Kaizen Means Never Being Satisfied

One of the Toyota executives attending the Tundra’s debut was Jim Press. A tall, lean Midwesterner, Press is the president of Toyota Motor North America, making him the company’s highest-ranking American. Toyota is governed by a large corporate board, which is made up of top executives in Japan and senior managing directors spread around the globe; Press is one of 49 managing officers of the company just below that level. For most of his career, Press worked on the West Coast, at Toyota’s North American sales headquarters in Torrance, Calif. More than half of Toyota’s profits now come from the U.S.; its success here, and its success globally, are so closely related as to be indistinguishable. In the view of one longtime Toyota watcher, Press’s high standing reflects the fact that, more than any single manager, he delivered the American market to Toyota. His efforts helped make the Camry the best-selling car and the Lexus the most popular luxury brand in the U.S.

Press, who is 60, never had an ambition to be an auto executive. When I first met him in his Midtown Manhattan office in October, he told me that after college he took a job working for Ford. “My family was in retail,” he said, “and this was a foray into the manufacturing side to kind of learn what goes on in the industry before I went on and became a car dealer.” In 1970, his boss at Ford moved to Toyota and encouraged him to join up too. At the time, Toyota sold a few Land Cruisers and was known mainly for one car, the Toyota Corona. It seemed like a poor career move. “When you’re young and your head is full of ideas, you don’t let facts get in the way,” Press said. So he took a flier, gave up his company car (a new Ford Thunderbird) and went to work at Toyota.

When he started, the Big Three completely controlled car sales in the United States. The only foreign company of any prominence was Volkswagen, and as Press recalled, Toyota’s modest sales were lumped with various tiny carmakers as “Other.” Still, soon after he arrived, Press realized he liked the company’s intimacy: he could meet face to face with top managers and exert some influence over marketing decisions. And he liked Toyota’s obsession with customer satisfaction. When he told me about his first trip to Japan, he seemed to be recounting a religious experience. “As a young person, you are searching for this level of comfort, you don’t know what it is, but you’re sort of uncomfortable,” he said. In Japan, as he put it, he found a home, a place where everything from the politeness of the people to the organization of the factories made sense. On that first trip, at a restaurant one evening, he tried a rich corn soup and asked the waitress for the recipe. She checked with the chef, who explained that there was no recipe; it had been handed down from his mother. The next morning, the waitress came to Press’s hotel room: she had found a cookbook with a recipe for the soup. Press, apparently, was still her customer. “That blew me away,” he said.

It can be simplistic, and often a distortion, to accept a corporate executive as the personification of a corporation, especially one as large and varied as Toyota. Yet Press serves as an apt representative, and not merely because his career arc mirrors the company’s ascendancy. Like Toyota, he expresses himself in private with modesty and care, yet in public his speeches are bold, declarative and effervescent. In his office, he has an informal, relaxed presence and exhibits just a hint of an avuncular stoop; yet he loves to race cars and sometimes swims 5,000 meters a day. Toyota is as much a philosophy as a business, a patchwork of traditions, apothegms and precepts that don’t translate easily into the American vernacular. Some have proved incisive (“Build quality into processes”) and some opaque (“Open the window. It’s a big world out there!”). Toyota’s overarching principle, Press told me, is “to enrich society through the building of cars and trucks.” This phrase should be cause for skepticism, especially coming from a company so adept at marketing and public relations. I lost count of how many times Toyota executives, during the course of my reporting, repeated it and how often I had to keep from recoiling at its hollow peculiarity. And yet, the catch phrase — to enrich and serve society — was not intended, at least originally, to function as a P.R. motto. Historically the idea has meant offering car customers reliability and mobility while investing profits in new plants, technologies and employees. It has also captured an obsessive obligation to build better cars, which reflects the Toyota belief in kaizen, or continuous improvement. Finally, the phrase carries with it the responsibility to plan for the long term — financially, technically, imaginatively. “The company thinks in years and decades,” Michael Robinet, a vice president at CSM Worldwide, a consulting firm that focuses on the global auto industry, told me. “They don’t think in months or quarters.”

Certainly the most obvious example of Toyota’s long view is the Prius hybrid. Press said he believes that every automobile in the U.S. will eventually be a hybrid. I asked how soon. Not in five years, he replied, “but I think at some point in the not-too-distant future.” I asked whether Toyota developed and marketed the technology years ahead of the other major automakers because it possessed better technical skills. Press instead framed the issue as a matter of philosophy. Ten years ago, he said, at about the same time the Prius made its debut, Ford rolled out the huge S.U.V. franchise. “Both of us had the same tea leaves, the same research,” he said. “One of us bet on hybrid, one of us bet on big S.U.V.’s.” In his view, the wisdom of making big S.U.V.’s — Press left unacknowledged that Toyota eventually brought out its own line of S.U.V.’s — seemed dubious: “First of all, long term, is fuel going to get cheaper or more expensive? Is oil going to become more plentiful or less plentiful? Is the air going to become cleaner or more polluted? And so, do you do something proactive and innovative, to be in tune with where society is going? Or do you hold on to where it has been, and then don’t let go, to the bitter end?” It was never a matter of altruism, he seemed to be saying, but an example of how corporations survive in society. “What’s the right thing to do to sustain the ability to sell more cars and trucks?” he asked. The Prius was not about a fast return on investment. It was about a slow and long-lasting one.

The Tundra is hardly green like the Prius, yet it, too, illustrates Toyota’s characteristic patience and belief that it should serve every kind of customer. The biggest-selling vehicle in the United States is not the Camry (448,445 sold last year) or the Accord (354,441) but Ford F-Series trucks (796,039). Not far behind in sales are the full-size trucks from Chevrolet. These are among the most lucrative consumer products around, yielding anywhere from $6,000 to $10,000 in profit for every unit sold. “To the American automakers, that’s their bread and butter,” Jeff Liker, from the University of Michigan, explains. “They break even on passenger cars, lose money on small cars. But all their profits come from large S.U.V.’s and trucks. For the American auto companies, this is the last hill that they dominate.” Several auto analysts pointed out to me that G.M. and Ford trucks not only have an extremely loyal customer base; they’re also widely regarded as extremely well built and engineered (often in contrast to their passenger cars). When I asked Jim Press how long the company had been thinking about creating a full-size truck, he said it had been a priority dating to the early 1990s, when Toyota failed with its first big truck, the T100. The company failed again in 2000 when its first (and smaller) Tundra came out; only 124,508 units were sold last year.

Within Toyota, there is a rare and secretive designation for certain development projects known as irei, which is roughly translated as “not ordinary” or “exceptional” and refers to vehicles that the company will spend any amount on and go to almost any lengths to engineer, market and perfect. In the early 1990s, the Prius had this designation. When it came time several years ago to begin redesigning the new Tundra, it received the classification, too. The success of G.M. and Ford suggested that it was a product that could eventually reap tremendous profits. It was also a vehicle that could conceivably cement Toyota’s reputation, once and for all, as an all-American company.

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