By H. Thomas Johnson
Toyota's current quality crisis is not a sign that its longstanding reputation for excellence was a mirage, that its fundamental management system was never really superior to the systems in competing organizations. Rather, it reflects disastrous policies adopted after 2000, when top management's thinking changed 
sharply in a direction that, while consistent with that of most other Western companies, would never have been tolerated at Toyota in the past.
In a bid to surpass General Motors as the world's largest automaker, after 2000, Toyota's top managers became ensnared in a destructive mode of thinking--thinking that focused their decisions and actions on achieving immediate financial targets, no matter the long-run consequences to the company's welfare. Popularly known as "management by results," or MBR, this approach dominated American businesses after 1970 and remains the prevailing business philosophy today.
Before 2000, however, Toyota followed an alternative mode of operating that I refer to as "management by means," or MBM. A company employing MBM succeeds by building and continuously improving the system of relationships among customers, managers, workers, suppliers, owners, and the larger community. The system's purpose is to enhance human well-being by providing safe and useful products and services, meaningful livelihoods, and sustainable financial returns.
One of the first things I learned when I began observing Toyota's operations almost 20 years ago was that accounting-based financial tools, such as cost targets, standard cost variances, performance budgets, and compensation incentives, are not needed in a Toyota plant. Indeed, the company's legendary industrial engineering genius, Taiichi Ohno, reportedly said that he was able to achieve the changes in plant operations that led to what became known as the Toyota Production System because "my boss, Mr. Toyoda, kept the accountants off my back."
While creating and refining its unique MBM management system from the 1950s through the 1990s, Toyota rose to become the most successful and trusted manufacturer in the world. So it was surprising that the company embarked on a "management by results" strategy after 2000. With financial executives gaining control of top leadership positions, Toyota's management grew less attuned to operations than to the demand for steady growth in shareholder wealth and share prices. The current engineering and design failures that have caused unprecedented recalls are classic symptoms of pushing to achieve short-run financial and growth targets beyond the company's current capacity to integrate new plants, new suppliers, new workers, and especially new managers into a coherent whole.
Can Toyota regain the reputation for excellence that it enjoyed until recently? It depends on top management's commitment to restoring and nurturing the disciplined pattern of continuous improvement in operations that originated with the company's founders. Toyota's new CEO Akio Toyoda would be well advised to reflect on how the current MBR thinking espoused by the architects of Toyota's disastrous growth policy of the past decade differs from the MBM thinking that led to its previous record of sustained success.
H.Thomas Johnson is professor of business at Portland State University and Distinguished Consulting Professor of Sustainable Business at Bainbridge Graduate Institute. In 1997, Harvard Business Review named his book Relevance Lost one of the most influential management books of the 20th century, and in 2003, Harvard Business School Press listed Tom among today's 200 leading management thinkers. In 2001, Tom's book Profit Beyond Measure received the Shingo Prize for Excellence in Manufacturing Research, and in 2007, the American Society for Quality awarded him its prestigious Deming Medal.
Photo of country road supplied by freefoto.com
By Janice Molloy
As in most places, summer in New England means an extravagance of local produce. Even my veggie-phobic son can't turn down a farm-fresh ear of corn, carrot, or handful of green beans. It was against this backdrop of abundance that I recently read Michael 
Pollan's lastest book, In Defense of Food: An Eater's Manifesto--a systemic look at the evolution of the "Western diet" and its devastating effect on the health of people and planet alike. Pollan's sobering analysis is a stark illustration of the dangers of reductionist thinking as well as a call for a more holistic approach to diet and health.
No one denies that obesity and diabetes have skyrocketed in the U.S over the past several decades. Some might argue that this trend reflects a failure of individual self-control. But Pollan points to several larger factors, including U.S. dietary guidelines from the late 1970s that promoted "healthy" carbohydrates over "unhealthy" fats; a rise in the consumption of processed foods; and an emphasis on the nutrients in foods to the exclusion of foods as a whole.
This last item stems from what Pollan calls "nutritionism," a belief that "food is not a system but the sum of its nutrient parts." The implications of this paradigm are huge. When nutrition scientists break food down into its constituent parts, study them one by one, and deem an element to be vital for my health, it doesn't matter whether I get it from a crisp green salad or a bag of highly processed, fortified corn chips. As Pollan states, "a notorious junk food [can] pass through the needle eye of nutritionist logic and come out the other side looking like a health food."
Pollan quotes New York University nutritionist Marion Nestle: "The problem with nutrient-by-nutrient nutrition science . . . is that it takes the nutrient out of the context of the food, the food out of the context of the diet, and the diet out of the context of the lifestyle." So, for instance, for many years, health experts have been perplexed by the "French paradox": the fact that French people suffer a relatively low incidence of coronary heart disease while consuming a diet that is rich in saturated fat. Scientists have searched for the magic bullet--Is it the red wine? The fish? The foie gras?
Holism, the opposite of reductionism, recognizes that a thing can have properties as a whole that are not explainable from the sum of its parts. The French--and Italian and Greek and Japanese and Indian and Mexican--paradox may result from a synergy of factors, including the ingredients used, portion sizes, savoring of meals with friends and family, amount and type of exercise people get, and other, less obvious variables. Unfortunately, as much as we might like to package healthfulness in an energy bar or vitamin pill, it doesn't seem to be that easy.
Pollan concludes the book with a set of general guidelines for escaping the harmful effects of the Western diet. Most of them are common sense, such as shopping the peripheries of the supermarket and avoiding the processed crackers, cookies, and chips that fill the middle. Some demand more effort, like doing all of your eating at a table--a discipline that can be challenging in today's go-go world.
None of these behavioral shifts rise to the level of large-scale systemic change--something I'd love to see Pollan tackle in a future book. By making smart individual choices, we may not make much headway against the rising tide of obesity, diabetes, heart disease, and cancer in our culture. But we can improve our personal health and well being--and eat some fabulous meals in the process.
Janice Molloy is content director of Pegasus Communications and managing editor of The Systems Thinker.
Cabbage photo by Nancy Daugherty