Why Toyota is a successful company

"According to Matthew E. May, the author of a book about the company called “The Elegant Solution,” Toyota implements a million new ideas a year, and most of them come from ordinary workers. (Japanese companies get a hundred times as many suggestions from their workers as U.S. companies do.) Most of these ideas are small — making parts on a shelf easier to reach, say — and not all of them work. But cumulatively, every day, Toyota knows a little more, and does things a little better, than it did the day before.

In part, this is because most companies are still organized in a very top-down manner, and have a hard time handing responsibility to front-line workers. But it’s also because the fundamental ethos of kaizen — slow and steady improvement — runs counter to the way that most companies think about change. Corporations hope that the right concept will turn things around overnight. This is what you might call the crash-diet approach: starve yourself for a few days and you’ll be thin for life.

The Toyota approach is more like a regular, sustained diet — less immediately dramatic but, as everyone knows, much harder to sustain. In the 1990s, a McKinsey study of companies that had put quality-improvement programs in place found that two-thirds abandoned them as failures. Toyota’s innovative methods may seem mundane, but their sheer relentlessness defeats many companies. That’s why Toyota can afford to hide in plain sight: It knows the system is easy to understand but hard to follow..."

More at this New Yorker article. Discussion (and some rebuttal) at this Reddit thread.