Business Development Report: Analysis of Toyota's Change Management

This report provides a detailed analysis of Toyota's change management strategies. It begins with an introduction to the company and the significance of change in the business environment. The main body of the report describes the specific changes implemented by Toyota, such as restructuring departments and focusing on customer service, and their importance in maintaining a competitive edge. The report then delves into the organizational culture of Toyota, identifying the reasons for resistance to change, including lack of trust, economic risks, and concerns about failure. The study further explores the approaches leaders can take to minimize resistance, such as education, communication, and employee involvement. Finally, the report examines the impact of leadership style and emotional intelligence on the implementation of change, emphasizing the importance of transformational leadership and the need for leaders to be supportive and decisive. The conclusion summarizes the key findings and highlights the importance of effective change management for business success.

Business and management

TABLE OF CONTENTS
Introduction................................................................................................................................3
Main body..................................................................................................................................3
Description of change and its significance.............................................................................3
Analysis of culture of organisation and reasons of resistance towards change.....................3
Approach of leaders to minimise resistance towards change.................................................3
Impact of leadership style and emotional intelligence on implementation of change...........3
Conclusion..................................................................................................................................3
References..................................................................................................................................4

INTRODUCTION
Business organisations are required to update their operational practices with the
changing market conditions to remain competitive and attain sustainable growth and
development (Burke, 2017). The present study is based on case analysis of Toyota regarding
change management. The study will include a description of change occurred along with its
significance for the company. Further, the culture of the company will be analysed to
determine reasons for resistance towards change. To resolve this resistance, description for
the significance of leadership style and emotional intelligence on the implementation of
change will be provided.
MAIN BODY
Description of change and its significance
Toyota motor company is considered to be the most famous company engaged in
manufacturing of auto mobile around the world. The company was initiated in 1937 and
founder of Toyota motors was Kiichiro Toyoda. At present, the company has maintained its
position as the largest manufacturers of cars as a global brand (Cummings and Worley,
2014). The company got success from the continuous adoption of efficiency and quality. The
major reason behind their success is continuously updating and launching of new products
and services in the marketplace with the changing market conditions.
In 2010, Toyota Motors declared a considerable change in their management
framework as a part of their rapid development strategy. Toyota is well known in the market
because of its improving organizational changes so as to provide a better competitiveness in
the market. These changes differ from revaluation to objectives of management (Marcu,
2016). In 2010, some major changes were declared by the company such as to increase
productivity and efficiency, the previously known Business Development Unit and Marine
Business Division has been converted into Marine and Unit Business Division. The sales
department will take care of this unit.
The department of purchasing planning will now be updated to Department of
Purchasing Administrative and the International Purchasing Promotion Division. Further, the
purchasing of body part division will now be restructured to Division of purchasing planning
(Benn, Dunphy and Griffiths, 2014). The major aim behind this is to merge foreign and local

functions of administration and future work activities of project management and cost
effective policies.
The divisions of Strategic Production Planning has been covered under the division of
Customer Services Operations head to reinforce the customer services and ensuring best
quality by Toyota Motor Company (Huhtala and et al., 2013). Another change was the
renaming of Tokyo Design Division into Advanced Design Division to concentrate on
potential technological improvements and changes. These divisions resulted in the success of
TOYOTA MOTOR COMPANY.
The proposed changes of Toyota Company were significant because of the changing
market conditions. To cope up with increasing competition in the market, Toyota has to
implement new changes and technologies to get a competitive benefit and to satisfy the
never-ending needs and expectations of the customer. Toyota has always served best services
at best prices to maintain the competitive edge (Fullan, 2014). Another reason for the change
was globalization; it was considered to be the major driver for the change in the organization.
Communication and integration among people around the world were increasing with the
improvement in technology due to which company updated their operation activities as per
updated globalization trends. Due to the downfall, companies suffered from insufficient
resources and faced a lot of changes in the needs of customers (Duveen, 2013). Toyota made
a decision to keep restriction on their resources by using them carefully and focused more on
offering quality products in order to deal with changing needs.
Analysis of culture of organisation and reasons of resistance towards change
Conflict towards change is considered to be a general issue for organizations and
individuals. If the manager knows well regarding the resistance to change, then it can result
in the success of implementing change in an organization. Opposing to change is not just the
outcome of unawareness or rigidity, but it is a likely response by individual who desires to
safeguard their self-interests and benefits (Hayes, 2014). By considering work culture of
Toyota, the primary reason for resistance was lack of trust as change can create the threat of
losing jobs for employees. Further employees consider the fact that changes are not viable,
resistance is more potential if individuals know how to do things to get successful effectively.
Believing that the changes are not reasonable, if problems are known, a planned change can
be resisted as it tends improbable to succeed.

