The Toyota Way: A vision for a high-tech future that’s built around people
Most of the world’s leading carmakers have manufacturing plants in Argentina. Yet, it is Toyota that’s now out in front as the automotive firm people in the country most want to work for (number one in the automotive sector and third overall in the Randstad Employer Brand Research Argentina 2017). “The ‘Toyota Way’ is rooted in continuous improvement and respect for people,” says Andrés Massuh, HR and Corporate Administration Director. “To our people here in Argentina, we say ‘help us enhance quality, help us become more productive, and we’ll guarantee you job security and investment in your skills and future’.”
How does Toyota Argentina stand out when there is so much competition for talent in the country’s automotive sector? How has the company worked with unions to become one of the most productive and advanced in the region? How has a corporate philosophy that originated in Japan been successfully adapted and applied on the other side of the world?
Automotive is one of the most popular industries among Argentinians. Why is vehicle manufacturing so appealing to talent?
Argentineans are passionate about cars; people love being behind the wheel. It’s telling that the first great star of Formula One, Juan Manuel Fangio, was Argentinean and there have been many great racing drivers since.
This passion for driving has translated into a proud tradition of vehicle manufacturing. There has been car production in the country for over a century. Working alongside the manufacturers is an extremely well-developed network of components suppliers and dealerships. Toyota Argentina directly employs around 6,000 people, but our network of partners employs many times that number, and we see everyone in this value chain as part of our community.
Toyota has been manufacturing in Argentina for just over 20 years, with capacity expanding rapidly from 20,000 when we started to 140,000 vehicles today. Our Hilux pickup is the market leader in the region, being especially popular within Argentina’s large agricultural sector. We also make the SW4, a sports utility vehicle. We export a lot of these larger vehicles to Brazil and other parts of the Latin American region, while our partners in Toyota Brazil focus on production cars like the Corolla and the Etios.
What do you think makes Toyota so appealing to talent and how are you looking to improve on this?
I believe that people in the engineering and other talent communities see Toyota as an island of stability and opportunity in an economy that has seen a great deal of instability and painful downturns over the past 20 years. While there have been people facing uncertainty over their jobs in the country’s car plants and a lot of lay-offs in the economy as a whole during this time, we’ve continued to expand and hire new people.
I think that the reputation for reliability and high quality of our vehicles and the brand loyalty supports our reputation as an attractive employer. As our sales grow, as people see how well our vehicles perform and last, they start thinking I can have a good future at Toyota.
Most of all, we offer solid, sustainable and purposeful career prospects. We want people to remain with us throughout their careers and we continually invest in their skills, career development, welfare and wellbeing.
The country’s main engineering universities are a key source of recruitment. Nonetheless, there is always a shortage of people with the engineering skills we’re looking for and so we can’t be complacent. We therefore invest strongly in programs such as student internships, as many of the trainees later become Toyota´s employees.
A pillar of our talent strategy is to create a more diverse culture. Women still make up barely a fifth of the engineering workforce in Argentina. Our initial goal is to ensure more women in leadership roles. Broadening our talent pool in this way is a critical part of our future.
We’re also looking at how we can improve our appeal to millennials. This includes strengthening flexibility and work-life balance, which are key priorities for the generations joining the workforce. This is a challenge in a company whose culture retains a lot of its traditional Japanese roots, but is vital if we’re to continue to attract the best talent. Key steps include better planning of workloads and shift patterns. We can also make more use of tele-commuting for non-production staff, which is of particular value to us as our main plant in Zarate is more than an hour’s drive from Buenos Aires City, where most of our staff and people we need to attract live.
How does the Toyota Way of continuous improvement and respect for people manifest itself?
Every day, we ask ourselves ‘how can we do this better’ – this is part of our DNA and culture as a business. A lot of this is about small step improvements – ‘kaizen’ – that cumulatively can make a huge difference. Teams come together every day to identify issues and work out ways to resolve them. The best ideas are entered into a competition for Toyota staff worldwide and regional winners here in South America have the accolade of being able to go to Japan for the global finals.
In an industry and marketplace facing so much change, a key part of respect for people is carefully and honestly discussing what the future holds and ensuring employees have the training and skills they need to meet the challenges. We need to constantly invest in our people to help them develop new skills and be better prepared to face the future.
How do you adapt the Toyota Way to the demands and culture of the operation here in Argentina?
Clearly, there does need to be some adaptation in order to be able to transmit our values, as well as taking account of aspects of our distinctive local culture. Our main goals are not only to attract the best people in the marketplace, but also people that can fit in well within our organization.
Our people here in Argentina and colleagues in Japan actually have a huge amount in common. Toyota has always seen itself as a family, rather than just a business. Here in Argentina, we’re keen to invite employees’ families to visit us in our plants and we’re very involved in the life of the communities in and around where we and our partners operate.
Having grown from around a 1,000 to 6,000 employees, one of the challenges we face is how to communicate with our people and strengthen this sense of community. Social networks can help us to broaden our communications. But we also recognize that management plays a crucial role in communication and needs to be on the production lines talking to people face-to-face constantly. That is a key part of the Toyota Way.
The Argentinean automotive industry has faced productivity challenges, especially in relation to absenteeism. Securing union agreement for changes in working practices can also be difficult? How has Toyota overcome these challenges?
Dialogue with the unions and employees is the key. We’ve been able to cut absentee rates from 8% to 3% and now have one of the highest rates of productivity in the industry.
This same dialogue and agreement is equally essential in preparing Toyota for the future. We’ve committed to protect jobs and invest in skills, and in return the unions are working with us to adapt agreements and modernize working practices. We see ourselves as working towards a common goal. The unions recognize that we need to continually improve efficiency to enable us to keep growing and protect their members’ jobs.
What does the future hold for Toyota Argentina and what are the implications for your people strategy?
Protecting the environment is the most significant priority. We’ve committed to shift all of our production to electric, natural gas or hybrid engines and stop making gasoline-powered vehicles by 2050. As a result, we need to transform our production facilities. Our partners also face considerable challenges – suppliers must adapt production, while sales people in our dealerships need to educate consumers about why this is so important and encourage them to switch to greener vehicles.
We’re also looking ahead to a new business model, in which rather than owning a car or van, customers subscribe to a comprehensive mobility service. This would include being able to call up different sizes and types of vehicle on-demand, depending on what they need for that particular day (e.g. shopping or a weekend away). Public transport would also be included within the service.
From an organizational and people perspective, these changes require a different mindset and skill set. They also require the ability and agility to change at the same rapid pace that the world is changing. This is a cultural shift that requires people to embrace change.
Knowledge base: What we can learn from Toyota Argentina
- small steps improvements can make huge differences over time
- while job switching is often high among engineers, many still appreciate stability and the chance to contribute to long-term growth
- successful modernization demands understanding and buy-in from employees.
HR and Corporate Administration Director, Toyota, Argentina
Andrés Massuh graduated in Business Administration, before studying for an MBA. After some years working in financial services, he joined Toyota, working in the financial department for ten years. Two years ago, he was inspired to take up his current position as leader of the HR team. He enjoys working closely with his peers and keeping continuous contact with all members of the organization. Upcoming priorities include developing and implementing regional and global strategies, aligning practices and objectives and working as one team. Andrés is married with twin daughters. He loves traveling with his family, playing tennis and running in his free time.rit.
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