Business Report: Strategic Information Systems for Toyota Global

This report provides a comprehensive analysis of strategic information systems (SIS) within Toyota Global. It begins by identifying the company's critical success factors, including the Toyota Production System (TPS), Kaizen, Genchi Genbutsu, and its people-centric approach. The report then outlines the information needed to evaluate these success factors and presents a formal organizational chart. It proceeds to analyze Toyota's current information systems, highlighting weaknesses such as organizational hierarchy issues, communication barriers, and product recalls. The report further explores the usage of features like MRP, MRPII, and EDI as features of information systems. The report also includes lists of financial and non-financial data attributes, user views of information systems, and a discussion on security risks and data breaches. Finally, the report proposes potential remedies for these weaknesses within a new, improved system, providing valuable insights into how SIS can be implemented for maximum corporate benefit.

Running head: BUSINESS REPORT ON INFORMATION SYSTEMS
BUSINESS REPORT ON INFORMATION SYSTEMS
Name of the student:
Name of the university:
Author note:

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BUSINESS REPORT ON INFORMATION SYSTEMS
Executive Summary:
Information systems that are strategically planned and implemented within the
organization, which plays a vital role in performing the most important tasks within the different
departments, are termed as strategic information systems (SIS). They are useful in enhancing the
brand image of the company. Many companies are implementing them globally, it helps the
companies to be in a better competitive advantage, and there are multiple other advantages of
strategic information systems, which will further be discussed, in the following paragraphs.
This report will consider the case of Toyota global, which is one of the leading players in
the automobile industry presently across the world. The paragraphs will highlight the different
aspects of information systems: Its advantages, disadvantages, cost factors and other
considerations that has to be kept in mind before implementing SIS. BY the end of this report,
the reader will have a clear idea on how SIS can be implemented within the organization so that
it can be utilized for the maximum corporate benefits.

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Table of Contents
Introduction:....................................................................................................................................3
Discussion:.......................................................................................................................................4
Success factors for Toyota Global:..............................................................................................4
TPS:.........................................................................................................................................4
Kaizen:.....................................................................................................................................4
Genchi Genbutsu:....................................................................................................................4
People:.....................................................................................................................................5
Information needed to evaluate the objectives of the success factors:........................................6
Organizational Chart of Toyota Global:......................................................................................7
Current system within Toyota:....................................................................................................8
Weaknesses:.............................................................................................................................8
Usage of MRP, MRPII, and EDI as features information system:........................................12
List of financial and non-financial data attributes:................................................................13
Four user views of information systems:...............................................................................14
Security risks and data breaches:...........................................................................................15
Possible remedies in the new system:....................................................................................16
Conclusion:....................................................................................................................................16
References:....................................................................................................................................17

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BUSINESS REPORT ON INFORMATION SYSTEMS
Introduction:
Strategic information systems (SIS) are systems that contain information that are used by
the companies for their corporate benefits. It is called ‘strategic’ because of the crucial role it
plays in enhancing the image of the information services within the organization. These strategic
information systems are generally incorporated within the organization as a response to the
corporate business strategies, which in turn help in giving the companies a corporate advantage.
Department specific tasks such as payroll calculation, storing employee personal as well as
professional details in HR management portals are being carried out with these task specific
information systems. There are five categories of information systems that are generally
incorporated within the organizations, which are systems that help in transaction processing,
Management processing strategies/systems, Support systems for decision-making and an expert
system of neutral networks.
In this research, the chosen company is Toyota Global, which is one of the most
successful and technologically advanced automobile company in the world today. The different
aspects and technologies involved with the implementation of strategic information systems
within the organization will be studied in details in this report. The technologies such as MRP,
EDI, and as well as MRP II will be studied along with the different financial as well as non-
financial aspects associated. The potential threats such as data theft and breach and other security
issues associated with SIS implementation, will also be discussed in details. The report will also
contain an organization chart in a formal way, which will help the reader understand more in
details about the chosen company – Toyota Global.

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Discussion:
Success factors for Toyota Global:
Before understanding in details how information system can be implemented within the
company, it is of utmost importance that the reader first knows the different success factors for
the company. These can be summarized below as:
TPS:
The TPS which stands for the Toyota production system, is the well-known production
model used by Toyota internally. The principles associated to this model are often referred to as
“lean manufacturing.” Established shortly after the Second World War, this model was
developed by Toyota to understand and analyze how to derive the most out of any available
resource may it be a human resource or a machine. ‘Waste elimination” was one of its major
focus points. This model believes in the elimination of ‘Muda’, a Japanese term that means
wasteful involvement of employees (Routroy and Pradhan 2013).
Kaizen:
“Kaizen,” again is a term, which means “continuous improvement” in Japan. Toyota
follows the philosophy that aims at constant employee betterment and constant innovations
within the company rather than sudden overnight ideas of “game changing” (García et al. 2014).
Kaizen is considered just not as a philosophy or way of working within the organization, but it is
also considered as a responsibility of all the employees in and out of the workplace (Coetzee,
Merwe and Dyk 2016).
Genchi Genbutsu:
“Genchi Genbutsu,” is one of the most important core values being implemented by
Toyota, which can be translated as “go to the spot.” It is an extremely innovative and employee

