Monday, January 9, 2012

Developing People - Toyota's Constraint

In Theory of Constraints (TOC) and other continuous improvement methodologies, we talk of the importance of training and developing people to prepare them to understand and operate under a different 'paradigm', that most of the times will bring improved operational performance.

Toyota's CEO, Mr. Akio Toyoda, acknowledges that Toyota's constraint to growth during the last years was the lack of people trained in the Toyota Production System (TPS).  Their past focus on being the "#1 car manufacturer in the world" induced them to pursue goals that were beyond their current capacity.  
Current sales figures have shown that what is currently limiting Toyota's growth is lack of sales, so they are probably at the right time to develop the next generation of leaders to sustain their future growth.  

The key lesson to this story is, in my opinion, that a company must assess correctly their real capacity, to know what commitments can be undertaken.

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