A Modern Parable - Ford vs. Toyota

From an e-mail I recieved:

A Japanese company ( Toyota ) and an American company (Ford) decided to have a canoe race on the Missouri River . Both teams practiced long and hard to reach their peak performance before the race.

On the big day, the Japanese won by a mile.

The Americans, very discouraged and depressed, decided to investigate the reason for the crushing defeat. A management team made up of senior management was formed to investigate and recommend appropriate action.

Their conclusion was the Japanese had 8 people rowing and 1 person steering, while the American team had 8 people steering and 1 person rowing.

Feeling a deeper study was in order, American management hired a consulting company and paid them a large amount of money for a second opinion.

They advised, of course, that too many people were steering the boat, while not enough people were rowing.

Not sure of how to utilize that information, but wanting to prevent another loss to the Japanese, the rowing team's management structure was totally reorganized to 4 steering supervisors, 3 area steering superintendents, and 1 assistant superintendent steering manager.

They also implemented a new performance system that would give the 1 person rowing the boat greater incentive to work harder. It was called the 'Rowing Team Quality First Program,' with meetings, dinners, and free pens for the rower There was discussion of getting new paddles, canoes, and other equipment, extra vacation days for practices and bonuses.

The next year the Japanese won by two miles.

Humiliated, the American management laid off the rower for poor performance, halted development of a new canoe, sold the paddles, and canceled all capital investments for new equipment. The money saved was distributed to the Senior Executives as bonuses and the next year's racing team was out-sourced toIndia.

Sadly, The End.

Here's something else to think about:

Ford has spent the last thirty years moving all its factories out of the US , claiming they can't make money paying American wages.

TOYOTA has spent the last thirty years building more than a dozen plants inside the US . The last quarter's results:

TOYOTA makes 4 billion in profits while Ford racked up 9 billion in losses.

Ford folks are still scratching their heads.

3 comments:

Anonymous said...

I like your analysis... but it misses the biggest cause of failure: The UAW. Toyota can afford American workers, but they couldn't afford UAW workers. And neither can Ford.

Notoriously Conservative said...

That's true. However, I did address that fact in a previous post, found here: http://www.notoriouslyconservative.com/2008/11/big-three-let-them-go-bankrupt.html

The UAW sets ridiculous wages, pension packages, and health benefits.

keightlynn said...

"The UAW sets ridiculous wages, pension packages, and health benefits."

How true. The union is so corrupt is it discusting.

You forgot to mention that Ford has been building nothing but crap for the past 20 years.

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