Page 48 - Toyota Under Fire

THE MOST ADMIRED COMP ANY IN THE WORLD

experts” can never provide the amount and level of problem solv-
ing that is required if TPS is to function smoothly. Every team
on the production line has to be doing effective problem solving
every day.
That means that Toyota has to invest in team members so
that they can be problem solvers and respect the solutions that
the team members find. The expertise in using TPS and TBP for
solving problems that even average team members have makes
them the company’s most valuable asset. Losing employees, for
whatever reason, literally undermines the business model. It is no
different from capital assets walking out the door. In general, the
phrase human capital seems to demean human beings, lumping
them in with machines and money in an undifferentiated mass.
But at Toyota, the capital really is human. Machines can be re-
placed quickly. A team member with 10 years of experience in
TPS and TBP can be replaced only by spending 10 years invest-
ing in the training of another employee. People are not the big-
gest bucket of variable cost at the company, they are the largest
bucket of appreciating assets.

Growing to Lead in the
United States and the World

The combination of TPS, TBP, and the culture of the Toyota
Way is the competitive advantage that allowed Toyota to become
the largest carmaker in Japan and expand into other markets in
Asia. But in the 1960s, the combined Asian markets were easily
dwarfed by the U.S. market.
When Toyota began planning to enter the U.S. market in the
late 1950s, its strategy would have seemed laughable to anyone

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