Analysis of Toyota's Management and Operational Strategies

This report provides an in-depth analysis of Toyota's management and operations. It begins with an introduction to the company, its management structure, and the roles of leaders and managers. The report then delves into a comparison of management and leadership, exploring their characteristics and functions. It analyzes various management and leadership theories, including system theory, situational theory, and contingency theory, and assesses their application within Toyota's organizational context. The strengths and weaknesses of these leadership approaches are evaluated. Furthermore, the report examines key operational functions, approaches to operations management, and the impact of external business environment factors on decision-making. It also explores how operational efficiencies can be improved, culminating in conclusions and recommendations for future improvement within Toyota. The report emphasizes the importance of leadership and management in driving Toyota's success and provides insights into how the company can further enhance its operational performance.

MANAGEMENT AND
OPERATIONS

Contents
Introduction......................................................................................................................................1
TASK 1............................................................................................................................................1
1. An Introduction of organisation and its management structure...................................................1
2. Definition and roles of leader and manager and comparison between management and
leadership.........................................................................................................................................2
3. An Analysis of different role of management and leadership in applicant to the organisational
situation............................................................................................................................................4
4. Strength and weakness of leadership and management approaches............................................6
5. Conclusion on the impact on organisation and Recommendation for future improvement........7
TASK 2............................................................................................................................................8
1. Key operations of Toyota.............................................................................................................8
2. Key operational functions and its roles and responsibilities of managers...................................9
3. Key operational approaches to operations management and their values'.................................10
4. The Impact of the external business environment factors that affect decision-making by
leaders and managers. ...................................................................................................................11
5. Analysis of how operational efficiencies can be improved.......................................................12
6. Conclusion and recommendation...............................................................................................13
Conclusion.....................................................................................................................................13
References......................................................................................................................................14

INTRODUCTION
Management and operations is a significant part of the company that focus on
monitoring, streamlining, evaluating the procedure of industry as well as it is responsible
for effective planning and successful execution of strategies. It is the key factor of the
strength of the company. The study aim to analyse management and operations of
Toyota. Toyota is the world's largest Japanese automotive manufacturing company. The
report includes the role of leader and function of a manager in Toyota in a term of
operational strength and weakness. This report will present models and theories of
leadership and management along with it their strength and weaknesses are also
evaluated that can be applied in various situations in the company. It will explain key
approaches to operation management and evaluation of the importance and value will
be done that will help the company to achieve business objectives.
TASK 1
1. An Introduction of organisation and its management structure.
The Toyota Plc. is a Japanese multinational automotive vehicle manufacturer
headquartered in Japan. It consists of 36445 employees worldwide and in September
2018, was the 6th largest organisation in the world in terms of profit. It is the 2nd largest
automotive manufacturer. It produces more than 10 million vehicles per year (Toyota,
2019). The company was founded in 1937 by Kiochiro Toyoda. The Toyota motor
corporation produces vehicles under five brands, includes the Toyota brand, Hino,
Lexus, Ranz and Daihatsu.
Source: The Toyota, 2019
1

Toyota's Management Structure
The structure of Toyota is supported on the varied business operation of the
company. Toyota has the divisional organisational structure. This structure is support to
business goals and strategic direction to its employee. It is the effective for Toyota to
maintain strong global presence. That shows the ability to use structure of the
organisation to maximize efficiency and capability of utilization.
This structure defines the pattern and arrangement in the company's resources and
process. Toyota's new management construction is following the main characteristic like
global hierarchy, geographic divisions and the product based division. With the help of
this new structure organisation is more able to responding to regional market conditions.
This help the local manger to take immediate decision of any situation (Dobscha and et.
al., 2015). By these leaders and manager of Toyota are able to handle any issues and
provide the higher quality of the product. However, it helps to increase the decision
making power of leaders and manager.
2. Definition and roles of leader and manager and comparison between management
and leadership
2
Illustration 1: organizational structure
(Source: Organizational structure of Toyota, 2018)

