Strategic Frameworks of Knowledge Management Assignment 2022

Running Head: STRATEGIC FRAMEWORKS OF KNOWLEDGE MANAGEMENT
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TOYOTA
STRATEGIC DEVELOPMENT
Student name
8/27/2019

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Contents
Introduction:..........................................................................................................................................2
Creation of Knowledge:.........................................................................................................................2
Importance of Knowledge in strategic development:.............................................................................3
Strategic Marketing:..............................................................................................................................4
Sustainability:........................................................................................................................................5
Competitive advantage:.........................................................................................................................7
Managing Corporate Change:................................................................................................................8
Conclusion:............................................................................................................................................9
References...........................................................................................................................................10

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Introduction:
The concept of knowledge management is of great significance for any company. It is
a framework or practice which is not a newer one as it is running from the ancient times in
the subject of strategic thinking. It has been agreed by many parties that in this planet many
products are invented so to serve the needs and wants of consumers satisfactorily and are
existed in such environment which is dynamic means continuously changing and here, rival
companies are producing the innovative goods and the behaviour of consumers are based on
trends or fashions which are inculcating in the atmosphere (Korgh, 2016).
That’s why in today’s time this consideration is to be kept in mind by the
organizations so to survive for the longer duration of time in the market place efficiently.
This practice is also defined by Nonaka that knowledge is not the primary activity of the
organizations but, it is a guideline through which behaviour of each and every employee is
specifically stated (Shatouri, 2012). The purpose of this essay is to explain how this theory is
applied in the organizations and here, the company chosen is Toyota.
Toyota is a Japanese automobile company which is established in the year 1933 and it
is founded by Toyota Sakichi. Its headquarters are situated in the country Japan, Aichi. It is
the first one, who takes the initiative of producing more than 10 billion vehicles in the year
and it is implemented from the year 2012 onwards. It manufacturers all types of vehicles
whether it ranges from small that is cars and big just like buses as well as trucks. Its business
is operated in all parts of the world. It is unique as compared to other rival companies
because its name comes in the list of strongest firm manufacturers (Toyota, Toyota Global
Vision, 2019).
Creation of Knowledge:
In general terms, Knowledge is the awareness or consciousness part which can be
gained with the help of learning or by experience. Thus, it is a behaviour which is focused on
the culture of the organization. It includes the procedures and tools deployed so to gather and
share data effectively (Bandera, 2017).
It is followed, many organizations that utilize traditional models are failed and due to
this, outcome organizations tend to adopt the knowledge principles in their businesses so to
gain competitive advantage in the dynamic environment and to achieve high productivity. In
relates to Toyota, it is performed for inculcating resources in both forms that are physical and

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humans. The sharing of knowledge is for physical environment, database software and for
learning new things in the structure. (Bandera, 2017)
Nonka identified the two types of knowledge that are explicit and tacit knowledge.
This leads to the creation of SECI model and it is very much important in learning as well as
transferring knowledge. In these various stages are included such as socialization,
externalization, combination as well as internalization (F.L.Hong, 2012).
In socialization, knowledge can be transferred through practice and by observing the
actions of other parties involved. In externalization, information is gathered is converted into
the document format for making it easy to understand. In combination, both documents, as
well as information, merged together. In internalization, it can be said that the true employee
is the individual who shows dedication towards work in the job. It is required not in the
current workplace but also in future prospective. It is not only happening in the case of public
sector but, also in private sector (Zheng, 2010).
Toyota basically, implements its position in that only and treats knowledge
management as a tool which helps in managing the strategy effectively of a firm. This all can
be achieved by performing communication, support comes from top managerial positions,
developing the networks to learn, and people as well as culture and evaluation
procedure.SECI model is not a framework just to explain the approach of learning but, it also
solves the problems which arise in the case of transferring of information such as cultural
barrier (Schulze, 2013).
Importance of Knowledge in strategic development:
Strategic development refers to the planning aspect of strategy It defines separately
generic strategy and intensive growth strategies. In generic level, scope to expand its
operations in the global market scenario and in intensive growth, such actions are included
for maintaining the growth. It is related to cost differentiation as well as broad differentiation
(Tidd, 2018)
It is done so to reduce the cost which is incurred in producing the products and its
focus on making the offerings of company unique so to gain competitive advantage. It is
implemented at the time when globalization forces inculcate in the economy and previously it
only sells its offerings to Japan and export to only some countries which are located in abroad

