1. Why was Toyota facing a recall crisis?
Toyota could not treat this problem adequately. One of the reasons is that because the headquarter in Japan makes all critical decision in Toyota and in this case the place is far from America, Toyota headquarter did not notice the importance of this problem at the early stage. While NHTSA started the investigation at 2009 September, Toyota did not treat this problem seriously. This attitude led NHTSA to reclaim Toyota’s statement of the floor mat problem. If a general manager focusing on the US market, he could understand the situation and spend more time and resources to handle.
The second reason is that Toyota did betray their principles, Toyota Way. At principle 5, you should “build a culture of stopping to fix problems to get quality right the first time.” When you find a problem, you have to scrutinize the reason at least five times. However, in this case it does not seem that Toyota investigate the first case thoroughly. If this case were happened in Japan, I believe that such case would be inspected again and again since all employees have the culture to do so. However, sudden aggressive expansion hindered to disseminate this culture globally, which needs a long time.
According to the case, the Wall Street Journal said that the conflict between founder family and non-family member exacerbated Toyota and the high jacking Toyota by non-family member is the reason that caused the crisis. However, I disagree with the opinion and this was not based on the fact. Actually, Toyota has had a very specific corporate culture, compared with other Japanese global companies. For example, the headquarter exists not in Tokyo but in Nagoya, third biggest city in Japan even if it is more useful and advantageous to have headquarter in Tokyo or Osaka, like most big company does. And also, in no other global big company in Japan, a founder family has influence on the corporate decision making....