Next are economic risks, as the change was disliked by individuals who undergo own
income loss, profits or job security. This is particularly related to product department of the
company as changes were inclusive of choosing technologies instead of employees. Another
reason for resistance to change was high comparative costs, changes in a company engaged
huge cost for which there was a high risk of compensated profits. The concern of failure also
leads to resist change in Toyota as; lack of self-confidence has been reluctant to trade
procedures in which previous employees mastered for new ones that might prove too
problematic to master (Northouse, 2015). Lack of loyalty and position also was the reason for
resistance as individuals liable for eliminating activities that will affect position and status.
Changes that seem to be not consistent along with strong ideals and values can be opposed
until individuals know the requirement for change and consider the choices in identifying
how to implement change, they will oppose it.
Approach of leaders to minimise resistance towards change
Following approaches are required to be adopted by leaders to minimise resistance towards
change:
 Developing education and communication: The best way to overcome resistance
is to develop communication and education regarding the changes earlier. Direct
communication and education by leaders will assists employees in observing the
judgement in the change effort. This decreases baseless and wrong rumours
regarding the organizational changes (Al-Haddad and Kotnour, 2015).
Communication is considered to be the toughest part in organizations. Thus leaders
must be well versed with it.
 Participation and involvement Employees engagement in the effort of changes
motivates acceptance of changes instead of opposing it. This aspect is more likely
to reduce resistance thus leaders are required to involve team members while
planning for change by taking their suggestions and opinions for the same.
 Offering facilitation and support: Leaders can set off likely resistance by
supporting their employees at difficult times (Ramchunder and Martins, 2014).
Support by leaders assists employees in addressing their fear and concern during a
change period. This aspect is more concerned with terms of proper counselling,
training and team building activities.
 Better agreements and negotiations: Leaders can prevent resistance by providing
motivation to employees to accept changes. This can be done by threatening or

offering incentives to enabling resistors of changes which have potential to prohibit
changes. Further, employees should be appreciated and awarded by leaders who
had supported them to motivate others for the same behaviour.
 Improving manipulation and cooperation: Cooperation ensures the demeaning
motion of taking a person to an organizational change planning group for the
purpose of appearances instead of their essential contribution. This generally
entails resisters to join the leaders for change efforts (Appelbaum and et al., 2015).
For this aspect, leaders are required to play a representative role in making
decisions without forcing but explaining the change effort.
 Explicit and Implicit force: Leader can explicitly as well as implicitly oblige
employees to accept change and making it clear that resisting change can result in
loss of jobs.
Impact of leadership style and emotional intelligence on implementation of change
Leadership is said to be the most important aspect of being successful in
organizational change. Leaders are considered to be idol personalities in any society.
Theorists have explained variously styled of leadership, and each and every style contains its
own effect on management change. Study of Goetsch and Davis (2014) states that conversion
leadership aims at the development of organization while servant leadership focuses on the
follower’s development regarding the model of leadership for management change. In present
dynamic era, this best way is to develop followership and management change trading by
making use of transformational leadership.
The efficient organizational change would not be possible if there is the absence of
supreme intelligence and strong leadership. Thus, while change managers must be supportive
and attentive towards changing work conditions (Aarons and et al., 2015). They are required
to guide teams regarding the facts that are eager to drive changes effectively in an active
system. Due to this factor, the leader should be enthusiastic and be quick while making
decisions to resolve work issues.
CONCLUSION
The present study shows case of successful implementation of changes by Toyota in
their business strategies with the objective to improve productivity and attain competitive
advantage. The company had faced severe resistance, but management resolves these issues
with viable strategies by maintaining positive work environment. For effective change

management, business entities are required to ensure to apply appropriate leadership style and
emotional intelligence to minimise resistance towards change.

REFERENCES
Burke, W.W., 2017. Organization change: Theory and practice. Sage Publications.
Cummings, T.G. and Worley, C.G., 2014. Organization development and change. Cengage
learning.
Marcu, M., 2016. How to Discover the Culture of an Organisation. Social Sciences and
Education Research Review, 3(1), pp.115-119.
Huhtala, M., Kangas, M., Lämsä, A.M. and Feldt, T., 2013. Ethical managers in ethical
organisations? The leadership-culture connection among Finnish managers. Leadership &
Organization Development Journal, 34(3), pp.250-270.
Fullan, M., 2014. Leading in a culture of change personal action guide and workbook. John
Wiley & Sons.
Duveen, G., 2013. 12 Representations, identities, resistance. Development as a social process:
Contributions of Gerard Duveen, p.182.
Hayes, J., 2014. The theory and practice of change management. Palgrave Macmillan.
Northouse, P.G., 2015. Leadership: Theory and practice. Sage publications.
Al-Haddad, S. and Kotnour, T., 2015. Integrating the organizational change literature: a
model for successful change. Journal of organizational change management, 28(2), pp.234-
262.
Ramchunder, Y. and Martins, N., 2014. The role of self-efficacy, emotional intelligence and
leadership style as attributes of leadership effectiveness. SA Journal of Industrial
Psychology, 40(1), pp.01-11.
Appelbaum, S.H., Degbe, M.C., MacDonald, O. and Nguyen-Quang, T.S., 2015.
Organizational outcomes of leadership style and resistance to change (Part One). Industrial
and Commercial Training, 47(2), pp.73-80.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence.
Upper Saddle River, NJ: Pearson.

Aarons, G.A., Ehrhart, M.G., Farahnak, L.R. and Hurlburt, M.S., 2015. Leadership and
organizational change for implementation (LOCI): a randomized mixed method pilot study of
a leadership and organization development intervention for evidence-based practice
implementation. Implementation Science, 10(1), p.11.
Benn, S., Dunphy, D. and Griffiths, A., 2014. Organizational change for corporate
sustainability. Routledge.