When the 'giant' Toyota decides to change.

Toyota's problem lies in its classic management philosophy, which has helped the company succeed for decades.

Many people in the auditorium burst into laughter during the press conference when the CEO...Akio Toyoda was excited.Talking about the new generation Camry with two options, one sexy (XLE version) and one truly sexy (XSE version).

The 2018 Toyota Camry, unveiled at the 2017 Detroit Auto Show. Photo:The car connection.

And as if to salvage his slightly exaggerated statement, he forced a somewhat strained smile and said, "I know that calling the Camry a sexy car these days sounds like an exaggeration to many. But I truly believe the design department has done something unprecedented."

This interesting moment is one of many new glimpses into the transformation of Toyota, a car manufacturer previously associated with a conservative image and slow innovation.

Neutrality isn't necessarily perfect.

With Toyota products, the adjective "sexy" is rarely used.Toyota's neutral product philosophy, creating a core value focused on durability and resale value, has propelled it to become a world-leading automaker. However, this has been accompanied by a somewhat bland design; everything is perfectly normal, from styling to performance.

The current landscape, with changing customer preferences, the rise of Korean cars, and the trend towards electric vehicles and autonomous driving technology, is forcing Japan's largest automaker to re-evaluate itself.The Toyota Way, also known as the Toyota Method, with its 14 principles of management, is the handbook that has propelled the automaker, which started in the textile industry, to its current position. Hansei, the method of self-reflection, is one of them.

Hansei reminds Toyota employees to always be open-minded, self-reflecting, and correcting mistakes. CEO Akio Toyoda, grandson of the company's founder, is perhaps the one who embodies this philosophy better than anyone else. He said in a press conference in May 2017: "I feel something is wrong with whether or not we are producing cars in a way that meets consumer expectations."

Prioritizing functionality over design has made the user's emotions secondary. Toyota acknowledged this after years of listening to feedback. They changed by empowering their design department more. The new Camry and C-HR bring a fresh perspective with their sporty, dynamic, and unconventional styling.

"Toyota's global strategy is to create more emotion in its products."", Jessica Caldwell,"The company has been criticized for producing boring cars. Now is the time for a gamble – the mid-size sedan segment is struggling," commented an analyst at Edmunds.

The boom in the crossover/SUV segment has pushed sedans into a widespread decline. To reach this shrinking and more demanding customer base, Toyota has no choice but to adapt.Toyota's neutral philosophy is most clearly demonstrated in its flagship sedan line.We are genuinely threatened.

The Camry is no longer the quiet, understated model suitable for older people. Its design is more appealing, with a touch of luxury from Lexus. The different Camry versions have more distinct differences in styling and equipment, no longer just for show like its predecessor.

"We can reach many new customers who previously ignored Toyota vehicles, because the company's current products are truly different from before," said the engineer.Professor Hiroyuki Koba, the head of the C-HR design project, said.

The C-HR, a new crossover with a sporty and distinctive design language, is expected to improve Toyota's otherwise bland image. Photo: Caradvice.

Mr. Koba added that Toyota aims to design new products for those who don't like Toyota cars. The Japanese automaker's products have historically tended to be easily accepted by the majority of customers. This is Toyota's strength. Of course! But consumers demand more than that before turning away if there is a sufficiently good alternative.

We cannot afford to be slow in making improvements.

Another key management philosophy in the Toyota Way is to use only what is necessary, reliable technology, and, most importantly, what aligns with the company's identity. Therefore, Toyota's products are very slow to innovate.

The Japanese automaker also doesn't rush to produce vehicles based on fleeting consumer trends. The research process and consensus-building across multiple departments typically take a considerable amount of time before a Toyota vehicle goes into production.

The rise of Korean cars, with their increasingly improved quality and rapidly changing designs, may be one of the reasons for Toyota's turnaround. Competitors are targeting Toyota's weakness of slow innovation. With a similar pricing strategy, the Koreans are gradually expanding their market share, breathing down the neck of the automaker that lost its number one position in global sales to Volkswagen in 2016.

OriginalNemawashiToyota's (careful changes) need adjustment. Beyond design, Toyota needs to demonstrate its willingness to offer customers a wide range of quality upgrade options and products.

Toyota's new manufacturing direction begins with closer collaboration with suppliers. Previously, Toyota engineers would contact suppliers on a monthly basis. But now they are directly involved with the design team at the product research and development center.Headquarters located in Ann Arbor, Michigan, USA.

"We gave them a chair and became part of the production project.""They're here now, talking to us every day," said Robert Young, vice president of Toyota North America.

Allowing suppliers to participate earlier and more deeply in the production process is a new feature of Toyota. The Japanese automaker wants to develop new models faster, apply complex techniques, and give the cars a more distinctive character.

Based on the new TNGA platform and changes in the materials supply system, the new generation Camry reduces completion time by 40% and costs 25% less than its predecessor, according to Autonews. Toyota's largest sedan, the new Avalon, also adopts a similar production method to the Camry. The car is expected to launch in 2018.

A portrait of Toyota's captain, CEO Akio Toyoda. Photo: Autonews.

CEO inspires

There's a more subtle change at Toyota, not in the company culture, but in the personality of one individual. CEO Akio Toyoda, a Japanese national, runs the Japanese automotive giant but possesses an open, decisive, and Western-styled personality.

UnderAkio Toyoda, Toyota, navigated the difficult period of the 2008 financial crisis. This was followed by a large-scale recall in the US due to a sudden acceleration defect. But things gradually returned to normal, and the Japanese automaker steadily rose to a leading position. For this man born in 1956, Toyota's philosophy is now undergoing significant changes.

According to Toyota's fiscal year report for 2016, released in March 2017, the company's revenue decreased.Revenue fell 2.8%, reaching $242.2 billion. Net income decreased 20.8%, to $16.1 billion. Looking ahead to 2017, the Japanese automaker expects revenue to continue to decline by 2.5%.According to Bloomberg, the percentage and profits fell by 18%.

Despite the challenges ahead, Mr. Toyoda said the company will persevere with its new strategy."I believe the latest business results reflect Toyota's positive and sustainable future direction, rather than prioritizing short-term profits."

In the past, the pursuit of quantity was one of Toyota's goals, and it proved successful. Maintaining the number one position for a long time solidified Toyota's reputation, but it also resulted in many models with uninspired designs. Mr. Toyoda stated that he would not place too much emphasis on that position. What Toyota needs to focus on now is improving the quality of its products.

Under Mr. Toyoda, the design department received more power to freely implement ideas. The Lexus luxury car division has a new captain. He personally gave the head of the division the authority to make decisions, striving to create a distinctive Lexus brand in order to compete with the BMW, Mercedes, and Audi trio.

If we had to find a figure who embodies what Toyota is hoping to change, it would be CEO Akio Toyoda.When the "big players" transform, everything is worth waiting for.

According to VNE