human resource management team provided so many lessons that, to this day, most companies still try to ignore. Thanks for sharing. - john 

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Vickie Stone January 09, 2018
6 People AGREE with this reply

When Tesla first started hiring they didn't want anything to do with Nummi people, eventually they hired them in...My Son got hired in QC and was on board with Tesla, wanting to add his experience he learned from Nummi, but it fell on deaf ears for the most part. There was no rotation or standardized work, the mention, or suggestion of a change just didn't happen. Per my son the plant was being run by a bunch of engineers right out of school that didn't have a clue. He was fired after 6 months with no warning or even any discussion about why he was being let go....Seems he and a engineer had a couple of heated discussions about the job, and that engineer was one of Elon's buddy's...I have many friends that work there and they say they just bite their tongues. Seems to me if Tesla would have utilized former Nummi workers knowledge they wouldn't be in the mess they are in trying to make production...

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John Shook January 10, 2018
3 People AGREE with this reply

I haven't been there so have to be careful (haven't been to the gemba), but surely what you suggest is true about Tesla's inability to make production. Seems Tesla knows how to design a great vehicle, but it's easy to make a great vehicle in small numbers. Making a great car every minute is a totally different ball game. It takes teamwork (among people but also people together with technology), problem solving, alignment of everyone toward toward the same goals - all the things that NUMMI excelled in. It is a shame that the lessons NUMMI taught right inside those walls have been forgotten or are not valued. Or so it seems, anyway. 

Rebecca Eckhoff January 09, 2018
8 People AGREE with this comment

NUMMI was my lifeline for 23 years.  As a female, I was treated equally and encouraged to grow and suggest improvements.  Have used concepts I learned in my personal life, “do not complain unless you have a suggestion for improvement”.  Mutual trust and respect.  NUMMI demanded our best, which they rewarded us in so many way.  

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John Shook January 09, 2018
4 People AGREE with this reply

Thanks much for this thought, Rebecca. That women could work effectively in production was one of the lessions that NUMMI taught Toyota Japan! When NUMMI opened in 1984, there were no women working in Toyota's production operations in Japan; if you visit Takaoka plant (NUMMI's "mother plant") today, you'll see a large percentage of the workforce are women.

Actually, and surprisingly, the percentage of women in the workforce in Japan today is slightly higher than the US (almost the same at 64% vs 63%in 2014) and of those jobs, 20% of them are manufacturing jobs (second only to retail and sales). - john   

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Mark Graban January 09, 2018
1 Person AGREES with this comment

Thanks for sharing your reflections, John.

The NUMMI story you tell resonates with me. I first saw that same type of turnaround start to happen at my GM engine plant when we got a new plant manager, a guy who was one of the original NUMMI people you worked with, Larry Spiegel.

Compared to the previous plant manager, Larry was so different in his mindset and approach. He came in and said what you said. He told the workers that the plant's poor quality and low productivity wasn't their fault. The days of blaming the workers were over. But, it took time for Larry to build trust with people who had worked 35 years in the old culture.

Today, some hospitals are proving that their problems aren't a "workforce problem." It's a leadership problem. A system problem. A trust problem. But, hospitals can improve the way NUMMI did. It's not about Lean tools and it's certainly not about "turning the hospital into a factory." It's about leadership. People sometimes ask, "Who is the Toyota of healthcare?" A better question might be, "Who are the NUMMIs of healthcare?"

 

 

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John Shook January 09, 2018
5 People AGREE with this reply

Thanks for remembering Larry Spiegel, Mark. Larry and other "NUMMI Commandos" from GM, including people like Steve Bera, Ken Cousa, Steve Coletta among others, were changed probably more than any of us. Shifting from a blame culture to a problem solving one -- to 5 whys to 5 whys -- may the most important yet difficult of changes for any organizational culture or individual manager.

It isn't only healthcare that has more to learn from NUMMI's lessons of Mutual Trust. But, yes, NUMMI might be a better model for us than Toyota itself. NUMMI was a hybrid culture, aiming for best of both worlds. NUMMI wasn't perfect and didn't achieve its ideals 100% of the time, but it never stopped trying and never stopped being sincere in its neverending efforts. That in itself is probably one of the key takeaways.

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David Fisher January 09, 2018
4 People AGREE with this comment

Outstanding tribute...  Thank you!  Tatsuro Toyota served as NUMMI’s president from May.1984.  I know this because I was there from April 1984 to the end in 2010.

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John Shook January 09, 2018
2 People AGREE with this reply

Wow, David, you must be one of the few to be there from the very beginning to the very end! You must have seen a lot of action :-)

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Wendy Rich January 09, 2018
3 People AGREE with this comment

This story is a story that still lives in my heart...I had the privilege of working the start up of this new adventure...I worked in the Adm building with Mr. Higashi as head of engineering...my life was changed by the Mutual Respect that was lacking in the corporate world.  Imagine going to training for Problem Solving sitting with hourly and salaried working together and making changes together!

An experience I will never forget and friends I still have today...thank you for believing it could be!

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John Shook January 09, 2018
2 People AGREE with this reply

Hello, Wendy. The work that you and others did with Mr. Higashi was directly critical to NUMMI's success and legacy. NUMMI was more than just what happened on the plant floor - it was also engineering, all the support functions, suppliers, the UAW. Thank you for sharing your experience.    

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Mike Denison January 11, 2018
2 People AGREE with this comment

Thanks John for your insights and prompting the updates and thoughts from many people

we owe a huge debt of gratitude for the pioneers of TOYOTA Way thinking and there will be many coaches and consultants who are successful today standing on the shoulders of Tatsuro Toyoda along with many others

I never met him, being mainly in the UK but my travels to Japan and the US and Canada as part of my “getting to think in TOYOTA” brought me in contact with people who had worked with him

I know we benefitted in TMUK from many of the lessons and learning from NUUMI which enabled us to be successful and now transfer our knowledge, experience and thinking way onto others

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Sal Sanchez January 16, 2018

John,

 

Thank you for the reflection Mr. Toyoda.  It’s nice to your insight on Mr. Toyoda as well as your perceptive on Tesla.  

I am coping what I wrote on our NUMI FB page:

RIP TOYODA-San
I have many good memories of your visits to NUMMI. I also read many of your speeches that praised NUMMI and I thank you for your hard effort for always doing your best for NUMMI and for all Toyota’s.   I was first introduced to you through my father who started at NUMMI at a NUMMI picnic.  . After reading and hearing the stories about TOYOTA and you, I knew that this is a place I wanted to work.  Thank you very much for your hard work always.  Your example of leadership will studied and followed by many.  

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