Akio pushes Toyota closer to its ‘gemba’

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in Profiles in Leadership

Imagine you’ve just stepped into a leadership role when your company is hit with a global recession, massive recalls that have damaged your largest asset (reputation), and a devastating disaster that all but halts production.

That was the inheritance of Akio Toyoda, grandson of the founder of Toyota, after being named president in 2009.

Despite the challenges, though, Akio has “re-­energized” the company, say ex­­perts familiar with Toyota. With 19 new or redesigned models in 2012, including an expansion of the Prius line, Toyota seems to have regained momentum.

Here’s how Akio is turning things around:

√   He’s fast and flexible. “Usually Japanese companies are based on a ‘bottom up’ management style, which slows down the pace of decision-making,” explains executive vice president ­Yukitoshi Funo. “In looking at other companies, we realized the need for a certain level of ‘top down’ to move quickly.”

In another shake-up move, Akio created a team of five top advisors, each an expert in his area, to do fast “pit work” during Tuesday morning meetings. No agendas, no written reports. They make decisions on the spot, such as their decision to invest $50 million in Tesla Motors.

√   He asks top executives to stick with their specialties. Traditionally, Toyota has wanted top execs to rotate throughout departments. But now they stay put, so they can leverage their experience.

√   He’s getting closer to the “gemba”—where the real work is happening. Akio bypassed several management layers in order to personally take charge of the sagging Lexus brand.

To some, it may seem like micromanaging. But it worked for Steve Jobs, and Akio believes his personal attention is critical to his leadership and his ability to connect emotionally with customers through Toyota’s products.

— Adapted from “Akio Toyoda: Toyota’s comeback kid,” Alex Taylor III, Fortune.

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