Toyota Motor Corporation - Losing 'The Toyota Way'?
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Case Code: BSTR385 Case Length: 20 Pages Period: 2005-2010 Pub Date: 2011 Teaching Note: Available |
Price: Rs.600 Organization: Toyota Motor Company Industry: Automotive Countries: Japan; Global Themes: Organizational Culture, Globalization |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Organizational Structure and Culture at Toyota
Toyota had grown over the years through constant pursuit to cut down on costs and waste. At the same time, the company also maintained traditional structures and hierarchy. The engineers reported to functional managers in their technical area...
The problems
Though Toyota was lauded for its unique production systems, culture, and values, industry analysts pointed out several problems. These problems included an inflexible organization structure and dwindling focus on quality...
Toyota Loses its Way
When Toyota embarked on a massive cost-cutting journey in 2005, pressure was stepped up on its chief engineers to reduce costs. The cost reduction showed on the quality of the vehicles across the world...
And Quality Deteriorates
The product quality related problems with Toyota came to the fore in August 2009, when a Lexus accelerated out of control, leading to the death of all the four occupants...
Managing Crisis
Industry experts opined that Toyota's response to the crisis had been slow. Akio admitted that the delays in response reflected the hubris and arrogance that Toyota had developed over the years...
The Aftermath
Toyota was fined US$ 16.4 million by the National Highway Traffic Safety Administration for its slow response to the crisis. The company also had to spend millions on advertising and reportedly was on the verge of paying billions in class action lawsuits...
Exhibits
Exhibit I The Toyota Production System
Exhibit II Toyota Motor Corporation - Vehicle Production by Region
Exhibit III Toyota Motor Corporation - Income Statements (2006-2010)
Exhibit IV Toyota Motor Corporation - Net Revenues and Operating Income By Region (2006-2010)
Exhibit V The Toyota Way
Exhibit VI Toyota Motor Corporation - Recall Timeline
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