...TOYOTA, INC. A Case Study in Communicating Bad News Written by: Alex Mezey Scott Hamilton Kevin Kuwahara Courtney Sandlin Dr. Robyn Walker Faculty Advisor Center for Management Communication Prepared for: Case Study Initiative Center for Management Communication 2013 Page 1 of 12 INTRODUCTION In 2005, Lupe Lee bought a new Toyota Camry from a local Sunnyvale, California, Toyota dealership, donating her immaculate Camry bought in 1990 to a local charity. Going from an older Camry model to a newer one, it was obvious that Lupe not only liked Camry cars, but she liked Toyota and its business model. However, this was all about to change on September 9, 2011. On this day, Lupe and her daughter were on their way to Berkeley for a niece’s wedding. They planned to stop in Burlingame to pick up Lupe’s sister, Rose. They arrived at the sister’s apartment early, so Lupe and her daughter went inside. After visiting in the apartment for a time, the three of them went out to get into the Camry to continue on to Berkeley. Lupe would have to make a U-turn to head back towards the freeway. Instead, she decided to maneuver into a nearby driveway to turn around. This is when things began to go horribly wrong; as they started up the driveway, the car began accelerating. Rose exclaimed “Lupe! What are you doing!? Why are you going so fast!? Push on the brake!” Lupe had no control of the car; she was terrified. She tried desperately to press the brake, but nothing happened. She quickly...
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...Team B Assesses Public Relations for Toyota SUA Recalls MKT/578 University Of Phoenix Team B Assesses Public Relations for Toyota SUA Recalls In August of 2009, an off duty California Highway Patrol officer and three family members died when their Lexus crashed after the accelerator pedal stuck. The car was traveling at a high rate of speed and could not be stopped according to a panicked call from the driver (MacKenzie and Evans, 2010). This tragedy kicked off a crisis for Toyota as it had to deal with accusations that a faulty accelerator pedal is what caused the crash. The company faced negative publicity from the media, the public and the NHTSA (National Highway Transportation Safety Administration) as a result of this accident and other accidents involving sudden unattended acceleration (SUA) from a stuck accelerator pedal. In response to these incidents and the publicity, Toyota eventually recalled 7.5 million vehicles to fix the stuck accelerator problem and shut down production of its effected vehicles until the problem could be solved. In this paper, Learning Team B has evaluated the role public relations played in this case and how the company could better prepare for a similar crisis. Problem Toyota realized it had a public opinion problem after numerous reports of “runaway” cars were claimed to have been caused by an accelerator pedal that would remain pressed down after the driver released the pedal. This resulted in the California accident...
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...Firestone Case Study Robert Workman Jessica Jurkowski Michael Wilding Webster University Firestone Case Study BACKGROUND In 1900 Harvey S. Firestone established The Firestone Tire and Rubber Company, the company started with 12 employees. They started out by supplying rubber tires for wagons and buggies. In the 1908 Henry Ford and Harvey Firestone formed a partnership with firestone supplying tires for the new model T this was a natural relationship because they had mutual friends. (Noggle and Palmer, 2005) Today Firestone is known as Bridgestone/Firestone after the two companies merged in 1990 for $2.6 billion. Today the company markets 8,000 different types and sizes of tires along with other products. Firestone has had a substantial history of scandals relating to tire safety In 1978 Firestone recalled 14.5 million tires—the largest tire recall at the time—after excess application of the adhesives binding the rubber and steel resulted in 500 tread separations and blowouts. The company was also fined $500,000 for concealing safety problems. ("e-businessethics.com") However in the late 90’s Firestone would be put into serious jeopardy and be threatened with going bankrupt. The Ford Motor Company was started by Henry Ford in 1903 in Dearborn, Michigan producing only a few cars a day. Ford was the first company to use assembly line production and has grown into one of the largest family run organizations in the world In 1999 Ford had a staff of 360,000 employees...
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...organizations. For different car model year and manufacturer the study looks at frequency of recalls, recorded customer complaints, and yearly sales data. Analysis shows recalls are a common event with the majority of recalls initiated by only a few car makers. Though car makers use many eye catching and popular quality and customer care slogans and programs, many popular car makers still face valid customer complaints and consequently face many unwanted recalls. This study identifies that most recalls occur during the first five years of the car model year. This preliminary study of automobile recalls can be further extended at a later stage to identify key causes of recall. Keywords Product recalls, Reverse logistics, car recalls, product returns, closed loop supply chain 1. Introduction Though manufacturers use state-of-the-art operations philosophies, tools and techniques, it is difficult to make the perfect product and products often need to be recalled. Recalls occur when the customer or the manufacturer or the government safety ensuring authority identifies a serious product defect or fault as a health hazard or as risky to use. Recalls are a consequence of a bad quality product which the manufacturer did not address or was unaware of before distribution...
