Strategies for Ford and General Motors to Gain Market Share from Toyota

This paper discusses the long term strategies and opportunities for Ford and General Motors in the US market to gain market share from Toyota. It explores operational strategies and improvement techniques that can be implemented by the companies. The paper also advises on operational strategies for Ford and GM to increase their market share.

Running head: INTRODUCTION TO BUSINESS OPERATIONS AND SERVICE
INTRODUCTION TO BUSINESS OPERATIONS AND SERVICE
Name of the Student
Name of the University
Author Note

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Introduction
The aim of the paper is to identify the long term strategies and opportunities for Ford and
General Motors in the US market. The paper will introduce a companywide operations
management for the companies. The paper will also advice on the operational strategies which
will be implemented by the companies which will be implemented to gain market share from
Toyota.
Ford Motor Company is an American multinational company which has its headquarters
in Michigan which is a sub urban of Detroit. The company was found by Henry Ford and was
incorporated in the year 1903. The company is known for selling various types of commercial
vehicles and other automobiles. The company is divided into two parts where the company sells
the commercial vehicles and commercial vehicles under the Ford Brand and the luxury vehicles
under the Lincoln brand. The company is also known for owning the Brazilian SUV
manufacturer brand which is Troller. The company also has introduced various new methods of
manufacturing cars under the large scale manufacturing and updated assembly lines. The
company has opened its research and innovation center in China, Germany and California. The
Ford Research and Innovation and has expanded its innovations worldwide.
General Motors is also an American multinational company which has its headquarters in
Detroit. The company is known for designing, distributing parts of the vehicles, manufacturing
and marketing for the automobile companies globally. The company was founded by William C.
Durant in the year 1908. The company also invested a huge amount of money in the research and
development and implemented various strategies and has divided its brands like the Cadillac,
Buicks, Olds and Oakland. With the implementation of new strategies the company has been

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able to bring changes and upgraded its relationship as a supplier and consultancy to Cadillac and
Buick.
Toyota is a Japanese multinational automotive manufacturer which has its headquarters
in Japan. According to Kobayashi (2018) in the year 2018 the company’s corporate structure
consisted of more than 364,445 employees all over the world. It is the only company which is
known to produce more than 10 million vehicles in a year since the year 2012. The company has
a vigorous respect for the people who are working in the company as well as its continuous
improvements in manufacturing and lining up of the vehicles. The company has summarized its
values and conducted the guidelines with five principles which are Challenge, Kaizen which
means improvement, Genchi genbutsu which means go and see, respect and team work.
The paper will apply a range of numerical decision making models and techniques which
will be able to explain the factors which are involved in managing the business operations and
services. It is aligned to explore various tools and techniques which can be used by Toyota in
order to introduce a companywide improvement strategy. In the later part the paper will discuss
and advice the organizational strategies which can b implemented by Ford and GM to gain
market share from Toyota in the US market.
Discussion
Kasemsap (2018) discusses those operations improvement strategies are a total set of patterns
and discussions which helps in shaping a company’s operations and their contributions to overall
strategy through the reconciliation of the market requirements with operational resources. Also
Helm-Stevens and Ansoff (2018) argues with the previous decision that operations improvement
strategy is not only concerned with the reconciliation of the requirements in the market but also

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by satisfying the market requirements by setting appropriate performance objectives for its
operations. It also involves a set of decisions which should be taken on deployment of
operational resources of the company.
Toyota was a very famous automotive maker in the automobiles industry. But in the recent
years it has suspended its sales by 57 percent of the automobiles in the US market. In the year
2017 it has recalled almost more than 9 million vehicles which are more than its total number of
sales in the past three years. As an Operations Manager of Toyota it can be said that an
organization’s market position is only one in which its performance enables to attract the
customers. In order to introduce the company wide operations in improvement strategy, by
implementing the five strategies.
 Going lean – According to Popovič, Tassabehji and Castelli (2018) lean is basically an
operational philosophy which generally focuses on the continuous improvement of
delivering the products and services to the customers of the company. Toyota should be
able to add practices in making the operational services more efficient and effective.
 Focusing on the quality rather than quantity – Toyota has been working on various
operational strategies which are implemented in multiple versions of the quality
management in its business. With the help of various techniques like Six Sigma and
Kaizen the company the company has been now able to gain a control over its statistical
processes. With the help of these small changes in practices the company has therefore
expanded its operations. According to the author Harmon (2019) the idea of focusing into
quantity the company will be able to reduce waste and reworks, this also saves money for
the company. This improves the working results of the company which thus makes it
more effective.