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friendly technique being rightly implemented by Toyota wherein any situations or their outcomes
are being confirmed based on personal observation or interpretation rather than blindly relying
on computer or second hand electronic data, which is followed by most of the companies in
today’s world. This is where Toyota stands apart from other companies and is so successful in
any of its business operations. For example, if there is any such circumstance or situation within
the company wherein a manager or a higher authority needs to interfere, the manager has to go to
the factory site or the floor himself to understand and observe the situation to make any decision,
instead of just relying on computer data (Yang and Yang 2013). Chairperson of Toyota Global
Akio Toyoda is known for often visiting unannounced dealerships, outside the Toyota factories
in order to carry out personal inspection of newly manufactured vehicles (Gao and Low 2014).
People:
Often the most important success factor for Toyota, which is its own employees, is
overlooked. According to Kaizen, all the employees within Toyota goes through trainings and
processes of self-development, which can in turn cause the company to improve as a whole.
Kaizen insists on the valuable contribution by the employees towards the growth of the
company, which is only possible through the self-improvement of the employees. Wastefulness
can be eliminated by keeping the employees and the workers in the factories completely updated
with the recent technologies. Toyota has always believed in such a work culture that always stays
updated with the recent trends and technologies. Teams are formed and small groups of
employees work together in harmony and correlation in order to solve complex tasks together
(Aguado, Alvarez and Domingo 2013).

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Information needed to evaluate the objectives of the success factors:
The success factors mentioned above have a common objective, which is nothing but the
overall development of the company. The objective of TPS, which is the Toyota Production
system is to enable the company have a proper relationship with its suppliers as well as its
customers. The model organizes the manufacturing tasks as well as the logistics and eases the
work of the different employees working within the production department of the company.
The objective of Kaizen is to keep the employees under a constant process of
improvement and self-development rather than a sudden plan of any sort. This ensures a
systematic and constant growth of the company. The objective of the “Genchi Genbutsu”
philosophy is that it aims at equality within employees and real-time decision making based on
personal observation instead of going by second hand data. Similarly, employee contribution
aims at providing the company the best possible work force and human level involvement in
operational tasks to reduce any kinds of errors.
Therefore, in order to evaluate the success factors of the company, it is extremely
essential to identify the factors influencing these objectives. It is important to know the working
principle of the employees working in the production department, which is the TPS. It is
important to know how the rest of the organization including the human resource management
handles issues related to the TPM. Job satisfaction of the employees also play an important role
in the success of the company, because often Kaizen stresses on overtime and extra work, which
can be physically tiring for the employees. It is important to understand the mentality of the
manager and the leaders and the conditions and circumstances under which they have to take
decisions, under the philosophy of Genchi Genbutsu” (Mostafa, Dumrak and Soltan 2013).

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Organizational Chart of Toyota Global:
The organizational structure of Toyota is extremely well defined. The central board
consists of the chairperson, vice chairperson, the president and the executive vice president. They
are guiding leaders for the rest of the Toyota offices spread across Europe, China, Asia Middle
East as well as other parts of the world. Under the operations group of North America different
operational units are present in Europe, China and Asia as well as Middle East and Africa. The
business development group has multiple units such as administration, technical accounting as
well as purchasing. The TPS or the Toyota production system is also one of the aspects being
used extensively within the company in the manufacturing units and the production engineering
groups (Rüttimann and Stöckli 2016).

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Fig 1: Organizational Chart of Toyota Global. (Source: As used by author)
Current system within Toyota:
The present working system within Toyota is a socio-economic process-driven strategy,
which is also known as lean manufacturing. The major driving principle in the production
department is the Toyota production system as well as the value stream mapping (VSM)
terminology. Toyota believes in ‘Kaizen’, which means constant self-development of the
employees. It also ensures that the managers and other higher authorities always get involved in
any situation personally to eliminate the risk of taking any wrong decision by just relying on
computer data (Jones 2013). The company also stresses on identifying the valuable employee
contribution towards its constant growth and keeps tem motivated with rewards and recognition
at the work place. This is the present working system of Toyota and this present working model
has a number of weaknesses as well. These weaknesses have to be addressed by the company
management in order to ensure better business outcomes and a better work culture within the
organization (Ward and Sobek 2014).
Weaknesses:
Some of the major issues within the internal working of the organization are listed below:
1. Structure of organizational hierarchy:
This is one of the major weaknesses of the present working system within the
organization. The different roles and responsibilities are so widespread that it prevents
the company from attaining maximum possible flexibility in taking business decisions,
especially at a regional level. Often a language barrier occurs within the employees
working in regional offices due to which there are lack of communication within the