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...global automotive industry. Analysts began to question Toyota's legendary quality and felt that the recalls represented a major failure on part of the company. After the recalls, Toyota went into crisis management mode and announced a fix for the accelerator problem. Various crisis management initiatives undertaken by the company to regain the trust of customers and restore its image as a quality automaker. As part of its crisis management process, Toyota placed ads in print and television media, involved executives and used social media platforms to address its customers. However, some analysts felt that the crisis communication team of Toyota was weak which led to a delay in identifying and addressing the situation. Crisis management experts were of the view that the image of Toyota would depend on how quickly it can fix the problems and how well it communicates with its customers. ISSUES: 1. Understand the importance of crisis management and various issues and challenges related to it. 2. Analyze whether Toyota's response to the crisis was adequate. 3. Explore the PR and crisis management strategies that Toyota should adopt to contain the impact of the crisis and retain its brand reputation. INTRODUCTION: The case is about the poor crisis management of Japan based Toyota motor corporation. It took Toyota around 77 years to build an enviable reputation for producing high quality...
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...technology in global automobile market. The technology advancements are offered to public after several checks and quality assurance and safety measures. Still there are several accidents which happen despite of all security checks. During 2009 one of latest vehicle named Toyota Lexus encountered an accident due to failure of technology. The San Diego received an emergency phone call from passengers of Toyota Lexus who were terrified due to out of order accelerating control of car. The passengers could not get even few seconds and the car smashed completely. The technology failure resulted in loss of four lives. This accident has put a great question mark on authenticity of Toyota’s security check and quality control. It led to a crucial trust and reliability crisis for Toyota all over the world. The customers demanded a complete review of quality and reliability analysis of company products and services. Despite of such crucial circumstances, Toyota’s management delayed apologies or assurance for inquiry which created more resentment among customers. The tragic accident not only resulted in loss of four lives but also caused decline in Toyota’s sales, investors, and market share and customer loyalty. The company delayed communication regarding casual agents of incident and did not make any disclosure or clarification for such huge loss. The consequences plunged quality of company from 30 % to 19 % according to customer opinion and feedback. The central office of Toyota did not initiate...
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...04064. at the Town Hall, 62 Federal Road, Parsonsfield, ME 04047. at the Town Hall, 180 Main Street, South Berwick, ME 03908. at the Town Hall, 208 Sanford Road, Wells, ME 04090. at the Town Hall, 186 York Street, York, ME 03909. (Catalog of Federal Domestic Assistance No. 97.022, ‘‘Flood Insurance.’’) Dated: August 10, 2010. Sandra K. Knight, Deputy Federal Insurance and Mitigation Administrator, Mitigation, Department of Homeland Security, Federal Emergency Management Agency. [FR Doc. 2010–20410 Filed 8–17–10; 8:45 am] BILLING CODE 9110–12–P DEPARTMENT OF TRANSPORTATION National Highway Traffic Safety Administration 49 CFR Part 571 [Docket No. NHTSA–2010–0112] RIN 2127–AK56 Federal Motor Vehicle Safety Standards; Motorcoach Definition; Occupant Crash Protection National Highway Traffic Safety Administration (NHTSA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). AGENCY: SUMMARY: erowe on DSK5CLS3C1PROD with PROPOSALS In accordance with NHTSA’s 2007 Motorcoach Safety Plan and DOT’s 2009...
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...Ethical Analysis of General Motors Ignition Switch Scandal Organization Review General Motors was founded by William Durant on September 16, 1908. At its inception, GM owned only the Buick Motor Company, but acquired Oldsmobile, Cadillac and Pontiac within ten years of its formation. Demand for automobiles heightened between 1910-1929, allowing General Motors to set the standard for production, design and marketing innovation. GM diversified their selection and opened more than a dozen new plants outside of the United States. In 1927, the head of GM's design studio, Harley Earl, designed the LaSalle which marked the beginning of true automotive design as it was far less boxy than the Ford Model T. "In 1940, former GM President William Knudesen was chosen by President Roosevelt as Chairman of the new Wartime Office of Production Management." During WWII, GM supplied the Allies with more goods than any other company, delivering more than $12 billion worth of materials including airplanes, trucks and tanks. Between 1960-1979, environmental concerns led to a downsizing of vehicles across all GM lines, making it the largest reengineering program ever undertaken in the industry. The emphasis on environmental responsibility ushered in an age of lighter, more fuel-efficient vehicles. GM was the first to offer an air bag in a production car, and they introduced the catalytic converter to reduce emissions. This technology is still used by the entire auto industry today. After Germany...
