Did Toyota Fall From Supply Chain Grace?

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Product Developments

For those of you who missed the story, Toyota just announced its largest recall ever of 3.8m cars including the following models: 2007 to 2010 Camry, 2005 to 2010 Avalon, 2004 to 2009 Prius, 2005 to 2010 MY Tacoma, 2007 to 2010 MY Tundra, 2007 to 2010 MY ES350, 2006 to 2010 MY IS250, and 2006 to 2010 MY IS 350. All of these models were recalled for a rapid acceleration problem which has resulted in 100 NHTSA (National Highway Transportation Safety Administration) complaints and more than 12 fatalities, according to several press reports and Toyota’s website. The NHTSA came down hard on Toyota for issuing, “inaccurate and misleading information when the company said, “no defect exists, according to this Reuters article.

By several measures, Toyota has fallen from supply chain grace. Inventors of ËœThe Toyota Way,’ the company appears to have violated one of its own key principles: continuously solve problems using root cause analysis. Let’s start with the first issue, Toyota’s own website calls the problem (from it’s home page) “Important Information on Floor Mat Campaign, but ironically, the recall appears much more involved than a simple floor mat redesign. In fact, Toyota will, “reconfigure the floor surface beneath the pedal to create more space between the pedal and the floor, as well as shorten the gas pedal and even install a new brake system, hardly a simple floor mat issue. Does Toyota’s handling of the issue thus far center around costs? David Cole, Chairman of the Automotive Research Center in Michigan when speaking about the repairs and costs said, “If you dig into the vehicle like in the power train or under the dash, the cost is high even if the part cost is low, in other words, the problem potentially involves a system, not just a part or a simple assembly.

Where does the real “root cause lie? We’ll leave that to the NHTSB and Toyota but some of the problem appears to have been shoved under the rug (no pun intended). In addition, the whole story made us wonder, if this same problem appeared in say a GM car or truck, would the kind press extend the same courtesy it has to Toyota? Somehow, I highly doubt it. It seems as though Toyota could have pulled a page from the Tylenol-scare crisis management handbook act promptly and take rigorous action immediately, and put customer safety first above profits. In case studies of this incident, many suggest Johnson & Johnson, the makers of Tylenol, relied on their corporate credo or corporate responsibilities to, “consumers and medical professionals using its products, employees, the communities where its people work and live, and its stockholders, for inspiration in developing the subsequent public relations strategy. Too bad Toyota seems to have strayed a bit in their own handling of the situation. Their corporate mission “to provide a safe and sound journey, may just have taken a back seat.

And unfortunately, there’s no extra strength pill they can pop to ease the pain that’s sure to come as a result.

–Lisa Reisman

Comments (3)

  1. FED UP says:

    When will Americans wake up, Toyota has been the recall king for the last 5 years. I had a Honda that would accelerate out of control whenever the temperature would go below 30 degrees and of course 3 different dealers told me nothing wrong with the car. I dumped it and got a Chevy 70 thousand miles and no problems. If you have a Toyota on the list DUMP IT, it will be worthless in 6 months you won’t be able to give it away.

  2. Dave says:

    This story reminds me the issue of the risks in the supply chain.
    Modern supply chains are vulnerable to risks more than before.
    These risks should be managed.

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