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Toyota Satisfaction Committee

Toyota Satisfaction Committee Toyota executives lead the customer satisfaction committee at TMS and TMC. * These committees help establish the link between marketing strategies and operational realities of the organization. DEVELOPMENT OF CUSTOMER SATISFACTION COMMITTEE * One of Toyota’s key indicators of its performance for customer satisfaction is “initial quality” or ” the quality percieved by the customer in the first few months of ownership. * The J.D. Power initial survey provides feedback on quality to automobile producers, individual diagnostics, and comparison to competition.

Toyota was not ranked number one in customer satisfaction by J.D. Power and found out they had a lot of room for improvemnt. * In 1986, TMS/USA made a strong proposal to TMC/Japan stating that Toyota should be number one. The proposal implied that TMC should improve product quality in the plants to achieve that number one ranking. * In 1987, TMC began to persue the proposal.

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* The initiative to improve the customer satisfaction came to be referred to as “J1”. ESTABLISHMENT OF TMC’S CUSTOMER SATISFACTION COMMITTEE * In 1988 TMC established a committee structure specifically to accomplish the J1 objective for customer satisfaction. There were three subcommittees involved to address specific customer satisfaction issues: product quality, domestic sales and service, and overseas sale and service. INITIAL EFFORT TO IMPROVE QUALITY AT TMC JAPAN * TMC’S initial efforts for the J1 initiative concentrated on the work of the product quality committee. * They set out targets and initiated many improvements, and were to 60 to 70 percent on their way to achieving their targets when the incongruity between their “high” quality improvements and “lower” customer satisfaction rating became obvious. * TMC’s product quality committee relied heavily on TMS’s voice-of-customer information and surveys of customers.

* Some of TMC’s responses were “Door has scratch” or “grease on the carpet” but their audits of the vehicles when leaving Japan had no signs of these. The damage must be occurring after they leave Japan. THE J1 BOOMERANG * TMS returned messages to TMC stating product quality was improving, yet damaged vehicles are still arriving at the dealerships. * So TMC/Japan study team followed some shipments to the dealerships and discovered that the damage was indeed occurring after the vehicles left Japan, when the vehicles were the responsibility on TMS. * TMC reflected the proposal back to TMS that TMS itself should make some improvements on the J1 initiative. INITIAL EFFORTS TO IMPROVE QUALITY AT TMS * In 1989 they established a formal program defining standards to accessory installation processes and quality at ports of entry.

* Quarterly audits provided feedback and encouragement. * They allowed dealership managers to improve goodwill warranty adjustments on their own. THE TMS CUSTOMER SATISFACTION COMMITTEE * The TMS customer satisfaction committee was established to improve teamwork and communication between all departments by coordinating the development of company-wide satisfaction activities. * The mission of the committee can be summarized in the following chain of events: 1. TO strengthen the dealer network, all TMS, activities, and product quality.

2. TO become number one in customer satisfaction, with millions of satisfied customers and high brand image. 3. TO achieve and maintain sales and volume of 1.5 million annually by retaining former customers and attaining new ones. THE COMMITTEE STRUCTURE * The committee structure is composed of the subcommittee chairmen, Japan staff advisor, and a secretary.

The structure is not permanent and the committee maybe replaced if Toyota’s priorities change. * The committee promotes communication and continues to oversee the work of the subcommittees, the cross-functional work really gets done in the subcommittees. * The subcommittees have became relatively powerful in this company, as far as getting work done quickly. THE SUBCOMMITTEES * Each major operational area at TMS is represented in a subcommittee made up of members responsible for instituting improvements in customer satisfaction. * These subcommittees include sales and marketing, parts and service, product quality, and Lexus. THE STRUCTURE OF SUBCOMMITTEES * The subcommittees provide a forum for cross-department communication among top-level representatives from diverse operational departments and for coordinated actions to improve customer satisfaction.

* Involvement of operational department is key to success of the committee structure. * Another key factor to success of the committee structure is that each subcommittee is chaired by Toyota Vice President execustives. * Executive leaders of the subcommittees are responsible for involving all affected departments in determining problems and developing action plans related to customer satisfaction. Their involvement secures support and commitment for programs that address customer satisfaction issues. INFORMATION FLOW THROUGH SUBCOMMITTEES The subcommittees play a major role in gathering, analyzing, reporting, and distributing actionable information that can be passed on to the appropiate department.

* The subcommittee hears the customer voice from a variety of sources: 1-800- calls, surveys, or externals studies such as those of J.D. Powers. * Customer relations department reads the voice-of-customers and feeds the subcommittees through monthly reports, newsletters, and other communications. * The subcommittee reviews the information and communicates it to the appropiate department for action. * The information is then feed back to executive managers for review.

* The committee meets monthly and each subcommittee reports to the president on a quarterly basis. SUBCOMMITTEE AUTHORITY AND RESPONSIBILITY * Mission of each subcommittee is narrowly defined to ensure they can function. * The responsibility among the departments is to achieve objectives not solely affected by an individual department. This denies each department and workers the Luxury of being able to send to problem on down to the next station and assume that somebody else will fix it. * They establish their own specific plans for improving customer satisfaction, but they have no implementation power. There are no resources in the committee to do anything other than evaluate voice-of-customer data, come up with a conclusion, and then decide on a action of plan. REGIONAL/PRIVATE DISTRIBUTOR CUSTOMER SATISFACTION COMMITTEE * They are dedicated to solving problems and setting standards at local levels. * As top priority, they target high-volume, low satisfaction dealers on a monthly basis and urge them to follow specific customer satisfaction plan.

* Having these Regional/Private distributor committees has helped the Region focus more on customer satisfaction issues rather than customer relation issues.


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