Evolution of Manufacturing Systems and Ex Post Dynamic Capabilities: A Case of Toyota's Final Assembly Operations

Abstract

Abstract The chapter focuses on changes that have occurred in the Toyota production system over the last decade, the factors including these changes, and the processes of change. It is proposed that, while foreign observers often had assumed that production workers at Toyota were generally pleased with the work environment that was in place in the late 1980s, this was not completely so, and a tightening of the Japanese labour market provided strong incentives to Toyota to revise their production system. The paper shows that the process of changes at Toyota involves a combination of a broadly oriented ‘vision’, a considerable amount of trial and feedback learning, a considerable amount of discussing in order to get broad agreement on what is desirable and acceptable and what is not, and revision of the vision to provide a rationale for the evolving consensus. The chapter treats Toyota's continuing success, in the face of periodic external changes and continuing internal ones, as an indication of the fact that it has achieved strong dynamic capabilities.

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