The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer

Hourensou: A Japanese word made up of three parts: “hou” (hou koku—to report), “ren” (renroku—to give updates periodically), and “sou” (sou dan—to consult or advise). Toyota stresses the importance of sharing information at all levels of the organization as well as the importance of managers staying informed about the activities of their subordinates. As a result, Toyota managers strive to find efficient ways to get information fed to them and to give feedback and advice to help train and develop people. While there is no single methodology for accomplishing this, many Toyota executives and managers ask their subordinates to give daily reports.

Heijunka: A Japanese word that roughly translates to “leveling.” Heijunka levels demand by type and quantity over a fixed period of time to create a smooth flow of work, reducing unevenness and overburden. It is the foundation for flow, pull, and standardized work.

Hansei: Refers to the process of reflection to recognize one’s mistakes, feel sincerely concerned about them, and take appropriate steps to avoid their reoccurrence.

Toyota prefers to start organically with the model line process—learn deeply by starting with developing the system in one place

Principle 1. Base your management decisions on long-term systems thinking, even at the expense of short-term financial goals.