Scalable was a word introduced in the Information Technology world but it raises some interesting questions in applying it in other contexts.
In IT it is a popular buzzword that refers to how well a hardware or software system can adapt to increased demands. For example, a scalable network system would be one that can start with just a few nodes but can easily expand to thousands of nodes. Scalability can be a very important feature because it means that you can invest in a system with confidence you won’t outgrow it.
Now we see it applied more generally to a company that many customers would rate very highly for customer service. Toyota Failure Proves Quality Isn’t Scalable.
A small operation can bootstrap itself into a medium or even a reasonably large company, via either organic growth or acquisition, and still maintain the quality which was the basis of its initial success.
At some point, though, whether you’re talking an automaker or a technology firm, size breeds insularity, which in turn fosters risk aversion. I haven’t even mentioned the corner-cutting mentality which occurs when making numbers becomes a (the only?) priority.
The author, Alexander Wolfe, points out that in the more open world created by the Internet, the quality stakes are very much higher.
Toyota might not have so fortunate a fate, and thus a swifter fall, because we now live in Internet time, where seismic shifts occur in timeframes too tiny for rational thought to stop that Twitter/Facebook/Cable TV train from running the business off the metaphorical track.
I believe the author identifies exactly why this problem occurs.
It’s true that the scalability doesn’t seem to be a limiting factor for manufacturing, per se. It’s not the manufacturing which is at fault in the Toyota crisis. It’s a management failure brought on by an inherent inability of human beings to scale up, beyond a certain point, the social interactions which grease the wheels of a smoothly running society. (And, in a very real sense, a company is a society writ smaller.)
The real reasons for the Toyota problems have yet to be pinned down, however a clear message is that Toyota was not willing to accept that customer satisfaction is determined by the customer. Undoubtedly the final bill for Toyota will be very much greater than if they had accepted that if a single customer is dissatisfied, you have to make it right. Of course there is a very small proportion of the population that are never satisfied. However unless you do as much for them as most people would accept is right and fair, then you may well be storing up problems for yourself.
Insularity is not an acceptable or justifiable company trait. There must be full two-way communication that both parties find acceptable. Setting that up and providing adequate resources for that is not somehting that is easily scaleable. However the hoped-for economies by providing less than satisfying customer service are completely outweighed by the market penalties when customers feel ignored.
On a personal note, I have been a most satisfied customer of Toyota for many years and will gladly pass on the word to friends and acquaintances. However my voice and the voices of other satisfied customers are lost in the huge noise created by those who it would appear have reasons to claim that Toyota just did not listen.
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