Wednesday, February 03, 2010

Toyota as resilient enterprise?

Watching Toyota fall all over itself in its attempt to react to its recent crisis brought to mind Yosi Sheffi's seminal book The Resilient Enterprise, in which Toyota plays a starring role.  In 1997, there was a fire at a key supplier in the supply chain for Toyota's brakes, just as there was a crunch on to get cars out the door because some incentive was coming to an end.  Toyota's supplier reacted immediately and informed Toyota, which in turn marshalled its keiretsu into a war room, shipping out technical specs to other suppliers and getting production back up to speed with minimal disruption to production.  Much rejoicing ensued.

Somehow this sense of urgency has not been maintained in the current environment.  One suspects it has to do with the presumed impact of the 1997 and 2009-2010 incidents on the corporate top and bottom lines.

On another note entirely, I have to say that it strikes me as mildly improper that
the US Transportation Secretary Ray LaHood has sprung into action today by telling Toyota drivers to stay out of their cars until they're fixed.  However rational that may be, the fact that the US Treasury has a controlling interest in GM and Chrysler makes LaHood a not disinterested party.  Yet another of the lamentable unintended consequences of the government's extraordinary actions during the crisis.  We may hope that this conflict of interest will be removed in an orderly fashion over the next few years.