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 Improve Forecasting – According to the author Dennis and Wixom (2018) a company
should always forecast its demand and capability in the market whether be it on selling
their products and services, managing or purchasing the inventory. Toyota being a
popular automobile company was very weak in forecasting the US market which led
them in bringing down their vehicles in the year 2017. The company was either
unprepared in meeting their market demand or else they have wasted a huge amount of
money in expanding their production. Epstein (2018) has stated that this process will
reduce the quality of the company products because of very poor forecasting of demand.
Thus the customers were left unsatisfied with the vehicles.
 Introducing customer–centric theory – According to Ngai (2019) the present companies
are always customer centric that is they lean towards the taste and preferences of their
customers. Dennis (2018) says that customer centric approach towards business is
actually very effective in a long run. Therefore Toyota should be developing the
operations and strategy to embrace their customers and make them happy so that the
automobile company can always be in the fast way towards achieving their business
success.
 Dynamic business process – According to the author Wixom (2018) companies should be
working hard in their operational process in order to become more efficient. In the
present years business processes are developing over time. Due to globalization there are
various changes in the business process which the companies keep on adapting. Toyota
should reengineer in order to pinpoint the wasteful processes concerning how they are
doing their business and developing more and more effective procedures.

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A company which wants to develop a culture of rapid and continuous improvement uses
many tools at their disposals. Therefore it can be very difficult for them to keep up all in mind in
deciding how to execute the opportunities and addressing the challenges faced by them. This
part of the paper will be discussing few tools and techniques which can be implemented in
bringing continuous improvement in their business. If Toyota uses these tools and techniques it
will be able to regain some of the lost market share in the long term. The large automobile maker
company should have a smooth production system and increase the production rates without
incurring problems in their own working procedures and methods.
 DMAIC – The DMAIC methodology consists of five different phases which consists of
define measure, analyze, improve and control. These steps are used to help ensure that
the improvements are most probably data driven and measurable by the company.
According to the author the DMAIC is known to b an improvement cycle which is an
effective tool and technique for a structured change management. The define phase is all
about selecting high impacting opportunities for bringing improvements and
understanding the metrics which highlights the project success. Measuring phase is used
to develop the data and develop methodology to evaluate the success. In the analyze
phase the business managers find out the problems which are in the business. There after
analyzing they try to improve the steps and brings changes in the organizational
strategies. The last stage is the control stage where the monitoring process and procedures
are developed for long term success.

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( Fig 1 Source : Dennis 2018)
 Kanban – Kamban is a Japanese term which means billboard that indicates available
capacity to work. The practice of Kanban should be originated by Toyota in order to have
a visualization of work. The idea of Kanban was first introduced by the author Ansoff
(2018) the idea of this technique in business is to maximize the flow of the goods and
work which can be easily achieved by the principles of Kanban. The four principles are
visualizing the work, limiting the work in progress, focusing on maintaining a steady
flow of work and improving the methods continuously.

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(Fig 2 Source : Kobayashi 2018)
 5S – This technique should be used by the company in the place of manufacturing of the
cars and utilities vehicles. According to Epstein (2018) this tool is widely used by the
multinational companies to achieve rapid continuous improvements in their firm. The
5Sstarts with sorting thing first where the company keeps only what is regularly used
nearby. The second stage is Straighten where the company should arrange spaces for its
employees where they will be able to work properly. In the third stage which is Shine,
here the workers are ensured that the workplace is ready to for an immediate use. The
fourth stage is Standardize where each and every job in the company is done with utmost
care and everyone is challenged to offer ideas to improve the business in very possible

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ways. The last “S” is sustaining where the company works in order to foster a safe,
efficient and effective workplace for the workers working in the company to introduce a
companywide operations improvement strategy.
(Fig 3. Source Mitchel 2016)
Operational Strategies
According to the author Stark (2015) operational strategies refers to the methods which are used
by the companies in order to reach their objectives. If a company is able to develop proper
operational strategies it will help the company to examine and implement efficient and effective
systems of using the natural resources, work in progress and personnel. According to Goffin and
Mitchel (2016) automobile companies can increases their market share through innovation,
strengthening customer relationships, smart hiring process and acquiring the competitors brands
in the market.

