Big Motor President Izumi’s “devil’s orders” demanding a net profit of 5 million yen per store.

On August 31, President Izumi sent an e-mail to all employees. One part of the message is noteworthy.

In terms of MQ per location, we will increase the MQ by 5 million yen per dealership and 2.5 million yen per satellite store.

The “MQ” in “MQ increase” is an abbreviation for “margin quality. MQ at Big Motor simply means “net profit,” not sales. To get a better understanding of the meaning of “MQ add-on,” we asked Mr. A, a former employee who until recently worked for Big Motor in western Japan.

He said, “Normally, the store’s expenses are about 20 million yen per month. What President Izumi means by MQ5 million yen is that the store should make a net profit of 5 million yen after deducting all store expenses, labor costs, utilities, etc.

In the case of a store with 10 salesmen, if each salesman simply earns 2.5 million yen MQ, the total MQ will be 25 million yen. If this can be cleared, the profit and loss will be surpassed, and the president’s target of 5 million yen net profit will be achieved. In other words, what President Izumi means by “topping up” is to bring profits back to the previous quota of 5 million yen MQ.

During the first six days of the first week of August (August 1-6), when the new system came into effect on July 26 and media coverage heated up, the number of vehicles sold at Big Motor nationwide was 672. This is approximately one-third to one-fourth of the number before the cheating scandal broke. Due to the negative publicity caused by the revelations, it is now very difficult to achieve even the normal MQ target.

The MQ of 5 million yen is not a “new quota,” nor does it mean that we should work hard to achieve our existing quota.

For a regular store to make a net profit of 5 million yen, please visit ……

Furthermore, on September 4, it was discovered that an e-mail with specific quotas was sent to assistant store managers and chief managers as well. To summarize the contents,

(A) 5 units per month for the number of units sold and 3 units per month for the number of units purchased
(B) 1 unit per month for sales and 10 units per month for purchases

Two types of quotas were imposed: (A) 5 units per month for sales and 3 units per month for buy-back. The quotas are not low, however, given the company’s image has been dramatically damaged. However, it has not yet been decided whether the “remedy” will be applied from October onward.

In September, an officer from the headquarters made the rounds to stores nationwide, and we learned that further e-mails with the following contents were sent to them. In summary, it reads as follows.

We need more than 2.5 million yen per person for September!
We are salespeople. We are in a position to have our salaries supplemented by the company.
Let’s make sure we make enough money to cover our salaries, even if it’s just a penny, and think about profit and loss.
Let’s sell and buy well. Let’s sell together!

Mr. B, an active employee (sales) working for Big Motor in eastern Japan, describes the dire situation.

The number of customers has dropped drastically. Not only is the number of customers drastically decreasing, but we can no longer sign insurance contracts because our agency contract has been terminated by a major non-life insurance company. Orico is the only loan provider.

It would be impossible to make the same net profit as before under these circumstances. It seems to me that the company is intentionally making unreasonable demands in order for the employees to resign for their own reasons. They are forcing store employees to make up for the drop in net income due to a series of scandals that have come to light. I wonder if the executive board and the headquarter executives understand the real situation?

It seems that Deloitte Tohmatsu, a major management consulting firm, is in the process of rebuilding the company, but to be frank, nothing has changed on the shop floor. Under the current circumstances, I want the stores to make a net profit of 5 million yen, even if it’s just 1 yen! I want a profit, even if it’s just a penny! This is as good as saying, “Die! This is as good as saying, ‘Die!

In a video message from the president on August 24, President Izumi expressed his appreciation and gratitude to his employees…but one week later, he sent an e-mail to his employees putting strong pressure on them to achieve 5 million yen MQ per store. He also sent a headquarters executive to all stores in Japan. I was impressed by the final words of Mr. B, a current employee who agreed to be interviewed.

In the end, the new system is a copy of the old one, nothing has changed. The remuneration of several hundred million yen for upper management and tens of millions of yen for deputy managers and general managers has hardly changed at all. There is not the slightest reflection on what went wrong. What went wrong and why did the company become like this? It’s as if their brains have stopped working.”

On September 1, all employees received a “Survey of Employee Awareness” and “Questionnaire on Harassment” from the head office. They were asked questions such as what they thought was the cause of the series of scandals and what Big Motor should do in the future. Now that the upper management at the head office has lost credibility, it is not certain whether the employees will answer the questionnaire properly. And if employees have to be asked such questions to find out, the future of Big Motor is too bleak.