The news about Toyota’s day-to-day business practices and handling of recall situations seems to just keep rolling in. The L.A. Times ran an article earlier today spotlighting Toyota’s organizational structure as the possible “root of safety problems.” They blame the “uncoordinated response” to recall issues on a “diffuse organization.” Of course, these conclusions didn’t just come out of thin air; now that problems are being coming public, very public, former employees are coming forward with insight into the inner workings of Toyota.

Instrument Panel - 2005 Toyota Celica 3dr LB GT Manual (Natl)

Instrument Panel - 2005 Toyota Celica 3dr LB GT Manual (Natl)

The L.A. Times article reports that former Toyota insiders attribute the recall situation that Toyota is facing on an organizational design intended to put power in the hands of executive in Japan, while leaving the U.S. operational counterparts unable to make decisions that would have prevented recalls to reach a crisis level. John Jula, former engineering manager of Toyota’s technical center in Ann Arbor, Mich., said that he left the company in 2003 because he was convinced that the company’s dedication to safety had deteriorated. As an engineering manager, he had little contact with U.S. plant managers even thought he had duties to design interiors for some U.S. models. All design and technical decisions came out of Japan.

This tight control by Toyota’s Japan based headquarters is echoed in another former employee’s story by Laurence Boland. Boland handled regulatory compliance for Toyota in their offices in Torrance, Calif., left Toyota in 1995 after spending a quarter-century with the organization. Boland recalls data he gathered on the 1979 Toyota Celica’s sticking accelerator throttle being “cleansed” from the final report filed with the National Highway Traffic Safety Administration (N.H.T.S.A.). Where did all his data go? Japan.

This occurrence seems to be a part of a long time strategy of Toyota’s to minimize safety recalls—and in turn save the company hundreds of millions of dollars. John P. Kristensen, an attorney involved in a lawsuit against Toyota, say that Toyota has used its organizational structure to defend itself from lawsuits by “forcing attorneys to file repeated requests for information to subsidiaries.” The end result of all of this? More than 2,600 complaints about sudden acceleration filed with the N.H.T.S.A and 34 of those have resulted in fatalities. For those who say that this is being blown out of proportion we must ask ourselves how many fatalities are acceptable before the tough investigations and questions start being asked.


[Source: L.A. Times]