Toyota Motor company Losing its Quality Edge
1. Executive Summary:
Toyota Motor Corporation is the leading global automobile manufacturer operating in more than 140 countries and boasted sales of 9.75 Million vehicles during 2012 compared to key rival General Motors at 9.29 million vehicles (Dawson, 2013). Toyota’s consistent delivery of superior quality, reliability and durability has been cited as the key success factors behind their ascension to global leadership in 2008 (Feng, 2010; Takeuchi, Osno and Shimizu, 2008). (Spear, 2004) postulates that the Toyota Production System (TPS) which incorporates the company’s legendary lean manufacturing practices coupled with the business philosophy of always placing the customer first; enabled them to repeatedly outperform their competitors on quality, productivity and cost reduction. The TPS became the benchmark for manufacturing practices in other industries ranging from aerospace to consumer goods. Toyota has won prestigious international quality awards including the Malcolm Baldridge Award, The Japan Prize and the Deming Prize which is Japan’s highly coveted award for quality achievement which further entrenched their quality heritage.
In light of Toyota’s impeccable reputation for placing the customer first and the company’s coveted quality heritage, the 2009 recall crisis shocked consumers and the subsequent negative publicity presented the biggest threat to the Toyota corporate brand reputation in the company’s history (Fan, Geddes and Flory, 2011). According to (Taylor, 2012) Toyota had received consumer complaints related to unintended acceleration as early as 2002. The author intones that the company not only denied the problem but failed to take action until the problem escalated into a full scale quality crisis in 2009, following a fatal crash involving a Lexus ES 350 with a jammed accelerator in North America. According to (Thompson et al., 2012) Toyota recalled approximately 4 million motor vehicles, following the accident. Further steps were
Toyota Motor Corporation is the leading global automobile manufacturer operating in more than 140 countries and boasted sales of 9.75 Million vehicles during 2012 compared to key rival General Motors at 9.29 million vehicles (Dawson, 2013). Toyota’s consistent delivery of superior quality, reliability and durability has been cited as the key success factors behind their ascension to global leadership in 2008 (Feng, 2010; Takeuchi, Osno and Shimizu, 2008). (Spear, 2004) postulates that the Toyota Production System (TPS) which incorporates the company’s legendary lean manufacturing practices coupled with the business philosophy of always placing the customer first; enabled them to repeatedly outperform their competitors on quality, productivity and cost reduction. The TPS became the benchmark for manufacturing practices in other industries ranging from aerospace to consumer goods. Toyota has won prestigious international quality awards including the Malcolm Baldridge Award, The Japan Prize and the Deming Prize which is Japan’s highly coveted award for quality achievement which further entrenched their quality heritage.
In light of Toyota’s impeccable reputation for placing the customer first and the company’s coveted quality heritage, the 2009 recall crisis shocked consumers and the subsequent negative publicity presented the biggest threat to the Toyota corporate brand reputation in the company’s history (Fan, Geddes and Flory, 2011). According to (Taylor, 2012) Toyota had received consumer complaints related to unintended acceleration as early as 2002. The author intones that the company not only denied the problem but failed to take action until the problem escalated into a full scale quality crisis in 2009, following a fatal crash involving a Lexus ES 350 with a jammed accelerator in North America. According to (Thompson et al., 2012) Toyota recalled approximately 4 million motor vehicles, following the accident. Further steps were