GENEVA – Whatever happens to Toyota following the forced recall of millions of its autos, its story will remain legendary. Toyota’s rise from humble origins as the “offspring” of a family textile machinery company in a remote area of central Japan to become the dominant global automobile maker and a synonym for quality is astonishing. Along with a small number of other Japanese corporate icons – for example, Sony, Honda, and Canon – Toyota was the bright star of the Japanese economic miracle and global challenge.
It remains to be seen whether Toyota’s current problems are temporary or irreversible. Its current difficulties notwithstanding, it retains tremendous advantages – and in any case, the competition is not that much greater. But, to ensure their global position, Toyota – and most other Japanese multinational corporations – needs a cultural transformation.
As was vividly illustrated by the delays by its chairman and CEO (and grandson of the founder), Akio Toyoda, in responding to calls to appear before the US Congress, Toyota has a serious global communication problem. That problem is a reflection of a broader Japanese weakness in foreign languages, especially English. But as a dominant global player and the world’s biggest automobile company, that excuse is just not good enough.
I have had a close acquaintance with Toyota for three decades. In the 1980’s, as Western corporations in diverse sectors faced the onslaught of what was seen as the daunting Japanese challenge, I accompanied Western managers to Japan to learn about the country and its management and production techniques. This invariably included visits to Toyota factories. It was well worth it – and almost certainly still is – as the Toyota Production System deserves admiration and emulation.