In Japan, it is said that the people who bow the most and the lowest are the businessmen. They will bow as deep as appropriate, to apologize for the slightest unhappiness of the customer. A bow is also an acknowledgment of responsibility with a promise to make up. During the recall fiasco that bedeviled Toyota, Chairman Akio Toyoda took personal responsibility not only because of his position but also because it was a matter of family honor. Chairman Toyoda, personally led a deep and wide organizational revamp, and it's fairly conceivable that in doing so, Toyota's products and reputation are headed in the right direction. But how did Toyota, the epitome of defect-free product and quality circles ever get to such a pickle?
Expansion, hit by the recession
During the time GM was teetering, Toyota proclaimed that its growth to world number one will be achieved by selling as many regionalized models. In other words, simple organic growth and not through M&A [mergers and acquisitions] unlike Volkswagen's insatiable appetite for buying up a buffet of brands. Buying companies or brands were not the Toyota way, even if Toyota sticks to the Japanese industrial practice of taking minority stakes in parts suppliers that co-develop components.
You may be familiar with those pieces of fabric hung at the portals of Japanese establishments. Called Noren, they are not mere hoarding to announce "open for business" or a subtle prod to bow your head to make you watch your step. It's a commitment, a promise to serve you, the customer, to your utmost satisfaction.
Noren greeted us when we entered the conference room in the glass, granite, and steel Technical HQ of Toyota in Toyota City, Aichi prefecture. The place is a vast sprawling university campus that meets a Hollywood backlot mix of factories and galvanized sheds. Strewn along the maze of roads, were secret prototypes festooned with camouflage and regular Toyotas sprouting weird equipment. There were even traffic lights, presumably to allow secret test models to exit our path so we don't see them.
At the conference, Toyota was as straightforward as can be regarding the causes for the rash of recalls that have reached 11 million units as of this date: communication from the ground up was slow and the reaction to the press reports of vehicle defects wasn't adequately handled. This forced Toyota to slow down its ever abbreviating model development times. To minimize delays while increasing testing for quality control, Toyota has increased both human and capital assets so that car designs reach production with full confidence in durability and safety performance.
Though Toyota culture stresses zero defect and quality as number one, it went beyond appointing and empowering CQOs - Chief Quality Officers. The reform process emphasized early detection and early rectification. Though quality, audit, and production processes and systems remained largely intact, Toyota further tightened feedback loops and accelerated feedback reception, investigation, and analysis. Customer complaints reach an officer minutes after it is reported.
Toyota's famous consensual/collegial decision-making by wide cross-rank participation in meetings still functions. The organizational improvement is the insertion of assistant managers below the Group Manager so that the "new" layer can be in contact with a smaller group. Still, the most important and arguably revolutionary change in the largely conservative Toyota culture was to inculcate care for the customer at the shop floor. Normally, Human Resources Department emphasizes production and quality circle targets for production. Now, even shop floor workers are being taught to care for the customer as the end-all and be-all of their quality circle and production targets. One would think that Toyota's constant meetings may have held up the communication paths, but Toyota has made a choice that all parties involved must be informed at the same time so reactions can be immediate.
Through the office block's plate glass, curious eyes will see various cars from all of Toyota's competition, parked idly by in some nooks, giving the impression of an engineer's sandbox with unkept toys. Obviously, the rival products are there to be compared to and benchmarked. Toyota is particularly proud of their flood test area which makes their cars the flood-resistant choice for the Thai, Indonesian and Philippine "monsoon" market. The significance of this test is emphasized by the number of known brand cars that were pushed to the side having utterly failed the flood test.
