David, what’s going on with Toyota? Is this just an instance of bad luck blown out of proportion? It seems clear to me that at the very least, Toyota is getting bad press advice, at least as regards the sensibilities of American customers.
I do find it hard to believe that all of the ex-post narratives in the press regarding Toyota’s terrible “culture of centralization” have even a grain of truth in them. What do you think?
Indeed. As you know, I’ve spent quite a bit of time studying Toyota, and even wrote a paper about how Toyota manages to sustain innovation within highly efficient operations. It seems likely to me that senior management became too focused on growth, thereby allowing the organization’s commitment to its core values and production methodologies to weaken. I don’t think this can be dismissed as bad luck–the company appears to be exhibiting all the standard pathologies of large Japanese organizations. In my paper, I argue that one factor in Toyota’s success was “exploratory interpretation”: the ability to frame problems as opportunities to learn and change. We’ll see whether the company is able to transform itself in response to this crisis. If not, I think prolonged decline is a real possibility.