Reviewed by: Competing to be Really, Really Good: The Behind-the-Scenes Drama of Capability-Building Competition in the Automobile Industry Michael Cusumano (bio) Competing to Be Really, Really Good: The Behind-the-Scenes Drama of Capability-building Competition in the Automobile Industry. By Takahiro Fujimoto; translated by Brian Miller. LTCB International Library Trust/International House of Japan, Tokyo, 2007. xi, 156 pages. This new book by Takahiro Fujimoto of the University of Tokyo is a translation of his 2003 book Nōryoku kōchiku kyōsō (Capability-building competition), published by Chūōkōron Shinsha. It is brief (only 144 pages of text) but broad and deep, providing a convenient synthesis of Fujimoto’s work going back to the early 1990s on Japanese techniques in manufacturing and product development, largely at Toyota. The book starts with a discussion of what are “capabilities” and why they are important in business competition, such as in utilizing market and design information in the development and production of products. Fujimoto has studied Japan’s automobile industry because firms in this sector have “asserted their most pronounced international competitiveness” (p. 19). Subsequent chapters explain what the author means by organizational capabilities in manufacturing and product development, review how Nissan and Toyota evolved their approaches to manufacturing from the 1930s through the 1990s, and explore the notion of capabilities as an emergent process. The book ends with a discussion of global competition, trade friction, and [End Page 548] some comments on new trends in automobile production that should affect future competition, such as the ability to make products quickly “to order” rather than to a production schedule. This little book has a big theme: Toyota and other successful Japanese firms evolved unique manufacturing and engineering capabilities in a process that mixed some “rational” planning but mostly trial-and-error responses to unique local conditions. We read that Japan had a very small motor-vehicle market during and after World War II and had to come up with ways to manufacture a growing variety of products in very small volumes. The flexible mass-production techniques that have since become famous from Toyota include the kanban system, better known as just-in-time production, as well as other supporting concepts that minimize inventories and processing errors while maximizing the use of people and machinery. The capabilities that come with these techniques have enabled Toyota and other Japanese auto producers to lead the industry in productivity and quality by a large margin. Fujimoto’s particular mission is to correct potentially simplistic views of how Toyota and other Japanese firms came to their current prominence. He states his case with minimal qualification: The Japanese automakers . . . did not set out to create new kinds of production systems. Rather, their systems emerged through piecemeal, ad hoc measures for addressing needs and issues that arose in their business and operations. The Japanese had no idea—in any systemic, big-picture sense—what they were doing. (p. 65) The author goes on to tell us that, fortunately for Japan, these capabilities turned out to be particularly well suited to designing and manufacturing products with “integral” architectures—that is, products (like passenger cars) whose components are tightly interrelated rather than highly modular. At the same time, because these capabilities evolved in an ad hoc manner over many years and came to involve layers of suppliers as well as particular ways of training employees and incorporating different techniques for processing information and managing quality, they are themselves highly integral. The systemic, unplanned evolutionary nature of Toyota’s management techniques in particular is at least one reason why, Fujimoto argues, competing firms around the world have had difficulty duplicating them. This is despite the fact that, as he notes ironically, these capabilities evolved from studying and in many ways improving upon American manufacturing and engineering practices at Ford and the U.S. aircraft industry prior to the early 1950s. Informed observers of Toyota and Japanese management practices know that these capabilities evolved over many years in response to local conditions, built upon American practices, and were not precisely planned in advance. Nor did any Japanese manager in the 1930s or even in the 1950s [End Page...
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