Is Toyota Experiencing a Culture Meltdown?

In ernational  nte na on Mar eti g  rke ing

Assignm ment  ‐ W k 6 ‐  Week

Topic: Is To oyota ex xperienc cing a co orporat te cultur re meltd down?

Am Mr my razek Pa aolo R Roma Geo orge S Saltos Mirc Sz cea zumila as Stepha S anie W hke Wesch

Summary In the past few months, Toyota faced a variety of issues regarding its reputation as an outstanding car manufacturer in the global auto industry. Although the first signs of manufacturing errors – triggered by a number of safety incidents in Toyota vehicles – were evident in 2002, the major crisis hit the company in November 2009. At this point, Toyota was forced to announce a recall of approximately 9 million vehicles that were affected by uncontrolled acceleration and balky brakes. The problems at Toyota, which some assign to a poor risk management process, cost the company more than $2 billion in repairs and loss of sales. Even worse, Toyota’s so called ‘mythologized corporate culture’ was affected in the market place and consumer perception about the brand plummeted noticeably. Overall, the events over the last few months put Toyota’s position as one of the most admired companies in the world in peril. Corporate Culture – The Toyota Way1 Toyota is a Japanese car manufacturer that was founded in 1930 and now employs approximately 400,000 people from around the globe. The company’s management philosophy is manifested in 14 principles, guiding Toyota towards an efficient use of its resources. Furthermore, Toyota’s corporate culture entails a central theme of high commitment to teamwork and a devotion to a concept called Kaizen, i.e. continuous improvement. Altogether, the company aims at creating a work environment that empowers its employees, encouraging them to be creative and bring about change and innovation. All of the above aspects combined are considered Toyota’s real competitive advantage and also referred to as TPS or Toyota Production System. With that, the company’s ultimate goal is to...