These Top Finance Concerns from Cindy Kraft, the CFO Coach. These opinions reflect the view on business conditions we see from talking with business owners and investors, so I wanted to share them.
The CFO Rising conference yesterday morning was right up my alley with sessions on Creating Alignment in the C-Suite, A New Dynamic in the Boardroom, and ... particularly ... Finance Skills for a New Decade. My next few blog posts will talk about what I heard, but I’ll start with some interesting stats that opened the morning.
The CFOs in attendance were polled around critical issues they are facing, and here are some of the results ...
--89% felt the worst was over but do not anticipate a turn around anytime soon
--Only 4% felt growth was likely to happen in the next several months
--70% were concerned and VERY concerned (35%) around the cost effectiveness of proposed government regulations
--When asked about the proposed health care legislation, 69% were very concerned about the tax impacts and 62% were very concerned about the quality of care
Conversely, the attendees felt there was some good that came out of the economic downturn ... it has forced finance to go back to basics.
--32% said they now had a core business focus
--25% were focused on increasing productivity
--3 out of 4 indicated they would be preserving cash as a hedge against economic uncertainty
--77% indicated their focus would be on organic growth ... which means ...
--Only 10% indicated M&A was a core business focus
http://www.cfo-coach.com/ to subscribe to Cindy Kraft's postings.
March 27, 2010
March 23, 2010
Toyota Man
March 14, 2010
Toyota’s Runaway Case Gets Stranger
Poor Toyota. All they wanted to be was the number one automobile manufacturer in the world. They were so close. Good cars, great reputation, worldwide distribution, owners are fans, and the best marketing of any auto manufacturer. The successful launches of the Lexus and Scion lines changed the luxury and first car markets. Nobody was close to Toyota’s momentum.
Now their name is smeared with runaway cars, stuck gas petals and floor mats. Have talked about companies not believing complaints by customers, and over confidence in their product. Complaints are second chances given to you by customers to save the sale. You can look at the Big 3 in the USA ignoring reports by the car rental companies that the Japanese cars were performing better with less maintenance, and they ignored statistics proving them. It was hubris by domestic manufacturers.
Toyota is in a difficult situation. Too many lawsuits by too many opportunistic attorneys looking to make money, and government prosecutors looking to improve their political name by suing Toyota. If you read the previous article I sympathize with Toyota finding intermittent problems with multiple causes. They are difficult to see and harder to analyze than production problems, and a nightmare to resolve.
The San Diego case is strange, very strange. A 61 year old car runs away with him. 94 miles per hour. Police chase him and help slow him down. Makes the national news. Next day we find out he driving a car NOT recalled. It has a brake override system that if he was holding down the brake should have turned off the accelerator. Worse, the “victim” is $700,000 in debt and was about to lose the car along with the other three repossessed. He could be motivated to fake the runaway to make money.
First of all, am not going to assume this was faked. Am going to analyze the situation and ways to investigate this. I am not convinced by investigators who can not make the car do it again. How can you know how to trigger it unless you know all the possible causes and combine them all? Right now that has not been settled.
Would love to see the video if I were investigating. Per Toyota if he is stepping on the brake the acceleration should stop. The police cruiser video should show solid brake lights if he is pushing like he claimed. Were there any highway cameras or news copter pictures of the incident? Did they as for witnesses?
If he was faking, he had to overcome the brake override system that should have turned off the accelerator. There would be evidence of that unless he was a top flight programmer. Most people do not know how to reprogram a car.
First impressions by the police are good evidence. Did they smell the brakes catching up to him? Yes. Did the brake lights stay on the whole time? Maybe not, he was reportedly pumping the brakes until the police had him apply the parking brake and stay on the brakes. That may have finally activated the brake override system. How did the victim act when they stopped? The brakes should have been too hot to touch. The wheels hot too conducting heat away (unless they were aluminum or magnesium. They might conduct heat away too fast, but the hub would be hot.
Physical evidence needs to be checked. They would have had to fade. That may glaze the face of the pads or show other damage on the pads and discs. Experts can tell. The reports are the brakes were worn out.
If the evidence is he let go of the brakes to accelerate, would suspect fraud. If not, Toyota would be well served to assume this is a possible real problem and keep looking for combinations of problems. How likely is a 61 year old to panic when his car acts irrationally. Know a lot of teens through fifty year olds who would panic. My gut feel is this is a real runaway.
Okay, what possible problems are there? Physical, Hardware, Firmware or Software. Physical has been exhausted with petal recall and changing the floor mats. Hardware is what it is. Firmware and Software are really the biggest culprits left. My partner believes it is software. Too much probability with the diversity of runaway cars over so many models and years. Also he is a systems expert unlike any inside the auto industry with too many years of experience to fall for the first good probable answer and would dig deeper.
Toyota would be wise to hire an expert like him, but suspect it would not happen. Mainly for litigation reasons. Toyota is better off with non English speaking help who would be tough to be interviewed on a witness stand. (Especially if the company help was hard to find?). Disclosure rules in the US would eventually flesh this out, but still makes the attorneys’ jobs harder with all the difficulty of translating exactly technical jargon to English. Can’t blame Toyota here, is any country more litigious than the US?
