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Reinvent or Die

Written by: Allen Hatton

Article Overview: Some of you might know that in the mid 90’s I worked as a turnaround manager and interim CEO for troubled companies. I got to experience the pain of going out of business over and over again. I first saw this with a company that I worked for in the 70’s and 80’s that was in business for 12 years and went belly up.. There is a multitude of reasons why companies fail and for the purpose of this Leadership Gems I want to focus on a big one. Learning .The attitude you have toward learning is critical to your long term success. Hang with me for a moment.

Reinvent or Die

Some of you might know that in the mid 90’s I worked as a turnaround manager and interim CEO for troubled companies. I got to experience the pain of going out of business over and over again. I first saw this with a company that I worked for in the 70’s and 80’s that was in business for 12 years and went belly up.. There is a multitude of reasons why companies fail and for the purpose of this Leadership Gems I want to focus on a big one. Learning .The attitude you have toward learning is critical to your long term success. Hang with me for a moment.

I attended a workshop recently to hear and learn from a well known speaker and consultant. This guy is my age, makes a million bucks a year and works 20 hours a week. I like that. So I dragged my backside to downtown Washington at 8 AM on a Saturday morning to see my new Guru. This guy was confident to say the least, and one question that came from the audience was “what is the difference between confidence and arrogance”? His answer, “with confidence I am still learning, with arrogance there is nothing left to learn”. So check out your arrogance factor and ask yourself in every single area of your business “what don’t I know and how can I learn more”. A good place to make a beginning is by asking your own people what you don’t know and then go to the outside and ask friends, consultants and vendors. And don’t forget to ask what you don’t know about developing yourself as a manager and leader. I’ll be glad to help you there!

The brief article below is from last month’s Wharton Leadership Digest and it captures the essence of a speech given by the president of Toyota. Read it and learn from someone who understands all too well what I am talking about.

LEADING CHANGE: Reinventing Toyota

Fujio Cho, President of Toyota Motor Corporation, spoke on August 3, 2004 about reinventing his company:

If you are not busy re-inventing your company I guarantee you are falling backwards. Even worse, your customers are probably looking elsewhere.

When re-invention works, it can be great. Think about James Bond movies -- the Bond character is re-invented every few years to the delight of audiences. It has created an amazing franchise that has stood the test of time.

But, of course, re-invention is not without risks. So, why should Toyota...or any auto company re-invent itself now? Because our industry has never been more competitive in history.

Examples are everywhere. Hyundai has quality and prices that have caught customers' attention...not to mention ours...General Motors now has plants and products that are standouts...Ford has great trucks and turn-around profits...Chrysler's new 300 is flying out of showrooms...Honda has top quality and new hybrids coming...And Nissan is on fire with the fastest growth of anyone in the business.

Is this highly competitive market stressful for us? Most certainly! Is it good for us? Absolutely! Does it lead to better products for the customer? Without a question!

In a sense, the idea of "re-invention" is similar to the concept of "kaizen," or continuous improvement that is a cornerstone of The Toyota Way philosophy.

But a few years ago, we realized we needed to develop a greater sense of urgency in our business. Steady success is good, but it can foster serious weaknesses. Complacency sets in...customer focus declines...creative ideas dry up...and...before you know it...you are in trouble.

So, two years ago, Toyota announced a long-range plan to re-invent ourselves. We called it "Global Vision 2010." Developing a new "Global Vision" was actually an admission on our part that we faced a crisis.

There used to be a time when we could handle everything from Japan. But starting in the 1980s, our own business started to move at turbo speed, and it has been accelerating ever since.

The sense of crisis we feel...despite increasing sales and profits...stems from our fear that we have not kept up. And particularly fears that we have NOT kept up with environmental issues...the demands of globalization...and the need to develop our people for the future.

Identifying these three priorities is easy enough. But instituting the necessary changes in a big company like ours is another matter. New approaches are necessary in every area of our business, from R & D and purchasing...to production and marketing....

And...what I have discovered in the process...is one universal ingredient that makes it all work...and that is ATTITUDE.

Until everyone...and I mean everyone...sheds their regional or national label we will NOT be able to reach our true potential as individuals...or as a company.

Japanese? American? European?

Does it really matter these days? We all want to sell globally and grow globally. It is the common bond that binds us all here today...and keeps us vital as an industry.

By re-inventing ourselves...and our companies...regularly...we will better serve our customers...prosper...and preserve our planet for future generations.

Note: The full text of Fujio Cho's comments can be found at http://pressroom.toyota.com/photo_library/display_release.html?id=sp20040804.

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