Toyota’s 4P Model

Toyota has long been one of the top performing automotive companies in the world. They went from a relatively obscure Japanese car manufacturer in the 1940’s, to one of the most recognizable brands in the world.

Taiichi Ohno was a huge part of the transformation. One of the largest contributors to the field of Industrial Engineering, Ohno left behind a legacy that’s hard to parallel. Some primary tools he created are the seven deadly wastes, 5s, Just-in-Time manufacturing, and his ten precepts. His work proved so useful, it spanned to industries of all kinds- not just vehicle manufacturing. From sales, to marketing, and even customer service, his insights into continuous improvement have been invaluable. It takes whole books to cover everything, but the simplest framework is the “Toyota Way” document. Below is the visual summation of the “Toyota Way,” from author Jeffrey Liker’s book of the same title.

Image 1: The 4-p model of the Toyota Way

The beautiful thing about this philosophy of manufacturing, is that it applies in nearly every industry. Sales is a process that has many steps that can be thought of in a fashion similar to manufacturing (inputs–> a process–> output). How do you get from a potential customer inquiry to a closed sale? The series of steps may not exactly mirror manufacturing, but the above principles can be applied regardless. Running a bar or restaurant? Ohno’s principles can provide a good foundation for making and delivering food in a smoother process.

Software companies tend to be the hot topic in news, job hunting, investing, and even in social discussion (not many people talking about the best HVAC companies in town). Companies like Asana and Calm, both San Francisco based startups, have built their companies from a philosophical foundation. With a long term thinking foundation as the base of the company, many of the higher level principles follow naturally. Creating a process flow, standardizing tasks for quality improvement, and going directly to where the work is done to see for yourself, for example, are three pieces of the triangle that are readily applicable in software companies.

I’d go so far as to argue these principles are applicable in any business, in any industry. Sure, maybe not each piece individually will be directly useful. These did originate in manufacturing. However, if even one provides a new framework to think about (and improve) your business, I’d call that a success.

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