Even with the strongest commitment to ethical practices, executives can operate without integrity -- perhaps because of greed, maybe due to pressure, or most likely, from a combination of both. Research shows that pressure weighs most heavily. A 2006 study commissioned by the American Management Association and Human Resources Institute indicates that "pressure from management or the Board to meet unrealistic business objectives and deadlines is the leading factor most likely to cause unethical corporate behavior." As Toyota fights its ex-auditor Katy Cameron in court, the company may want to consider whether its current business objectives challenge management's adherence to the quality-conscious "Toyota way."
After 23 years of employment, Cameron, 54, was demoted from her auditor position at New United Motor Manufacturing Inc., a joint venture between Toyota and GM that uses Toyota's manufacturing process. She's now suing NUMMI for $45 million, alleging that management routinely deleted or downgraded defects she found -- including broken seat belts, faulty headlights, and inadequate braking and steering wheel alignment -- to reduce defect numbers, thereby inflating management bonuses and supporting a company-wide mission shift from quality to quantity.
Toyota's reputation took a hit last month when Consumer Reports removed a few of its vehicles from its recommended list. If that didn't get executives thinking, perhaps a $45 million loss will. Something's got to give, or the "Toyota-way" (which dictates the right process will produce the right results) will become synonymous with hypocrisy and negligence.