An Analysis of Management and Leadership in Toyota's Operations

This report provides a comprehensive analysis of management and leadership practices within Toyota Motor Corporation. It begins with an introduction to Toyota's organizational structure and explores the roles of managers and leaders, differentiating between management and leadership styles. The report delves into the application of various management theories and models, such as management by objectives and situational leadership, assessing their effectiveness in different contexts. It examines the key operational functions within Toyota, including finance, process design, strategy, and forecasting, highlighting the responsibilities of managers in each area. Furthermore, the report evaluates the impact of the external business environment on operational management and decision-making. The report concludes with recommendations for improving operational efficiencies and offers insights into how Toyota can continue to enhance its management and leadership approaches to achieve its organizational goals.

MANAGEMENT AND
OPERATION

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
An introduction to the organisation and its management structure........................................1
P1. Definition and roles of manager and leader and difference between management and
leadership................................................................................................................................2
LO 2.................................................................................................................................................4
P2. Role of leader and function of manager in different situational context..........................4
P3. Application of different theories and models of approach...............................................6
LO 3.................................................................................................................................................7
P4. Key operational approaches to operation management....................................................7
P5. Importance and value of operations management ...........................................................8
LO 4.................................................................................................................................................9
P6. Assessing the factors within the business environment that impact upon operational
management and decision-making by leader and manager....................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Operation and management are the key factor of strength of an organisation. It is the
administration of business practise to build the highest level of possible efficiency within the
organisation. The assignment of Operation and Management include the study on Toyota Plc, a
Japanese manufacturing company dealing in the auto-mobile sector. The report is in two parts;
Task one will include the management structure of Toyota and role of manager and
leader in the organisation and difference between management and leadership. Report will also
cover various theories, concepts and approaches and will analyse the role of leader and manager
in specific situation. The task will end up with evaluation of strength and weakness of various
approaches and will provide some recommendation to manager and leader to bring improvement.
Task second will cover operational function of Toyota and identify the roles and
responsibilities of manager in the key operational function. Key operational approaches and their
value will also be included in the report. The study will also evaluate the impact of external
business environment factors that affect decision making by manager and leader. Lastly, the task
will end up with some recommendation to improve operational efficiencies for future
improvement.
LO 1
An introduction to the organisation and its management structure
Toyota Motor corporation is a Japanese multinational automotive manufacturer with
corporate structure of 70,000 employees worldwide and it was established on August 28, 1937. It
is headquartered in Toyota City, Aichi, Japan. Toyota was the first auto-mobile manufacturer in
the world to produce more than 110 million vehicles per year (Bolden, 2016). Toyota
manufacturer cars have wide coverage from economic minibus to luxurious cars. The
organisation has been shaped by a unique set of principles and values that ave their roots in the
company's formative years in Japan.
The supply chain strategies and processes of Toyota are fundamentals in daily operations.
By correspond Just-In-Time manufacturing and Toyota production system, organisation emerges
to be one of the world's largest automaker.
Management structure is fairly significant for any organisation which is elpful to manage
internal and external matter and all the activities of business. Toyota's management structure
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defines the arrangement and pattern of the firm's resources and processes. This management
structure facilitates the organisation's effectiveness and efficient business management. Toyota
has purely matrix structure that is combination of product based structure and traditional
functional structure (Donate and de Pablo, 2015). The management structure include; Senior
management on the top then production department, sales department, finance department and
research and development department comes under the senior manager and they can
communicate with them and follow the orders of senior manager.
In the structure Toyota make changes time to time, recently it underwent to the changes
in 2013 and the motive of modification is to meet the following objective:
 Convey customer opinion and on-site information in timely manner to management.
 Make constant checks that whether decisions of management are acceptable to society or
not.
P1. Definition and roles of manager and leader and difference between management and
leadership
Definition of Manager
Managers are the person in the organisation who design and manage the work in order to
the pre-determined objectives and goals of the industry. Managers are one who perform basic
managerial functions and are an important link between organisation and its stakeholders i.e.
customers, employees, shareholders, society, suppliers, government, etc.
Role/ Characteristics of Manager
 The primary role of a manager is to ensure the daily functioning of overall business of
Toyota.
 They are entrusted with a leadership role, a manager is responsible for overseeing group
of employee or a department within the Toyota.