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employees themselves leading to employee unrest. Th in turn causes employee job
dissatisfaction (Moeuf et al. 2016).
2. An unspoken secrecy that is maintained at the work place:
This again is a major issue within the work culture of Toyota, which causes increase in
the response time to any business situation. The management seems to take much more
time in understanding a situation right in the first place because of the secrecy maintained
within the employees, since the higher management is ignorant of many concerns or
issues, which are not spoken about.
3. Product recalls that have had effect on the market in the recent years:
The company had started massive recalls within its decisions starting mainly from 2009,
which in turn questions the business capacity and decision making quality of the
company. The company can revise its organizational structure and working policies in
order to address the recalls that can be prevented or the recalls that are controllable.
A newer system to address the weaknesses:
A newer system of working can be recommended which will just not eliminate the above-
mentioned weaknesses but also address other issues which are presently untapped by the
organizations. There are a number of opportunities and areas of improvement that the
organization can presently focus on. Some of these new implementations can be summarized
below (Cresswell, Bates and Sheikh 2013):
1. Expanding business to other countries: More the presence in different countries, more
a multi-cultural workplace it will have. In that way, employees will get to mingle with
each other even more and will be exposed to newer perspectives coming from different
people in the work place. It will also help in increasing sales and improving the brand

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value of the company. Newer job opportunities will be created within the company,
which will also cause the organization hierarchy to be more flexible than before. Since
employees from different cultures and countries have to work together in newer countries
where the company still have not made its presence, it will also ensure an unsaid
transparency in the work culture. This will cause more innovative ideas to come up
among the employees, thereby enforcing the concept of ‘kaizen’ even more (Twarowska
and Kąkol 2013).
2. Rising demand for fuel-efficient automobiles:
There are different segments of cars such as sports cars, luxury cars, low maintenance
cars for general transport and other categories of cars across the world. Toyota should
start focusing on manufacturing high mileage yielding fuel-efficient vehicles that should
be able to cater to the needs of the common traveler. It should focus more on developing
newer models, which are affordable for an average consumer and not manufactured
presently by any of its market competitors such as General motors, Honda and ford. This
will considerably reduce product recalls since the basic needs of an average customer will
be addressed. This is a basic success factor for any given organization. Based on this
information (Liu and Meng 2017).
The advantage that Toyota always had is that, since its inception it had developed
a global presence and a very strong brand image. Earlier it was more focused on its home
base and marketing their products within their home base itself. It was never much
innovative in coming up with newer strategies in product exports. It was only concerned
about the sales in its home bases. Then, due to dissatisfaction within its customers and lot
of product recalls since 2009, it had come up with the strategy of exporting and

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marketing its products in other parts of the world. It started making use of information
systems in order to build and implement those strategies. It started focusing on a global
network and which in turn would develop the local bases (Kiser, Leipziger and Shubert
2017).
Fig 2: Flowchart of the current working system of Toyota (Source: As used by the
author)

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Fig 3: Data flow in the working system of Toyota global (Source: As used by the author)
Usage of MRP, MRPII, and EDI as features information system:
Materials requirement planning (MRP):
This is a technique of production planning, which is software based and a control system for the
inventories, used in the manufacturing units and their internal processes. Although it is not much
seen in the organizations now a days, still it can be implemented manually by hand as well. MRP
ensures to meet three main objectives, which are summarized below as:
- It ensures that raw materials are available for production and smooth delivery of products
to the consumers. As discussed above, Toyota should aim to improve their customer
services even more. It should also ensure that in whichever new country it is about to
start or expand its business, there should always be an abundance of all the raw materials
and a proper interaction with its suppliers in the global network. This will ensure a
smoother workflow within the organization. The company should also aim to provide a
smoother delivery process of the automobiles to all its customers even if it means to

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export their products in other parts of the world s and when required. This entire process
can be controlled and managed by information systems making use of materials
requirement planning (MRP) (Laudon and Laudon 2016).
Manufacturing resource planning (MRP II):
- This is an information system in its integrated form, which has evolved from the earlier.
Materials Requirement Planning (MRP). It includes additional data such as employee
personal information and financial data as well in its operations and therefore gives more
advanced and accurate operational results. The system can be used by Toyota in
implementing strategies in order to make and schedule making in scheduling inventory
management expenses as well as inventory management system of the organization
(Miclo et al. 2016).
Electronic data interchange:
- Electronic data interchange (EDI) is and to end exchange of important confidential
business documents through computers. This is done between companies in order to
share business related information. It is a digital technique of information sharing
between computers, which eliminates the usage of traditional fax machines and manual
mailing of paper documents. This information system uses a particular format of data
transaction, which is widely accepted by different companies all across the world. Toyota
can use this technique, when it plans to expand business in other countries where is
presently not located. Expanding to other countries would mean coordinating and
interacting with multiple foreign vendors. In such a case, an information system like EDI
would be a great help for Toyota (Demir and Krajewski 2013).

