Toyota´s Chief Engineer System

The Chief Engineer System is based on a key person – the chief engineer – who leads the whole PD from conceptualization to start of production: this is a critical factor in Toyota´s LPDS. Morgen and Liker (2006:21) describe it with a metaphor: they say that the chief engineer needs ‘to be the glue that holds the whole PD system together’. Interestingly, the CES originated in the Japanese defense industry and was adopted at Toyota in the 1950s. However, the responsibilities and characteristics of the systems remain fundamentally the same.

According to Morgan and Liker (2006:119) it is easy to imitate this specific organizational form, but it takes years for companies to develop the roles and responsibilities characteristic of Toyota´s system. The challenge is to identify exceptional people possessing a perfect balance of excellent engineering and leadership skills, and who are ‘groomed’ by Toyota for at least 12 years. Ward (2009:6) confirms this argument, by presenting similar practices at Ford Motor Company and GM. While both companies appointed heavy-weight project managers, they did not fully understand the concept of system architect and therefore tended to merely create another bureaucratic position.

168 The findings from the literature (Sobek et al. 1998:42; Rauniar et al. 1998; Sobek et al. 1999:72; Morgan & Liker 2006:117; Womack et al. 2007:114 and Ward 2009:85) provide for a compilation of a chief engineer profile as follows in Table 7.2.

Chief engineers …

Responsibilities

… are both entrepreneurs responsible for project profit and system designers responsible for designing the value stream

… are totally responsible for an entire vehicle

… define clear and logical architecture for the product and whole value stream … design a system and integrate knowledge and parts into the system

… are system integrators – a product integrator and people integrator with a focus on integrating across functions

… control the PD process and avoid waste

...are responsible for project planning, timing and scheduling, from the early concept stages through launch and into the initial marketing campaign

… approve the initial marketing campaign

… sets goals for performance and quality for the part and the efficient manufacturing of the part

… establish the cost targets with a continuous improvement concept in mind … sign every drawing

Vision … must generate and communicate an inspiring, focused vision to excite people and

draw their support

Leadership

… are not bureaucratic managers: they must lead people, not command them … have no direct authority over functional engineers, who report to direct functional managers

Skills and knowledge

… have combined technical, leadership, and commercial skills … must provide technical guidance to the functional departments

Decision-making ….make fast and correct decisions, balancing innovation, risk, time, cost, customer

needs, and product and manufacturing physics

Problem-solving

… must break down communication barriers between departments, and demand effective communication

… have knowledge about new technologies to solve cross-disciplinary problems … must resolve any disagreements across functions and achieve consensus within the design teams

Organizational issues

… have a direct line to the company president … are ranked higher than the departmental leaders

… are supported by strong functional groups with expert knowledge in specialty areas …have little administrative responsibility, and supervise only a few assistants

… must negotiate for resources with the departmental managers

Table 7. 2: Compilation of a chief engineer´s profile

169 The main points in Table 7.2 can be briefly explained. The chief engineer is the most important person influencing the success of the whole development programme: this is the person who ‘runs and owns’ the whole programme over multiple vehicle generations. The unique role of the chief engineer in the Toyota system is to develop the structure of the PD organizational system and to develop a definite and clear product concept for a new vehicle. He is accountable for the success of a vehicle design and development and even for its sales. The chief engineer is selected by top management immediately after the advent of a new vehicle has been decided upon.

While the chief engineer is working with thousands of engineers a team of only six to ten assistants must formally report to him. The purpose of this structure is to ensure that the chief engineer does not have to waste time with administrative work and human resources issues. It enables him to focus on the customer and the product. A great deal of independence and autonomy is given to him in order to allow him to focus on technical vision and horizontal cross-functional group facilitation.

The chief engineer is the central icon in the Toyota LPDS system: this therefore is a high profile position with a special status. It would be interesting to ascertain whether there has ever been a female chief engineer as the lean literature describes this position only in male gender terms. Liker and Morgan (2006:13) claim that to date chief engineers at Toyota have all been men, which is in accordance with Japanese cultural traditions. Within the Toyota community it is an extremely valued and coveted position, often more admired than the position of director or vice president. The CES is an integral part of a specific organizational structure which will be focused on when Principle 6 is discussed. The link between the theory and the real organization involves Principles 5 and 6 as they are closely inter-related.

7.3 PRINCIPLE 6: ORGANIZE TO BALANCE FUNCTIONAL EXPERTISE AND