 The role of a manager include; set short and long-term goals to ensure Toyota's longevity,
enforce company's policies (Jiménez-Jiménez and et.al., 2015).
Definition of Leader
Leader is the person who get work done from the employees focusing on the objective
and goal of the company. Leader is one who inspire, encourage and influence individuals or team
to work willingly in the attainment of company's objective.
Role/ Characteristics of Leader
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 Leader plays an essential role in motivating employees through communication skills and
leadership and built-in them the vision of organisation.
 Leader is responsible for make the employees work in a manner to achieve the task.
 The major role of leaders is to influence and inspire employees to perform on a high level
that as a result enhance the productivity and efficiency in the company.
Difference between management and leadership
Management Leadership
Management is a discipline of managing things
in the best possible manner. It is the art of
systematically organising and coordinating
things in efficient way (Kiehtreiber and et.al.,
2018).
Leadership is the quality of influencing people
so that the goals are attained enthusiastically
and willingly.
Management adopts passive and impersonal
attitude
Leadership adopts active and personal attitude
Management exercise power over others. Leadership develop power with people
Management of Toyota establish agendas, sets
timetable and allocate resources
Leadership creates visions for employees,
clarifies the big and unclear picture and set
strategies.
Management reflects the managing activity of
Toyota's effectiveness that enhance the strategy
for the effective coordination of execute
the goals through the availability of resources
and manage the whole organisation effectively.
Leadership is the practical approach for
encompassing Toyota for the ability of the
entire organisation.
Analysis and differentiate between the role of the leader and function of a manager by
applying a range of theories and concepts
Manager Leader
The objective of the manager of Toyota is to
set the role in the organisation
The objective of a leader in Toyota is to guide
other employees in the industry
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The communication of the manager will be
done to the policies regulated to the leaders of
Toyota
The leader is responsible to communicate with
other employees as per the setted policy by the
organisation
Manager emphasis on the activities Leader emphasis on the entire workforce
LO 2
P2. Role of leader and function of manager in different situational context
Toyota facing the situation where the prices of fuels, equipments and material are
increasing on rapid phase and in this specific situation the effective implementation of style of
leader and function of management that can handle the cost of manufacturing and enhance the
revenue and sale of the organisation. There are various theory of management that can combined
with leadership skills to develop and grow the company as well as its operation.
As per the issues faced by organisation , management by objective is the approach which
can be utilised for dealing with complex situation. Management by objectives is basically a
performance management approach implementing which manager or leaders in an enterprise can
enable employees to align their objectives with that of business goals. In context of Toyota,
manager or leaders by setting the attainable objectives can positively influence people to increase
their efficiency as well as improve their performance at workplace. In addition to this, managers
or leaders in an organisation need to mainly emphasizes on finding new ideas as well as
facilitating innovation so that they could make valuable contribution in accomplishment of
desired business objectives.
The function of management and role of leadership constitute the Toyota for the changes
and improvement in the operation of the organisation (Leonidou, Christodoulides and Thwaites,
2016).
The management of Toyota applied contemporary theory to deal with the current
situation of increase cost of purchase and manufacturing. Managers of the organisation plan the
strategies such as; effective selection of supplier who provide raw material at lower cost and
leader use their trait style to motivate employees to adopt advance technologies to lower the cost.
Situational Approach
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A model of situational leadership and management was put forward by Hersey and
Blanchard in 1996 that describe the role of leader and manager on various stages of performing
task. The component of the model contains the concept that every situation in Toyota requires
a special management and leadership style to handle the situation (Nakamura and et.al., 2015).
This model including four styles in the scale between supportive behaviour and directive
behaviour. Following are the leadership and management style.
Directing
This is the core style of leadership and management where the leader and manager
provide a lot of guidance and direction to employees by telling them what to do and how they
can accomplish the task without supporting them or less supporting.
Coaching
According to this style, Leader and Manager of the organisation shows an intense amount
of supportive behaviour as well as direction to the employees. Leadership and management tell
the employees what to do and support and encourage them (Northouse, 2018).
Supporting
In this style, Leader and Manager implement supporting behavioural in two way
communication but provide less direction. It involves the leadership traits that reduce the stress
and frustration in the company that result in increasing productivity.