The next morning, we were bussed over 200kms to the east, to Higashi Fuji Technical Center. It's one of five giant Toyota Technical centers sprinkled across Japan. Cradled on the foothills of snow-capped Mt. Fuji, our buses were escorted by security in the latest Prius, through a maze of forests, berms, fences, more buildings with space-age hemispherical cladding and neat lines of cypress cover obscuring sections of the secret testing tracks. We visited one of many electro-magnetic chambers that test for all kinds of interference to a car's quiet and uninterrupted functioning of its electronics. Then there was a simulator where whole cars, without tires, go through a rough process that mimics a high-speed drive over severely broken roads to check on the functioning of all systems and durability of parts. Within the cavernous crash test facility, we were shown the entire safety program of Toyota, from different crash test dummies to poles and barriers used to hit pristine cars. All this impact energy is collected as data by sensors and is inputted in the vital parts that come into contact with the passenger. For example, to mitigate whiplash injury, Toyota seats use tubular steel seat frames that function as shock-absorbing springs that direct crash energy to counter a car's tendency to dive under in a collision.
To our delight, Toyota staged an off-center frontal crash between a Yaris and a Majesta. The latter, as elegant as a Maserati Quattroporte, is one of four curvaceous variants of the 2-ton Crown. You can sense a silent collective cringe when the 2 cars were launched at each other at 55km/h, impacting in a sickening bang. The crash test proved passenger survivability is possible between collisions of cars of divergent weights for so long as it is properly designed. As predicted, the doors could be opened by rescuers, and the dummies' temperature-controlled rubber skin was unscathed as proven by all the data gathered from them.
Toyota also briefed us on a family of sophisticated virtual dummies called THUMS - Total Human Model for Safety. These virtual dummies plot the effects of impact right through virtual organs, muscles, and bones, things crash test dummies, which serve as data gatherers, cannot yet simulate. For a technical facility tour, Toyota showed us a lot of its original testing ideas in support of its own crash safety design program. What we were shown at Toyota's facility was far more extensive than what has been seen by the International Press in the test centers of other similarly sized global carmakers.
The day after, we had some seat time with a couple of Lexus LS 600 hybrids fitted with automatic braking. Sensors and cameras linked to the ECU identify the obstacle in front, whether dummy pedestrian or moving pole. If contact is imminent, seat belts are tightened and the brakes automatically come to a full stop. Mind that these safe driving intervention systems have been fitted to many Japan market Toyota models over the past several years, which was about the same time that several other rival brands were touting their versions as proof of their lead in safety innovation. Incidentally, 60% of all accidents in Japan are rear-enders, usually caused by drivers falling asleep. Toyota devised vibrating steering wheel rims coupled with audible warnings to alert the driver not only of rapidly closing braking distances but also unintended lane changes. Safety engineers like to call their objective "Zeronize"; i.e. to achieve zero accidents.
Run over the man
What was even more fun was the big driving simulator. We "drove" a Lexus housed in a big metal sphere surrounded by a 360-degree wraparound movie screen. The simulator rides on tracks that give the driver a feeling of motion and it has hydraulic rams that mimic the dive experienced when braking hard. On the screen is a computer-generated photo of the roads in nearby Gotemba city. Taking the wheel, I was instructed to drive on this virtual road and watch out for Police, pedestrians, reckless drivers, and wayward children. Computer programs can be randomly changed to pop surprise hazards like a child crossing, a car challenging you to a race, a cop [Panda car in Japan] car shadowing you, and a scooter ramming into your car's flanks. Since there were many of us eager to take turns after watching each other's performance on CCTV, the hazards were modified with every driver change. As advertised, pitching on braking and leaning on swerving is felt just like in the real world. Prescription glass wearers were warned that the curving screen and accompanying motion can lead to dizziness.
What started 30 years ago as an innocently named preventive maintenance bulletin, the pact between a car maker and a car owner has changed. Nowadays, the word RECALL is generally understood in a spectacularly paranoid way. Ironically, recalls are resorted to by those who truly care about their brand's reputation and customers. This now has the unfortunate consequence of debasing even a well-deserved reputation for a solid history of decades of perfect quality. In all of the fatalities involving models that were recalled, US Federal investigative and regulatory agencies have cleared Toyota's good name. With Toyota's new programs in place, such reputation-damaging recalls are bound to get fewer in the very near future.