Potential: Revealed

Strategic Thinking, Innovative Ideas, Growth Marketing, and Revealing of Potential

Archive for Toyota

Creative friction

Recently I posted about an interesting research article on “The Contradictions That Drive Toyota’s Success“.

In summary the authors describe three “forces of expansion” (defined as those that lead the company to instigate change and improvement) and three “forces of integration” (defined as those that stabilize the company’s expansion and transformation). The countervailing nature of these forces allow Toyota to be widely and sometimes wildly innovative, creative, and constantly renewing itself, without undue chaos or losing its very clear and constant cultural identity. In the previous post I focused on the Expansion forces. Now a thought about Integration forces.

The Integration forces are listed as Values from the founders, Up-and-in people management, and Open communcation. Each are interesting but a part of the description of Open Communication was of most interest to me. A specific aspect of open communication was “give people freedom to voice contrary opinions”. It struck me as contraditory — ah, the authors’ title for the article was starting to make sense! — that being contrary with one another would serve to integrate the culture.

Then it reminded me of the economist Joseph Schumpeter’s thoughts about creative destruction. Schumpeter asserted that the process of innovation and growth in a capitalist economy was a strong mixture of both descruction and creation occuring simultaneously. And bringing these contradictory forces together results in a stronger, more vibrant and growth-oriented economy.

In fact in the Toyota example there are several examples cited of how allowing contrary opinions had positive impact. One I particularly enjoyed was of the new head of U.S. sales ignoring “everything those top executives told me” about what should be done to succeed in the U.S. market. It had to be clear to his bosses in Japan that the U.S. sales executive was contradicting their orders long before the results of his decisions played out, yet they allowed him to make his case and then go with his own ideas. He could have been wrong, but then if he was following some of the principles from the “Forces for Expansion” (discussed in the previous post), particularly to have an experimental attitude and approach, he would have a built-in mechanism to manage the risk of failure and to continually adjust or abandon his ideas if needed.

Most organizations and leaders will say they want to “hear” contrary opinions. Few in my experience want to “allow” those contrary opinions to be freely acted upon. And in Toyota’s case it is apparently beyond allow, but to “encourage” their people to act on their contrary opinions and ideas.

Latent value, by definition, has to be revealed. Reveal is a verb and connotes action. Toyota is a great example of an organizational approach and culture that personifies, through their actions, continually discovering and “revealing potential”.

Do you agree? Are there other ingredients that lead to unlocking latent value?