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Toyota recall: An embarrassment for Japan, Inc.

Analysis: A bruised icon, and the woes of being a consumer in Japan.

Toyota didn’t help itself with displays of the familiar arrogance it cultivated in the days when it was raking in record profits and going bumper-to-bumper with General Motors in the race for the title of world’s biggest automaker.

That Toyoda’s flip-flop on the congressional hearings came only after nudging from senators only proves how much he has to learn about the qualities required of a 21st-century CEO.

For observers of other quality-control scandals in Japan, Toyota’s response followed a familiar pattern of denial, foot-dragging and insensitivity. The last decade alone has produced a long list of examples, from faulty kerosene heaters and exploding televisions, to tainted milk and deliberately mislabeled beef.

In Japan, the producer is king and the consumer a mere irritant, while stakeholder advocacy is pitifully underdeveloped. The bigger and wealthier the company, the greater the indifference – just ask Japan Airlines shareholders who will see their investments reduced to zero Feb. 20 when the firm is delisted from the Tokyo Stock Exchange.

If one good thing comes out of the recall debacle, it will be a genuine effort, by Toyota and other Japanese manufacturers, to match their admirable capacity for monozukuri (making things) with more transparency and accountability to the people who buy their products.

Japan's unshakeable popular faith in those products has an important upside for Toyota in its hour of need: it is hard to find anyone who does not believe the carmaker will dust itself off and re-emerge even stronger than before. And after the events of the past few weeks, Japan’s bruised icon needs all the goodwill it can get.
 

http://www.globalpost.com/dispatch/japan/100219/toyota-recall-embarassment-japan