Organisational Strategy | Assignment

ORGANISATIONAL
STRATEGY

TABLE OF CONTENTS
INTRODUCTION.................................................................................................................................3
MAIN BODY........................................................................................................................................3
Macro environmental factor..............................................................................................................3
Industry position analysis..................................................................................................................4
INTERNAL RESOURCES AND CAPABILITIES..............................................................................5
Resources..........................................................................................................................................6
Capabilities........................................................................................................................................6
STAKEHOLDER’S PERSPECTIVE....................................................................................................7
CONCLUSION.....................................................................................................................................9
REFERENCES....................................................................................................................................10

INTRODUCTION
Organisational strategy in a business plays a vital role for achieving its success.
However, it is true that without have effective strategy, it is impossible for businesses to set
up a milestones and to meet future needs (What is An Organisational Strategy and Why is it
important, 2017). Thus, in order to gain the organisational objective, it is necessary that
business must have effective actions of plan. Hence, this assignment will articulate strategic
position of Toyota entity which is conducting its business operations in the Automobile
sector. It is multinational automotive manufacturer which has corporate structure of 364,445
employees across the world. Topics covered in this assignment include Micro environmental
factors of Toyota, its industry position, internal sources and capabilities along with the
perspective of stakeholders.
MAIN BODY
Toyota is multinational company and has sixth largest position in the sector
automobile manufacturing. According to the recent analyse it had been found that as of
2017, entity becomes second largest automotive sector across the world. Its organisational
strategy consists of combination of both cost leadership and broad differentiation leadership
through competitive advantage will get occurred in the global world.
Macro environmental factor
In order to analyse Macro environmental factor of Toyota, Pestle analysis will get
develop trough which all external surrounding factors will get analysed. Its Macro external
environmental factors are as follows-
Political: It has been analysed that Toyota has mainly expanded its business
operations in several countries so that its demand of vehicle will get met. It has begun its
manufacturing in United Kingdom and at that time entity is getting bigger market from the
Europe for offering, making and selling its products. However, in today’s world it is analysed
that in terms of political stability there has been an opportunity for entity to its business with
minimum political interference (Toyota Motor Corporation PESTLE and Environmental
analysis, 2019). Government across the world is providing support for its eco-friendly
products.

Economical: This is the factor which mainly influences organisational development
of Toyota. However, currency exchange rate fluctuation is the major factor which directly
impacting it’s reported revenue. In terms of current analysis it had been analysed that weaken
of Yen vs U.S. dollar is the opportunity as well as rapid growth of developing countries is a
opportunity for entity to enhance its business.
Technological: in terms of this factor, it had been evaluated that Toyota is the first
company which has launch hydrogen car (Fozer and et.al., 2017). It is because the entity has
effective research and development team through which is looking for offering vehicle with
alternative fuel options.
Social: entity has mainly effects with social factors. However, in accordance with this
analysis it had been evaluated that increasing interest of hybrid car is the opportunity for
entity to expand its business.
Legal: This is the main factors which greatly influence the business of Toyota in
global world. However, in today’s world improvement of intellectual property law is the type
of opportunity for entity to expand its business operations. Complex environmental laws are
the one which mainly influence the organisational strategy of entity.
Environmental: In the organisational strategy, entity needs to consider
environmental factors which are different in each nation of the world and in order to get the
government as well as customer support entity needs consider on external factors like climate
change, contribution in the business sustainability etc.
Industry position analysis
Success of Toyota mainly based on the ability of firm to exploit its opportunities and to
respond to its threats in the sector of automobile (Jiang and et.al., 2015). However, in order
to analysis its organisational strategies for meeting with the type of opportunities and threats
will show its capability.
Current business opportunities:
Toyota and its competitors of automotive sector have similar opportunities. This is the
era under which there are tremendous market opportunities exists for this sector and situation
of the industry is a race among firms in order to exploit such opportunities as soon as
possible. In today’s world there exists a competition in terms of technological advancement