Delegating
In this, Leadership and management give full responsibility of decisions and tasks to
employees. They little support or direct the followers according to this style (Ross, 2017).
Roles and responsibilities of managers in the key operational function
Finance
Finance plays an important operational function. It is essential for manager to ensure that
the organisation's has been utilized properly to carry out major functions such as goods and
services of Toyota by that need of customer could be satisfied.
Process Design
This function is concern with the effective designing of products that is convenient and
attract consumer to purchase. Operational manager in Toyota is responsible for make sure that
the product is designed catering to the market trends and according to consumer demand. The
manager focus on producing top- notch quality products (Donate and de Pablo, 2015).
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Strategy
Strategy in operational management mention to the planning tactics that help the
organisation to optimise the resources effectively and have competitive edge over other. Strategy
included in supply chain configuration, optimum utilisation of human resources, capacity to hold
money and many more. The responsibilities of manager in this context is to make effective
strategy and make sure that employees are performing well with the limited resources.
Forecasting
Forecasting refers to the process of making an estimation regarding certain events that
might occur in the future. The manager is responsible for forecasting the estimation of customer's
demand so that production in Toyota can be done accordingly. Through forecasting, operational
manager is responsible to make sure what to produce, when to produce and how to produce in
regarding to customer's need (Jiménez-Jiménez and et.al., 2015).
P3. Application of different theories and models of approach
System Leadership
The system theory includes the process of the organisation that dominate to various
system and actions to be followed including the temporal scale and type of business.
Management with good understanding of system theory identify how an employee affects the
organisational system and how different system influence the followers. This theory enable
leaders to identify all the stakeholder that are related with the present situation. Along with it,
The theory of system enables manager and leader to observe the pattern and events in the
workplace that in turn help them to match up programs to perform effectively to complete goal
or mission of the organisation rather than the isolated.
Contingency theory
Contingency theory was developed by Fred Fiedler in 1958. This theory focuses on the
change in the strategies according to the changes in situations. This theory is dependent on the
optimal position for the contingent position of organisation. According to this approach
leadership and management effectiveness is contingent upon with their leadership style that
should flexible and match the situation of organisation (Pardey, 2016). According to this theory:
 There is no need of one best style of leadership
 It is important to change the style according to the situation.
Evaluation of strength and weakness of various approaches to leadership and management
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Strengths
 The theories and approaches empower
the leadership style.
 They are important to increase the
productivity and working performance
of employee.
 It results in stable work environment.
 It is important for maximize
profitability and return.
Weaknesses
 Different theories and approaches bring
change in leader and manager style that
affect demand of consumers.
 The theories state that leader and
manager should change their style
according to the situation, but it seems
very unclear that what kind of
situations need change.
 It can create confusion within the
organisation and for employees as well.
LO 3
P4. Key operational approaches to operation management
Introduction to Key operations of Toyota
Operation is the function of processes that transform inputs into services and products
that add value to the consumer. It is a branch that deals with managing processes and operations
within the organisation. The function of operational management is to increase the productivity
of the company with implication of limited resources. The manager that manages the functions
of operations are called as operation manager (Willis, Clarke and O'connor, 2017).
There are various key operational function in Toyota, such as; Control and distribution
system, transformation of raw material, process designing, capacity management, logistic and
inventory management, scheduling, etc.
The operations of Toyota are responsible for effective transformation process of inputs
into outputs, where inputs include; material, machines, labour, management, capital, customer
and output include; goods and services (Bolden, 2016). The critical decisions of operational
management are; Product and service design, quality management, process design, layout
facilities, supply chain management, etc.
The key operational approaches are important for enhancing business productivity and
growth:
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Six sigma
Six sigma is a disciplined, data driven approach and methodology for eliminating defects
in any process from manufacturing to transactional and from product to services. Six sigma is the
type of approach that can be used by Toyota to focus on the team efforts and their effectiveness
in the accomplishment of goals and tasks and as result improved performance is achieved
(Kiehtreiber and et.al., 2018). Toyota associate six sigma that leads to high performance culture
and let employees understand their full strength. With the use of this methodology they are able
to the best quality, low priced and shortest lead time by eliminating wastes. Six sigma strategy
make able to:
 Manage and decrease setup time
 It helps the organisation by giving ideal method of minimum production that avoid extra
cost and risk.
 It empowers workers and increase their involvement.
Total quality management
Total quality management is defined as an integrated organisational effort designed to
improve the quality of products and services at each level. TQM is the long term process to bring
efficiency in the production of the organisation (Nakamura and et.al., 2015). The TQM approach
focuses on the continuous improvement in the quality of the products and services offered by
Toyota with considering the need and demand of potential customers. The manager in total
quality management is to apply the strategies such as; KAIZEN in Toyota where the
management focuses on continuous changes in manufacturing to being improvement. The
concept of TQM;
 Produce quality work
 Focus on customer
 Have a strategic approach to improvement
 Encourage mutual respect and teamwork
P5. Importance and value of operations management
Operation management help Toyota to improve the overall productivity. Along with it, in
the present situation, operation management handles issues such as; operation, design,
maintenance and production process that reduce the price of production and to maintain the
products prices that can be afford by the consumers. There are various functions perform by
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operation management such as; transformation of raw material into finished goods, distribution,
capacity management, quality control, etc.
Through operation management, operation manger manages business operation in an
effective manner and enables firm to supply goods to customers. Operation management has
great value as it enables business entity to provide high value proposition to customers which is
very much important in order to positively influencing clients to remain loyal to brand. In
addition to this, operation management has great value as it assists in increasing working
efficiency while producing products or services which effectively fulfil needs of customers.
Evaluation on how leaders and managers can improve efficiency
Leader and manager can improve their operational efficiencies by using total quality
management approach. They can improve efficiency of operational management in the industry
by distributing the role and responsibilities of every department effectively (Northouse, 2018). It
is highly recommended to Toyota to improve the quality check process of its products and
services and ensure that defective products can be identified and modified before sent out to the
market.
LO 4
P6. Assessing the factors within the business environment that impact upon operational
management and decision-making by leader and manager
External business environment is categorised in two major parts; Micro environment and
Macro environment. In Micro environment; Customers, competitors, suppliers and society comes
and in macro environment; Demographic, economic, technological, political and cultural.
The impact of micro environment that affect decision making of leader and manager
 Customers- there are various factors of customers that can affect the leader and manager's
decision making process. It includes; change in demand on the basis of trends, tastes,
preferences, income level, etc.
 Supplier- This factor also affect the decisions of leader and manager that include; rate of
raw material offered by supplier, number of supplier contact with the organisation, etc.
 CSR- The organisation are require to be responsible towards the society and
environment. This include to maintain values, beliefs, environment protection and ethical
and sustainable extent that make pressure on leaders and managers of Toyota to ensure
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that each and every operation is ethically carried out by the employees. If an organisation
fails to fulfil its responsibility than this factor could have adverse effect on the reputation
of firm.
 Ethics : Objectivity as well as fairness are considered to be as basis for ethical decision
making. The leaders in Toyota company might have to face difficulty in in achieving the
true objectivity when they are required to work under high level of pressure. In context of
Toyota. It is very much important for managers or leaders in an enterprise to analyse the
factors or decision from the point of view of other stakeholders. As this tactics will help
them in determining the effectiveness of their decision.
The impact of Macro environment that affect decision making of leader and manager
 Demographic- Demographic factor make impact on the decision of leader and manager, it
includes; Target segment, area of production, age of customers, etc.
 Economic- Economic factor include; economic condition of country, level of spending
power, Level of supply of raw material, etc.
 Technological- Technological factor include; Technological changes or advancement,
new researches and developments, etc.
 Political- This factor include laws, rules and regulations of the region or country and on
the manufacturing and production of auto-mobiles.
 Cultural- This factor include; change in the overall trend, society's preference, etc.
Culture is the factor which directly influence the way decisions are made by managers or
leaders in an organisation. For instance, political culture in a company leads to
disagreement among employees related to goals which furthers results into conflicting
preferences and eventually impact the decision taken by manager or leader.
Conclusion of how manager and leader have made impact on the organisation and
recommendation for future improvement
In Toyota, the efficacy of leadership and management is essential in identifying the
dissatisfaction of workers in top level decisions. The impact of leader and manager is as follow:
 They enhance the work performance of employees, where leader guide them and
manager motivate them to do better that in return result in high productivity and profit for
the organisation (Thorpe, 2016).
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