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but, with the rise of demand it started its business in foreign countries and due to this, it has
to face problem as it is a new market so managing the business becomes difficult in this
regard (Hiriyappa, 2013).
It is by this consideration company came to recognize the role of knowledge
management and then adopt it for the first time with the utilization of tools and also fulfil the
tactic knowledge. It is by this, the company put efforts for converting data into the form of
information. It is done through the procedure of collection, organizing, summarising and then
after analysing. Knowledge enablers in whom it is included are introducing the vision of
knowledge, managing the conversations in a manner so that no conflicts arise, establishing
the correct context, displaying knowledge reformers and globalizing local knowledge is
performed in the organization (Rodrigues, 2010).
However, one point is to be noted down that it is not much successful than what is
being expected. So, manager of the company has to evaluate the issues which caused a barrier
in its process as it is 21st century so intellectual capital to be employed in the business so to
maintain its same position in the marketplace (SatishTyagi, 2015).
Thus, by going through all this, it can be said that it has a good plan but, not followed
in the right direction in which it can be. Toyota Motor Corporation that is Japan’s largest and
the world’s leading company and it is also called as Knowledge Company. It also wins the
award of Global Most Admired Knowledge enterprises and not only once, twice but thrice
time that’s a big achievement. Measures of this award are on the basis of knowledge-based
culture, products, cooperation, knowledge sharing, and organizational learning (FrankRuff,
2015).
Strategic Marketing:
It is an important concern with respect to companies as by this, marketing becomes
effective and the goods reach in the market place easily. It targets the age group of 30-50
years and made up its products for middle-class segment of population and, focuses on
maximizing the satisfaction level of buyers. In respect to price, it adopts penetration pricing
and it is that in which price is set in such way so to gain competitive advantage in the market
and it is possible only with low pricing so to get the number of prospective buyers (Tomino,
2011).

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For the purpose of advertising, it uses daily promotion which is usually done in the
case of daily consumable goods like food items. It also utilizes social media tools effectively
as, it understands that, it is a new trend which needs to be adapted because consumer spends
most of the time in it. Trade shows are also conducted whenever there are a need to aware the
people about the new product and its features. Toyota makes use of personal selling, public
relations, as well as social and print media tools (Sosnovskikh, 2016).
Toyota should also have to understand that low pricing strategy is not much use in the
long-run as there are more chances that new joiners be able to sell the goods at a low price so
this can successful only for short-run period. It should also have to keep an eye on
competitors’ promotion so to develop its strategy accordingly. The place is where goods are
available and for this company, it is done by way of retailers and dealers (Hiriyappa, 2013).
Strengths of corporate are that it provides a diverse range of product suited according
to lifestyle and offer a reasonable price to consumers. The weakness of Toyota is rigid
organizational structure, secrecy in culture of firm as well as taking time in recalling the
product once again. Opportunities available in relation to sustainability factor, which would
increase its brand value in the market place. Threats are in relation to competition as because
automotive industry it is very much wide which provide various opportunities to the new
joiners, change in price of raw materials also hamper its operations (Ali, 2014).
External environmental analysis of the industry in which this firm is: Political factors,
is concerned with tariff as well as tax policy of government and it is due to the fact, firms are
required to pay money when they purchase their goods from the other countries, so it depends
on that. Economic factors are with the spending power of buyers. Social factors, it is done for
showcasing the other people and making the products for loyal customers. Technological
factors, it is very much necessary to adopt whenever changes take place otherwise,
company’s share falls down (AbdulRashid, 2014).
Sustainability:
Sustainable development is a concept which states that the needs of present are
fulfilled, without having compromise in future generation. It is a factor which gives
consideration on profit, people as well as planet (Shatouri, 2012).

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Types of business responsibilities are reactive, proactive and predictive. In reactive,
help is given in the form of donating a specified amount for solving the social issue.
Proactive is done by solving the query by taking a step-by-step procedure. In predictive,
effort is put on education as well as on other variables. Toyota follows the third approach in
relates to sustainability and puts focus on specific areas such as education, water, safety roads
as well as on sanitation problem (A.Shinkle, 2012).
For society, it launches an initiative to reduce the traffic on the roads by making its
vehicles safer and educating the society to follow the rules of traffic and maintaining
technology in that way only, just like giving information where is the traffic (Toyota,
Initiatives to Improve Traffic Safety, 2019).
For human resources, it engages technical training institute so to give them
appropriate training so that they work in an efficient way, in order to reduce the wastage
which is coming out while manufacturing the vehicles. This practice can be attained by
framing a sound training environment to learn. It also puts efforts on the activities such as
producing vehicles of high quality so to satisfy the needs and wants of customer effectively
(Sosnovskikh, 2016).
In relation to the environment, it sets up a target that its vehicles should be releasing
the zero present carbon emissions. It also creates an eco-park for supporting the environment
effectively. Here, knowledge plays an important role in gaining the factors which are running
in the external environment and it will also helpful in gaining competitive advantage in the
market scenario (Toyota, Toyota Environmental Challenge 2050, 2019).
Action learning is done at the individual level means by leader in the team. Quality
circles maintained in the Toyota so as to solve the queries as well as for reducing the errors
done through human efforts. As a group level, it implements the strategy of’ learn local, act
global’ which is a guideline that to learn the domestic needs of the country and then after,
implement it at international level, so to enhance the efficiency of its operations (Woodsman,
2013).
It is for this, it adopts the practice to transfer the knowledge of old employees to the
newer ones which are good in enhancing the knowledge. However, it has a drawback of
cultural barriers which occurs in transferring the information from one to another. So,

