Industry

Automotive Industry

Company History

Toyota Motor Corporation, also known simply as Toyota, is an automotive manufacturer based out of Toyota in Japan. It was founded by Kiichiro Toyoda on August 28, 1937. Toyota is one of the largest automobile manufacturers in the world, producing about 10 million vehicles per year. The company was originally a machine manufacturer started by Sakichi Toyoda, Kiichiro's father. Both companies are now part of the larger Toyota Group. While still a branch of Toyota Industries, the organization fostered its first item, the Type A motor in 1934 and its first vehicle in 1936, the Toyota AA. After World War II, Toyota profited from Japan's union with the United States to gain from American automakers and different organizations, which would bring about The Toyota Way (an administration theory) and the Toyota Production System (a lean assembling practice) that would change the little organization into a forerunner in the business and would be the subject of numerous scholarly examinations. During the 1960s, Toyota exploited a quickly developing Japanese economy to offer vehicles to a developing working class, prompting the advancement of the Toyota Corolla, which would proceed to turn into the world's record-breaking top of the line car. The flourishing economy additionally supported a global extension that would permit Toyota to develop into perhaps the biggest automaker on the planet, the biggest organization in Japan and the 10th biggest organization on the planet by income, as of December 2020. Toyota was the world's first auto maker to create in excess of 10 million vehicles each year, a record set in 2012, when it additionally revealed the creation of its 200 millionth vehicle. Toyota was also praised for creating one of the first consumer electric vehicles, starting with the Toyota Prius in 1997. The company now sells more than 40 hybrid vehicle models around the world. However, more recently, the company has also been accused of greenwashing for its skepticism of all-electric vehicles and its focus on the development of hydrogen fuel cell vehicles, like the Toyota Mirai, a technology that is costlier and has fallen far behind electric batteries. In 2013, Toyota, Scion and Lexus were recognized throughout the auto industry for being the best. Lexus was ranked the highest of any luxury brand in J.D. Power and Associates’ Customer Satisfaction Index. The big news in 2014 was the announcement on April 28 that Toyota is establishing a new headquarters in North Dallas (Plano), Texas for its North American operations. This move is designed to better serve customers and position Toyota for sustainable, long-term growth. Toyota closed out 2015 with yet another major announcement as Toyota Motor Corporation stated that it will establish a new company, Toyota Research Institute Inc. (TRI), as an R&D enterprise with an initial focus on artificial intelligence and robotics.

Company Milestones

In 1935 the first vehicle is built, and the first dealership established.

In 1972 Cumulative production in Japan reaches 10 million vehicles.

In 2006 Toyota’s group global sales of 8.808 million vehicles exceeds GM’s by 128,000, making it the world’s biggest automaker

Resources

Other demographic characteristics are based on employees working in the company, for example in the US, most workers have attained college education and have diplomas and degrees, the common mean of transport used personal vehicles, a huge population is married, females are more compared to males, most people are born in the US, and lastly most employees work in white-collar positions compared to blue-collar jobs.

Toyota company has been experiencing a lot of changes currently, on 2nd September 2021 The Economics Times newspaper reported that the ongoing Covid-19 pandemic has greatly affected Toyota company after one of the key factories in Vietnam was affected. The company is a major supplier to Toyota with wires that produce cables used in automobile manufacturing, with the increased infection of the Covid-19 pandemic, Toyota company has strained to acquire such quality products leading to low production of cars. Toyota Company’s chief purchasing group officer Kazunari Kumakura acknowledged the issue and the company reported plans to reduce by 40% of its car production.

Toyota company faces the challenge of where to acquire substitute parts used to manufacture cars as most of its source countries have been affected by the pandemic and the government has imposed measures such as lockdowns to curb Covid-19 from spreading. Vietnam is Toyota's number one and best supplier of wire harnesses and having been affected the company had to bear the loss and reduce its car production. I think the issue was handled ethically since the lives of people matters than anything else. Some supplying companies like Furukawa Electric Company were forced to reduce the number of staff to allow social distancing as a measure of controlling the spread of the pandemic.

