The Secret to how Toyota Innovate — Set-Based Concurrent Engineering

Tom Connor
Nov 1, 2018 · 3 min read

Another gem of a system from Toyota. Traditional design practice, tends to quickly converge on a solution. By contrast SBCE keeps many options in development in parrallel and consistently delivers superior results.

Toyota has had an incredible impact on global industry, inventing a vertically integrated manufacturing method that has seen it become the number one car manufacturer. Their methods are based on various concepts developed by W. Deming and Taiichi Ohno and refined over many deliberate years of improvement. There are many excellent books on how Toyota runs their systems — The Machine that Changed the World and The Toyota Way are two well worth checking out.

I came across a different aspect of the Toyota system, reading the excellent article by Barry O’Reilly — “Optimise to be wrong, not right” in which he explores the concept of running multiple concurrent small experiments, most of which are like to go nowhere however provide a massive upside when one unexpectedly pays off.

Toyota embrace this concept in the way that they do product development using a system they develop called Set Based Concurrent Engineering — SBCE

“set-based concurrent engineering” (SBCE) begins by broadly considering sets of possible solutions and gradually narrowing the set of possibilities to converge on a final solution. A wide net from the start, and gradual elimination of weaker solutions, makes finding the best or better solutions more likely. As a result, Toyota may take more time early on to define the solutions, but can then move more quickly toward convergence and, ultimately, production than its point-based counterparts.

Toyota’s Set Based Concurrent Engineering

Considering sets of ideas has multiple advantages and demonstrates a counter intuitive principle of much of Toyota’s philosophy, that at times you are better to sub optimise intermediate steps to achieve a much better overall outcome. Their famous “Andon Chord” which can be pulled by anyone to stop the production line and immediately resolve a quality problem is another example. highlights how developers at Toyota:

This approach yields substantial organizational learning. It takes less time and costs less in the long term than typical point-based engineering systems that select a design solution early in the development process, with the typical consequence of false starts, rework, failed projects, and minimal learning.

Set Based Concurrent Engineering incorporates 3 principles to deliver a final product:


• Define feasible regions

• Explore trade-offs by designing multiple alternatives

• Communicate sets of possibilities


• Look for intersections of feasible sets

• Impose minimum constraint

• Seek conceptual robustness


• Narrow sets gradually while increasing detail

• Stay within sets once committed

• Control by managing uncertainty at process gates

The SBCE approach is also validated indirectly by research in decision theory. In their book Decisive — Chip and Dan Heath identify a process to improve organisational decision making. One finding from the work that they reference was that consistently organisations found that decisions when reviewed with the benefit of hindsight where significantly better when there where two or more viable options to choose between. This forces you to more actively compare options and by following the SBCE approach there are options all the way through to final implementation being compared and evaluated.

Aside from the books mentioned at the beginning of this article this fascinating article by John Shook on how the Toyota culture was transplanted into the Californian GM Freemont factory is great reading — and a topic for another day — How to change a culture — Lessons from NUMI — John Shook.

10x Curiosity

Always curious - curating knowledge to solve problems and create change. I write for myself to capture interesting links and synthesise ideas I am trying to learn.

Tom Connor

Written by

Always curious - curating knowledge to solve problems and create change

10x Curiosity

Always curious - curating knowledge to solve problems and create change. I write for myself to capture interesting links and synthesise ideas I am trying to learn.

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