Toyota - Without Warning

Posts Tagged ‘Toyota’

We’re Listening Now

Tuesday, February 9th, 2010

Are we simply hypersensative about everything and anything Toyota today? We’re we highly insensitive to anything Toyota (at least regarding quality) two months ago? I believe both to be true, and both are working in concert with each other, which implies quality issues that were being avoided or neglected (Silent Problems) are going to be front page news for the foreseeable future. And more importantly, any complaints regarding safety will receive ”Urgent” priority. For instance, a report over at Bloomberg,

Toyota Motor Corp.’s Corolla, the world’s best-selling car, is being reviewed by the U.S. after driver complaints about steering, according to a government spokeswoman.

The National Highway Traffic Safety Administration has recorded more than 80 complaints about Corolla steering for 2009 and 2010 models, according to the agency’s online database.

“We are reviewing steering complaints with the Corolla,” Karen Aldana, a spokeswoman for the agency, said in an e-mail. NHTSA wants “to determine if a safety defect investigation is warranted, as is standard procedure with all complaints.”

In essence, the silence barrier has been broken. And once the barrier is broken, the floodgates will open. This is exactly the state of being Toyota is living in, which goes back to the Can You Trust Toyota issue I wrote about earlier this week. The safety regulators don’t trust Toyota. The press doesn’t trust Toyota. And most importantly, the consumer is learning to distrust Toyota. Such are the dynamics of Silent Problems when they finally surface, and most analysts are simply underestimating the dynamics at play here. One would think that things couldn’t get much worse, yet this is what’s happening, which I’ve been stating for well over a week.

Bottom Line: Toyota is quickly becoming a textbook case around how silent problems begin, evolve and eventually explode. How silent problems are dealt with is of critical importance to every organization and is addressed in the book Without Warning.

Tags: Can you trust Toyota, Corolla, recall, safety, silence barrier, Silent Problems, Toyota, trust
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Toyota’s Silent Problem Crisis

Saturday, February 6th, 2010

The opening paragraph in the Wall Street Journal captures the essence of Toyota’s problems, but more importantly Toyota’s silent problems. The article A Crisis Made in Japan by Jeff Kingston, director of Asian Studies at Temple University states,

In Japan there is a proverb, “If it stinks, put a lid on it.” Alas, this seems to have been Toyota’s approach to its burgeoning safety crisis, initially denying, minimizing and mitigating the problems involving brakes that don’t brake and accelerators that have a mind of their own. President Akio Toyoda, grandson of the founder, was MIA for two weeks and the company has appeared less than forthcoming about critical safety issues, risking the trust of its customers world-wide.

The article further states: It is not surprising that Toyota’s response has been dilatory and inept, because crisis management in Japan is grossly undeveloped. Over the past two decades, I cannot think of one instance where a Japanese company has done a good job managing a crisis. The pattern is all too familiar, typically involving slow initial response, minimizing the problem, foot dragging on the product recall, poor communication with the public about the problem and too little compassion and concern for consumers adversely affected by the product. Whether it’s exploding televisions, fire-prone appliances, tainted milk or false labeling, in case after case companies have shortchanged their customers by shirking responsibility until the accumulated evidence forces belated disclosure and recognition of culpability.

Japanese firms often seek to cover up or fudge the facts and the people communicating with the media and public often do not have the information they need to do their job. The absence of a structure to quickly get accurate information to top management hampers an accurate and adequate response. That leaves management unprepared to deal with media questioning and conveys an image of stonewalling and indifference.

This article by Jeff Kingston is a must-read if you want to get your arms around how Toyota’s crisis started, how it grew, and eventually how it exploded. It also points to why Toyota’s problem might be far from over and why its aftermath may continue to linger into the future. In my book, Without Warning, I write, There is little doubt that participating in and winning in a world that is connected, mobile and increasingly transparent can be challenging, creating a multitude of problems for political and business leaders alike, and their organizations. The problems one is expected to solve arrive with risks attached. The potential for faulure is real. At times, the opportunity for a happily ever after ending appears remote at best. Yet this is the sandbox where most political and business leaders play, and at times are asked to leave. It’s also this same sandbox where many followers find themselves, contemplating whether to follow their leaders in the games they play or to pursue a different path, one they believe they can truly make a difference.

Toyota’s problems are real, and everyone must ask, “Are there more surprises in the grass?” Time will tell.

Tags: Akio Toyoda, Jeff Kingston, Silent Problems, Toyota, Toyota's crisis, Toyota's problems, Without Warning
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Toyota’s Problem Just Beginning?

