Introduction to Business Operations and Services

This assignment examines business operations and services using Toyota as a case study. It analyzes Toyota's operational challenges and suggests improvement strategies. The assignment also advises Ford and GM on operational strategies to gain market share from Toyota, focusing on product development, supply chain optimization, cost reduction, and technology adoption.

Introduction to
Business Operations
and Services

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ......................................................................................................................................1
(i) Explain operations improvement strategy and must include the tools and techniques..........1
(ii) Advise on the operational strategies that Ford and GM can implement to gain market share
from Toyota.................................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENBCES..............................................................................................................................8

INTRODUCTION
Business Operation is the work of managing the inner workings of the business in order
to achieve corporation goals. It is the repeatable elements of a business that can be highly
optimized through process improvements such as automation. To enhance the business
operations it is require to provide quality services so that needs of consumers can be satisfy and
firm can earn more profits. It also helps the business entity to expand the market share. To better
understand this concept Toyota has been chosen which is a Japanese multinational automotive
car manufacturer. There are various topics are covered in this report such as: To introduce a
countrywide operations strategy and also use tool and techniques in this context. Apart from this,
report also discuss about to advise on the operational strategies that Ford and GM can implement
to gain market share.
TASK 1
(i) Explain operations improvement strategy and must include the tools and techniques
Toyota is a car manufacturing company which operate its business across the globe and it
belongs to Japan. There are more than 370000 workers are employed in the corporation and it
known for its quality products and powerful engine which enhance the quality of its cars. As
organisation has good market image and reputation in the world. It becomes the world's first auto
mobile car producer which manufacture more than ten million vehicles in the year 2012. In the
global market it is leader in sales of hybrid electric vehicles and it is one of the largest firm to
encourage mass market adoption of hybrid vehicles across the globe (Wang and Durugbo,
2013).
As organisation lead the market in hydrogen fuel cell vehicles and it is a reputed brand in
the world. Due to some reasons sales of company is reducing because consumers was not satisfy
with the quality of cars. As well as operations of Toyota was not effective and for that purpose it
recalled almost nine million vehicles. As the corporation has good market share in America as
compare to its rivalries because it provide superior quality vehicles. But now quality has become
Achilles' heel in context to the organisation. The sales of firm was suspending approx fifty seven
percentage of its autos sold in United States. So for that purpose the company has direct the
executives to ramp up production as soon as possible. The market share of corporation was
reducing because sales of organisation was decreasing and it affect the business operations as
1

well as profits. So it is necessary for the firm to make better improvement strategy which is
associated to the operations. It will provide help the enterprise to boost the sales and generate
higher revenue and it help to capture more market share (Visnjic and Neely, 2016).
In this regard the it is the duty of operation manger of Toyota to suggest operations
improvement strategy so that business of company can grow and it can earn higher profits. For
that purpose it is require for the organisation to fulfil the expectations of consumers by providing
quality products so that they will attract towards the corporation as a result sales of firm can
increase. To achieve the goals it is important for company to make better strategies as per the
requirement. The operations improvement strategy which can be used by the organisation is
describe as below:
Customer-Centric Thinking: To develop the customer centric thinking is important for
an organisation in order to achieve predefined objectives and targets. As the consumers are the
king of market so it is required for the corporation to make better strategies so that desires of
individuals can be satisfy. A company can increase the production but if does not have enough
consumers to purchase the products than its sales and profits will reduce because the products
were not produced as per the requirement of consumers. So it is important for Toyota to develop
customer centric thinking so that cars can be sold more in order to maximize the revenue
All successful business firms are emphasis towards customer centric thinking so that they
can lead in the market and take the advantage of competitiveness. As the demand of consumers
are changing time to time and it can affect the strategies of organisation. Before making any
strategy it is important for Toyota to analyse market demand, recent trend, preferences and
buying habits of individuals. It is helpful for the company to develop better strategy by analysing
all these factors. As the consumers are focuses towards high quality products and those
corporations which provide quality products people attracts towards them. It is beneficial to
boost the sales as well as profits. As the main problem which is associated with firm is that it
does not provide quality products that's why sales of enterprise was reducing. Apart from this it
is deviating from the standards assembly line principle of jidoka in order to minimize
expenditures incurred from stopping the production line for seat quality defects. It contributed
towards inability to determine the root cause of the problem. As a result individuals are not
satisfy with the company and its market share was reducing (Sampson, 2012). To enhance the
quality of products six sigma approach can be used by the management of company because it
2

