Introduction Toyota Motor Corporation is a very successful automobile manufacturer that is recognized globally. They have continued to obtain and retain a competitive advantage over their counterparts, despite recalls over many years. Regardless of recalls, Toyota has been quick to rectify their shortcomings and continue to lead within the automotive industry with their innovative measures. In this essay, I will discuss key internal factors for Toyota. Within those factors will include Toyota’s core competencies, which are what they do really well in comparison to their competition, three of their strength’s, which will include their posture within the automobile market and their heavy focus on research and development, and two of their
Management then creates a strategy around these competencies which assists in creating competitive advantages. Toyota is a dominate leader within the automobile industry in innovation. Based on that key factor, they were the only automaker that was listed in the top 20 on the initial public offering list (Toyota leads auto industry in innovation, again!, 2016). Toyota’s core competencies seem simplistic, yet they are very powerful. There are two in which they focus on which is continuous improvement and respect for people. These core competencies are a part of their production system, better known as the Toyota Production System (TPS). The TPS is based on the philosophy “completely eliminating all waste”. Excess inventory, defective products, and unnecessary processing steps are all inclusive when discussing excessive waste, which eventually negatively effects the corporation as a whole. In 1924, Sakichi Toyoda created the Toyoda Automatic Loom, which improved productivity and work efficiency by eliminating wasteful practices and defective products. Kiichiro Toyoda believed that “the ideal conditions for creating things are more successful when machines, facilities, and people work together to add value without generating any waste.” (The orgin of the toyota production system,
They are also seeking to expand by offering condominiums and apartments, in addition to renovations and remodeling services. They were the winner of the 2013 Good Design Award.
• Afforestation and Biotechnology – Toyota is focused on saving the earth by promoting greenery businesses that include biomass, green roofing, and enhancing Japanese farming by offering the “Housaku Keikaku” (harvest plan) for rice-growing cooperatives.
• Marine Products – Toyota offers marine crafts and pleasure boats and engines known as the Ponam series, which also was a recipient of the 2014 Japan Boat of the year Award.
Heavy focus on research and development
Another important factor that will ensure Toyota retains a competitive advantage within this industry is continuous process improvement, which is one of their core competencies. Toyota Motors has over fifteen research and development organizations worldwide and each facility has a main focus, such as advanced engineering or exterior, interior, and color design. Toyota conducts all of their research and development within these facilities where the overall objective is to produce the highest quality vehicles. Their ability to focus on research and development allows them to keep their technological advantage at bay amongst their products, which in turn leads to innovation and
One of several aspects of the Toyota production system that differ from The GM system is that Toyota puts a flow into the manufacturing process, while GM has lathes located in the lathe area, milling machines in the milling area Toyota places a lathe, milling machine and a drilling machine in the actual sequence of the manufacturing process.
General Motors incorporates entrepreneurship and innovation into its business objectives. This is evident in General Motors Vision statement which states that its goal is to “lead in advanced technologies and quality by creating the world’s best vehicles”. (1) For instance General Motors has an extensive R & D, Design, and Engineering department that oversees the creativity, innovation, and invention of its strategic technologies and innovation programs which are aligned with its corporate vision. In order to lead in advanced technologies of the world’s best vehicles General Motors incorporates entrepreneurship and innovation concepts, which are essential to competing in the global market place.(2) In the spirit of entrepreneurship, which is the process of discovering new ways of combining resources,(5) General Motors is a majority shareholder in GM Daewoo Auto & Technology Company of South Korea, and has product, powertrain and purchasing collaborations with Suzuki Motor Corporation in Japan.(3) These associations allow General Motors to maneuver into specific customer markets and broaden its product base. Being an innovative organization also requires General Motors to establish advanced technology collaborations, which it has with Daimler AG and BMW AG of Germany and Toyota Motor Corp. of Japan (3) as well as promoting competitiveness and deferring the cost of the research and development. (2)
The Toyota Production system was influenced by the production systems of the United States mainly the Ford production system. The Ford production system was highly profitable has it implemented mass production which reduced the cost of manufacturing. The same system would not have worked for Toyota which is a Japanese company has the customer needs are different and also the availability of resources limited. Therefore it was necessary for the architects of Toyota Production System to design their model on the interests of the Japanese culture. This led to the design of a system in which mass production of different types of vehicles was achieved at a low cost and minimum wastage contrary to the Ford system in which large production of few model helped in reducing the cost.
Toyota Motor Manufacturing, U.S.A. (TMM) is deviating from the standard assembly line principle of jidoka in an attempt to avoid expenses incurred from stopping the production line for seat quality defects. This deviation has contributed to the inability to identify the root cause of the problem, which has led to decreased run ratios on the line and an excess of defective automobiles in the overflow lot for multiple days. If this problem isn’t fixed quickly, an increased amount of waste will continue to be incurred and customer value will be threatened.