Tuesday, February 2nd, 2010

Toyota’s recall is now underway and factories will restart next week. The worst of Toyota’s problems are behind them - or are they? Yes, there are plenty of analysts, bloggers and news reports out there suggesting that Toyota will quickly rebound from this mess, and resume their stature as the #1 automotive company in the world. The brand will survive untouched. However, I’m thinking their image, quality and reputation problem may just now be underway.

Why do I say this?

It’s really quite simple. First, Toyota is acting like they’re is a bigger problem yet to surface. For instance, President Akio Toyoda’s only public comment over the past month consisted of an impromptu, 75 second interview while in Davos at the World Economic Forum. It was a brief apology, and nothing else. President Lentz of Toyota’s U.S. operations has been more forthcoming, stating that Toyota knows what the problem is, and they have the fix. So one could surmise, the problem is over - right?

Wrong. News is news, and a second story is beginning to emerge, and it could be more damaging than the first. Some are beginning to question whether Toyota has truly identified the problem? Bloomberg just published an interesting article stating the problem may still be out there, U.S. Said to Probe Toyota’s Electronics in Recalls.

U.S. safety officials are investigating whether electronic throttle systems may have caused sudden acceleration in Toyota Motor Corp. vehicles, as alleged in at least seven lawsuits.

The government is also considering civil penalties against Toyota, the world’s largest automaker, for its handling of recalls affecting millions of its cars and trucks, according to an official of the Transportation Department, who asked not to be identified because a review of the automaker’s actions isn’t complete.

The National Highway Traffic Safety Administration is trying to determine if electromagnetic interference may be causing the throttle system to malfunction, said the official of the Transportation Department, which oversees NHTSA.

At least 15 lawsuits seeking class action status have been filed against Toyota on the acceleration issue, and seven of them claim an electronic throttle system called ETCS-i is at fault instead of the pedals.

In cars with the ETCS-i system, the engine’s throttle is controlled by electronic signals, which are sent from a sensor that detects how far the gas pedal is depressed. The signals are transmitted to a computer module that controls how much the throttle opens.

Lawyers claiming an electronic defect contend that floor mats or stuck pedals don’t explain the sudden-acceleration incidents that triggered their lawsuits.

This is the story that is already beginning to gain traction, here, here and here. It could get really ugly. According to the reports, Toyota has had an icebox silent problem for years (a problem that is being intentionally silenced). And now that it is beginning to surface, Toyota is likely to realize monumental declines in market share, reputation and most importantly, many loyal customers. This is exactly what I discuss in my book Without Warning, and is why everyone needs to read it before it is too late.

Tags: Icebox Silent Problem, recall, Silent Problems, Toyota
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Toyota’s Who Is No. 1 Challenge

Friday, January 29th, 2010

Everyone knows the challenge Toyota Motor Company is facing with sticky gas pedals. We know that Toyota and its dealers have suspended manufacturing and sales of the affected models. We know that millions of current owners are greatly concerned about the cars they drive to work or use to transport their family. We know that a design fix has been made by Toyota’s supplier CTS, and it is shipping. We don’t know who will receive the limited resource (the new pedal design) first.

So here is Toyota’s Who Is No. 1 Challenge.

The Factory Scenario: If the factory receives the parts first, production facilities can be restarted, 1000s of employees will move back to a normal work schedule, and new cars can be shipped to dealers and ultimately purchased by consumers.

The Dealer Scenario: If the dealers start to receive the updated pedal assemblies first, they can begin installing them on cars in their lots, which will enable new car sales to resume. In turn, plants will remain idol and cars currently in use will remain at risk.

The Customer Scenario: If the customer is the top priority, new pedal assemblies will be shipped to dealers and cars with defective pedals that are currently in use can be repaired, thereby satisfying the needs of the existent customer. In this scenario, plants remain idle, and new cars on dealer lots aren’t available for sell.

The Modification: Toyota and its supplier CTS is talking about providing a modifaction kit for cars currently in use. This would allow updated pedal assemblies to be used by the factory and dealer installs on new cars currently sitting on dealer lots. Will customers be truly satisfied with a so-called fix?

Which scenario will Toyota pursue? Which scenario should Toyota pursue?

It’s a tricky question, because it gets to the crux of “Who is No. 1.” If Corporate Profits are Number 1, factories will receive the assemblies and a few might leak through to the dealers. If the Dealer is No. 1, dealers can begin moving stagnant inventory and keep their sales staff productive. If the Customer is No. 1, consumers will feel valued and might be forgiving.

