Hitting the Brakes: Toyota in Crisis (Research Paper Sample)

First and Last Name Professor's Name Business Studies 6 April 2016 Case Study: "Hitting the Brakes: Toyota in Crisis.” Case Overview: Key Points Based on their commitment to quality, Toyota Motors built a world-class automotive brand, which was known for its reliability, innovation, consumer focus, and excellent workmanshipCITATION Ged15 \p 99 \l 6154 (Fan, Geddes and Flory 99). However, the company began facing trouble in 2007 when it was forced to recall over 55,000 Camry and Lexus models equipped with all-weather floor matsCITATION Ged15 \p 100 \l 6154 (Fan, Geddes and Flory 100). The recall was sanctioned due to the floor mat's possibility of causing pedal entrapment, and subsequently, in 2009, an approximate 2.8 million Lexus and Toyota models were recalledCITATION Str13 \p 293 \l 6154 (Parnell 293). As events unfolded, Toyota took another massive blow from the NHTSACITATION Ged15 \p 105 \l 6154 (Fan, Geddes and Flory 105). The company was accused of allowing the problem to continue unattended, which was then compounded by a declaration from a prior employee who turned over documents which proved Toyota committed criminal actions which led to the recall incident and various accidentsCITATION Ged15 \p 101 \l 6154 (Fan, Geddes and Flory 101). Following Toyota's massive losses and decreased sales, their main competitors (GM and Ford) took advantage of the situation and offered Toyota buyers an extra $1000 rebate to trade in their Toyota modelsCITATION Neu11 \p 231 \l 6154 (Neufeld 231). This caused further losses for the company, and in 2010-2011, GM's sales increased by 14 percent, while Toyota's declined 16 percentCITATION Neu11 \p 231 \l 6154 (Neufeld 231). Even though Toyota moved fast to solve the problem, the damage was irreversible. Consumers lost trust in Toyota products as a result of the evidence pointed directly to the company being the main culprit. Case Analysis To a certain extent, Toyota's upper management can be blamed for the incidentCITATION Neu11 \p 231 \l 6154 (Neufeld 231). It is no secret that companies strive for profits, and the evidence, in this case, pointed to an apparent disregard of protocol which led to a quality failure. The recall was preventable if proper measures such as quality checks and other routine preventive measures were put into action before the crisis. Additionally, if the crisis did occur, the same measures would prevent any further damage. Toyota reacted too late; they did not take preventive measures and did not implement a quick intervention to ammend the damage. Much of the leacked information that was provided by Toyota's ex-employee incriminates some of the upper management. The documents brought to light made it clear that key members of management had knowledge of the faulty parts. It also proved that the brake systems were not being properly tested, and management decided to ignore this fact which consequently resulted in the crisis. However, the most compelling evidence showed the lack of response from Toyota. Even after it was evident that the brake system was faulty, there was a latent reaction to fix it and to make massive recalls. The NHTSA and the US government took drastic actions towards Toyota. However, they were pertinent to the crime. Along with minor accidents suffered by Toyota drivers due to the faulty pedals, by 2014, there were 14 confirmed deaths which were directly linked to the faulty pedal. Taking the death toll into account and the company's lack of effort to recall the vehicles faster, all actions taken against Toyota by the government were justified. Application If the CEO of Toyo...