in order to make the products more attractive and profitable. Thus, in order to meet the
opportunity entity is further increasing its investment in developing effective research and
development team. Its products come under most innovative one where “Prius” is an effective
example of this one. Thus, this strategic action is most important in industry environment of
this sector.
Further, another issue which affect business of each company include sustainability
and in this sector, sustainability mainly focuses on fuel economy and impact of environment
through business process (Leng and Chin, 2017). Thus, in regards with the Toyota entity it is
been analysed that the company is mainly addressing concerns of environment through higher
efficient of business processes.
Core Competence:
Toyota has effective core competence skills in management, high technology and
knowledge as well as with good relationship with competitive. Entity mainly has high
capability through which it is able to give high performance and production which made it
different from competitors. Currently, company is looking for developing unique product
through which entity will recognise for its great ability to manufacture cars with great and
affordable quality.
Current threats facing Toyota:
Major current threat for Toyota is globalisation because of which it becomes easier
for other auto manufacturer entities for competing in bigger market. It is true that automotive
firms are generally considered as aggressive against each other in order to provide products
and services which have unique innovations and marketing (Barron, Pereda and Stacey,
2017). It is the main reason because of which Toyota has to compete with huge firms which
mainly impact upon its cost, fuel efficiency, brand image etc.
INTERNAL RESOURCES AND CAPABILITIES
Trend which shows the key success factors in automobile industry is as follows-

Resources
Capabilities
In accordance with above two graphs, the resource based views analyse that Toyota
has effective strategy and performance through which it has achieved the success in overall
global market. However, with the view to analyse entity’s resources mainly five key terms
will get include that is physical, technological, financial, human and intellectual capital.
Toyota is considered as vast organisation which competing in many markets and it is been
true that over the years, entity has build effective market resources through which it will able
to compete in the different areas of market segments (Kushwaha and Sharma, 2016).
However, in order to use the resources in more effective way entity has created its
competences in lean manufacturing, efficient supply chain management and in inventory
management as well. This enables flexible, reliable production of entity’s business operation
on a global scale and because of which changing consumers needs will easily get meet.
Financial resource analysis:

In term so financial resources, net income of the entity is 22,446 million in the year
2018 which is a good profit but by analysing its past operation entity as bigger profits and in
turn entity as mainly invested its lot of money in physical, technological and human resources
with many types of assets over the globe. In order to conduct flexible business operation,
Toyota has invested heavily in physical and technological resources around the world so that
cheap and reliable cars will get produced in number of markets (Jayaram, Das and Nicolae,
2010). Toyota has its physical assets in all over the world because of which entity is able to
meet different market challenges of globalised world.
Human resource analysis:
This is the term which mainly accounts for the number of employees hired by entity
across the globe and in context with the Toyota organisation it is analysed that entity has
huge corporate structure which mainly consist of 364,445 employees worldwide and because
of which it becomes the sixth largest company in terms of revenue across the world.
Technological resource analysis:
In terms of this type of resources, Toyota is famed for having advanced material with
effective inventory management system (Sisson and Elshennawy, 2015). It also has
automated parts which are built with effective quality control systems. Recently, entity has
introduced automated cars and eco-friendly cars which differentiate with other manufacturers
of the market in this sector.
Capabilities:
Toyota is the entity which mainly solves its problems through better utilising their
resources and with core organisational strategies. Through this its strategic capabilities get
formed. However, other than this entity is possessing number of its core capabilities which
can be used to leverage its energy consumption technologies, diversifying sources of fuel and
increase in manufacturing and efficiency in green vehicles.
STAKEHOLDER’S PERSPECTIVE
Toyota recognises the importance of its stakeholders as it has the business operations
across the world because of which it directly address the interest of stakeholders. However,
other than this, this is the best company which stand best in terms of fulfilling the corporate