Now let’s take one additional piece of information into consideration, this being Toyota’s Mission and Values Statements.

Mission Statement

“To attract and attain customers with high-valued products and services and the most satisfying ownership experience in America.”

Vision Statement

“To be the most successful and respected car company in America.”

With everything now on the line. Which next step should Toyota pursue? I believe their next step will truly determine whether or not they live their Mission and Vision Statements. I believe it will define Toyota’s future success, or decline. Unfortunately, it could have all be avoided.

What do you think? Which demand point should recieve the new pedal assemblies?

Tags: CTS, pedal assemblies, recall, silent problem, Toyota, who is no. 1
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Tiger Woods vs. Toyota Motor Company

Thursday, January 28th, 2010

What do Tiger Woods and Toyota Motor Company have in common?

a. Both have throttles that can stick open?
b. Both were No. 1 before their fall?
c. Both have had their images and brands severely bruised?
d. Both held silent problems that eventually surfaced with a vengeance?
e. All of the above?

The answer of course is “All of the Above.” Okay, “a.” was maybe a little off base, but I’m certain you catch my drift. However, there is no doubt that Tiger and Toyota are equally guilty of b, c and d.

Over the past year, I’ve repeatedly stated in this blog that Toyota has a serious problem relative to the “Silent Problems” (problems that are being avoided, neglected, going unnoticed, or being intentionally silenced) inside its organization. And as is the case with silent problems, if not dealt with early, they will emerge with a vengeance, which is exactly the case with Tiger Woods and Toyota.

Today, a story by Tom Krisher (AP) titledd “Can Toyota rev back from crisis?” gets to the heart of silent problems as relates to Toyota. Krisher writes,

Crisis managers say the issues with the pedals likely surfaced early on at lower levels of the organization, but no one wanted to deliver bad news to the boss.

“The story just kind of drags on. That’s just deadly for a reputation,” said Brenda Wrigley, chair of the public relations department at Syracuse University’s School of Public Communications. “It just spirals into a big situation that’s probably going to have long-term financial impact for the company.”

In March of 2007, Toyota started getting reports of gas pedals being slow to rise after being depressed for acceleration. Engineers fixed the problem in the Tundra pickup early in 2008.

But troubles persisted in other models, eventually leading to last week’s recall and the plans to suspend sales and shut down six factories while Toyota tries to fix the problems.

The time has come for the concept of Silent Problems to take center stage. 12 months ago, Toyota appeared invinciple, today it is struggling to survive. All because a silent problem inside the organization was allowed to germinate, grow and eventually explode. In the process, billions of dollars of brand equity has been lost. And my guess is, Toyota will never fully recover.

If you’re a business leader or manager, I have a couple of suggestions.

You must read the book Without Warning. It will provide the context around Silent Problems and why they are so dangerous. And the book will provide a path on how to surface and eventually solve Silent Problems.
If you have concerns that Silent Problems reside inside your organization, conduct a Silent Problem Audit.
Get out there and start looking, hearing and questioning - What really is going on that you’re not aware of. Do the WalkAround.

Today, its easy to focus on strategy, efficiencies and innovation. However, one thing can trump them, this being the Silence that resides in your organization. If it can happen to Toyota, it could also happen to you.

If you have a Silent Problem concern, give me a call at 651-436-3962, I’d be delighted to discuss the process with you further.

Tags: management by walking around, silence, silent problem audit, Silent Problems, stuck throttle, Tiger Woods, Toyota
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Toyota Surprises Again & Again…

Thursday, January 21st, 2010

Over the past 12 months, I’ve been consistently harsh on a couple companies due to their exposure to silent problems. One of these companies is Toyota Motor Company. As is commonly the case, as one silent problem is exposed, suddenly another, then another and another begins to surface. Its as if the dike has been breached and is at risk of crumbling apart.

Today, Toyota announced an0ther recall. The second recall pertaining to dangerous acceleration in some of its vehicles. It stated:

DETROIT, Jan 21 (Reuters) - Toyota Motor Corp (7203.T) said on Thursday it would recall millions more vehicles in the United States, its second massive recall in four months, this time to fix potentially faulty accelerator pedals. The newest recall, affecting 2.3 million vehicles, marked an acknowledgment that potential problem with dangerous acceleration on Toyota vehicles run deeper than the automaker had first announced and broadened a recall that already ranked as its largest ever. The recalls have damaged Toyota’s reputation for market-leading quality and safety at a time when the automaker’s U.S. sales remain under pressure. Toyota had previously maintained that there was no evidence of a mechanical fault linked to reports of unintended acceleration that prompted the recall of about 4.2 mllion vehicles last year.