emphasis to minimize the defects from the manufacturing process and it is helpful to improve the
quality of products. For the continuous improvement it is very beneficial and eliminate the
defects from the product. If organisation will provide quality products and services as per the
desires of consumers than maximum number if people will attract towards the firm and it leads to
increase sales. As a result company will earn higher profits and increase the market share. As the
cost of production is increasing in the organisation because of ineffective operation management.
So by using six sigma approach manufacturing cost will be minimize and profit margin can be
maximize.
As another thing in which consumers are more centric is the price. To determine
appropriate price is important for an organisation so that maximum number of buyers can
purchase the products. According to the quality of cars the prices are high so that consumers
were not ready to buy the cars and for the purpose it have to recall almost nine million vehicles.
So it is important for Toyota to set reasonable price of its products so that sales will increase and
it leads to capture more market share. As corporation provide car in different designs and it has
wider product line. For that purpose it is required for organisation to set distinct prices of its
different products. As consumers will purchase the car as per its need and suitability which can
fulfil their demand. So this operational improvement strategy will help the firm to increase the
sales by satisfy the desires of people (Maglio and Spohrer, 2013).
As focus operations & strategy will be helpful to grasp consumers in order to make them
happy and it is helpful in context to the growth and success of business. To analyse the demand
and preference of persons is not an easy task because all individuals have different taste, habits
and likes so it is important for Toyota to make proper strategies in order to fulfil the expectations
of people. For that purpose it can offer different types of products which have distinct features
and design. As a result people will show their willingness in order to purchase the products of
company. For an example, some customers demand they want 4 air bags and some demands for
six where are some consumers are demanded that they need 7 air bags in the car. So it is
important for the firm the consider the needs of individuals and on the basis of it products can be
produce. In this case organisation can introduce different types of cars as per the number of air
bags and other features so that person can buy the product as per its own desire and it is helpful
for the corporation in order to fulfil the expectations of individuals. This strategy is beneficial in
context to the operational improvement as result consumers will prefer to buy the products. It
3

provide help to increase the profits as well as market share of the corporation. As a result
goodwill and brand image will enhance. There are various tools and techniques which are needed
to be include in improvement strategy and these are as mention as below:
Give something more: The essence of successful customer centric thinking is to evolve
consumer's needs & related attitude. It denotes that offering products & services does not only
fulfil expectations but also emphasis towards needs, also creates new ones and anticipating the
behaviour (Demirkan and Delen, 2013). In this situation blue ocean strategies meet consumer
centric strategy. In this regard organisation have to emphasis to provide something more beyond
the expectations of individuals. In this context, innovation can be made to provide something
extra to the individuals so that they attract towards Toyota. For that purpose it can make provide
various features in car such as: enhanced gesture control and it used the prevalent technology of
voice & knob controls to develop a system which determine and facilitate enhanced gesture
control. Apps and firmware updates and it is beneficial to deliver information like: popular
restaurants shopping malls, weather etc. For that purpose Vii facility can also be provided so that
individuals can stay connected with their friends and family. Smart fuel saving tips, this facility
can be provided by the organisation in its car. It provide the tips & notification to the consumers
while driving in context to take some action to improve mileage. If Toyota focuses this technique
and make the improvement strategies in this regard than people will prefer to buy the products of
this organisation.
Add value value to offerings: To expand the business and profits it is important for the
organisation to provide value to the offerings which company provide to the consumers. Only
selling is not important but it is require to provide better and quality product which creates
value . So it is important for Toyota to make better strategy in order to provide value so that
consumers will ready to pay for it. As a result consumers will show their wiliness to purchase the
products of firm and it help the corporation to increase the sales and revenues. Through this it
can expand its market share and can sustain for a long run in the dynamic business environment.
So for the growth of business it is important to add value to the offerings so that company can
expand its business (Chon and Yu, 2012).
Facilitate direct interaction with consumers: It is important for an organisation to
make direct interaction with the consumers. It is beneficial to know the wants and expectations
of persons and on the basis of it manager can provide the products so that desires of consumers
4

can be satisfy. To convenience the consumers direct interaction is necessary and it is helpful to
increase the sales and if sales will maximize than profits can be increase. So it is important for
Toyota to make direct interaction will the consumers in order to maximize the sales as well as to
fulfil the expectations of them. Apart from this queries of individuals are needed to be solve and
that they feel satisfy and show their willingness to connect with the company (Chen and Tsou,
2012).
So with this operations improvement strategy will be helpful for the organisation to
achieve its predetermined objectives. The tools and techniques are also be used in context to the
improvement strategy which is beneficial for the firm to maximize the sales and the revenue. As
a result market share will expand which is helpful for the business growth. It is also helpful to
create better reputation in the market and it is also useful in context to the sustainability. The
business of Toyota will survive for a long run.
(ii) Advise on the operational strategies that Ford and GM can implement to gain market share
from Toyota
To gain market share it is important for an organisation to make better plans and
operational strategies so that business can grow and get success. As per the case sales of Toyota
was reducing because the consumers were not happy with the quality of its product so that they
does not want to buy cars. For that purpose it have to recall around nine million vehicles from
the market. As a result profit and market share was reducing which is not good for the company.
Therefore, it has an opportunity in front of Ford and GM to maximize the sales and market share
because sales of its competitors was decreasing. For that purpose it is important for Ford and
General Motors to implement better operational strategies in order to expand market share as
compare to Toyota. As organisations strategies which can be used by companies are as mention
below:
 As Ford and General Motors have to improve their auto lineup which is help for the long
term purpose in order to gain more market share.
 Both companies can secure market share gains by investing windfall profits into making
products more competitive.
 As gain market share from Toyota, Ford and General Motors have opportunities to
provide better product to the consumers and increase the prices so that they can earn
more profits (Baines and W. Lightfoot, 2013).
5

