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The Toyota Way: Beyond Shame

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Apologies from some of those directly involved have been absent. Executives from now defunct subprime and predatory lenders such as, New Century Financial, Countrywide, Wachovia, and Washington Mutual have never admitted culpability nor offered any explanation or apology. Most of the executives at the top of these companies have found jobs in other banks or recreated new firms.

Investment and large commercial banks called before Congress offered lukewarm responses to the effect of, "I am sorry for my firm's part in the industry's negligence-- Always passing the buck to someone else and never acknowledging direct responsibility. To apologize with sincerity for an American financial firm would be to admit weakness. No company or manager wants to be that vulnerable. Denial goes a long way in corporate America. It minimizes legal and social costs and lets the deniers stay happily in their "not my problem" bubble.

Unlike the Toyota and Japanese business model, the American business model has been based on a "principle" of pure profit. The "rip-your-face-off," "eat what you kill' language of the financial industry reveals the whole story. As a culture, we have embraced and celebrated a model that leaves out any sense of moral decency or collective responsibility. Shame, embarrassment, or any other behavior modifying emotion are antithetical to the American business model.

In the wake of the economic collapse, we have begun to examine why this moral vacuum exists and how we got here. Pursuing profit without connection to the greater society that supports it is the primary misunderstanding of modern business. In the Japanese model, executives understand their direct responsibility to society, colleagues, and employees-hence the severe social consequences of their corporate actions. (Some executives are "shamed" enough to take their own lives based on professional missteps.)

Business and society are inextricably linked in Japan. In America, with the exception of conscious business leaders and companies, this link is remarkably absent.

The actions of the last decade, as well as the response to the crisis over the past 18 months, reveal that the overwhelming majority of America's financial industry remains unconscious. They are seemingly unaware and indifferent to the enormous material and personal effects of their acts on the greater society.

The Toyota tragedy opens the window into deeper self-examination of the American business model. Toyota will rebuild itself in its own image-based on tried and true historical values. What values do we have to return to as we rebuild American business other than the principle of profits before people?

The continuing economic recession has (and continues to) put tens of millions of people out of work, forced millions of businesses to close, cost billions of dollars in savings and lost income, interrupted retirements, put millions out of their homes, destroyed marriages and families, caused heart attacks and suicides, and wrecked the American Dream for hundreds of millions of homeowners and ordinary citizens.

Shame is a useful thing if it propels one to better behavior or inhibits poor behavior. In Japan perhaps shame has too great a consequence. In America's corporate boardrooms and everyday trading desks, there isn't enough shame or simple conscience. There isn't enough sense of commitment to the greater collective that would prevent our "best and brightest" from bringing down their own economy or compel them to build it back up.

Our continuing economic suffering is reason enough to re-evaluate our for-profit "value" system. Is it only money we are after? Or in the wake of the on-going Great Recession and all its inherent moral turpitude is there something like "human decency" we can add?

A dangerous moral vacuum exists in modern American finance and throughout large portions of American business. It propels us to do in
the pursuit of profit what we would never justify in our personal lives.

If we don't use the lessons of the Toyota Way to rebuild American business in the image of a morally responsible society, a for-profit model that understands its direct obligation to the greater collective, that would be the real shame.

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Monika Mitchell is the Chief Executive Officer of Good-b (Good Business International)a leading new media company xcelerating the movement for better business for a better world.
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