Friday, April 11, 2008

A Parable: Ford versus Toyota

This is a story about Ford (F) and Toyota (TM) that just turned up in my email box, but I think it may have been floating around the web for a while.

A Parable

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 to India

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.


Rick said...

Wow! At first, I thought that the parable was original, but found out that it has been around the world more than 100 times with different company names.

Nice try, but try a little harder next time, or find yourself other hobbies. Perhaps having a pet would be good for you!


Anonymous said...

It is funny.It covers some branded companies.There is a lot of companies in the world.
car auctions

Unknown said...

Hi,this is very interesting topic.The both teams Japanese and American are practiced a lot but Japanese won by a mile.American team investigate the reason for the crushing defeat.They investigate that the Japanese had eight people rowing and one person steering,while the American people had eight people steering and one person rowing.
car auctions