Along with this there are various operational strategies can be implement by Ford and GM which
are as:
Continual development of new product: To gain more market share it is important for
the organisation to development new product as per the demand and requirement of consumers.
For that purpose it is important for Ford and GM to make proper operational strategies and
emphasis to continual development of new product because trend, demand and market conditions
has changes over a period of time.
Optimize the supply chain: To optimize the supply chain is important for Ford and
General Motors so that it can take the advantage of competitiveness. For that purpose it is require
for the corporations to improve inbound & outbound supply chain to take benefit of cost saving.
Inbound: Push value added services such as: packaging & ticketing and to introduce
vendor portals to exchange information in context to purchase orders, invoices and deliveries.
Outbound:
Outbound shipping costs have exceeded the total of all other costs and for that purpose it
is require continual renegotiation with carriers & strategies changes in how to position's stock
closer to consumers.
Decrease cost of production: It is important for an organisation to reduce the cost of
production so that profit margin can be increase. For that purpose it is important for Ford and
GM to make proper operational strategies which emphasis to reduce the cost of production by
eliminating the wastage so that profit margin can be increase. It will help the corporations to
capture more market share as compare to Toyota (Babu, 2012).
To emphasis towards new technology: To gain the competitive advantage and to
capture more market share it is important for the organisation to use latest technology. As
because consumers are more emphasis towards innovative technology because it makes the work
more easier and smoother. There are lot of scope available in front of Ford and General Motors
to use innovative technology in order to fulfil the expectations of consumers as a result sales of
corporations will boost and it leads to more profits. As a result market share of companies will
expand as compare to Toyota. Technology can involves: predictive vehicle technology, self
driving, more fuel efficient rides, augmented reality head up display.
So these are the some operational strategies that Ford and General Motors can implement
in order to gain market share from Toyota. So it has a great opportunity in front of both
6

companies to capture more market share by satisfy the desires of consumers. It is also beneficial
in order to maximize the profits and to achieve the objectives of firm (Aral and Godes, 2013).
CONCLUSION
As from the above report, it has been concluded that it is important for a form to
emphasis towards business operations and services. To improve the operational strategy is
important for an organisation and there are different tools and techniques which can be used in
this regard so it is necessary for the firm make better strategy so that it can achieve the
corporation's objectives. It is required for the business to formulate effective operational
strategies so that market share of company will increase and it can earn higher revenue and it can
sustain for a long term. To survive in the competitive environment it is necessary for the
organisation to fulfil the expectations of consumers and emphasis towards innovative technology
so that it can sustain for a long run in the market. To rule in the market it is important to gain the
competitive advantage.
7

REFERENBCES
Books and Journals
Aral, S., Dellarocas, C. and Godes, D., 2013. Introduction to the special issue—social media and
business transformation: a framework for research. Information Systems Research.24(1).
pp.3-13.
Babu, K. V. S. N., 2012. Business intelligence: Concepts, components, techniques and benefits.
Components, Techniques and Benefits (September 22, 2012).
Baines, T. and W. Lightfoot, H., 2013. Servitization of the manufacturing firm: Exploring the
operations practices and technologies that deliver advanced services. International
Journal of Operations & Production Management.34(1). pp.2-35.
Chen, J. S. and Tsou, H. T., 2012. Performance effects of IT capability, service process
innovation, and the mediating role of customer service. Journal of Engineering and
Technology Management.29(1). pp.71-94.
Chon, K. S. and Yu, L., 2012. The international hospitality business: Management and
operations. Routledge.
Demirkan, H. and Delen, D., 2013. Leveraging the capabilities of service-oriented decision
support systems: Putting analytics and big data in cloud. Decision Support
Systems.55(1). pp.412-421.
Maglio, P. P. and Spohrer, J., 2013. A service science perspective on business model innovation.
Industrial Marketing Management.42(5). pp.665-670.
Massa, L. and Tucci, C. L., 2013. Business model innovation. The Oxford handbook of
innovation management.20(18). pp.420-441.
Oliveira, T., Thomas, M. and Espadanal, M., 2014. Assessing the determinants of cloud
computing adoption: An analysis of the manufacturing and services sectors. Information
& Management.51(5). pp.497-510.
Sampson, S. E., 2012. Visualizing service operations. Journal of Service Research.15(2).pp.182-
198.
Visnjic, I., Wiengarten, F. and Neely, A., 2016. Only the brave: Product innovation, service
business model innovation, and their impact on performance. Journal of Product
Innovation Management.33(1). pp.36-52.
Wang, X. and Durugbo, C., 2013. Analysing network uncertainty for industrial product-service
delivery: A hybrid fuzzy approach. Expert Systems with Applications.40(11). pp.4621-
4636.
8