Toyota's Social Innovation Umbrella

The 2014 Net Impact conference gathered like-minded people from all walks of life: Students, C-suite executives and members of the media sat side-by-side in panel discussions addressing some of the world's most pressing challenges, and folks from across industries mixed and mingled to inspire solutions to those challenges and more.

During the hustle and bustle of the conference, I had the chance to sit down with Latondra Newton of Toyota North America. She just took on a new role and has been asked to unite – for the first time – Toyota’s North American social innovation activities, including philanthropy, community relations, and diversity and inclusion. She is also charged with overseeing the Toyota Mobility Foundation, which was created earlier this year to address mobility challenges around the world.

If it sounds like a tough job, that's because it is, but Newton has met the challenge head on. During our chat, we touched on what social innovation means to Toyota and some of the company's far-reaching community relations programs -- some of which were even news to me. For example, did you know Toyota's manufacturing processes helped streamline food delivery after Hurricane Sandy? I surely didn't.

Read on for that story and more.

TriplePundit: To get things started, can you give us a bit of background about what you do at Toyota?

Latondra Newton: I have a newly-created role within Toyota North America, Chief Social Innovation Officer. For the first time in our company's history, we're bringing together certain functions -- like diversity and inclusion, our Toyota USA Foundation and all of our other philanthropic efforts outside of that foundation, as well as community relations -- under one umbrella.

The idea is that we wanted to aggregate all of those functions because we realized that there was something they had in common; there was some synergy among them that allows us to ... [use] the know-how that we've accumulated to be able to help nonprofits do more for the communities where we live. We also find that it helps our own business as well. It not only creates value in the communities, but we actually learn from people we partner with and we can bring learnings back into our business to make ourselves better. So, that's how we define 'social innovation' for Toyota; I know the term is used a lot here and there in different ways.

I also have a global position … as the Chief Program Officer for the Toyota Mobility Foundation. That foundation was just established as a legal entity in August of this year, but we will not be issuing our first grants until 2015. So, we're right in the throes of all the planning and figuring out how we're going to launch that foundation right now.

3p: We've heard of a few examples of how Toyota is working with nonprofits to leverage its manufacturing process to improve efficiency. Can you tell us a little more about that?

LN: The organization that's responsible for sharing our Toyota Production System know-how, which is our manufacturing know-how, with nonprofits is called TSSC, which stands for Toyota Production Systems Support Center. And we actually initiated this organization as a department within our company some 20 years ago.

To date that organization worked with 200 different entities within the community, whether it's small businesses or nonprofit organizations. That includes recovery efforts; we've been working in the health care industry ... so that gives you an idea of the scope of the work that organization does.

3p: Great. Any success stories you'd like to share?

LN: One of [our key partners] is the St. Bernard Project, which is an organization that was established after Hurricane Katrina. Two very enterprising young lawyers from the [Washington, D.C.] area actually left their entire lives behind to move to New Orleans because they were so compelled by the devastation in the area ... They moved to the St Bernard's Parish, which is one of the hard-hit parishes southeast of the city, and they started helping people rebuild homes.

They were doing that and doing amazing work for a while, but when we connected with them it was because they really felt like the process was not fast enough. They wanted to get displaced people back into their homes much sooner than they were able to achieve on their own. They'd heard about the Toyota Production System [TPS], so we went down and started working with them over multiple months.

Once we understood all the issues, then we could turn our attention to some of the practical tools that most people are familiar with -- think about standardized work practices and those kinds of things. So, some of the practical things we helped them do: They had a warehouse operation that kept all of the supplies for homebuilding, and it was a mess ... It wasn't very efficient, and it was one of the bottlenecks in the homebuilding process. So, we were able to help them rearrange their warehouses similar to how we would arrange our parts supply in our operations. They could quickly see when they have too much inventory or not enough inventory. When people are trying to find what they needed to put on a truck to deliver to a home site, they could easily get to it -- really practical things like that. It really transformed their efficiency.

We also helped them visualize the entire homebuilding process from soup to nuts. Visualization is a very important part of the Toyota Production System because if you can see everything and know ... what the lead time is to do every step in a process, you can easily spot where the bottlenecks are. Then you can work with your team efforts to improve those bottlenecks, so you can move on to solving the next problem, and the next problem.

The result of that was tremendous. We were actually able to decrease the lead time of building an average home by 48 percent.

3p: Wow, huge results. It's intriguing because when you think of a manufacturing system, you may wonder how that can be applied to other industries and activities. Have you found that a focus on efficiency and culture the best way to help that process translate?

LN: It is ... [TSSC] has been able to spread the work that they've done to other locations. In Joplin, Missouri after tornadoes, they went into that market and helped rebuild homes there. They're still active in New York after Superstorm Sandy. And because of those learnings, they've been able to take a model and spread the model to different sites -- and the same model is useful regardless.

3p: Can you tell us a bit more about the work TSSC did after Hurricane Sandy and how the Toyota Production System was put into use there?

LN: That was a very fun project, and I had the good fortune of being on the ground because I lived in New York at the time. In the Far Rockaway area, [the Food Bank for New York City] had a mobile food bank unit. So, they had a warehouse that was responsible for packing boxes with food supplies to feed a family for X number of days. Then they would pack it in a truck, and they would take this truck on a regular distribution route to meet people close to where they lived and distribute food.

