Wednesday, February 10, 2010

Toyota Customer Confidence Crisis


Any crisis starts with containment, and that is what Toyota is working on now with its crisis in customer trust. After death and injuries spurred three global recalls that covered over 8 million vehicles, what was once a exemplary engineering and manufacturing mega-corporation has its integrity being questioned.

The problems as follows: an aftermarket floor mat that, if not clipped down properly, can interfere with the gas pedal; a pedal from one supplier that can get "sticky " because a composite material interacts with moisture over time as it wears; and a software glitch on the 2010 Prius that can cause less-than-a-second's hesitation in braking when the antilock braking system is applied.

For each of these problems a specific cause has to be determined—when it occurred, where, and how. There is no evidence that floor mats were assembled incorrectly because they are put on by dealers. There is no evidence that the sticky pedals were assembled wrongly; that issue rather concerns the specific composite material selected for one part. And in the Prius case, the issue lies in the software code, not in how the module was assembled at the plant. So revamping production does not appear to be in order. It seems remarkable that all the recalls occurred within a six-month period. But in fact the cause was at least six months old in each case—five or more years in the case of the pedal design.

Thus, the real principle violated here is that the quality control process did not uncover the problems before distribution, and resolve them completely before launching upon the public. And from here forth, merely repairing the defected units upon recall and issuing new warranties will not help repair its damaged public image. To do so, you would need to show a renewed commitment to quality, safety and customers.

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