Toyota has lost its sales momentum, its quality distinction and its marketing muscle. In essence, Toyota is simply another me-too car company with nothing exciting to sell or a competitive advantage to tout. As I’ve noted here, here, here, here, and here. But more importantly, its brand reputation for quality over the past year has been bruised badly. Toyota is lost because many of the silent problems it has been avoiding and neglecting for years is engulfing it. As I’ve shown previously (see chart), there is a direct correlation between business performance and silent problems. And its my belief that the silent problems of years past is beginning to engulf Toyota, with more without warning events yet to surface.

What should Toyota do?

Unfortunately, the leaders at Toyota don’t know what they don’t know. First, they need to begin at the basics by asking employees what is really going on. What problems in your area have we been avoiding? What problems are being neglected? My guess is the Toyota culture that use to be great was built around open communication. Now its down to finger pointing. So my suggestion is to get back to basics and begin to inventory the silent problems inside the organization, and then create a strategy around how to solve them.

Tags: Silent Problems, Toyota, Without Warning
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Toyota’s Mounting Problems

Wednesday, December 23rd, 2009

Have you ever played a game where your opponent didn’t play fair? For instance, a baseball player that had a corked bat or a golfer that deliberately moved their ball to improve the lay. In each of these instances, deliberate acts (cheating) can change the outcome. Well, this appears to be what Toyota has been doing for over a decade.

Earlier in the week, I wrote about how Toyota’s sales had been declining due to lapses in quality, reputation and design. Today, the LA Times in an article titled Toyota found to keep tight lid on potential safety problems states, A Times investigation shows the world’s largest automaker has delayed recalls and attempted to blame human error in cases where owners claimed vehicle defects…

In the wake of Toyota’s announcement of the massive recall (referring to the rash of acceleration problems Toyota vehicles have experieced), The Times examined some of the ways the automaker has dealt with safety problems in recent years and found that:

* The automaker knew of a dangerous steering defect in vehicles including the 4Runner sport utility vehicle for years before issuing a recall in Japan in 2004. But it told regulators no recall was necessary in the U.S., despite having received dozens of complaints from drivers. Toyota said a subsequent investigation led it to order a U.S. recall in 2005.

* Toyota has paid cash settlements to people who say their vehicles have raced out of control, sometimes causing serious accidents, according to consumers and their attorneys. Other motorists who complained of acceleration problems with their vehicles have received buybacks under lemon laws.

* Although the sudden acceleration issue erupted publicly only in recent months, it has been festering for nearly a decade. A computerized search of NHTSA records by The Times has found Toyota issued eight previous recalls related to unintended acceleration since 2000, more than any other automaker.

* A former Toyota lawyer who handled safety litigation has sued the automaker, accusing it of engaging in a “calculated conspiracy to prevent the disclosure of damaging evidence” as part of a scheme to “prevent evidence of its vehicles’ structural shortcomings from becoming known” to plaintiffs lawyers, courts, NHTSA and the public.

As a result, plaintiffs attorneys are considering reopening dozens of product-liability suits against the automaker.

If the allegations in the LA Times article is correct, Toyota has been living a life where Silent Problems (in this instance, problems that are being intentionally silenced) have been a normal operating procedure. The allegations are damaging and now that the silence is broken, Toyota’s image and reputation are being challenged and its loyal customer base, compromised.

Prediction: When Silent Problems of the Ice Box variety escape, the resultant impact is huge. What was once under control, is now out of control. Every word is dissected, every claim challenged, every decision questioned. I’m convinced that Toyota is in bigger trouble than most can even comprehend. Don’t be surprised if Toyota is the next G.M.

Tags: acceleration, product recalls, safety problems, Toyota
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Number 1 is the Loneliest

Monday, December 21st, 2009

Most organizations strive to be No. 1. It is the coveted spot. The position where success is realized. The position where trophies for excellence are offered. The position where power is garnered. However, it is also a very lonely and dangerous position to reside, because being No. 1 often breeds complacency and risky behavior.

A case in point is Toyota, a firm I’ve written about several times. Last weeks Economist, the front cover title was, “Toyota slips up - Where the world’s biggest carmaker went wrong, and what it is learning from other corporate turnarounds.”

The article points out numerous areas where Toyota has become vulnerable while being in the No. 1 slot.