What was happening is you'd have a line of people wrapped around the block in the hot sun. These [were] elderly people, very small children and families standing in the sun who needed food, and they were just waiting for hours in line for their turn, with their fingers crossed that there was enough on that truck for them to be one of the lucky ones to get a box to take home. [The food bank] really wanted to make sure they could make that process more effective … and not have people standing in the hot sun waiting. So, we went to their warehouse, watched them for a while and studied their process. Then we really got into to work with them.

Some of the practical things that we were able to do: We had [shipping] boxes that were a certain size, and we had food sizes that were very standardized. What we realized is that these boxes had a lot of air space remaining, so it limited the number of boxes you could get on the truck. So, it's very simple and very practical: We were able to reduce the box sizes and reconfigure the way the boxes were packed so more could fit on the truck. We were able to feed 400 more families in a single shipment as a result of that. There were a lot of little changes like that, which accumulated in helping us improve efficiency. I've forgotten how many minutes it used to take for them to pack a box, but we changed it so the way they pack a box is actually like an assembly line. And it went from several minutes down to 11 seconds to pack a box.

3p: How amazing that such small changes can yield such significant results. It's interesting because I've been writing in this space for a few years now and have never heard of TSSC. You said the organization has been around for 20 years?

LN: Yes, the organization itself has been in operation for 20 years. We never really talked about it [laughs]. We've just recently started talking about it more.

It used to be the Toyota Supplier Support Center, which is really what TSSC originally stood for. And we started that because we realized that when we started localizing our parts, components and machinery equipment in North America, we wanted some way to help our domestic suppliers be more efficient and effective in doing their business -- not just for us but for other customers.

So, that was the first thought of giving something away, because we could help suppliers who could also help others in the industry. Then we realized this could be more than just suppliers: It could be small businesses that have no connection with us, it could be nonprofits, etc., so that's how it evolved over time.

3p: Glad to hear the news! Learning that this has been such a longstanding initiative, why are TSSC and other community relations programs important to Toyota?

LN: What's interesting about it is: The real reason is often a reason that people kind of don't believe, and it's because the original mission of our company was not about building cars or trucks. Our first manufacturing business was building automatic looms for weaving, so a lot of the principles of TPS came from those loom operations before we even knew about the potential of the auto business.

[What we call] the 'founding Toyota family,' said that ... 'We're in a country that has very limited resources as far as money, people and space, so we have to figure out ways that we can help society get through rough patches. And we think we have an obligation as a business to establish something where if we are successful and profitable, we can actually be more helpful to the people in the communities where we do business.' ... That was the philosophy in the founding of our business, so the idea of establishing an organization like TSSC was not really so groundbreaking for us as a company.

But now fast forward in the modern day era: One of the things that we are recognizing about how important this is to our business sustainability is that we want to have the opportunity to learn from other people. And we learn things that might make us more responsive to our customers. Even with St. Bernard Project, it was an interesting observation that they were so client-centric. They were so close to their customers ... they could see them every day and touch them. When you get a company that's the size of Toyota, it's very difficult to be so close to the actual customer unless you're working at one of our dealerships. So, it's a very interesting thing that we've learned from these kinds of relationships that I think has helped improve our business in the long run.

The other value this brings to us is that we know that the emerging generation of leaders, we always talk about the millennial generation, it's very obvious that high-impact jobs are becoming more and more important. We want to be the kind of company that the best talent wants to work for. And for us to be able to attract that kind of top-notch talent, it's very important to be able to tell our story about the nature of our company -- and that we really do want to be a company that does more than build cars and trucks.

3p: Changing gears a bit, can you speak to your global role with the Toyota Mobility Foundation?

LN: The gist of the Global Foundation is the recognition that by 2050 we are going to have some very interesting mobility challenges because of the migration of people to the urban core around the world. That really causes practical issues like safety challenges, challenges with ecology, and even challenges with the aging population and having individual access to mobility. [It's about] ensuring that people in all walks of life -- whether they're in urban areas or rural areas, rich or poor, whether they have all of their physical capacity or not -- that everyone has the right to the freedom of individual mobility.

So, we want to do everything we can to work with partners around the world to make sure that can happen ... [We're looking at] intra-modal ways of transport where we use our clean products, like electric vehicles for example, in tandem with public transportation, and building networks with other partners in those locales to be able to make mobility work and optimize it.

It's just this idea of being known for presenting mobility solutions as opposed to making cars and trucks. And who knows what the future holds in this space? So, what we're going to do is work with both developed and developing markets, a 50/50 split ... We took privately-held shares of treasury stocks and put them into fund, and the dividends from that fund will support the foundation.

Right now we're going to start with a few pilot projects in 2015 -- it's premature to talk about the projects now because there's a laundry list of things we're considering -- and then we're going to learn from those pilots. And then ... whatever intelligence we get and research we do will help us understand the long-term methodology for soliciting grant applications. And actually being at this conference and talking to some of the subject-matter experts in the field is giving me ideas or things to think about that's going to help us formulate the direction that we have going forward next year. So, it's an exciting time.

For more on TSSC and how the Toyota Production System is helping nonprofits tackle tough challenges, check out the company's Million Meals Per Hour video below. After Hurricane Sandy, Toyota pledged to donate one meal per view of the video, totaling 1 million meals served.

Image courtesy of Toyota

Based in Philadelphia, Mary Mazzoni is a senior editor at TriplePundit. She is also a freelance journalist who frequently writes about sustainability, corporate social responsibility and clean tech. Her work has appeared in the Philadelphia Daily News, the Huffington Post, Sustainable Brands, Earth911 and the Daily Meal. You can follow her on Twitter @mary_mazzoni.