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This part of the study will attempt to find out the operational strategies which can be
implemented by Ford and GM to gain market share from Toyota. The strategies which are
advised are based on the company success and analyzing the company performances. In the US
market Ford is the second largest automaker, but however when speaking about global process it
holds the sixth rank in terms of market share. A figure has been provided below which shows the
market share of the companies – Ford, GM and Toyota.
(Fig 4 : Source Stark 2015)
The above figure shows the market share of 5 automakers in the year 2018. It can be seen that
Toyota has the highest market share o 11.7% however Ford has been placed in third position and
the second position is owned by General motors. Therefore it can be clearly stated that Toyota
owns more than double the market share of Ford and GM, despite Ford being the major brand of
the US. This is only because of the high performance pickup trucks which are manufactured by

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Ford and GM. In contrast Toyota’s innovative technologies are more appealing to the mass
market. The market capitalization of Toyota Motor is much higher than the top automaker brands
of the US like the General Motors and Ford. Few of the operational strategies which can help
Ford and GM to gain markets share from Toyota are advised below :
 Innovation is one of the best operational strategies which a company may implement to
gain an increase in the market share from another company. If Ford and GM brings to
market new technologies which its competitors are yet to offer to the customers they will
be easily gaining much of the market share from Toyota. Many f the customers from the
competitor brand becomes loyal which in a way adds on to the market share of the
company and decreases of the company from where they have switched. Therefore Ford
and GM should use the latest technologies available or can borrow from the growing
software companies and take over the market from Toyota.
 By strengthening the customer relationships Ford and GM can protect their existing
market share by preventing the current customers from jumping to the other competitor
brands in the market. Ford and GM can increase this by simply satisfying their existing
customers as by frequently speaking about the positive experiences to their friends and
relatives who can be a new customer to Ford and GM. According to Shingo (2019)
gaining market share via word of mouth increases the company revenues without
concomitant increase in the expenses which are made through market.
 Skilled and dedicated employees are the most important factors for which a company
gains most of the market share. Bringing the best employees on the board will also reduce
expenses related to the turnover and trainings. Toyota has one of the best employees in
the world to take car over the manufacturing, building designs and proper use of the latest

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technologies. Ford and GM should also employ best employees and manufacturing and
trainers. The companies should have best leaders who will be able to lead the employees
working in the company. This will able the company to retain the employees who are
deciding to move to other competitors companies.
 Lastly one the surest methods which will help Ford and GM to increase its market share
over Toyota is by acquiring its competitor. According to Shingo (2019) by doing so a
company accomplishes two things that is it taps into the firm’s old acquired customer
base as well as it also reduces the number of firms which are fighting in gaining
customers. Ford and GM should also try to keep an eye out for a good acquisition deal
when the company is a good growth mode. It is just like the muscles of the body and
heart depend on the functioning and signals which are sent by the brain. Therefore each
department in a company depends on the other department in order to stay healthy and fit
for a longer term. Ford and GM should also support the corporate and other operational
strategies and use the cross functional interactions to sustain in the longer term.
Conclusion
In order to conclude the above research paper it can be said that Toyota always had a great
customer base with all its vehicles. It has also used various types of operational strategies like the
Kaizen, innovations, upgraded management practices and failure problem controls. These have
helped the company to make a great market share from a longer time. The company has also
made a continuous improvement with the help of the Kaizen methodology. Toyota is now
positions as one of the best automobile makers globally that has very well outperformed against
the competitors brands. Toyota has control over its over its quality which ensures an error free
product to the customers along with the inclusive market approach in the workplace. Toyota is

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also continuously improving its internal process which reduces costs, increases the overall
productivity and results in better efficiency.
The paper has thus explained and introduced companywide operations improvement strategy,
it also has used various tools and techniques in determining the improvement strategy. In the
next part it has given advice on the operational strategies that Ford and GM can implement to
gain a better market share from Toyota.

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