Concerning technological operationalization within Toyota company, it conducts a lot of research and development on different aspects (Morgan & Liker, 2020). The company utilizes technology by innovating cars that continue to offer more comfort, convenience, and fun to users. Toyota company has established two main types of technologies, the first one is called "Jikoda" meaning automatic response to human touch, if the equipment detects abnormal operation, it automatically switches off to avoid damages. The second type of technology is just in time whereby the equipment is developed to offer the satisfaction required at any moment in a uniform flow. Finally, any change of technology in the company will lead to increased sales since more customers want to have new experiences and the company gains a competitive advantage.

References

Brito, P. Q., Soares, C., Almeida, S., Monte, A., & Byvoet, M. (2015). Customer segmentation in a large database of an online customized fashion business. Robotics and Computer-Integrated Manufacturing, 36, 93-100.

River D, Tsuyoshi I, & Bloomberg (2021, 2nd September), How a single Covid case rocked the World’s biggest carmaker. The Economics Times https://economictimes.indiatimes.com/news/international/business/how-a-single-covid-case-rocked-the-worlds-biggest-carmaker/articleshow/85856418.cms

Manna, D. R., Marco, G., Khalil, B. L., & Meier, S. (2011). Sustainable markets: A case study of Toyota motor sales, USA, inc. Journal of Business Case Studies (JBCS), 7(3), 63-72.

Morgan, J. M., & Liker, J. K. (2020). The Toyota product development system: integrating people, process, and technology. Productivity Press.

An analysis of the company based on Porter’s Five Forces:

Toyota has to face strong competition because the number of competitors in the automobile industry has increased. Automobile industries are aggressive and are in a race with each other to innovate and market the products. The bargaining power of buyers has a significant impact on the company's revenues. The low switch costs, high-quality material, and high information directly impact the bargaining power of customers. The bargaining power of suppliers is a weak power to influence the performance of the company. The threat of substitutes is one of the moderate forces to affect the company's performance. The threat of new entrants is a weak force because there are fewer chances of new entry (Toyota, 2019).

An analysis on the effectiveness of the leadership model the company is currently using:

The leadership model is based on the teamwork, collaboration, and opinions of all the employees working in the company. The customers and employees are the company's priority, and the leaders know that they have to be within limits and cooperate with the employees. It is seen that the company only appoints leaders who know how to lead the employees and how to engage them in work. The model is quite good, and it is seen that the model enables the company to succeed.

Current leadership style or styles in place at the company:

Toyota is based on a transactional leadership style, and all the leaders and employees have to follow accordingly. The transactional model has been implemented since the start. It has been seen that the leadership model has been the effective one. It has enabled the company to make the best decisions for both employees and customers. It has always shown assistance and cooperation with the suppliers and operational managers. It has been seen that the model has created cooperation and coordination among the employees, and they work like a team. It has been the reason for success for years.

Effectiveness of the leadership style/s and alternative style of leadership:

There are different styles of leadership, and all of them have different advantages and disadvantages. Transactional leadership is one of the effective leadership styles, and it has created a strong bond between the employees and leaders. The customers are the company's great strength, and it has always tried to use a transactional leadership style to generate great revenues and meet customers' expectations. It has been seen that there is short-term planning in transactional leadership, so transformational leadership is the most effective one, so it should be used in the company.

Effective leadership and leader:

Effective leadership is one where there is cooperation and coordination between the employees and leaders. The leadership should focus on the mission and shared vision of the company and should consider everyone as an important part of the company. Different traits make a leader effective. The leader should know their responsibilities pretty well, and he should assign the responsibilities and capabilities accordingly. It has been seen that the leaders should not look at the employees but try to engage them in the decision-making process. There should be effective communication between the employees and leaders so things may be smooth.

Sources of managerial power when leaders are effective:

If the leaders are effective and there is a good coordination bond between the leaders and employees, then the reward and legitimate powers are at the top. The reward power allows the leaders to introduce the bonus, extra salaries, promotions and the appreciation compensations for the employees. It has been seen that legitimate power enables the employees and leaders to have good coordination. They have friendly relationships and a cordial working bond that leads the company to success. It has been observed that both sources are effective and make the leadership influential for the employees (Toyota, 2020).

