Principle 7 focuses on employee recruitment and development practices used at Toyota. A comparison of these with the practices used at non-lean organizations will be revealing. Using examples cited in the literature the researcher will explore practices in
174 real organizations. Finally, the mechanisms for organizational and individual learning used at Toyota will be identified.
One of the important prerequisites of Toyota´s success is professional excellence founded on the skills and capabilities of motivated people. A system the company consistently uses to support towering technical competence can be broken down into three processes: the recruiting/hiring process, the developing/training process and the retaining process (Morgan & Liker 2006:163). The company builds engineering skills slowly using learning from direct experience and also mentoring of newly recruited engineers. A crucial factor influencing development speed in their PD process is professional trust which is built on integrity and competence. At Toyota professional trust is rooted in a rigorous selection of employees in a recruitment process and furthered in a training process: this will be clarified in the following sections.
7.4.1 Recruiting and development process in a traditional organization
In order to understand the advantages of a lean system in terms of both processes, contrasting the practices typical of non-lean and lean organizations can be revealing. To describe how a non-lean organization deals with new employees, an example from Morgan and Liker (2006:165-167) and own experience will be combined.
In traditional organizations staff recruitment is done by functional areas with strong support from the human resources department which usually organizes various recruiting initiatives, such as visits to universities or job fairs. Moreover, job advertisements are posted and candidates are pre-selected. The management of the functional department needs to have an open position approved by headquarters who allocate a budget for it. After a series of interviews with managers of both the engineering and human resources departments, the successful candidate will be placed straight into a functional department. This is an individual hiring process and the newcomer, depending on his or her capabilities and the capabilities of management, is in the hands of an individual department. The functional department takes the responsibility for the training of new recruits but usually there is no standardized process for this.
However new engineers are generally expected to be productive from the beginning. In some cases the initial teaching and guidance is provided by colleagues who are prepared to support a newcomer, as official supervisors often provide little or no
175 mentoring. Sometimes the company offers individual training on the job. However, this often lacks clear structure or the perspective of seeing one’s whole personal development system in terms of future prospects.
The perception in a non-lean organization is that a broad experience in various technical disciplines is important for career success and engineers are encouraged to move from department to department: however this is not systematically organized. Consequently, beginner recruits are not able to develop deep expertise knowledge or real competence in a specific field. As there is no systematic process or programme to guide engineers, they learn and develop haphazardly: this may occur either too quickly or too slowly. Since the supervisors themselves were also not developed systematically, they often do not have the experience and skills to mentor new engineers. Some engineers who possess self-initiative abilities look for opportunities to learn and develop individually. Often only a few of them will be supported by their department with training and seminars. However, training is usually offered in the form of online courses or as classroom training which is mostly too lengthy and often not relevant to their daily job requirements. After doing the same job for several years, the motivation and satisfaction decreases as the engineer finds he does not advance.
It must be noted that the practices and problems described above are not related solely to PD organizations as outlined in Morgan and Liker (2006). The researcher has encountered similar problems at three international companies, where one of them was a PD organization. In further descriptions of generic organizational issues the term ‘traditional’ will be used interchangeably with the term ‘non-lean’, when referring to company, organization and process. This will include companies and processes involved with PD.
7.4.2 Recruiting and development process at lean companies
A LPDS is not only about adopting lean tools and techniques; it is also typically about a change of philosophy. With regard to this, Morgan and Liker (2006:169) stress that at Toyota people´s development is ‘as important as the PD’ itself. In order to describe this process and identify practices used at Toyota the following literature sources have been reviewed: Sobek et al. (1998); Morgan and Liker (2006:168-177); Ward (2009:194-202) and Liker and Hoseus (2009:149-196).
176 Toyota uses a structured methodology for selection, mentoring and development of new engineers. Managers are trained to be teachers and every project is viewed as an opportunity for developing their engineers. Consequently, the competence of each manager is reflected in the abilities and performance of product teams. The application for a job and employment at Toyota constitutes a complex journey with lots of challenges.
