Effective leadership doesn't just happen. You have to happen into it!

Friday, February 12, 2010

Can You Be The Biggest AND The Best?


I had just sent my Toyota in for its scheduled service at a local Toyota service centre; which I am told is the biggest in South East Asia. The people of Toyota have always been professional when dealing with me. So far, I have no complaints with the service I have received or with my car. In appreciation, I have taken the time to complete the relatively extensive customer service surveys that they have sent out. I have responded to two surveys so far. And, for each survey I am given an e-voucher valued at RM20.00, redeemable at the next service. In both occasions, I had also written some suggestions for service improvements.

As I was waiting for my service technician to take over my car for the next 1 hour or so....it felt like letting go off my baby. But, I digress.

As I looked around the service centre, I could not help but wonder what is going through the hearts and minds of these excellent employees of Toyota. With all the bad publicity surrounding Toyota these days, it must be difficult for those on the ground who have been thought and imbued with the DNA of Toyota : Quality.

The crisis of confidence engulfing Toyota stemming from a steady stream of vehicle recall must be heart-wrenching for this proud and storied Japanese giant and its well trained and loyal employees. My colleague in Japan wrote to me to say that it is suffering from a crisis of confidence even in Japan. Can’t be a nice feeling when your own homeland doubts your quality. I also read that Japanese newspapers, both from the left and right, are united in raising concerns that the Toyota debacle will seriously undermine Japan’s painstakingly built status as a high technology, high quality country. I suppose, if you can’t trust Toyota, you can’t trust much of Japan! And, you definitely can't trust Japanese made airline seats!

Now, let’s attempt to answer the question. I think the answer is NO.
Being the biggest car maker requires a set of behavior which may not necessarily prepare an automotive company to also be the best. You don't necessarily use the same mind-set that made you the biggest to become the best too. It seems that many in Toyota had already been voicing their concerns since the 1990s as Toyota set its eyes on loftier goals. In fact there is a conspiracy theory swirling around that, this is an engineered crisis by Toyota to NOT be labeled as the No. 1 car maker. According to this theory, Toyota executives have realized that being number one in this industry is not a joyful experience. Hence, an engineered crisis to knock it self off from the perch.

Conspiracy theories aside, there are many lessons to be learned from the Toyota Experience….there you go…the title of the next hit book to replace the Toyota Way. Once again, you read it here first though I am sure somebody else will write it!

Toyota is a company that relies on quality improvements. To be precise, incremental quality improvements. Toyota, for many years behaved like a gifted child embarrassed by her own abilities. She progressed by leaps and bounds but always incrementally; a slow and steady evolution if you like. Or at least that's what they believed they were doing. But somewhere along this incremental improvement approach they managed to introduce the Prius to the world which today commands a premium for its category.Then, its Lexus was spoken in the same breath as BMW and Merc. Then, it became the biggest car company in the world. Wait a minute! You did all that by being 'incremental'?

I don't think so. Something had to give. In this case it was the inability to manage the quality of its vendors and parts makers. So far, this is where I will put my money on if you ask me where exactly Toyota had messed up.

While we wait for more details to distill our learning, I hope our very own Proton and Perodua and to a certain extent Naza will take notice of this. You can screw up in the domestic market and somehow get back to your feet. After all we Malaysians have a short memory. But if you mess up in the international market; you have very little chance for a come back. And PLEASE don't ever think that since even Toyota can make such mistakes, it is therefore forgivable for you to do so!

On the sidelines, I am also wondering how the problems facing Toyota and lately Honda too will benefit the Tata's and Hyundai's of the world.

Wishing all of you a Happy Chinese New Year. Remember : We have only one natural resource and that is Unity. Spread the cheer of unity in this festive period. Be careful of what you say about others in front of the young ones.

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