Recommendation for the following actions

Leadership model changes:

The leadership model that is in current use should be transformational instead of transactional because it has long-term planning. It is recommended that the weak point of the current model should be analyzed. If there is a need to introduce the changes, it should be done accordingly. Otherwise, the whole model should be changed. It has been seen that the leaders should communicate with the employees and discuss how the changes can be effective and what can be the effective outcomes of changing the model. All these recommendations should be considered before changing the leadership model (Aichi, 2019).

Actions needed to align operational needs with business strategies:

There are different actions needed to align with business strategies identified in week 1, and these are as follows. First, the trends and models should be updated, and the customer's needs should be fulfilled. It should be noted that the operational needs can be aligned if there is long-term planning. Moreover, it is seen that effective communication between the employees and leadership can enhance the business strategies identified in week 1. The employees are the company's strength, and there are fewer chances of success for the company. These actions should be taken seriously by company management.

References

Aichi. (2019). Toyota Motor Corporation – Company Profile, Information, Business Description, History, Background Information on Toyota Motor Corporation. Retrieved from https://www.referenceforbusiness.com/history2/63/Toyota-Motor-Corporation.html

Toyota. (2019). Toyota Industry Cooperation. Retrieved from https://www.toyota-industries.com/

Toyota. (2020). Toyota Global Company. Retrieved from https://global.toyota/en/

Timeline that will be used to implement the solution:

2021 plan for electric vehicle 2022 plan

20 electric vehicles manufactured in 2022.

One-year plan-first two electric vehicle manufactured

References

Include a link to the SWOT analysis.

Copyright 2020 by University of Phoenix. All rights reserved.

Copyright 2020 by University of Phoenix. All rights reserved.

MGT/526

6 September 2021

Dealer principal

General manager

Parts and accessory manager

Service manager

General sales manager

Financial controller

Parts interpreter

Warehouse manager

Store person

Parts sales representative

Pre-delivery manager

Service advisor

Workshop controller

Foreman

Master technician

Technician

Used car sales manager

New car sales manager

Fleet sales manager

Customer relations manager

Finance and insurance manager

Alter markets sales consultant

Stock controller

Finance controller

Dealership accountant

Office manager

Admin clerk

Receptionist

The type of hierarchy found in Toyota company is a matrix structure that emphasizes continuous learning and improvements. The matrix structure at Toyota company is part of the reasons for the company's leadership in the automotive industry. The company has hierarchical leadership where the authority is at the top of the pyramid. In this case, we have the dealer principal at the top of the pyramid. This is the overall manager of the company and manages all the other managers that are under them in the company. The dealer principal is essentially the head of the company. Under the dealer principal, the general manager acts as the operations manager as they oversee all the other managers and report directly to the dealer principal. (Itsuki,2021)

Under the general manager, other managers are answerable to the general manager. These include the parts and accessories manager. This is the individual who is responsible for ensuring that the company has enough features and accessories. They also ensure that the company produces and supplies enough parts and additions to the market. The other manager under the general manager is the service manager. The service manager ensures that the services offered by Toyota company are of high quality and offered on time as required by the customers. The general sales manager is responsible for ensuring that the company is making sales to the market. The general sales manager is also responsible for managing other managers such as the used car sales manager, new car sales manager, and the customer relations manager to ensure that the company is making enough sales on the market. The financial controller is also under the general manager. The financial controller manages and controls the company's expenditure in order to ensure that the company does not go into debt.

The used car sales manager reports to the general sales manager. The used car sales manager ensures that the used cars are sold in good condition. The other manager under the general sales manager is the customer relations manager. The customer relations manager ensures that the customers are well taken care of, communications to customers are made promptly, and any requests and queries are dealt with promptly. (Iwao,2018)

References

Itsuki, H. (2021). Evaluation on Changes of Strategy and Strategic Direction in Toyota Motor Company, Japan. Journal of Strategic Management, 5(1), 20-29.

Iwao, S. (2018). The Diversity and Reality of Kaizen in Toyota. In Industrial Competitiveness and Design Evolution (pp. 271-298). Springer, Tokyo.