February 16th, 2010
11:40 AM GMT
Toshiro Era doesn’t look like a radical. Dressed in his conservative blue blazer and tie, he looks like your average businessman in Japan.
But when he starts talking about his plans for corporate Japan, “radical” is among the words that leap to the minds of Japan, Inc. watchers.
Don’t lie. Move quickly. Be transparent. Allow in the media. Get your CEO out front early, even if there’s no consensus.
That’s Era’s message as he lectures two dozen senior managers at a food manufacturing plant two hours outside of Tokyo. It’s the opposite message most of the graying men in this room have heard their entire lives in corporate Japan. They need to change when crisis hits, argues Era.
“Japan is a homogenous and monolingual society. We assume we can gain understanding if we explain well later, even if we don’t talk about it immediately. Unlike Western companies, Japanese companies tend to specify the cause of the problem and fact-find internally first, before coping with the crisis. This move looks very slow and it is the worst move you can make when it comes to crisis management. Japanese companies, especially a conservative company like Toyota, will misstep,” said Era.
Temple University Professor and Japan scholar Jeffrey Kingston says Toyota followed the secretive rules of corporate Japan, a culture that closes off amid challenges instead of opening up.
“In Japan, there has been a greater movement towards more transparency, more accountability, better communication, but it’s a slow movement. This case highlights how much farther it has to go,” said Kingston.
Former National Highway Traffic Safety Administration administrator Joan Claybrook says when safety problems with Toyota’s cars began to emerge, Toyota as a corporation closed ranks.
The NHTSA was also not on the ball and that led to the ongoing safety issues, says Claybrook. “There’s too much secrecy that Toyota was allowed to get away with– withholding information, with not being transparent and forthcoming with the Department of Transportation. And as a result, we’ve had people die, and be injured, and I’m sure there are going to be more.”
Preventing further problems will require a culture change within Toyota, says Kingston. It’s something that appears to be happening, as Toyota’s President, Akio Toyoda, makes more public appearances and reassurances to his consumers.
He has yet to confirm that he will testify before US lawmakers in Washington February 24 and 25, something that Kingston says will be the marker of a true turning point for Toyota’s internal culture.
Back at Era’s seminar at the food manufacturing plant, he’s running through various examples of failures within corporate Japan. With his power point presentation and laser pointer, Era pushed the senior managers to go against the corporate grain. Change is never easy, he says, especially in Japan. But Toyota is proving that sometimes it needs to happen.
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