Toyota's culture faulted in recall crisis

[NINETY EIGHT REGENCY]

Toyota's culture faulted in recall crisis

To respond more effectively to future safety and quality problems, Toyota must learn to trust non-Japanese leaders, delegate more authority to them and decentralize decision-making, say people who've worked with and for the Japanese automaker.

Robert Cole, a business professor at the University of California Berkeley and Doshisha University in Kyoto, Japan, said some of the dysfunction at Toyota that has come to light as part of the company's recall crisis is caused by culture, including language barriers, while some is just a consequence of the tight control in Japan.

"Pressure will build for some type of U.S. representation on the board," he said.

However, several strong American leaders -- including Jim Press, the only American to have ever served on Toyota's board -- have defected to other automakers in recent years.

After a half-century of doing business in the U.S., Toyota still assigns a Japanese boss to mentor every American or European executive.

No Toyota executive in America was authorized to issue a recall. That included Jim Lentz, Toyota's top American sales executive, and his boss, Yoshi Inaba, who oversees North America.

"Most of the information was one-way. ... back to Japan," Lentz testified before Congress in late February.

Replied Rep. Ed Markey, D-Mass.: "What you're saying is that, ultimately, the decisions are made in Japan?"

One former Toyota executive who asked not to be identified said communication could be frustrating within Toyota.

"It's always taken a strong leader here to get the attention of Japan," he said. "Their culture will change because of this."

Growth changed Toyota culture

An exodus of key American leaders from Toyota since 2006 may have been a sign of tensions that are just now coming to light amid the company's first serious crisis in more than 50 years of selling cars in the U.S., according to people familiar with the company.

Press left in 2007 to take a top position with Chrysler. Another Toyota marketing leader, Jim Farley, left in 2007 for Ford, where he is now global marketing chief. Deborah Wahl Meyer, who headed the Lexus brand, left for Chrysler in 2007 and now is chief marketing officer for Pulte Homes.

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http://www.freep.com/article/20100308/BUSINESS01/3080373/1331/Toyotas-culture-rapid-growth-faulted-in-crisis