Quality: “Toyota was a byword for quality and reliability. A few years ago its crown slipped when a number of qulity problems surfaced… For years Toyota has been the quality benchmark for every carmaker, but at the very moment it faltered, others were finally catching up”
Style: “As Car Magazine observed recently: ‘Excepting the small cars and the Prius, Toyota’s European range is as appetizing as an all you can eat tofu buffet.”
Safety: “Last month Toyota’s standing was dealt a further blow. The Insurance Institute for Highway Safety… announced its highest rated cars and SUVs for 2010… Not one of the 27 vehicles it chose was a Toyota.”
Silent Problems: “In another class action suit, triggered by a former employee, a corporate lawyer named Dimitrios Biller. Toyota is accused of trying to cover up evidence that it knew some of its vehicles could be deadly in roll-over accidents… The suggestion that squeaky-clean Toyota’s behavior may have resembled that of Ford and GM, which in the distant past covered up problems with the Pinto and Corvair, is especially wounding.”
The Test: The test will be to keep the ingredients that have made Toyota great - the dependability and affordability - while adding the spice and the flavours that customers now demand. It will not be easy, and the competition has never looked more formidable. But by recognising the scale of Toyota’s problems, by proclaiming their urgency and then drawing on the firm’s strengths to fix them, Mr. Toyoda has already taken the first, vitally important step towards salvation.

Over the past 18 months, numerous companies that once held the coveted No. 1 slot have fallen. Consider the likes of CitiGroup, GM, Circuit City, Lehman Brothers and Washington Mutal. And of course, we can’t for forget Tiger Woods, and his fall from high. Each were at the top of the their game - then something happened. Simply, they lost their competitive edge, partly by being Number 1.

Today, Toyota is in a dangerous position. It has lost momentum. It’s reputation has been tarnished. And, many of its customers are finding attractive alternatives. Yes, Number 1 is a dangerous and lonely position from which to lead.

Tags: Circuit City, CitiGroup, Ford, gm, Lehman Brothers, No. 1, Silent Problems, Toyota, Washington Mutual
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Is The Toyota Way Waning - Part 2

Friday, October 2nd, 2009

The automotive industry has been in a funk for over a year now with declining sales, plant closings, massive layoffs and weak profitability. When I started this blog 9-months ago, more than once I’ve written about and chastised Toyota. This entry is little different, it simply confirms the multitude of challenges facing Toyota, because I’m convinced Toyota is coming unglued. For instance back in May I wrote:

Toyota appears to have lost its momentum. And as the economy turns around and car sales begin to rebound, I predict that Toyota will be a lagard. Fresh companies like Ford, Hyundai and others will be on the attack, going after #1. And if Toyota falls as I anticipate, reports about Toyota will also turn for the worse. Stories will reveal about how key decisions weren’t made. How faulty assumptions were made. How political infighting is underway. These are the basic foundations of Silent Problems and Without Warning Events.

Well, my remarks were right on. Toyota has lost its momentum and is quickly losing its leadership position in the marketplace. For instance today, Akio Toyoda, President of Toyota, delivered more bad news, as reported by The New York Times. Here are a few of the highlights:

Toyota was shamefully unprepared for the global economic crisis and now is a step away from “capitulation to irrelevance or death,” said Mr. Toyoda, the grandson of the carmaker’s founder. The company, he added, is “grasping for salvation.”
A recent fatal car accident in the United States, possibly linked to oversize floor mats in one of Toyota’s Lexus luxury models, was “extremely regrettable,” he said, and had undermined the company’s reputation for safety.
Toyota expects a record loss of ¥450 billion, or $5 billion, for the year that will end in March, as car sales stay sluggish.
“They say that young people are moving away from cars,” he said. “But surely it is us — the automakers — who have abandoned our passion for cars.”

Now let me see. Mr Toyoda informed the public that they were shamefully unprepared for the downturn. Their reputation for safety has been undermined. They are bleeding red ink, with no signs of a turn around. And, automakers have abandoned their passion for cars. From this seat, it looks like Toyota is following GMs lead to being irrelevant. So with that in mind, I have a word of advice to Mr.Toyoda.

