The Bottom Line Per ... Jim BolteBy Baselinemag Print
Toyota's Vice President of Information Systems on improving processes.
As the vice president of information systems for Toyota's North American manufacturing operations, Jim Bolte spends his days figuring out how technology can be used to streamline operations—and thus manage costs—at a mass-production business that turns out more than a million new cars each year. In an interview with Baseline, he talked about the efficiencies he's been creating lately—including the better deals he's been able to drive with the hundred-plus consultants he employs.
Q. Has the consolidation in technology vendors had a negative effect on you in terms of the level of innovation you see in new products?
A: Actually it's been an advantage for us because we can negotiate better deals with vendors. If we bring in professional services or contract people, it's not like the Y2K days when rates were through the roof. They're reasonable. So we've actually been able to lower some of our professional services costs—almost at the expense of the technology industry.
Q. How else is technology helping you manage costs?
A: We've worked with the business-side people to implement new processes and a new system to ensure that no bad quality goes out of the plant. Essentially, what we're doing there is providing real-time information so if somebody sees a problem on the assembly line, they can quickly identify which process is the cause.
The other savings are in our financials area; we've reduced our close cycle—the roll-up of information in accounting—from 11 days to seven days. That has allowed us to reduce the number of temps we employ, which translates into real-dollars savings.
Q. How often do you do an actual ROI calculation before undertaking a technology initiative?
A. In the past I'd say it's been less than half the time. We have very clear business initiatives, so it's not usually an issue of go or no-go. It's how big is the scope and what kind of time frame are we talking about and what the deliverables are going to be. What's more important to me is the post-implementation review. You know, after we implement a solution, to go back, pull out that business case, and see whether we got the benefits that we said, in cost, quality and timing.
Q: That seems like the wrong time to go through that exercise—after a project is done. Why not do it along the way?
A: We do. We have a very tight project management process, and very strict systems development methodology. So it's not like we're blindfolded until the end. But in the spirit of [the Japanese tradition] Kaisan, or continuous process improvement, even after a successful implementation we want to know how much better it could be for the next time.
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