Toyota on a roll with new teamwork model

It may seem odd but Naomi Ishii had absolutely no idea of India till he set foot here to head Toyota’s operations in January 2014.

“I was determined to go with an open mind and not discuss this with anyone,” recalls the Managing Director of Toyota Kirloskar Motor (TKM). There were enough sceptics who warned him that nobody who took the India assignment could ever be successful. Today, a lot of them would be eating their words with TKM reporting healthy profits in 2014-15.

It is a remarkable story of a company which was skating on thin ice till 18 months ago. Soon after Ishii took charge, his first priority was to get an idea of the strengths and problems within. This was the time workers went on strike and the young MD realised that the key was to solve fundamental problems which lay beyond the charter of demands.

During the lockout, Ishii could not help but notice how Indians displayed their problem solving prowess in a tough situation.

Yet, even while individual capability was undeniably impressive with a host of solutions coming in, the best answer did not often have a mid/long-term impact. There was also a need for better team work and Ishii would do his bit by constantly involving the HR and manufacturing teams for a consensus opinion. As he explains, individual capabilities to solve problems in India were very high especially within manufacturing where there was a process-oriented approach.

The problem solving route in being profit-oriented is also core to global Toyota’s operating system but this was not being used as much.

“People had lost their confidence and had no idea of the future or their roles in the organisation and everyone was looking for excuses. It was important to change the situation and build a strong future,” says Ishii. It was, therefore, time to stop making excuses and start thinking of protecting the company.

After the lockout was lifted, the job on hand was to get leaders of each function together to start thinking of the future. This was the beginning of the mid and long-term business planning exercise. Prior to this, only Japanese bosses were doing this at TKM with no participation by their Indian counterparts.

“From my point of view, it was important to get a sense of ownership and I began involving all Indian leaders in decision making. People did not figure out what I wanted from them in the first three months but gradually they warmed up to the idea and began showing performance,” says Ishii.

An opportunity also came along when the TKM team presented the mid and long term strategy to Toyota Motor Corporation, Japan, in July 2014. It was around this time that team leaders began gravitating towards the turnaround exercise, a clear sign that their sense of belonging and ownership had increased substantially.

Interestingly, TKM has marketing and manufacturing activities grouped under one umbrella. There was a distinct communication gap between the two which needed to be bridged as part of the revival process. Today, issues on demand and supply are better dealt with thanks to stronger communication between these functions.

“The key word is in India, for India and by India and the MD wants us to be the best in terms of sales, service and customer satisfaction,” says a TKM official. All functions are aligned towards creating a company where enhancement in brand/visibility, profitability and productivity are the three pillars. Ishii has also been driving home the message that the idea is to be an automobile person and not be someone confined to manufacturing, materials or finance.

And even while everyone is a core specialist by the end of the day, people can look still at things from different perspectives. Today, there is greater empathy and concern for other team members and the challenges on hand.

For the mid and long-term, the TKM Vision 2020-25 Realisation Committee meets every two months to discuss the road ahead. Likewise, function heads from sales, finance, manufacturing and purchase catch up every six months to outline ROI-based targets.

This is later vetted each year by the top management in the Hoshin meetings. Management Committee Meetings chaired by Ishii and the top leadership take place every Monday to advice on challenges faced by individual groups.

“Since last November, my request to function heads is to monitor ROI (return on investment) as this helps create a new mindset to ensure profitability. Each individual action can be really sharpened to achieve results across functions. The focus is very sharp now in visualising output through action and eliminating waste,” says Ishii.

Clearly, the mood is more buoyant now at TKM though the MD makes it clear that there is no reason to aggressively oversell the India story to Japan as the numbers speak for themselves.

An upbeat Ishii says India has the potential to generate huge volumes of cars in the coming years. It also has a great supplier base which can be a hub for future global Toyota operations.

“As a personal thought, I think we need to have a certain percentage of Indian global executives, at least till 2025 or 2030, in global Toyota operations. Indians are very good especially in their firefighting capabilities,” declares Ishii.

COMMENT NOW