Toyota’s Collapse – a sign of what to expect in the future – we grew to fast

“We pursued growth over the speed at which we were able to develop our people and our organisation and we should be sincerely mindful of that.” – Mr Toyoda explaining his understanding of why Toyota is now in such trouble.

I wonder how many more times this is going to be repeated in the near to mid term future?

It doesn’t take a genius to observe that many firms have been doing exactly what Toyota did – and probably even more so.

M&A has been the order of the day method for fast growth for many firms. Cheap money, competition, short term incentives and pushy investment banks have surely driven firms to create for themselves even bigger integration problems that those faced by Toyota.

In addition many of these firms have been reducing head counts and skimping on repairs and maintenance to boost short term returns. There simply have not been enough people on the ground with enough time and experience to make good decisions.

So as interest rates rise,  sales stagnate or decline as consumers continue to stay away because of job cuts or fears of them, it is likely that we will see many more Toyota excuses in the future – we grew to fast.

And the same could be said for the human species and the global economy. But then this is a whole different ball game. Infinite growth on a finite planet is not only impossible but potentially suicidal – but with the majority voting for the political party promising the fastest and largest growth we will only have ourselves to blame.

Alan McCrindle

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Filed under ecology, Economics, Strategy, Sustainability

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