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Inside Toyota: window on creative corporate culture
By Ni Tao |
February 13, 2010, Saturday
|
Print Edition
Print Edition
FOR a world accustomed to the smooth message of quality and reliability conveyed by the "Made in Japan" label, the recall crisis of Toyota Motors threatens to diminish not only the aura of a single company but also the reputation of Japanese corporate culture.
Toyota, the world's biggest car maker and one of the consummate emblems of Japanese craftsmanship, has recalled 8.5 million cars all over the world for accelerator and braking problems.
The gas pedal defect and brake mayhem continues to engulf the beleaguered auto giant, with its president Akio Toyoda being recently photographed bowing in a typically Japanese way to demonstrate his contrition to customers.
This picture, along with news stories about the car maker announcing a worldwide recall of allegedly ill-designed products, demonstrates the high price the company is paying for its botched handling of the quality scandals.
Toyota's initial response to the public outcry over malfunctioning accelerators and brakes was a PR disaster.
All the company did at first to assuage the public's safety concerns was to stumble: the problems with brakes and gas pedals are not as severe as portrayed by some alarmist reports; and this is not a purely "Made in Japan" problem as some flawed parts are produced in the US.
Even when it became clear that the auto maker was facing a storm and stock prices were falling, Toyota's management was strangely muted and aloof.
For an industry icon that was admired worldwide for quality and service, the image of an uncooperative, unapologetic and very opaque Toyota was difficult to comprehend.
What went wrong in Toyota's culture that led to this setback?
This question takes us to "Extreme Toyota," a book about what makes the car maker one of the world's best manufacturers.
Authors Emi Osono, Norihiko Shimizu, Hirokata Takeuchi are veteran observers of the company's evolution.
Published in 2008, the book may serve as a reminder of how Toyota lapsed from its formula for success.
One of the book's themes is that Toyota's success is predicated on the company's astute use of internal contradictions to its own benefit.
In other Japanese companies where internal contradictions are often seen as an anathema to growth, the standard approach to dealing with them has been one of choosing the "better force" and eliminating the supposedly "weaker force."
By contrast, Toyota embraces complexities and lets opposing views clash freely in the belief that the "weaker force" may some day turn out to be its major engine of growth.
Instead of stifling seemingly heretical minds, Toyota's management departed from paternalistic Japanese corporate culture and rigid demands for conformity by giving free rein to a variety of ideas.
Bold experiments are encouraged, sometimes with open-ended commitments from senior executives. Failures are tolerated for they are seen as an integral component of the company's long-term growth strategy.
And long-term thinking is a characteristic commonly found in Toyota and other Japanese companies. In his 1979 book "Japan as Number One," renowned Asia hand Ezra F. Vogel argues that "the Japanese firm is less interested in short-term profits and more concerned with the long run. Executives boldly sacrifice profits for several years to build the groundwork for later success."
Other qualities that are essential to Toyota's success include its emphasis on effective communication, an unending learning process and a constant desire to attain "impossible goals." Toyota employees are taught to view seemingly insurmountable obstacles as opportunities.
Despite all the praise showered upon the car maker, Toyota's failings are equally obvious. As Toyota expands its operations globally, the juggernaut is becoming increasingly bloated and dangerously out of touch with its customers - as exemplified by its bungling of the gas pedal saga.
Communication becomes less effective, whether within the company or with the public; Toyota's marketing acumen is still there, but the focus on increasing market share and undercutting its rivals through economy of scale sometimes left customers out in the cold.
It is a sad twist to the story of "extreme Toyota" when attention to detail and "customers-first" philosophy have become a big question mark rather than the hallmark of the manufacturing powerhouse that is Japan.
Toyota, the world's biggest car maker and one of the consummate emblems of Japanese craftsmanship, has recalled 8.5 million cars all over the world for accelerator and braking problems.
The gas pedal defect and brake mayhem continues to engulf the beleaguered auto giant, with its president Akio Toyoda being recently photographed bowing in a typically Japanese way to demonstrate his contrition to customers.
This picture, along with news stories about the car maker announcing a worldwide recall of allegedly ill-designed products, demonstrates the high price the company is paying for its botched handling of the quality scandals.
Toyota's initial response to the public outcry over malfunctioning accelerators and brakes was a PR disaster.
All the company did at first to assuage the public's safety concerns was to stumble: the problems with brakes and gas pedals are not as severe as portrayed by some alarmist reports; and this is not a purely "Made in Japan" problem as some flawed parts are produced in the US.
Even when it became clear that the auto maker was facing a storm and stock prices were falling, Toyota's management was strangely muted and aloof.
For an industry icon that was admired worldwide for quality and service, the image of an uncooperative, unapologetic and very opaque Toyota was difficult to comprehend.
What went wrong in Toyota's culture that led to this setback?
This question takes us to "Extreme Toyota," a book about what makes the car maker one of the world's best manufacturers.
Authors Emi Osono, Norihiko Shimizu, Hirokata Takeuchi are veteran observers of the company's evolution.
Published in 2008, the book may serve as a reminder of how Toyota lapsed from its formula for success.
One of the book's themes is that Toyota's success is predicated on the company's astute use of internal contradictions to its own benefit.
In other Japanese companies where internal contradictions are often seen as an anathema to growth, the standard approach to dealing with them has been one of choosing the "better force" and eliminating the supposedly "weaker force."
By contrast, Toyota embraces complexities and lets opposing views clash freely in the belief that the "weaker force" may some day turn out to be its major engine of growth.
Instead of stifling seemingly heretical minds, Toyota's management departed from paternalistic Japanese corporate culture and rigid demands for conformity by giving free rein to a variety of ideas.
Bold experiments are encouraged, sometimes with open-ended commitments from senior executives. Failures are tolerated for they are seen as an integral component of the company's long-term growth strategy.
And long-term thinking is a characteristic commonly found in Toyota and other Japanese companies. In his 1979 book "Japan as Number One," renowned Asia hand Ezra F. Vogel argues that "the Japanese firm is less interested in short-term profits and more concerned with the long run. Executives boldly sacrifice profits for several years to build the groundwork for later success."
Other qualities that are essential to Toyota's success include its emphasis on effective communication, an unending learning process and a constant desire to attain "impossible goals." Toyota employees are taught to view seemingly insurmountable obstacles as opportunities.
Despite all the praise showered upon the car maker, Toyota's failings are equally obvious. As Toyota expands its operations globally, the juggernaut is becoming increasingly bloated and dangerously out of touch with its customers - as exemplified by its bungling of the gas pedal saga.
Communication becomes less effective, whether within the company or with the public; Toyota's marketing acumen is still there, but the focus on increasing market share and undercutting its rivals through economy of scale sometimes left customers out in the cold.
It is a sad twist to the story of "extreme Toyota" when attention to detail and "customers-first" philosophy have become a big question mark rather than the hallmark of the manufacturing powerhouse that is Japan.
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