Manager
Manager is the individual person who is in charge of the certain group of task.
Manager is accountable for controlling and managing an organisation or staff. They
have effective communication skill or time management skill to maintain the discipline in
the company.
Leaders
Leader is an individual who influence by motivation to the group of organisation
to achieve a goal (Wu and Parker, 2017). They have strong communication skill to
covey their message in a team and also have passions to handle the team. Following
are the characteristic of leaders.
Basis Manager Leaders
Meaning It is an art of managing, organizing
and coordinating things in effective
way.
It is a skill of leading the peoples by
examples.
Characteristics  Manager builds a strategic
vision for their team.
 Communication is an
important to managers to
keeps their employees to be
informed about their rules
and regulation which are
happing in present and
future.
 Leaders involve the team in
their plan for future direction.
 It is also important to leaders
to communicate right
messages to their team
member. They have to
communicate all information
about the task to team for
effective and best work
(Hasegawa, NEC Corp, 2017).
Functions  Managing people is the
responsibility of manager to
manage and controlling the
people in order to fulfil their
needs.
 They are responsible for
 Leading people is
responsibility to Toyota's
leaders to motivate their team
member by providing
effective team work.
 Leaders are also responsible
3

daily efforts. They have
analysis the resources and
anticipating needs to make
changes according to
situation.
for taking challenges. Leader
have their own style to doing
work and solving problem
(Dobscha and et. al., 2015).
3. An Analysis of different role of management and leadership in applicant to the
organisational situation
Leader and manager both are essential in the organisation to fulfilling the
objective of Toyota by giving a desired direction. There are various functions of
management and leader as well as different styles that help in proper functioning in
Toyota. It can understand by various theories of management and leadership;
System Theory: This theory can apply by the leader and manager of Toyota to
control and manage the workers and to transmit further situations of system and are
responsible to guide employees to work according to the needs of the company (Holten
and Brenner, 2015). According to this model Toyota has to make changes in operations,
develop and implement strategies for successful operations. According to this approach,
leadership maintains both macro and micro perspective. This theory of leadership
assisting in promoting innovation and creativity in Toyota and encourage subordinates
to think out of the box that is the major element of the success of the company.
Situational Theory: Ken Blanchard and Paul Hersey developed this theory. The
situational theory state that manager of Toyota should adopt a different leadership style
based on the situations they face in organisation time to time. For example; present
situation facing by Toyota is increased cost and situational leadership can apply to
manage and control the situation. Following a particular leadership model is not
appropriate in every situation (Nakamura and et. al., 2015). There are four style of
leadership that can adopt by management depends on the present situation.
4

Directing: This style is high directive and low supportive and the directive leader
of Toyota are responsible for defining the role and task to its follower and guide them
closely. The manager or leader need to provide a lot of guidance to the employees.
Coaching: It is high directive and high supportive and the leader or manager of
Toyota give an intense amount of both support and directive behaviour to its followers.
Supporting: In supporting style the manager of Toyota have supporting behaviour
but provide less direction to the employees (Nawaz and et. al., 2016). This style is high
supportive and low directive.
Delegating: This style is low supportive and low directive by the manager of
Toyota as the employee have understanding of their role and responsibilities and are
able to take decisions on their own.
Contingency Theory: In 1958, Fred Fiedler developed the contingency theory.
This theory is based on the internal and external situation of the company and claims
5
Illustration 2: Situational leadership model
(Source: Situational Leadership Theory, 2018)

that there is no best style that organise and lead Toyota. The leader of organisation
should apply their own leadership style effectively according to situations to enhance
the productivity. In Toyota, leadership and management are responsible for identifying
the dissatisfaction of the followers in top level decisions (Northous, 2018). Leader and
manager considered the reason of the increased cost in the production process and
apply the theory to implement the change in operational activity to cut down the high
prices of equipment and material received from the supplier.
4. Strength and weakness of leadership and management approaches
These theories are important for an organisation in the different situation but
these approaches has some strengths and weaknesses that are as follows;
System leadership Model
Strengths:
 This model deals with many of the complexity that is facing during the operation
and production process in Toyota and provide a framework for build idea.
 It focuses on the innovation and creativity that is beneficial for organisational
success as well as for the society (Reim and et. al., 2016).
Weaknesses:
 This theory does not focus on a specific task function that makes it limited in the
context of Toyota.
 It is a lengthy and complicated process that needed supervision to understand
properly.
Situational Leadership Theory
Strengths:
 It helps in building better team unity that help in creating a comfortable and
effective group the environment in the organisation. It allows leader to monitor
employees closely that aware them with the capabilities and need of
improvements (Thorpe, 2016).
 It helps in to enhance motivation of employees and they feel valuable as the
leader and manger guide and direct them and involve them in the decision
making process sometimes (White, 2016).
Weaknesses:
6

