Not two days after imploring everyone to do kaizen like Toyota, we’re reminded that no matter how good you are at lean manufacturing, kaizen, and continuous improvement, if you focus too much on eliminating muda (waste) while ignoring muri (unreasonableness, overburden) you can fail as a business.
A snippet of a Japanese TV program uploaded to YouTube asks “Is Toyota also number one in the world in recalls?” (世界のトヨタ リコールも世界一？)
This image is fairly self-explanatory. The X axis is years, Y axis is recalls in units of 10,000. Toyota has 1,880,000 recalls in 2005. The chart compares Toyota with the recalls from the other two major Japanese automobile manufacturers.
This image explains that the recalls are due to the rapid expansion overseas and the pressure to reduce cost resulting in a supply chain that is overburdened and lacking in personnel. Toyota has been adding production capacity of 500,000 vehicles each year. This is the equivalent of one Fuji Heavy Industries per year (Subaru).
The growth of Toyota has been supported by the vast pyramid of suppliers beneath them, and the development of “building in quality” has not sufficiently extended to the supply base. Quality has decreased as a result.
The response from the Toyota PR department explains the background of the increase in recalls as a “increased structural complexity in our products due to the lengthening span of ownership of the automobile, an increased awareness of quality by the consumer, and advances in new technology and environmental technologies.” Toyota is blaming technology innovation and THEIR CUSTOMERS. If this is Toyota’s true and honest grasp of the current situation, rather than just PR spin and dodge, their problems aren’t going away any time soon.
The PR department goes on to explain that President Watanabe is heading up a “build in quality” effort involving the suppliers, so they area clearly tackling the problem from the highest levels.
What does the future hold? The automotive industry will shift focus in the future from the U.S. and EU to BRIC countries (Brazil, Russia, India, China). The slide says “if Toyota can clear the quality hurdle, they will continue to grow globally.”
Toyota may be its own worst enemy. At Toyota they say “beat Toyota” meaning they should not be complacent even when no other automotive company can beat them. It would be ironic if Toyota beat Toyota, and lost…