social responsibility (Chiarini and Vagnoni, 2015). The major group of stakeholder group for
Toyota include Employees, customers, investors, environment and communities.
Employees: For Toyota employees are its most significant stakeholders. These groups
mainly aim for job security, career development and fair employment practises. In regards
with their own perspective entity mainly address interest of these stakeholders through
effective corporate social responsibility where entity provides satisfactorily salaries and
wages with career development program as well (Rowland, 2017). Other than this, entity also
offers financial assistance for its employee who wants to continue their education. Thus, in
this way entity fulfils the perspective of this group of stakeholders.
Customers: These are the second-priority stakeholder for Toyota Corporation. The
interest of this group of stakeholder is regarding high quality automobile services along with
affordable prices. In the order to fulfil the perspective of this group of stakeholder, entity
mainly address their issue through rapid innovation based production system with the aim of
maximising the quality, efficiency and innovation. Thus, in this way entity covers the
perspective of these stakeholders.
Investors: For Toyota, investors are the major another stakeholders group which
mainly covers their interest with entity’s profitability. Entity mainly addresses such interest
through emphasis on global business strength and through rapid expansion of business entity
cover the perspective of this group of stakeholders.
Environment: Toyota mainly has the effective corporate social responsibility
strategies through which it targets its environmental goals. The main interest which covers by
this group of stakeholders is regarding business sustainability and environmental
conservation. Company mainly address such issue with Toyota Environmental Activities
Grant programs where firm donates funds for the welfare of environment (Dörnhöfer,
Schröder and Günthner, 2016). Its green program mainly support a network of environmental
activities through which perspective of this group of stakeholder gets covered.
Communities: The perspective of this group of stakeholders is regarding socio-
economic development by entity and Toyota mainly addresses issues of this group of
stakeholder through various community development and support programs. For example:
Toyota has effective education outreach program through it support the literacy across the
world. Other than this, entity also provides Go Safely initiative where safe driving education

has been provided to families. Toyota also works with other organisations like American Red
Cross in order to support development of community. Thus, in this way entity covers the
perspective of this group of stakeholders.
CONCLUSION
From the above report, it can be concluded that Toyota has effective organisational strategies
though which its business operations will smoothly gets conducted in globalised world. In
this report, articulation has been provided on the type of strategies in context with Macro
environmental factor, industry performance, internal resources and capabilities and with
stakeholder’s perspective through which understanding will get developed on Toyota strategy
to meet with such factors. Thus, it can be summarised from the report that Toyota has
achieved sixth largest manufacturing company through capturing technological advancement
opportunities and with innovative features of product and services which mainly helps them
to satisfy the changing consumer’s needs of globalised world.

REFERENCES
Books and Journals
Fozer, D and et.al., 2017. Life cycle, PESTLE and multi-criteria decision analysis of CCS
process alternatives. Journal of cleaner production. 147. pp.75-85.
Leng, K.C. and Chin, T.A., 2017. The Influence of Marketing Mix Factors on Consumer’s
Purchase Intention Toward Hybrid Car in Johor Bahru. Advanced Science
Letters. 23(9). pp.9115-9116.
Barron, A., Pereda, A. and Stacey, S., 2017. Exploring the performance of government affairs
subsidiaries: A study of organisation design and the social capital of European
government affairs managers at Toyota Motor Europe and Hyundai Motor Company in
Brussels. Journal of World Business. 52(2). pp.184-196.
Kushwaha, G.S. and Sharma, N.K., 2016. Green initiatives: a step towards sustainable
development and firm's performance in the automobile industry. Journal of cleaner
production. 121. pp.116-129.
Sisson, J. and Elshennawy, A., 2015. Achieving success with Lean: An analysis of key
factors in Lean transformation at Toyota and beyond. International Journal of Lean six
sigma. 6(3). pp.263-280.
Dörnhöfer, M., Schröder, F. and Günthner, W.A., 2016. Logistics performance measurement
system for the automotive industry. Logistics Research. 9(1). p.11.
Chiarini, A. and Vagnoni, E., 2015. World-class manufacturing by Fiat. Comparison with
Toyota production system from a strategic management, management accounting,
operations management and performance measurement dimension. International
Journal of Production Research. 53(2). pp.590-606.
Jayaram, J., Das, A. and Nicolae, M., 2010. Looking beyond the obvious: Unraveling the
Toyota production system. International Journal of Production Economics. 128(1).
pp.280-291.
Jiang, J and et.al., 2015, August. Financial analysis and comparison of compact electric and
gasoline cars. In 2015 Portland International Conference on Management of
Engineering and Technology (PICMET) (pp. 511-518). IEEE.
Online
Rowland, C., 2017. Toyota’s Stakeholders: A CSR Analysis. [Online]. Available through
<http://panmore.com/toyota-stakeholders-csr-analysis>
Toyota Motor Corporation PESTLE and Environmental analysis. 2019. [Online]. Available
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What is An Organisational Strategy and Why is it important. 2017. [Online]. Available
through <https://www.opstart.ca/organizational-strategy-important/>