 It might creates confusion within the employees as the various situation of Toyota
are interrelated with other factors.
 It is based on various situations and change with the situation in the Toyota and
focus on only current scenario, thus, it tends to emphasize short term strategy.
Contingency Theory
Strengths:
 It provides a way to assess the leader style that could be beneficial for Toyota in
specific situation.
 This theory is trustable, valid and reliable as many empirical researches supports
this theory.
Weaknesses:
 Constant change to the environment or structure of Toyota is challenging for
management.
5. Conclusion on the impact on organisation and Recommendation for future
improvement
Managers and Leaders are essential part of Toyota's successful operations,
growth and development. They put positive impact on the organisation and play a vital
role in shaping organisational culture (Wu and Parker, 2017). Managers are responsible
for managing all the departments of Toyota effectively such as; finance, production,
operation, sales, etc. and leaders are responsible for leading, guiding and directing the
followers to make them work efficiently. It has positive as well as negative impact on the
company, for example; if manager of Toyota is poorly manage the company's
department and leader unable to lead and motivate people that result in poor
performance of the overall organisation. The roles and responsibilities of both lead the
company towards successful growth. The leader and manager boost the confidence of
employees and help them to improve their skills that enhance productivity and working
performance of subordinates that result by enhancing productivity and profit of Toyota.
Following are some recommendation that can help Toyota in their future improvement;
 It is recommended to the leaders and managers of the organisation to adopt
situational leadership that is beneficial in every situation (Dobscha and et. al.,
2015). It is useful for the company because there are many situations arises in
7

the operation and production area that can reduce the morale of worker and if
there is any conflict occurs, leader can manage people by enabling
communication. Moreover, there are many situations arises in any production
company, thus, in the context of Toyota situational leadership is beneficial.
 Organisation should give proper training to the leader and manager for any
specific changes with new technology, in the operations and regarding to the
handling conflicts in the company that they can learn various approaches and
that make them able in strategic planning.
TASK 2
1. Key operations of Toyota
Toyota's operation management includes the effective and efficient decisions for
the operations. Toyota use broad set of strategies to take decisions of operation
management, integrating local and regional automotive market condition. Key
operations are required to perform various functions as the part of their responsibility
(Hasegawa, NEC Corp, 2017). Manager is responsible to make an effective and good
design of product and services. It includes in effective planning to goods desig n. A key
operation includes the quality of management and inventory management in the
company.
That are important functions of operation management. The company uses
productivity measures or criteria based business considered. Manager also include the
planning of goods, controlling on wastage and organising the training and development
sections for their team, and employees. Manager can make an effective location
strategy of their layout and establish plant. The HR manager is also responsible for
recruitment and selection process to fill the vacant post in the organisation. These
indicate the different area of business require the strategic approaches. This key
operation aspects help to make effective planning, controlling and organising the
equipment and human resource (Hasegawa, NEC Corp, 2017).
2. Key operational functions and its roles and responsibilities of managers.
Roles and responsibility of manager in key operation management.
Design of goods and services
8

It is the important function of operation management. Manager of Toyota plays
an important role in this function. They address this strategic decision area of operation
management by using advancement of technologies and quality of the products. They
also responsible for making effective design of goods and services by using tools and
technologies.
Quality management
Quality management is also an important function of operation management and
manager plays an effective role in this (Holten and Brenner, 2015). Role of manager in
this function to maximize the quality of goods by continuous improvement in
management principles and quality. It is the one important key factor of to Toyota
(Dobscha, Mentzer and Littlefield, 2015).
The Suitable location strategy
Location is an important every organization. Role of Toyota manager in that to
make effective and suitable location strategies to establish their business. They can use
mixed sets of location strategies like global, regional and local location strategy.
Layout design and strategy
Layout design is the function of operation management. Role of Toyota manager
in this make designs for their layout because manufacturing plants highlights the
application of lean manufacturing principles (Nakamura and et. al., 2015). Layout design
and strategy help to maximize the efficiency of workflow.
Job design and human resources
It is the most important function of operation management to design the job and
managing human resources in the organisation. Role of Toyota manager in this function
is to explain the task to employees and integrate hr programs and polices. The human
resource function of the organisation is responsible for providing training to the
employees.
The Supply chain management
Supply of goods and services timely at a particular location for that manage the
effective and strong supply chain (Nawaz and et. al., 2016). The Toyota manager plays
an important role in supply chain management. They use the lean manufacturing
strategy to supply their goods. Responsibility to use an automation system for real time
9