Mr. Toyoda, your years of glory are quickly coming to an end. As a business, you have much to proud of, after all, you were “the leader” of the pack. But that was yesterday. The challenges in front of you are greater than ever with new competitors entering the marketplace, and more on the horizon. But the world marketplace is not your biggest challenge. Your biggest challenge is Toyota and what it has become, with enemy #1 being the silent problems now dominant inside Toyota. Yes, you heard me correctly, silent problems are your #1 challenge. Their presence has been slowing you down for years, and is robbing your business and your organization. I strongly encourage you to start dealing with your silent problems today, and just maybe, you have a chance to regain the stature you earned over the past decade.

Call me, I’m waiting.

Regards,

Rodney Johnson

Beware Toyota, you’re being hunted while you’re looking in the rearview mirror. And news of the silent problems yuo’ve been avoiding will quickly surface.

Tags: Toyota
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The Unveiling of Toyota’s Silent Problems

Monday, August 31st, 2009

In most stories, a major character is confronted with a dilemma, often the challenge between “Doing what’s right” and “Doing the right thing.” The tension between these two is real and visible, and while the desired outcome is clear, the means to the outcome is sketchy and treacherous at best. And the dilemma often feels bigger than life itself. Such is the contentious landscape of the Whistleblower. from Chapter 11 of Without Warning

Whistleblower lawsuits often eminate from silent problems, most often the type that are being intentionally silenced. For this reason, they are high risk, and highly contentious. The other day, CBS News reported that Toyota is accused of withholding evidence. According to CBS News,

A former attorney for Toyota has accused the automaker of illegally withholding evidence in hundreds of rollover death and injury cases, in a “ruthless conspiracy” to keep evidence “of its vehicles’ structural shortcomings from becoming known.” The complaint charges that in a pair of lawsuits in Colorado and Texas, Toyota failed to fully disclose electronic data (such as e-mails) in defiance of court orders to do so. It states that when Biller learned of the company’s failure to produce design and test data from an engineering subsidiary, he attempted to collect and preserve the information. Despite these efforts, the engineering unit “was allowed to destroy relevant information and documents that should have been produced in, approximately, over 300 rollover accidents involving roof crush issues,” the lawsuit claims.It further charges that Toyota regularly, and improperly, withheld records on design and testing of vehicle roofs. For example, it says that Toyota never produced a document showing that the company’s internal standard for roof strength was tougher than the federal requirement. Toyota engineers and witnesses repeatedly testified that the internal standard did not exist, the lawsuit says, adding that there are vehicles on the road today that do not meet the standard… In the lawsuit, however, lawyers for Biller described Toyota’s effort to silence him as “illegal and against public policy in that it is intended to conceal information from plaintiffs and obstruct justice.”

From my perspective, this scenario parallels the stories about silent problems that exist inside “The Contentious Zone,” which I describe in the book, Without Warning. The Contentious Zone is a place where the opposing party not only disagrees with the situation, but also advocates the problem doesn’t even exist. And for this reason, this will be a long, protracted and volatile battle. However, I can guarantee one thing (cause I’ve followed these scenarios), for Biller to bring this forward at this point in time, three situations exist. They are:

Biller is well prepared with lots of evidence,
Biller knows his opposition extremely well, and
Biller wants to do what’s right.

While this story is worth following, it really begins to surface a much bigger problem underway at Toyota. Earlier this year (May 2009) I published Is the Toyata Way Waning? I wrote,

Since I made this prediction, Toyota’s world has and continues to spin out of control. It is a world filled with intrigue, disappointments, silent problems and now without warning events. Here are but a two of the stories being written about the highly reverred Toyota.

May 19, 2009 (The Truth About Cars)– Toyota plans on replacing 40 percent of its senior managers and half the board members while reorganizing its North American business according to the Financial Times. Akio Toyoda takes over as president of his grandfather’s company next month and clearly wants to set a new tone at the top.

June 2009 (Autoguide.com)– One of the last things Shoichiro Toyoda did as honorary chairman at Toyota Motor Corp., was to assemble all of the company’s executives and give them a tongue lashing. Toyoda even called out president Katsuaki Watanabe and blamed him, as well as those other executives in charge of the Japanese automaker, for leaving behind the company’s long-standing business practices to chase the quick-buck. He said they followed the lead of now-bankrupt automakers like GM and Chrysler, a path that has put the company in a serious financial bind.

Toyota’s #1 problem today isn’t design, manufacturing or sales. Their #1 problem is the silent problems now beginning to surface. And as I’ve discussed before here (Do Silent Problem Impact Business Performance), these problems will impact present and future performance, the whistleblower lawsuit is likely just the tip of the iceberg for what will follow.

Tags: Biller, Silent Problems, Toyota, whistleblower lawsuit
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Rodney Johnson - Without Warning