Toyota- focused differentiation, medium pricing, breadth of product line is low. Company is known for quality products, and nice styling.
Toyota’s Integrated Differentiated Strategy is very unique to the automotive industry. Its main focus, according to the president of Toyota, is that Toyota is not trying to rival other automakers; Toyota is trying to conquer customers with great products and service to obtain high customer satisfaction.
Toyota Motor Corporation is a Japan based company, whose headquarters are located in Aichi Prefecture. The company was founded by Kiichiri Toyoda in 1937. Currently the company’s CEO is Akio Toyoda. Toyota is basically into cars and it is one of the top players in the world in this industry. Toyota also owns two other brands namely Lexus and Scion, which gives the company a lot of advantage over it’s other competitors. Toyota manufactures sedans, saloons, suvs, muvs, pick-up trucks and buses. During the year 2013 Toyota had approximately 333,498 employees, who were working globally. In March 2013, Toyota was ranked as the thirteenth biggest organization globally in terms of its revenue. In the following table we can see the financial report of Toyota Motor Corporation in the year 2013-
(5) Liker, Jeffrey K. The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer. New York: McGraw-Hill, 2004. Print.
1. As mentioned Toyota is one of the top leading car companies due to their business strategy or plan being focused on the quality of their products for their customers. Now what do you think would have happened if Toyota did not choose to have quality as their main goal but instead they were more focused on low cost of expenses as being the most important factor in their business plan or strategy? With this scenario for Toyota's operations, their parts that are being used in their vehicles would not be as good of quality, due to the fact that they are getting these parts from the manufacturer that is going to be of cheapest cost to them. Well we all know that when something is cheap and inexpensive, it does not mean that it is always the most reliable and it may create more problems for Toyota in the future. With that being said there is a very good possibility that customers who purchase vehicles from Toyota will have problems with them more frequently due to the lower quality parts being used. Then when the customers bring their vehicles back with problems, Toyota is going to replace the non functioning part with another cheap and inexpensive part, allowing them to save money, instead of putting a quality part in. Another factor that would hinder the success of the business would be the fact that the company is going to be spending as little money as possible on the required tools that the vehicle mechanics at Toyota need in order to repair their vehicles when maintenance is required, resulting in the possibility that the employees will not being able to accomplish all the necessary maintenance or repairs to the highest standards or best of their ability due to having limited tools. If the necessary resources are no...
Toyota’s uses both differentiation and low cost as generic strategies to try and gain a competitive advantage over their competitors in the automotive industry. The market scope that Toyota uses is a broad one that encompasses nearly every type of customer that is in the market to purchase an automobile. Toyota is able to target such a large market because they have something for everyone. Toyota has four wheel drive trucks and SUVs for the outdoor types or those who live in areas that face severe weather conditions, hybrid models like the Prius for the eco-friendly customers that are interested in saving the environment, along with the standard cars for general, everyday use. Additionally, Toyota provides vehicles for all price ranges.
Toyota has adopted an expansion strategy aimed at increasing the company’s market share through sustainable growth. This will be done based on the delivery of high quality, and safe cars, at an affordable price. As the company seeks to expand to new markets, focus will be on maintaining an organizational culture that allows optimum efficiency in the ever dynamic global market.
As stated, the Toyota brand has and will continue to maintain a competitive advantage due to the quality of their product. They are able to charge a premium price while still utilizing the differentiation strategy. Their customer service is even superior to others. From a personal experience, I have enjoyed the small things, such as my dealership interactions, especially with Lexus, over a company such as Ford. Although miniscule to some, their kindness, helpfulness, and even additional resources within the waiting area make you proud to be
Toyota Motor Corporation is one of the largest automakers in the world. At its annual conference in Tokyo on May 8, 2008, the company announced that activities through March 2008 generated a sales figure of $252.7 billion, a new record for the company. However, the company is lowering expectations for the coming year due to a stronger yen, a slowing American economy, and the rising cost of raw materials (Rowley, 2008). If Toyota is to continue increasing its revenue, it must examine its business practice and determine on a course of action to maximize its profit.
Just In Time, Toyota Production, and Lean Manufacturing are productions systems intended to reduce costs, and waste associated with inventory and manufacturing.
All employees of Toyota are satisfied with lower level needs, they make great wages, they have job stability, and the job sites are full of safety initiatives and well planned (Liker, 2004, p.210). Toyota also provides family benefits to help with raising children and the wellbeing and health while at work, with all these benefits employees are content and can focus on big picture ideas. Toyota promotes a strong team mood and a sense