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...Organizational Performance Management Paper and Table Jessica Hare, Michael Jackson, Molly Sacco, and Natalie Shell HCA451 May 19, 2014 Lisa Kehlenbrink Organizational Performance Management Paper and Table Each organization provides a different type of services for consumers. Health Maintenance Organization, Emergency Medical Services and Cox Health systems work to provide health coverage for consumers and quality care for each consumer. HMO is a type of health care plan that consumers can chose for health coverage. Emergency Medical Services collaborates with teams to advance EMS systems. Cox Health systems provides a variety of services through their facilities. Cox health, like EMS, provides emergency treatment to patients. They also utilize the EMS for emergency patient transfers and admissions. Cox health also has to deal with HMOs and PPOs on a daily basis when treating patients and billing insurance companies. Cox Health is a good example of the other three organizations combined to provide excellence service to the consumers. The similarities and differences of HMOs and PPOs is first they are both networks. However, HMO allows one to choose a health care provider within the HMO network much like PPO. But, with PPO one can choose a primary care physician out of network as well. This is not so with HMO, one has to choose their PCP or Primary Care Physician within network. Another difference is one must have a referral from HMO to see a specialist but PPO a referral...
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...On August 9, 2000, Bridgestone/Firestone Inc. announced it would recall more than 6.5 million tires, most of which had been mounted as original equipment on Ford Motor Co. Explorers and other Ford light trucks. Bridgestone/Firestone had become the subject of an intense federal investigation of 46 deaths and more than 300 incidents where Firestone tires allegedly shredded on the highway. The Firestone tires affected were 15-inch Radial ATX and Radial ATX II tires produced in North America and certain Wilderness AT tires manufactured at the firm's Decatur, Illinois, plant. This tire recall was the second biggest in history, behind only Firestone's recall of 14.5 million radial tires in 1978. The 1978 tire recall financially crippled the company for years to come and the August 2000 recall threatened to do the same. Consumers, the federal government, and the press wanted to know: Why didn't Ford and Firestone recognize this problem sooner? Let us look at the series of events surrounding the tire recall and the role of information management. 1988---Financially weakened from its 1978 tire recall, Firestone agreed to be acquired by Bridgestone Tires, a Japanese firm. To increase its sales, Firestone became a supplier of tires for Ford Motors' new sport-utility vehicle (SUV), the Explorer. March 11, 1999---In response to a Ford concern about tire separations on the Explorer, Bridgestone/Firestone (Firestone) sent a confidential memo to Ford claiming that less than 0.1 percent of...
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...Toyota Recall Lawsuit Assignment 1 Week 4 Tina Christensen LEG100 Natalie Stratis-Malak, Esq. Strayer University 29 July 2012 Toyota Recall Lawsuit Toyota Recall Summary of Initiation of Lawsuit For those who are not familiar with the lawsuit against Toyota, it is interesting because it involves what so many believed to be quality product failure. Four people died in California in October of 2009 due to stuck accelerator pedal on their Lexus vehicle which is a Toyota made product. The key to the initiation of this case was that it was a State Trooper and his family that had died as the cause of the acceleration pedal failure. One amazing thing about this fact, is that it took the loss of life of a police officer and his family for the Toyota company to recognize that there was a product failure problem. Although the NHTSA had apparently received many reports of this accelerator pedal problem happening, it is cited by Bearman Law as having been ignored although previously investigated. As the investigation unfolded, many injuries and fatalities were uncovered that were caused by this Toyota malfunction and the public was not notified. The solution was for owners to remove the floor mat and not replace it. (Bearman Law Firm, 2012) I personally was shocked when I read further into this case as I recalled that this happened to my mother a number of times in her Toyota Lexus while on the highway and merging with traffic and the pedal sticking. I thought...
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...INTERACTIVE SESSION: ORGANIZATIONS INFORMATION SYSTEMS HELP KIA SOLVE ITS QUALITY PROBLEMS Korean car manufacturer Kia Motors started selling in the North American market, promising high-quality vehicles at prices well below the competition. In 1994, Kia sold 12,000 cars, and by 2004, Kia had sold 270,000 cars. From a marketing end standpoint, Kia has been a phenomenal success. But until 2002 Kia ranked at the bottom of J. D. Power and Associates’ annual initial-quality survey of new vehicle owners. In 1997 when the average North American car had 1.1 defects per vehicle, Kia had 2.75. In 2002 Kia had improved to 2.12 defects per vehicle, but the industry average was 1.33. Kia had a long way to go, and it was affecting its ability to sell cars, retain customers, and keep operational costs down. Like all manufacturers of vehicles sold in North America, Kia had to create a system by December 1, 2003 to report any defects, accidents, or injuries involving its vehicles to the U.S. National Highway Traffic Safety Administration (NHTSA). Kia Motors uses a manufacturing and production system to help in identifying sources of defects in their automobiles. Kia uses the information from the system to improve its production processes to eliminate or reduce defects. Improving vehicle quality lowers Kia’s costs for warranty repairs while increasing customer satisfaction. CASE STUDY QUESTIONS 1. Why was it so difficult for Kia to identify sources of defects in the cars it...
