Table of Contents
Executive Summary: 3
Toyota’s Issue: 4
Toyota’s response to handle the situation: 5
Toyota’s quality issue and possible causes: 7
Toyota’s corrective actions and cost impact: 9
The way forward- steps to re-bounce: 9
The objective of the report to investigate the quality issues Toyota- the largest Japanese Automobile company, is facing in the perspective of operation management principles and practices. Toyota had to recall eight million plus cars for fixing the acceleration and brake system problems associated with 52 fatalities and many injuries specifically in ...view middle of the document...
Toyota is in news now days for wrong reasons and its glorious past being a word class automobile company is at stake due to the quality issues with some of its product lines specifically in America and Europe regions. Toyota recalled more than 8M vehicles worldwide for various manufacturing faults reported by its customers since October 2009. It had to halt its operations at six assembly plants in North America and suspended eight of its vehicle brands due to the large scale complaints of serious technical faults in its vehicles leading to fatalities and injuries to users of these vehicles.
This report analyses the issues being faced by Toyota as a case study captioned as “Toyota- Make or Brake”. Our research is based mainly on various news and analysis reports published by various resources publicly available on the internet.
Toyota’s customers had been complaining about the faults in their vehicles’ acceleration and brake systems. It is generally believed that these technical issues had resulted into 52 fatalities and many injuries in North America and Europe due to unintended acceleration of these vehicles. Toyota accepted the complaints and as an immediate remedy had temporarily put some of its assembly plants’ operation on halt and recalled more than eight (8) millions vehicles worldwide for fixing the issues in October 2009 (Cato, J, 2010).
Toyota’s response to handle the situation:
Toyota was slow to ascertain the gravity of the issue and initially entrusted its low level managers to handle fault issues as a routine matter. Toyota’s treatment of fault reporting as a routine matter and not sensing the looming crisis surprised many in the media and invited widespread. The Media criticised Toyota management including Chairman, Akio Toyota for not coming forward personally to lead and manage a crisis of this magnitude. Though at last, the Toyota Chairman did appear personally and got involved in damage control by announcing corrective actions but Toyota being a market leader would have been more proactive in responding to the issue from the top (Mittal, V., et al., 2010).
Toyota’s initially response to this crisis was to recall the faulty vehicle (eight million plus), and shut down temporarily eight of its productions plants in Europe and North America. These steps were taken by many as appropriate corrective measures as it is in-line with industry norms for such situations (Mittal, V., et al., 2010).
The media and Toyota experts took a pessimistic view of Toyota’s affairs as they were disappointed by Toyota’s inability to respond to this crisis appropriately. Most the reports published on the Toyota crisis are targeted towards mismanagement at Toyota. Some experts who have insights to Toyota’s way of working have expressed concerns about its current management’s ability to face the huge media attacks. (Mittal, V., Sambandam, R., and Dholakia, U., 2010)
The negative press coverage certainly has...