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knowledge management is not only concerned with technology, but also on humans (Tidd,
2018).
Competitive advantage:
Knowledge is considered as an essential part in respect to companies and it is a useful
term which is used to guide the firms to take appropriate actions in time so to gain a
competitive advantage in the market. Toyota maintains good relationships with the suppliers
and which in turn, helps in maintaining stock before it ends so to maintain regular supply and
does not hamper the demand. Association with the dealers of corporate is made for sharing
explicit and tacit knowledge effectively and which in turn, helps in creating an identity for the
Toyota (Zheng, 2010).
Networks are the frameworks which are made from employees in the organization
who are having interest to talk over on a specific topic and when the ideas of their peers are
shared within a group to generate the new conclusion relating to developing product or
technology. Accountability is provided to the suppliers’ network so that they can acquire,
store, and transfer knowledge in between group members and it is not made large but small
so to create a strong bond of relation. Transfer happens to members from one team to another
(Bandera, 2017).
It does not end up with this only, as because there is a requirement to hire committees
to discuss the important aspects such as cost, quality, and safety to the groups. It is because it
follows the concept of re-engineering, which is concerned with rethinking of design made in
the procedures for improvements in manufacturing. It also has a great philosophy model that
is to learn from the past mistakes made (Demidova, 2011).
Operation Management Consulting Division (OMCD) is the department for sorting
out the problems which are occurring at the company and supplier level by facilitating the use
of the on-site facility and it is those services which provide time utility and, cover the large
segment of population easily. Toyota utilizes this with off-site, so to manage its drawbacks
and make use of this process. As, it is tacit knowledge, and requires the one-to-one
conversation that’s why suppliers are required to visit and this effort is become possible by
knowledge part only (Wilhelm, 2011).

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For the purpose of sharing, it is required to adopt bilateral and multi-lateral networks
in the organization of Toyota as the workforce is large as well as diverse. Processes such as
diffusion and creation provide assistance in matching the knowledge with the specific process
so to gain the advantage in the more share in the market (Heene, 2010).
Managing Corporate Change:
It means to change the model of business and it is not only for the marketing aspect
but in overall context. It happens in the year 2010, at the last and it is made so to gain
competitive advantage as because its competitors already take the intuitive according to
dynamic market situations. It is said to be dynamic because it keeps on changing
continuously so there is need to amend accordingly the business (Wilhelm, 2011).
Further, it is not easy to implement as it is big so possibilities are that might be
resistance from employees. In this context, there is role of knowledge in adopting change
successfully. It also utilizes 3Rs that is reduce, recycles and reuse its products as for making
it sustainable according to environment and for community (Pleoza, 2012).
Focus on pull strategy for buyers as by keeping the assumption that people will tend
to purchase only through by way of the persuasion. Factors which drive change are classified
into external as well as internal. In respect to external, elements which are political,
economic, social, technological, environmental and legal. In respect to internal, the
dissatisfaction of management with situation of today conflicts in between management as
well as employees, technology, structure, and responsibilities (Maurer, 2011).
Structure change is done in the year 2010 by merging both the departments that are
Business Development as well as Marine Business so to reduce the excess cost which has
been spent on the operations of Toyota. The new structure will be like, firstly the departments
merged then, sales, purchase is also divided into two forms first is planning and second, is
that which assembles the components. It renames the advertising and marketing division to
only Marketing Japan Company Limited. It expands the scope of strategic marketing support
to sales enhancement department. It also makes advancement in the design division
(Wilhelm, 2011).
This is all done with the intention that to make the firm compatible in the market
place, it is supported with the culture factor as many peoples of various diversities are

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working so for successfully implementing the intellectual capital effectively positive learning
environment required in which suggestions of workers are taken for further improvement and
it is done through open-space instead of interaction done in walls in the rooms (AbdulRashid,
2014).
It adopts even today ‘Just in Time’ strategy as it is very much useful in reducing the
cost and for promoting the advantages of goods. Another one is Jidoka which emphasize on
the concept that if issues are arising, stop the work so to find its solution (Tidd, 2018).
Conclusion:
In conclusion, it can be said that Nonaka's views serve as an important consideration
in relates to businesses. In the case of Toyota, it is helpful in locating the issues and taking
corrective actions successfully.
Knowledge management also gives assistance in solving the problems which are
related to technology and thereby, for making stronger the strategy of the organisation
effectively. It is useful in achieving long-term growth and in gaining sustainable competitive
value as compared to rival companies existing.
Learning can be done from customer, competitor as well as by supplier of trade. It is
good process through which innovation gets base and, innovation is not only focusing on
developing new product but, it also includes changing the old product into newer form so to
attract the number of potential as well as prospective customers.

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