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List of financial and non-financial data attributes:
Financial factors:
- The effectiveness of the implementation of the information system: A lot of money
will be invested in the implementation and risk of its failing has to be kept in mind;
otherwise, the entire investment can prove to be a loss for Toyota.
- The cost of the multiple application development for the implementation of software
based operations: Application developers charge a lot of money in order to develop
business specific applications for a particular company. Similarly, Toyota will also need
specialized mobile apps and business oriented applications, especially while
implementing information systems in their organization, which will again have certain
financial data attributes (Liu, Liang and Wang 2016).
- Cost of servers and more mobile devices like computers: Setting up new offices in
other countries will need many computers, servers, and centralized systems that would
take care of the information system operations. That will contribute to financial data
attributes to the company.
Non-financial factors:
- Ethical considerations: This is one of the most important non-financial data attribute,
while implementing information system. Toyota should not be answerable to any ethical
questions or situations by the usage of information systems. It should especially keep the
risk of data breach in using technologies like EDI, since the data has to pass through
different networks within or outside the organization (Debnath 2015).
- Employee job satisfaction: This again is an important consideration for Toyota.
Employees should be satisfied within themselves while making use of newer

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information systems in their work culture (Li, Hsieh and Rai 2013). They should not ever
think that information systems are automated and efficient enough to reduce their own
will to strive for continuous development (Kaizen), instead they should consider
information systems as their aid in reducing the bandwidth to do tedious tasks (Nkomo
2013).
Four user views of information systems:
Information systems can be considered more efficient that computers:
It effectively understands the requirements of the organization especially in the operations of
management, information technology and handles all employee as well as customers’ needs on
one single common platform.

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Organizational assets:
This view includes the effectiveness of a supportive business culture, an appropriate model for
business decision-making, authority decentralization and a very strong team that handles the
information systems operational tasks within the organization (Kootanaee, Babu and Talari
2013).
Managerial views:
This is a view as provided by employees, which should comprise of a very strong
management system of the higher authorities, mainly in the human resource teams. It should be
able to rightly judge and reward employees and their incentive systems as well as recognitions
within the organization and emphasize on teamwork and harmony. This also addresses the needs
of a non-accounting user (Chang 2016).
Security risks and data breaches:
Access by unauthorized hackers:
Unwanted hackers intrude using advanced technologies into sensitive computer systems
that store important business data like tax files and financial sheets. This is one of the major
threats faced by the organizations today (Scheiblich 2017).
Computer Viruses:
Viruses like Trojan horses and worms, which are, specialized computer applications
designed by hackers to attack computers and steal data or corrupt important files.
Vandalism:
Damage caused deliberately to the computer hardware or sensitive software applications
that help in business decision-making processes is a serious threat to information systems,
especially in a company like Toyota, which is known for maintaining a strange employee secrecy

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within the work culture, which is not at all a good practice. This can be a result of an individual
sabotage of any given employee as well as an unintentional sabotage (Wilson 2014).
Human errors/accidents:
Human errors and unintentional accidents can always pose threats for the information
systems. For example, employees being careless and leaving behind their sensitive mobile
devices unattended can lead to data theft and breach (Card 2017).
Possible remedies in the new system:
The new information system in Toyota can make sure it does not have the above-
mentioned threats in its working operations. It can ensure to have an audit trail system in all its
sensitive mobile devices like laptops and other servers to keep a track on who accessed what.
They should have more advanced firewall and anti-virus programs in the systems to reduce virus
attacks and hackers from getting into the systems. Toyota can also ensure more advanced and
strict employee policies within the work culture so that they take utmost care of the devices that
they are provided by the company for business tasks (Venkatesh, Brown and Bala 2013).
Conclusion:
There it can be concluded from the above paragraphs that information systems can be
effectively implemented in the working of Toyota due to its multifold advantages. Technologies
like MRP, MRP II, EDI, which can be implemented in the information systems, and it has been
found that these technologies will immensely ease the operational as well as managerial tasks
within the organization. However, there are different threats like data theft etc. that has to be kept
in mind by the management before implementing the information systems and should first
undergo a phase of testing within the organization before a final implementation.

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