Toyota Satisfaction Committee 10644

Toyota executives lead the customer satisfaction committee at TMS and TMC.* These committees help establish the link between marketing strategies andoperational realities of the organization. DEVELOPMENT OF CUSTOMER SATISFACTIONCOMMITTEE * One of Toyota's key indicators of its performance for customersatisfaction is "initial quality" or " the quality percieved bythe customer in the first few months of ownership. * The J.D.

Power initialsurvey provides feedback on quality to automobile producers, individualdiagnostics, and comparison to competition. Toyota was not ranked number one incustomer satisfaction by J.D. Power and found out they had a lot of room forimprovemnt. * In 1986, TMS/USA made a strong proposal to TMC/Japan stating thatToyota should be number one.

The proposal implied that TMC should improveproduct quality in the plants to achieve that number one ranking. * In 1987, TMCbegan to persue the proposal. * The initiative to improve the customersatisfaction came to be referred to as "J1". ESTABLISHMENT OF TMC'SCUSTOMER SATISFACTION COMMITTEE * In 1988 TMC established a committee structurespecifically to accomplish the J1 objective for customer satisfaction. Therewere three subcommittees involved to address specific customer satisfactionissues: product quality, domestic sales and service, and overseas sale andservice. INITIAL EFFORT TO IMPROVE QUALITY AT TMC JAPAN * TMC'S initial effortsfor 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 70percent on their way to achieving their targets when the incongruity betweentheir "high" quality improvements and "lower" customersatisfaction rating became obvious. * TMC's product quality committee reliedheavily on TMS's voice-of-customer information and surveys of customers. * Someof TMC's responses were "Door has scratch" or "grease on thecarpet" but their audits of the vehicles when leaving Japan had no signs ofthese. The damage must be occurring after they leave Japan.

THE J1 BOOMERANG *TMS returned messages to TMC stating product quality was improving, yet damagedvehicles are still arriving at the dealerships. * So TMC/Japan study teamfollowed some shipments to the dealerships and discovered that the damage wasindeed occurring after the vehicles left Japan, when the vehicles were theresponsibility on TMS. * TMC reflected the proposal back to TMS that TMS itselfshould make some improvements on the J1 initiative. INITIAL EFFORTS TO IMPROVEQUALITY AT TMS * In 1989 they established a formal program defining standards toaccessory installation processes and quality at ports of entry.

* Quarterlyaudits provided feedback and encouragement. * They allowed dealership managersto improve goodwill warranty adjustments on their own. THE TMS CUSTOMERSATISFACTION COMMITTEE * The TMS customer satisfaction committee was establishedto improve teamwork and communication between all departments by coordinatingthe development of company-wide satisfaction activities. * The mission of thecommittee can be summarized in the following chain of events: 1.

TO strengthenthe dealer network, all TMS, activities, and product quality. 2. TO becomenumber one in customer satisfaction, with millions of satisfied customers andhigh brand image. 3. TO achieve and maintain sales and volume of 1.

5 millionannually by retaining former customers and attaining new ones. THE COMMITTEESTRUCTURE * The committee structure is composed of the subcommittee chairmen,Japan staff advisor, and a secretary. The structure is not permanent and thecommittee maybe replaced if Toyota's priorities change. * The committee promotescommunication and continues to oversee the work of the subcommittees, thecross-functional work really gets done in the subcommittees.

* The subcommitteeshave became relatively powerful in this company, as far as getting work donequickly. THE SUBCOMMITTEES * Each major operational area at TMS is representedin a subcommittee made up of members responsible for instituting improvements incustomer satisfaction. * These subcommittees include sales and marketing, partsand service, product quality, and Lexus. THE STRUCTURE OF SUBCOMMITTEES * Thesubcommittees provide a forum for cross-department communication among top-levelrepresentatives from diverse operational departments and for coordinated actionsto improve customer satisfaction. * Involvement of operational department is keyto success of the committee structure.

* Another key factor to success of thecommittee structure is that each subcommittee is chaired by Toyota VicePresident execustives. * Executive leaders of the subcommittees are responsiblefor involving all affected departments in determining problems and developingaction plans related to customer satisfaction. Their involvement secures supportand commitment for programs that address customer satisfaction issues.INFORMATION FLOW THROUGH SUBCOMMITTEES The subcommittees play a major role ingathering, analyzing, reporting, and distributing actionable information thatcan be passed on to the appropiate department.

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

* The committeemeets monthly and each subcommittee reports to the president on a quarterlybasis. SUBCOMMITTEE AUTHORITY AND RESPONSIBILITY * Mission of each subcommitteeis narrowly defined to ensure they can function. * The responsibility among thedepartments is to achieve objectives not solely affected by an individualdepartment. This denies each department and workers the Luxury of being able tosend to problem on down to the next station and assume that somebody else willfix it. * They establish their own specific plans for improving customersatisfaction, but they have no implementation power. There are no resources inthe committee to do anything other than evaluate voice-of-customer data, come upwith a conclusion, and then decide on a action of plan.

REGIONAL/PRIVATEDISTRIBUTOR CUSTOMER SATISFACTION COMMITTEE * They are dedicated to solvingproblems and setting standards at local levels. * As top priority, they targethigh-volume, low satisfaction dealers on a monthly basis and urge them to followspecific customer satisfaction plan. * Having these Regional/Private distributorcommittees has helped the Region focus more on customer satisfaction issuesrather than customer relation issues.