by Bruce Beer, PMP:

Earlier, we began exploring Toyota’s quality and performance problems through 2010 and how Triage efforts could help them recover before it is too late. In this post, we continue that discussion. (Click here to read Part 1.)

Let us look at a few options they may have wanted to consider. Firstly, let us look at their immediate reaction to the situation which appeared to the public to be denial, delay, and no clear acceptance that there was a problem. While that perception remains, the company will flounder, sales will continue to drop off, and the reputation of being a low quality company will grow. So maybe their first action to stop the bleeding should have been a public acceptance by management acknowledging that there were problems  and fully accepting them, apologizing, and devoting extensive resources to solve the problems and prevent new ones. Then they could have publicized that they are re-instituting the quality measures that made them an industry leader back in the day. They had already started to do some part of this in early 2010 (some may say grudgingly and without enthusiasm!) so maybe they should continue to really punch this message home even more.

That might stop the decline in sales, but now we come to the cause of all their problems – the quality issues regarding uncontrolled acceleration. Another short/medium term measure might be to flood the car testing and evaluation companies with vehicles (already fitted with new mats and gas pedals) for them to test and report on – hopefully they get reports from highly creditable agencies that no problems were found which will go some way to restoring credibility, or if problems are found they are found by experts who can provide details which will assist in correction. Then for the longer term they need to thoroughly examine the quality measures they used to implement that made them an icon for quality in the past, compare those measures with today’s quality control, incorporate allowance for new technologies and manufacture, then implement measures and broadcast loudly what they are doing in the factories, to ensure only the highest possible quality products leave the factories. Communication is going to be vital to their recovery.

So as an example of how Triage might work for Toyota they could:

a) Stop the bleeding – be open and honest, communicate with the public and safety organizations that Toyota accept that there were problems and that management are fully focused on the issue

b) Improve short term sales by letting safety agencies and car reporting companies have cars to evaluate – hoping this will give a clean bill of health which can then be used in marketing, or if the worst happens, Toyota will have reports from experts identifying problems which can then be addressed

c) Longer term solutions of identifying the root causes of quality lapses and performing rigorous analysis to show how they can recover their reputation for quality.

High quality does not come cheap but is cheaper than the cost of not conforming to quality, and recovery of lost customers is always more expensive than gaining them in the first place. By performing some Triage, even if their analysis is not the same as mine, they can see how to stop the bleeding, look for a medium term solution to start building their credibility and sales, and a longer term root cause analysis of their quality problems, followed by an all out attack to resolve them.

Toyota must be aware of the feeding frenzy building up amongst lawyers of this and other countries, who see the opportunity for huge earnings via class action suits. This could well force itself up the triage list to prevent death of the patient!