The first hurdle starts with the limited number of positions available and with preference being given to top graduates from top schools and universities. The hiring process involves a series of intensive interviews focused on evaluation of a personal profile and the likelihood of a fit within the company´s culture. Once a person is accepted, the training process starts with the whole class of new hired employees in assembly plants and at dealerships. Obviously, learning about the history and traditions of Toyota is a crucial part of their training. After joining a specific technical department, the new engineer will have one of the senior engineers assigned as his mentor. Additionally, he will be appointed to his first technical improvement project, known as a ‘freshman project’, where basic engineering methods and Toyota tools need to be applied.
After finishing the freshman project, usually taking from four to nine months, the beginner engineer starts with training-on-the-job within his or her technical specialty. The first two years are spent intensively on the workstation with CAD. Then for another three to six years the engineer works on a simple component design. Only after successfully completing this training can an engineer earn his / her first-level engineering rank and become a member of a technical development team.
The initial period is followed by an approximately eight-year development period. The manager is continuously mentoring engineers and evaluating their technical progress and adherence to company processes and standards. For the assessments conducted three to four times in a year the manager uses standardized skills matrices and feedback from various people working with the engineer. Action plans are developed for each engineer through Hansei (reflection) and Hoshin Kanri (policy deployment) and follow-up interviews. The results of the evaluation process form the basis for deciding whether to give an engineer the opportunity for further technical growth. Only after working for ten to twelve years can an engineer be promoted to a first-level management position.
177 7.4.3 Mechanisms for organizational and individual learning
Toyota´s approach to developing new engineers in a LPDS uses Genchi Genbutsu, which is a Japanese phrase meaning ‘going to see the actual situation first hand to understand deeply the current reality’ (Morgan & Liker 2006:173; Liker & Morgan 2006:14; Liker & Hoseus 2009). This principle is already reflected in the initial development period where engineers work in assembly plants or at dealerships. At a later stage, Genchi Genbutsu is applied in PD in the ways which Morgan and Liker (2006:173) synthesize as follows:
Competitor teardowns – engineers identify the best competitor’s car in the vehicle class
and disassemble it for examination. Individual parts are evaluated for quality, performance and manufacturability and displayed for all programme participants, including suppliers: the resultant reports are then distributed to all stakeholders.
Prototype builds – engineers build prototypes, first virtually and later physically, and
cooperate intensively with production-assembly engineers, prototype specialists and quality specialists. This prototype phase is a time of intensive learning, where many engineering changes are generated. Engineers use checklists and decision matrices to rapidly make quality decisions.
Wrap-up meetings – the spirit of Genchi Genbutsu is embodied at meetings during the
prototype phase held daily at the build site. The engineers from various departments (body engineers, prototype engineers, production engineers), together with the chief engineer and suppliers, discuss problems encountered by prototype assembly engineers, together with the chief engineer.
7.4.4 Linking the theory with the real world
Many companies admire Toyota´s performance and strive to emulate their lean system. The fact that Toyota takes a number of years to recruit, train and develop an engineer is frustrating for many of them. Lean transformation is strongly about a change of philosophy: this involves a new way of thinking and a change of organizational culture. And this is the biggest challenge for replication. The philosophy is the backbone of the LPDS but it also supports other principles. However no company can completely replicate Toyota´s approach or culture; nonetheless the lean thinking philosophy can be adapted. It is important to emphasize that only excellent dedicated people can sustain the system. To achieve this any company needs to significantly invest money in
178 education and development of their engineers, as well as into development of its suppliers.
In the light of knowledge of lean practices it can be argued that traditional hiring and development processes do not adequately support the creation of a high-performance PD system. Although many traditional organizations have tough requirements for candidates and recruit top students from top universities with top results, they do not necessarily ensure systematic and holistic learning and development.
Organizations tend not to have any company-grounded initial training process for newcomers or any individual development plans supported by real-life experience. Structured mentoring and teaching systems and consistent career paths for development of specific technical skills are lacking. Furthermore, supervisors are not motivated to develop new engineers, as there are few or no incentives for this. Organizations often lack consistent criteria for evaluation and rewards. With this in mind, the researcher’s opinion is that such shortcomings can result in a waste of many young talents.
Product development organizations with non-lean recruitment and development processes struggle to pass standardized practices and tools on to a new generation of engineers. Consequently, this leads to variations in technical skills and high-task variation in the PD process. Organizations are unable to plan and standardize accurately or to clearly predict outcomes.
7.5 PRINCIPLE 8: FULLY INTEGRATE SUPPLIERS INTO THE PRODUCT