Page 159 - Toyota Under Fire

TOYOT A UNDER FIRE

to put out the fire, stop the bleeding, and contain the problems.
That was certainly the case with the recall crisis. For the first few
months of 2010, the company was entirely focused on reacting
to the crisis before beginning the process of improvement kaizen,
which would involve identifying and resolving the root causes of
the crisis, not just dealing with the symptoms.
Part of the reason that the company remained in reactive
mode for so long, of course, is that many parts of the organiza-
tion, including the most senior leadership in Japan, simply didn’t
appreciate the depth of the crisis that Toyota was encountering in
the United States. In our interview, Akio Toyoda identified the
gap in understanding of local conditions and urgency between
regions and headquarters as a major contributor to the evolution
of the crisis:

There was a gap between the time that our U.S. col-
leagues realized that this was an urgent situation and the
time that we realized here in Japan that there was an ur-
gent situation going on in the U.S. It took three months
for us to recognize that this had turned into a crisis. In
Japan, unfortunately, until the middle of January we did
not think that this was really a crisis.

Meanwhile, the various parts of Toyota in North America
were operating in a frantic reactive mode. Perhaps a more apt
description would be shock. For decades, Toyota had worked
hard to create a reputation as the highest-quality and highest-
value automobile producer in the world—since Global Vision
2010 was announced, the goal of being the most admired auto
manufacturer had been explicit. By 2008, the company arguably
had achieved that goal. Toyota was ranked fifth on Fortune’s list

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