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...Author: Roynard Mathieu Silverans Peter Casteels Yvan Lesire Philippe PII: DOI: Reference: To appear in: Received date: Revised date: Accepted date: S0001-4575(13)00346-1 http://dx.doi.org/doi:10.1016/j.aap.2013.08.021 AAP 3271 Accident Analysis and Prevention 13-12-2012 22-7-2013 20-8-2013 Please cite this article as: Mathieu, R., Peter, S., Yvan, C., Philippe, L., National roadside survey of child restraint system use in Belgium, Accident Analysis and Prevention (2013), http://dx.doi.org/10.1016/j.aap.2013.08.021 This is a PDF file of an unedited manuscript that has been accepted for publication. As a service to our customers we are providing this early version of the manuscript. The manuscript will undergo copyediting, typesetting, and review of the resulting proof before it is published in its final form. Please note that during the production process errors may be discovered which could affect the content, and all legal disclaimers that apply to the journal pertain. National roadside survey of child restraint system use in Belgium Roynard Mathieu*1, Silverans Peter1, Casteels Yvan1, Lesire Philippe2 Belgian Road Safety Institute (BRSI), Chaussée de Haecht 1405, 1130 Brussels, Belgium Laboratory of Accidentology and Biomechanics PSA Peugeot-Citroën / Renault (LAB), 132 rue des Suisses, 92000 Nanterre, France 2 1 Abstract Keywords: Child restraint system (CRS), CRS use, CRS misuse, unrestrained, inappropriate CRS use, ISOFIX, roadside survey 1. Introduction In...
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...scrutiny for the past several months due to its acceleration and braking defects. As a result, it will cost the Japanese carmaker $2 billion dollars in repairs and loss sales. Of course the auto industry has a history of vehicle recalls which is not breaking news. This problem is not Toyota’s lack of engineering or quality of their cars; it’s the arrogance of their company’s culture and lack of a quick response to solve issues. Toyota has long been known for its superior car quality, global brand presence and its unmatched reliability, which is now threatened by their turn of events. Surprisingly, Toyota had technical defects in their parts, which was widely ignored. In 2002, Safety Research and Strategies (SRS), a consumer advocacy group, reported that there were a high number of acceleration problems in Toyota’s cars during the same time the carmaker introduced their new electronic throttle control technology. The car company ended up blaming the problem on the floor mat. They’re reasoning was that the floor mat was loosened which jammed the gas pedal, causing the pedal to accelerate uncontrollably. The National Highway Traffic and Safety Administration, (NHTSA) conducted an investigation is 2003, but did not take their action seriously. Toyota ignored these problems which resulted in the car company to recall nearly 3.8 million domestic vehicles in November 2009, the company’s biggest recall ever. Since the past 10 years, Toyota has been pointing the blamed finger to...
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...SWOT ANALYSIS: REVIEW DOCUMENT FOR COMPANY ANALYSIS Company Name: Cummins Inc. Industry Sector: Global Diesel Engine Manufacturer Date: 23/11/2014 Analyst: Rajesh Kumar Strengths • Strong distribution network and strategic joint ventures with customers to allow better access to end customers CMI has joint ventures and strategic alliances with customers, particularly in emerging markets, including Tata motors in India, Dongfeng Motors in China, Komatsu in Japan, and PACCAR in the US. These companies are market leaders in their respective regions/countries. Additionally, CMI has 600 company owned and independent distributors locations, and approximately 6500 dealer locations in more than 190 countries. • Diversified portfolio of engines catering to wide range of customers The Engine segment produces engines and parts for sale to customers in on-highway and various industrial markets. Our engines are used in trucks of all sizes, buses and recreational vehicles, as well as various industrial applications including construction, mining, agriculture, marine, oil and gas, rail and military equipment. The composition of revenues by highway segment and industrial segment is around 60% and 40% respectively. Thus the concentration risk is minimized. The segment sells engines, generator sets, alternators, power systems and services. The Distribution segment includes wholly-owned and partially-owned distributorships engaged in wholesaling...
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