Page 70 - Toyota Under Fire

THE OIL CRISIS AND THE GREA T RECESSION

dents and above, including himself, taking more than a 30 per-
cent salary cut until profitability was restored.
Other cost-cutting measures were implemented as well.
The TEMA corporate jet was sold, managers gave up business-
class travel, hiring was frozen, and the voluntary exit program
mentioned earlier was announced. Team members in the TEMA
corporate offices formed kaizen groups to look for ways to cut
costs, even to the level of saving electricity in the offices. Ag-
ata told us, “There were many places we were spending money
that didn’t affect customers. For example, that is the reason you
can see the light, it’s not on [in my office].” Saving money became
a goal of continuous improvement. Lots of small efforts, rather than
a few big cuts made by a senior executive, added up to big savings.
As the Toyota executives had expected, the recession did in
fact put Toyota employees in a state of mind to accept levels of
change that they might have resisted before the recession. For ex-
ample, the plant in Kentucky, TMMK, had known only growth
and prosperity, and prior to the recession, the biggest complaint
that team members had was that they felt pressure to work too
much overtime. The initial impact of the oil crisis and the reces-
sion was muted at TMMK because the plant didn’t build any
trucks or SUVs, which had the most sudden and dramatic fall in
demand. But as the recession wore on and automobile sales
in general declined, the impact became unmistakable on the fac-
tory floor. Tim Turner, an hourly team leader who had been at
TMMK for 15 years, recalled the exact date that it really hit him
how deep the recession had gotten:

February 12, 2009. That’s the date we shut down the
plant [a highly unusual occurrence] to have a commu-
nication day. The general manager presented lots of

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