Toyota response to crisis an object lesson for business

The bad news just keeps piling on for the  Toyota Motor Company.

The company has been struggling to deal with a "sticky accelerator" and floor mat safety issue by recalling 8-10 million of its Toyota and Lexus vehicles sold worldwide.  That figure is higher than the number of cars Toyota sells in one year.

new recall will apparently be announced tomorrow  for 300,000 Toyota Prius hybrid cars with faulty brakes.

This is scary news for consumers who have grown used to the reliability of their Toyotas, but what is most remarkable is how the top executive at Toyota is behaving.

Toyota's CEO  Akio Toyoda has "manned up."   He says he is very sorry.

Toyoda is not only sorry, he bowed deeply over and over again during a news conference.

ABC NEWS reports:
"Toyoda said he was sorry in Japanese and then sent a message to consumers worldwide in English. "I am a little bit worried that while they are driving they feel cautious," said Toyoda. "But believe me, Toyota's cars are [safe] and we're trying to [improve] our product."

"It's not at all uncommon for executives on the hot seat to resign and then commit suicide," said Roland Kelts, a professor at the University of Tokyo and an expert on Japanese culture.

At least a dozen Japanese business executives have killed themselves over business setbacks since 1998.

Kelts, author of the book "Japanamerica," noted that Toyoda had bowed very deeply. "The deeper the bow," said Kelts, " the greater respect you show and quite literally you are exposing the back of your neck."

"In samurai days" said Kelts, "you were offering your head, which could be cut off."

Imagine that. A CEO of a multi-billion dollar world-wide corporation facing millions of dollars of product liability choosing to go on television and beg his customers and potential litigants for forgiveness.

Toyota even went one more step with an expensive "mea culpa" Super Bowl ad.
 


Toyota customers probably do have reason to worry about their cars right now, but the head of Toyota is showing the true measure of a man in taking full responsibility (even though industry watchers say some of the policies which led to the flaws are the fault of Toyoda's predecessor) apologizing profusely, and doing whatever possible to timely right the wrong.

Imagine that: Akio Toyoda isn't blaming George Bush.

Jane Jamison is publisher of the conservative news/commentary blog, UNCOVERAGE.net


Thomas Lifson adds:

It is customary in Japan for the chief executive of a company which has done something major wrong and inconvenienced its customers and the public, to bow deeply in apology, at a minimum. The more serious measure is to resign to take responsibility, regardless of personal culpability.

Akio Toyoda's father actually resigned as Toyota's president in the early 1950s, when the company entered bankruptcy, which was due to the extreme circumstances of early postwar Japan (its factories in ruins and the domestic auto market tiny). These factors were obvosuly beyond his control, but he did the right thing (in Japanese eyes) by resigning.

Full disclosure: I served as a consultant to Toyota for several years. These comments are based on publicly available information.
The bad news just keeps piling on for the  Toyota Motor Company.

The company has been struggling to deal with a "sticky accelerator" and floor mat safety issue by recalling 8-10 million of its Toyota and Lexus vehicles sold worldwide.  That figure is higher than the number of cars Toyota sells in one year.

new recall will apparently be announced tomorrow  for 300,000 Toyota Prius hybrid cars with faulty brakes.

This is scary news for consumers who have grown used to the reliability of their Toyotas, but what is most remarkable is how the top executive at Toyota is behaving.

Toyota's CEO  Akio Toyoda has "manned up."   He says he is very sorry.

Toyoda is not only sorry, he bowed deeply over and over again during a news conference.

ABC NEWS reports:
"Toyoda said he was sorry in Japanese and then sent a message to consumers worldwide in English. "I am a little bit worried that while they are driving they feel cautious," said Toyoda. "But believe me, Toyota's cars are [safe] and we're trying to [improve] our product."

"It's not at all uncommon for executives on the hot seat to resign and then commit suicide," said Roland Kelts, a professor at the University of Tokyo and an expert on Japanese culture.

At least a dozen Japanese business executives have killed themselves over business setbacks since 1998.

Kelts, author of the book "Japanamerica," noted that Toyoda had bowed very deeply. "The deeper the bow," said Kelts, " the greater respect you show and quite literally you are exposing the back of your neck."

"In samurai days" said Kelts, "you were offering your head, which could be cut off."

Imagine that. A CEO of a multi-billion dollar world-wide corporation facing millions of dollars of product liability choosing to go on television and beg his customers and potential litigants for forgiveness.

Toyota even went one more step with an expensive "mea culpa" Super Bowl ad.
 


Toyota customers probably do have reason to worry about their cars right now, but the head of Toyota is showing the true measure of a man in taking full responsibility (even though industry watchers say some of the policies which led to the flaws are the fault of Toyoda's predecessor) apologizing profusely, and doing whatever possible to timely right the wrong.

Imagine that: Akio Toyoda isn't blaming George Bush.

Jane Jamison is publisher of the conservative news/commentary blog, UNCOVERAGE.net


Thomas Lifson adds:

It is customary in Japan for the chief executive of a company which has done something major wrong and inconvenienced its customers and the public, to bow deeply in apology, at a minimum. The more serious measure is to resign to take responsibility, regardless of personal culpability.

Akio Toyoda's father actually resigned as Toyota's president in the early 1950s, when the company entered bankruptcy, which was due to the extreme circumstances of early postwar Japan (its factories in ruins and the domestic auto market tiny). These factors were obvosuly beyond his control, but he did the right thing (in Japanese eyes) by resigning.

Full disclosure: I served as a consultant to Toyota for several years. These comments are based on publicly available information.

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