There was a fantastic article in the New Yorker magazine (the May 12th, 2008 issue) about Toyota and its “open secret of success.” What the article discussed was Toyota’s relentless pursuit of improving the process of making automobiles. From the fact that any employee can pull an “andon cord” and stop the entire assembly line to address a problem, to “reorganizing factory floors and work spaces to allow for freer and easier flow of parts and products” Toyota has revolutionized the way cars are built and how manufacturing is done in the world.
Yet despite opening its doors and giving tours and explaining just how its does things including a joint venture with G.M. to show them how to better improve GM’s own production system, Toyota continues to lead far ahead of the pack. Why?
The article answers that to Toyota, improvement is not a sudden leap, but rather it’s an incremental process to make things better on a daily basis. The Japanese even have their own word for it, “kaizen”, or continual improvement.
One of the keys to my success, especially in recent years is the relentless focus on improving the process of investing and that is why this article really spoke to me. I continue to work on and improve the process of investing from research, to position sizing to when to sell. As long as I continue to work on honing the process, in the long run my performance should be great.
Here is the link to the article: