Toyota: Business Operations Improvement Strategy and Competitors

This report provides an in-depth analysis of Toyota's business operations, focusing on strategies to enhance performance and competitiveness. It begins by exploring the context of Toyota's market position and the challenges it faces from competitors like Ford and GM. The main body of the report details various quality management strategies that Toyota can implement, including Six Sigma, Total Quality Management (TQM), Lean Production, Supply Chain Management, and Just-in-time inventory systems. Each strategy is explained with its principles, procedures, and potential benefits for Toyota. The report also discusses how competitors might leverage operational strategies to gain market share. Overall, the report aims to provide a comprehensive overview of operational improvement for Toyota, offering insights into how the company can regain its market leadership through enhanced quality and efficiency. The report concludes by summarizing the key findings and recommendations for Toyota's operational improvements.

INTRODUCTION TO
BUSINESS OPERATIONS
AND SERVICES

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Explain how you would introduce a company wide operations improvement strategy.............3
Operational strategies competitors can use to gain market share of Toyota...............................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business operation and service are the activities which are carried out by the organization
for the purpose of surviving in the market. Toyota is a Japanese manufacture headquartered in
Toyota City, Japan. Toyota was founded in the year 1924 by the founder Sakichi Toyoda. This
report highlights the different quality improvement strategy which can be used by the company
in improving the performance of the business. Further this report highlights the different
competitor strategy which competitor can use to gain the market share of the Toyota.
MAIN BODY
Explain how you would introduce a company wide operations improvement strategy
As the case study says that Toyota the car manufacturing company, has able to earn the
good name in the market in the last couple of years due to the quality of the car offer by the
company in the market, and at the time was one of the top car seller in the global market. But it
is not the case in the current scenario for the Toyota as the company has seen the down fall in the
market share as the big competitor like Ford and GM is able to attract the customer toward the
company and the company has called many car back to the company due to the same reason. For
improving the quality of the product in the organization the company can implement the
following Quality management strategy to improve the quality of the product in the organization.
The strategy are as follows:
SIX SIGMA
It is one of the most used technique by the different organization in the world as this
technique looks at measuring the quality of the product in the organization and the information
of the same can be taken as a basis to improve the quality of the production in the Toyota. This is
generally known as a process of improvement for the product which were falling below the line
in the functioning of the business. This method generally understands the customer requirements,
improving business systems throughout the organization, and enhancing the organization's
financial performance as this are the main basic of any company it will help the Toyota in
improving the quality.. The main function of the six sigma is to look at the quality of the product
and improve the same (Furterer, 2016).
Procedure

Six sigma in the Toyota can be implemented with going through the different stages, the
first stage is defining; it is the stage where the company has to decide the what is the real
problem or the issue for the organization as the quality of the product is the issue for the Toyota
in the current scenario, the second stage includes the gathering of the information to find out
the solution of the problem which has occurred to the business. The solution can be more than
one alternative generally there are three key process in this stage they are Value stream mapping,
Data Gathering and Data Measurement validation. The third stage is the Analysis in which
organization on the basis of the information gather in the first and the second stage used to find
out the root cause of the problem for the organization. In the fourth stage the Organization used
to see the improvement in the problem as the best alternative was already applied in the
organization and in the fifth stage the company has to check and control the change in the
organization (Ross, 2017).
Benefits
Six sigma will bring the variety of the benefit for the Toyota in the long run of the
business as the six sigma will help the Toyota in as the six sigma is the tool which help the
Toyota in understanding the customer need very easily. Six sigma ascertain the different root of
the problem and also looks at the variety of the aspect of the problem. The other benefit which
will bring by the Six sigma to the Toyota is that the it sees the variety of the measure for the
problem which can help the business in selecting the best alternative out of the total alternative
available for the business. Six sigma will also help the business in the time management as all
the process which need to be done in this is done of the basis of the fixed pan which was derived
at the starting stage itself which will eventually helped the Toyota in reducing the time cycle for
the organization also (Jiménez-Jiménez and et.al., 2015).
TQM
Total Quality Management (TQM) as the name suggest is the approach which is used to
improve the quality of the production in the organization with the way of detecting the error and
reducing or replacing it in the manufacturing process of the business. This approach in toyota
will hold all the party in the organization responsible for the overall quality of the final product
or service. The Toyota can take the various aspect to find out the error such as the Toyota can
compare the production function of the today with the past on the different basis and on the
result of the comparison the Toyota can found out the real defect which is there in the production

function of the organization. TQM generally focuses on the end goal of the business as TQM is
the customer focused process in which the TQM looks at managing the employee and the worker
in such a way that they all work with sole motive of achieving the organizational goal. It will
help Toyota in eventually increasing the efficiency of the work in the organization, this has to be
done in the organization with the help of the fast decision making in the Toyota and by the help
of monitoring the performance of the employee on the regular basis as they are the one who used
to operate the function of the production in the organization.
Principles of the TQM
 All the function which are performed is done with keeping the customer in to the mind.
 All the employee should be empowered toward the common goal of the business.
 It is the process which takes the input and turn them into output.
 All the process in the end should be integrated in the larger process (Furterer, 2016).
 Company should have the plan which should include the quality integration in it.
 Company should look at the new way to increase product competitiveness.
 Decision should be taken on the real fact based decision making.
 Good amount of the communication should be there in the organization.
Benefits of the TQM
TQM will help the Toyota in reducing the cost of the product for the organization as it
helps the business in improving the efficiency of the work of both the worker and the production
in the organization. It will also help the Toyota in looking at the defect which is coming in the
production and the Toyota can improve the same at the point itself which will also help them in
using the less amount of the investment in making the change in the organization. It will also
help the Toyota in improving the morale of the employee in the organization as TQM includes
the employee in the decision making which eventually helps the business in improving the
efficiency and the performance of the business.
Lean Production
It is the other operational management tool which can be used by the Toyota in their
functioning as it will help the business in improving the quality of the product with the way of
reducing the wastage of the raw material in the organization (Jiménez-Jiménez and et.al., 2015).
Generally, this activity used to cut down the activity which are not adding any value for the
business. Some of the great principle of the Lean production is as follows:

 Doing the work or the task with the simple way and always believe on to the basic.
 Doing the thing in the better ways with the innovative and the creative idea.
 Involving all the employee in the process of the change or improvement.
Benefits of the Lean production
The biggest benefit which will be brought by the lean production to the Toyota is that the
company will be using the more amount of the raw material in producing the product for the
organization which will eventually help the business in improving the quality of the product in
the organization. The second benefit which is brought by the Lean production to the Toyota is
that the company will be able to save the cost of the production in the organization as the
company will able to manufacture larger amount of the product at the same rate it will help the
Toyota in the long run of the business as the main problem which is faced by the company is the
competition from the Ford and the GM and the lean production can help the business in
overcoming it (Tennant, 2017).
Supply chain Management
It refers to the supply of products or services and it also includes the process with the
help of which an organisation converts the inputs into final products. It will help the Toyota in
improving the value of products for customers and also supports the firm to gain competitive
advantage over other companies. Toyota should develop and implement the strategy of managing
the whole supply chain starting from production up-to distribution of the auto-mobile to
customers. This will help to improve the quality of operations of the company (Christopher,
2016).
Further, management of Toyota can also increase the collaboration with other partners of
supply chain to address the changing demands and preferences of the customers regarding
vehicles. Moreover, firm should concentrate on developing and implementing the model of
supply chain driven by demand that will focus on better integration of planning, purchasing of
raw material and renewal of the process related with changing demands (Fahimnia, Sarkis and
Davarzani, 2015). This will help Toyota to reduce the cost of operations, further supports in
insights of real-time demand. It will also help to determine potential shortage of inventory and
also leads to improvement in performance of the company and better customer satisfaction.
Proper implementation of supply chain management will provide various advantages to Toyota
such as decrease in cost, increase in revenue etc.

Just-in-time
It refers to the strategy that supports the firm to align the orders of raw material from
suppliers with the schedule of production. Toyota will adopts this strategy for improving the
existing level of efficiency and to reduce the wastage of raw material by ordering them only
when they are required for producing goods (Filippini and Forza, 2016).
Toyota should implement the strategy of Just-in-time as a part of its inventory system
because it will help the firm to order the parts of vehicles only when the management receives
order of buying the vehicles from customers. To implement the system company should consider
various factors like no breakdown in machinery, reliable suppliers, skilled workers, continuous
production of auto-mobiles and better ways to assemble the equipment that helps to assemble the
vehicles etc. By implementing the improvement strategy of Just-in-time in Toyota, company will
get various benefits such as it will help to reduce the requirement of warehouse, the duration of
production cycle will be short. It means that, auto-mobile firm will move from one product to
another in less time. Further, it will result in decrease in investment of funds on parts to
manufacture vehicles.
Benefit of using the improvement strategy
All the above strategy will help the Toyota in different way as all the above technique will be
looking at quality improvement but with different aspect such as., six sigma will look at the
customer. Lean production will look at wastage, supply chain will look at the process ad the just
in time will look at scheduling as this all aspect are the important aspect for the Quality
management in the organization it will help the organization.
Operational strategies competitors can use to gain market share of Toyota.
Operational strategies -
It refers to the different types of methods organization can use to attain their goals and
objectives. With the help of operational strategies firm can evaluate and implement most
efficient and effective systems for effective utilization of the resources as human resource,
financial resource, and other process (Iris and Lam, 2019).
Maintaining competitive advantage is very essential for auto-mobile companies to remain
competitive. Toyota's recall of vehicles may provide an opportunity to other competitors to
develop operational strategies for grabbing the market share of Toyota.

At the time when Toyota will recall its auto-mobiles, General motors and Ford will make
strategies for re-establishing their pre-eminence of US made auto-mobile to gain competitive
advantage over Toyota. Ford and general motors may adopt various types of operational
strategies to gain existing market share of Toyota. These are as follows -
Improving the supply chain -
Supply chain refers to the process of developing the products through delivery process.
GM and Ford can adopt various operational strategies to improve its supply chain. Either they
can adopt the method to deliver vehicles to customers in more efficient way which has not be
done by any competitor in past. Or the firm can also adopt the approach to reduce the cost of
manufacturing the vehicle which will help them in getting the competitive advantage in aspect of
the price. This will help organzation improve their revenue by reducing the cost of operations
(Hugos, 2018). For Example – Competitors of Toyota company can reduce the cost of raw
material by purchasing them in huge quantity or they can also buy the parts of auto-mobile of the
product line. This will help GM and Ford to gain market share of Toyota.
Marketing and distribution -
Nowadays, manufacturers of auto-mobile are getting serious regarding the marketing of
their products. This will help to expand the participation of companies in customer life cycle.
Further, it will help Ford and GM to improve their current level of profitability and growth in the
markets that are stagnant. These firms may adopt various marketing channels for reducing the
cost and to increase the profits and can also try to attract the customer of the Toyota by targetting
the product to the customer of the Toyota. Competitors of Toyota may also develop new
information systems for tracking the trends of buying behaviour of clients of Toyota and other
potential customer's (Kirchhofer, 2016).
Further, the companies can use sale promotion activities, marketing campaigns and other
tools and techniques for improving the effectiveness of sales promotion so that the loyal
customer of the Toyota will be also attracted toward them. Ford and General Motors will get the
opportunity to conduct targeted marketing in more effective way. In this way, they can reduce
the utilization of resources like human resource etc. in every stage of the process.
Best practises -
Another strategy through which competitors of Toyota like General motors and Ford can
increase their market share is by developing and implementing best practises regarding the parts

of US based auto-mobiles. Firms may adopt practises related with staffing of service personnels,
scheduling of maintenance of vehicles, procedure for repair and maintenance etc this will help
them in building the good name in the market and will eventually help them in building the
goodwill and as goodwill play a crucial role in marketing it will help the competitor.. This will
help to reduce the cost of service and other parts and company will get benefits of economies of
scale. By adopting this type of operational strategy, Ford and General Motors can gain the
market share from Toyota (Prajogo, Oke and Olhager, 2016).
Technology -
Technology is one of the major source of gaining competitive advantage over other firms.
Advance technology helps the organization to fulfil the demand of customer's. Ford and GM may
adopt better technology for manufacturing US based auto-mobile such as electrical cars etc.
These organisations should focus on innovating automate driving vehicles that will help to
compete with Toyota. Artificial Intelligence has also become a major force that can support auto-
mobile companies to gain market share of their competitors. This will also help Ford and GM to
better connect with customers, Artificial Intelligence will help clients to locate everything as well
as also help to monitor the safety of vehicle (Stewart, 2016.). This will help GM and Ford to
differentiate their products with Toyota. As a result, these organisations will be able to gain
existing market share of Toyota in auto-mobile industry.
Innovation -
It is one of the most important strategy that firm can use to increase its existing market
share. On the basis of extensive market research, Ford and GM can analyse the demand of
customers on the basis of which firm may modify the design, features etc. of the auto-mobile.
This will help the competitors of Toyota to increase the demand of their products in the market.
This will lead to increase in market share of companies (Tucker, and Laric, 2016).
CONCLUSION
After going through above report it has been summarized that the Toyota was struggling
very heavily in the market in he current scenario due to the bad level of the quality in the market
so it has been summarized that there are various operational management strategies that will help
Toyota to improve its operations such as Total quality management this will help the firm to
achieve long term success by satisfying the demands of clients. Further, lean system will help to
maximise the value for customers. Another is Supply chain management that helps to improve

the value of products for buyers and also supports the firm to gain the benefits of competitive
advantage. Just-in-time will help the company to improve its current level of efficiency. Further,
the Report summarized that there is a very competitive market in the UK and the Competitor of
Toyota will be introducing the different strategy to get a competitive advantages so the
organization need to be one step ahead to defend the same.

REFERENCES
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Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
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Supply chain management. 2016. .[Online]. Available Through :
<https://www.advantech.com/logistics/case%20studies/39fd76a1-9fc7-4c5f-82d7-
ac017d1a1a61/>.