This case study discusses the challenges faced by Toyota, including issues with digitalization, advertisement, brand recognition, and product recalls. It explores the impact on sales and reputation, and provides recommendations for the company. Read more on Desklib.
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Running head -CASE STUDY ON CHALLENGES FACED BY TOYOTA Case Study on challenges faced by Toyota Name of the student Name of the university Author’s note
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1CASE STUDY ON CHALLENGES FACED BY TOYOTA Introduction Toyota Motor Corporation is one the leading organisation in the global market. Despite its huge success, the company has faced many issues. The recent challenges the company faces haverisenseverequestionaboutbrandloyalty.Thefollowingcasestudydiscussesthe difficultiescausedbytherecentdevelopmentofdigitalisation,advertisementandbrand recognition through social media and recall problems. Discussion Evaluating product-harm crisis and how it has affected Toyota Product harm crisis can be classified as a crisis that occurs when a product is found defective or harmful for the consumers and is causes a publicised event. The critical effect of the crisis targets a subset of that particular category or the entire product category. It has an impact on the sales of the product and also the cost of the product associated with the product recalls. In the long run, it takes a toll on the reputation of the company. The company must regain the trust of the consumers during this crisis (Ma et al. 2014). In the automobile industry, product harm crisis is nothing new. There have been many incidents where companies had seen problems related to their products. Toyota’s has a reputation for manufacturing quality automobiles. However, in 2010, the company had to recall 2.3 million of its product worldwide. The product issue they face was a defect in their accelerator pedal, which automatically speeds up the car without the pilot being able to take control of the vehicle. In essence, it got the attention of media, spreading the news of the loss the company faced via Facebook, Twitter, which was a massive blow to the reputation of the company (Rajasekera, 2013). The figure-1 below shows a chart that was reported by The National Highway Traffic Safety Administration showing the record number of vehicles that has beenrecalled in the US by 2014.
2CASE STUDY ON CHALLENGES FACED BY TOYOTA Fig 1 – Vehicle recalls in the U.S.A. by 2014 due to NHTSA Source-(http://fortune.com, 2014). Identifying the problems needed to be solved by Toyota leaders The biggest problem which the leaders of Toyota should be concerned with is regaining the trust of the customers. The sticking accelerator pedal in eight models of Toyota has led in the closing of many manufacturing factories temporarily. Deaths have occurred due to these issues. In the US, piles of lawyers are waiting eagerly to life lawsuits to sue Toyota for the loss of the families that are the victims of the malfunctioning models of car that have been recalled (Jim, & Shinde, 2015). The company should look through the rapid spread of the negative impact that has led the company to suffer in loss of sales and also losing the trust of customers. Facebook and the internet is in full capacity, and the brand image has been destroyed Toyota has build over China, Europe, and also in Japan which happens to be their home market
3CASE STUDY ON CHALLENGES FACED BY TOYOTA Successful and Unsuccessful changes One of the successful move made by the authorities of Toyota after the recall program was launching an SNS. Toyota immediately put together a team to deal with the spread of news through social media. They had an ‘online newsroom’ and a team to strategise social media impact after the effect of the recall crisis. The team had Facebook, Twitter, YouTube, and Pressroom Toyota under their surveillance. In the effort of the company, it added an opinion section in their social media pages, where one could express their feelings towards the company. This led to the rise of customers on their Facebook page despite the continuous coverage of sentimental news by the US media. The company has reported that there has been an increase of 10% in the numbers of followers at their Facebook page monthly (Collins, Muthusamy & Carr, 2015). Despite the effort utilising public campaigns, Toyota is failing in regaining the trust of their customers. The recall of approximately 8 million cars has led the customers to shift their brand loyalty. This has been an unsuccessful move for the leading automobile company. The addressing made by the president of the company Mr Toyoda in front of US Congress made it clear how not being a good communicator, Mr Toyoda reflected a manner which portrayed a negative response in social media. Recommendation for Toyota to look forward It can be recommended that the company should have a trained public speaker who will speak on behalf of the company. Toyota should have some other methods for the announcement of the recall. The company should take new approaches in dealing with the spread of adverse impact on social media. The company can develop a robust framework which can deal with the tastings before the launch of the vehicles in the market. Conclusion Thus, from the following case study, it can be concluded that Toyota has faced a lot in the long run and have seen its rise and fall. From leading the market to finding it hard to coexist, the company is at stake. The case study has a schematic outline of the problems faced by the company in recent years. The company has learnt a great deal from the crisis.
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5CASE STUDY ON CHALLENGES FACED BY TOYOTA References Collins, K. F., Muthusamy, S. K., & Carr, A. (2015). Toyota production system for healthcare organizations: prospects and implementation challenges.Total Quality Management & Business Excellence,26(7-8), 905-918. Jim,S.,&Shinde,J.S.(2015).CrisismanagementatToyota.Advancesin Management,8(2), 16. Ma, B., Zhang, L., Wang, G., & Fei, L. (2014). The impact of a product-harm crisis on customer perceived value.International Journal of Market Research, 56(3), 341-366. doi: 10.2501/ijmr-2014-023 Rajasekera, J. (2013). Challenges to Toyota caused by recall problems, social networks anddigitisation.AsianAcademyofManagementJournal,18(1),1-17. Retrieved fromhttp://web.usm.my/aamj/