Don’t think Toyota’s problems are over. Cruise control runaways are happening too. Would expect more recalls and finding more causes. Some people are saying a brake override software solution and reprogramming the on/off button to shut off under repeated pushing is all that is needed. I have doubts that covers everything unfortunately. Technology is too complicated and simple solutions often miss part of the problem like the sticking petal and floor mats.
Toyota will recover like Ford did from the Pinto fiasco, and will focus like Ford on making great cars again. May take a few years, but Toyota’s great reputation will return.
Till then I would know how to shift my Toyota into neutral, or hold the start button down for 3 seconds. Yes I would still buy a Toyota before this is resolved, because the odds of it happening are under 0.1% and going down with every improvement.
Drive safe,
Steve
Now their name is smeared with runaway cars, stuck gas petals and floor mats. Have talked about companies not believing complaints by customers, and over confidence in their product. Complaints are second chances given to you by customers to save the sale. You can look at the Big 3 in the USA ignoring reports by the car rental companies that the Japanese cars were performing better with less maintenance, and they ignored statistics proving them. It was hubris by domestic manufacturers.
Toyota is in a difficult situation. Too many lawsuits by too many opportunistic attorneys looking to make money, and government prosecutors looking to improve their political name by suing Toyota. If you read the previous article I sympathize with Toyota finding intermittent problems with multiple causes. They are difficult to see and harder to analyze than production problems, and a nightmare to resolve.
The San Diego case is strange, very strange. A 61 year old car runs away with him. 94 miles per hour. Police chase him and help slow him down. Makes the national news. Next day we find out he driving a car NOT recalled. It has a brake override system that if he was holding down the brake should have turned off the accelerator. Worse, the “victim” is $700,000 in debt and was about to lose the car along with the other three repossessed. He could be motivated to fake the runaway to make money.
First of all, am not going to assume this was faked. Am going to analyze the situation and ways to investigate this. I am not convinced by investigators who can not make the car do it again. How can you know how to trigger it unless you know all the possible causes and combine them all? Right now that has not been settled.
Would love to see the video if I were investigating. Per Toyota if he is stepping on the brake the acceleration should stop. The police cruiser video should show solid brake lights if he is pushing like he claimed. Were there any highway cameras or news copter pictures of the incident? Did they as for witnesses?
If he was faking, he had to overcome the brake override system that should have turned off the accelerator. There would be evidence of that unless he was a top flight programmer. Most people do not know how to reprogram a car.
First impressions by the police are good evidence. Did they smell the brakes catching up to him? Yes. Did the brake lights stay on the whole time? Maybe not, he was reportedly pumping the brakes until the police had him apply the parking brake and stay on the brakes. That may have finally activated the brake override system. How did the victim act when they stopped? The brakes should have been too hot to touch. The wheels hot too conducting heat away (unless they were aluminum or magnesium. They might conduct heat away too fast, but the hub would be hot.
Physical evidence needs to be checked. They would have had to fade. That may glaze the face of the pads or show other damage on the pads and discs. Experts can tell. The reports are the brakes were worn out.
If the evidence is he let go of the brakes to accelerate, would suspect fraud. If not, Toyota would be well served to assume this is a possible real problem and keep looking for combinations of problems. How likely is a 61 year old to panic when his car acts irrationally. Know a lot of teens through fifty year olds who would panic. My gut feel is this is a real runaway.
Okay, what possible problems are there? Physical, Hardware, Firmware or Software. Physical has been exhausted with petal recall and changing the floor mats. Hardware is what it is. Firmware and Software are really the biggest culprits left. My partner believes it is software. Too much probability with the diversity of runaway cars over so many models and years. Also he is a systems expert unlike any inside the auto industry with too many years of experience to fall for the first good probable answer and would dig deeper.
Toyota would be wise to hire an expert like him, but suspect it would not happen. Mainly for litigation reasons. Toyota is better off with non English speaking help who would be tough to be interviewed on a witness stand. (Especially if the company help was hard to find?). Disclosure rules in the US would eventually flesh this out, but still makes the attorneys’ jobs harder with all the difficulty of translating exactly technical jargon to English. Can’t blame Toyota here, is any country more litigious than the US?
Don’t think Toyota’s problems are over. Cruise control runaways are happening too. Would expect more recalls and finding more causes. Some people are saying a brake override software solution and reprogramming the on/off button to shut off under repeated pushing is all that is needed. I have doubts that covers everything unfortunately. Technology is too complicated and simple solutions often miss part of the problem like the sticking petal and floor mats.
Toyota will recover like Ford did from the Pinto fiasco, and will focus like Ford on making great cars again. May take a few years, but Toyota’s great reputation will return.
Till then I would know how to shift my Toyota into neutral, or hold the start button down for 3 seconds. Yes I would still buy a Toyota before this is resolved, because the odds of it happening are under 0.1% and going down with every improvement.
Drive safe,
Steve
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