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TOYOTA CITY, Japan: In a classroom at a school in central Japan, a few dozen teens face a whiteboard covered with long mathematical equations as their teacher rattles on about the workings of kinetic energy.

The uniformed 17-year-olds look like typical students going through the motions of dreary school life. Looks can be deceiving - they're Toyota Motor Corp employees.

A carmaker running a high school? Toyota might be on to something.

Toyota, Japan's top automaker, made more money last year than Detroit's Big Three - General Motors, Ford Motor and DaimlerChrysler - combined.

And, Toyota is on its way to racking up record profits for a fourth straight year.

As rival automakers in the West watch their earnings slide and shares of the market erode on their home ground, one question has burned in the minds of industry executives and watchers: Why is Toyota so successful?

Volumes have been written on the topic - with the focus ranging from Toyota's renowned "lean manufacturing system" to its corporate culture of "kaizen," or continuous improvement.

But one answer can be found across town from its oldest car plants, at the Toyota Technical Skills Academy (TTSA).

The school, with 300 students aged 15 to 19, plays a unique role at the world's third-largest automaker: It is a breeding ground for an elite corps of future supervisors in the mechanical, machining and other technical fields, which are the core of any manufacturing firm.

It's a tradition nearly as old as Toyota.

The academy, which opened in 1938, a year after Toyota Motor was formed, was the brainchild of Toyota's late founder, Kiichiro Toyoda, who believed education was key to fulfilling his father's dream of building a national car.

Cornerstone

Insiders say Toyota's education programmes are the cornerstone of its success in growing from a tiny spin-off of a maker of textile looms into the world's richest carmaker, with nearly US$8 billion in bottom-line profits.

"The academy is extremely expensive to run, but we look at it as an investment for the future," said Mamoru Sakamoto, the academy's director.

"If you compare an academy graduate and a new hire starting from scratch, the difference is remarkable."

TTSA is one of five remaining vocational high schools run by Japanese companies. The economic downturn forced the closures of hundreds of such schools.

The school accepts about 70 15-year-olds annually. The youths become Toyota's employees upon enrolment.

Admission is extremely competitive, with fewer than one in four applicants making the cut. Academic standards are high.

Toyota won't disclose how much it spends on the school, which also admits about 100 high school graduates each year for advanced technical training.

But, in addition to operating costs, the company dishes out annual stipends up to US$17,400 per student. Tuition is free.

Other automakers have employee education programmes too, but none are as extensive or start as early.

US giant GM, which makes an average US$200 per car versus US$1,260 for Toyota, for instance, offers mainly Web-based training to its employees.

"Toyota (educates its workers) differently from any other company," said H. Kent Bowen, a professor at Harvard Business School and co-author of a paper on Toyota's production system.

In keeping with Toyota's philosophy of "genchi genbutsu," or the "go-and-see-for-yourself" approach, TTSA students spend a lot of time, with their future supervisors, receiving on-the-job training.

"Most of the training is done by one's supervisor. So, when a worker needs to learn, the teacher is always there," Bowen said.

Toyota's supervisors take a Socratic approach to teaching - providing answers by asking questions - to encourage workers to improve their work by developing their minds.

"There's a fundamentally different view of people. Making lots of little improvements all the time ... is the key to Toyota's success," Bowen said.

Students learn actual work practices - such as the suggestion box system, in which employees at all levels and fields make recommendations to improve operations.

Good suggestions are rewarded with prize money - which can be hundreds of dollars.

Toyota way

The training isn't just vocational.

Over the three years, students go through vigorous physical trials - including hiking up a 3,000-metre mountain, swimming for two hours in the sea and running half of a marathon.

"The idea is for each student to complete the tasks, so they become strong mentally and physically," said Hajime Sugita, an alumnus who was named the academy's general manager.

"We don't want them to be quitters."

As Toyota opens plants from China to the Czech Republic, it takes employee education a step further.

Last year, it set up the Toyota Institute, in central Japan, to drive home the importance of the "Toyota Way" for the mostly foreign executives who will be training local staff.

Kazuyuki Kawai, head of Toyota's human resources division, says bridging the cultural gap will be a challenge, as Toyota has 250,000 worldwide.

"In the United States, for instance, people think of their work as being rigidly defined," Kazuyuki said.

"It's like in a swimming relay: The next person jumps in only once the previous one touches the wall.

"But in Japan, the attitude is similar to track and field: The area where the baton is exchanged is wider and fuzzier."

Agencies via Xinhua

(Business Weekly 08/19/2003 page2)