A few more years ago than I would care to admin, I was at a dinner with Mr. Nakao, the President of Shingijutsu. He told a story, which true or not, illustrates the point.

Way back when, car sales in Japan were door-to-door. Sales people developed long-term relationships with customers.

New college grads hired into the sales team were trained by spending a month on the streets selling newspapers.

The key point being made to them was to understand the difference between 100 newspapers a day and 500 newspapers a week. On Wednesday morning, the papers they didn’t sell on Tuesday were worth exactly nothing. There was no way to make up today’s lost sales tomorrow. They were being taught that they needed to hit the target every single day… a target for level sales.

Toyota understood that the more level the entire system, the higher the total margins. They were out to optimize the entire value stream, not particular segments of it.