adjustment in their supply chain activity. By this manager minimize the negative effects
from the chain of supply.
3. Key operational approaches to operations management and their values'
Operational approaches refers the method which Toyota uses in order to improve
their quality of products and increase productivity. There are various approaches that
company use such as: Total quality approach, just in time approach and the six sigma
approach.
Total quality management approach: Toyota uses this approach for improving
their internal process related to quality for satisfying their customers' needs and
demands (Northous, 2018). It focuses on continuous improvement related to “process,
product's quality, quantity”, etc. the main aim of using this approach is to being in
competition by giving quality products at the low price and maintain the reputation in the
market.
Just in time approach: It is a common inventory management technique which
is used by The Toyota corporation. The main aim of using this approach is to reduce
and eliminate waste and decrease cost at the workplace. The benefits of this approach
is it reduces time in production process and system (Reim and et. al., 2016).
The Six sigma approach: It is important approach for Toyota as it focuses on
continuous improvement in various processes. Six sigma is a deep analysis whose
main aim is to eliminate defects while producing products. It also focuses on customers'
demands and try to satisfy them by improving their existing as-well-as new processes of
production.
The Lean management approach: Toyota promotes this approach. In this
approach company focuses on the smoothness of work or work flow. The Lean
approach of Toyota is to increase quality, profitability and efficiency in order to maximize
the company's revenue and profit.
4. The Impact of the external business environment factors that affect decision-making
by leaders and managers.
Leaders and managers make many decisions about products and services,
sales, consumers, suppliers, etc. which are highly effected by some external business
environment factors within the Toyota.
10

Consumers:
It is major external factors which impact on decisions making of leaders and
manager in the workplace (Thorpe, 2016). Therefore, managers should make decisions
about products and services according to trends, taste and preferences, needs and
wants, demand of consumers (Dobscha and et. al., 2015). Managers are highly focused
to the consumer, because commodities buy that keep alive and sound company.
Therefore, the company can achieve primary goal i.e. satisfaction of consumer.
Suppliers:
It is another major factor which impact on decisions making of managers in the
firm. Therefore, managers is required to take decisions about suppliers of goods and
services in the market. It is necessary to build relation with suppliers which impact on
sales and overall growth of business. A Good relationship with suppliers is to keep
follow of high level quality input material.
Competitors:
It is also involved in external business environment factor that impact on
decisions making of managers and leaders relating to selling of goods and services in
the marketplace. Therefore, they need to make decisions for producing unique product
and services as compared to competitors of Toyota (Wu and Parker, 2017). The
positive effects of this factor that consumer has many options to spend their money on
high quality products in the marketplace.
Corporate culture
Corporate culture refers to the joint principles, process and appeal system that
provide a limited way and flavour to the company. Most of the success of Toyota in
worldwide market is depends on its corporate attitude. The approach of Toyota is both
distribution and product development is market driven and customer-friendly. The
decision of leader and manager is relies on the philosophy of the organisation that is
concentrated on empowering employees, encouraging them for innovation, participation
of its worker that creates high level of employee loyalty. The culture is very sustainable
for manager and leader and have positive impact on the decision making of them, that
support the decisions of them in enhancing employees' value and productivity.
PEST factor
11

PEST factor are the external factor that consists; Political, Economic, Social and
Technological factor that affect the decisions of leaders and managers of Toyota.
The political stability of the global market is an opportunity for Toyota to grow
with minimum political tension. In addition, this factor supports they decision of leader
and manager as the government supports ecofriendly products that improve their
decision in production area.
Demands of consumer in the global market and costs of suppliers and spending
power of clients are differed from each other that put pressure on the manager to
develop effective strategy to minimise the cost of production and meet customer
satisfaction. Technological advancement is beneficial for the company as the capability
of adoption of Toyota is on a better level.
5. Analysis of how operational efficiencies can be improved
 The efficiency in control and distribution system of Toyota can be improved by
logistic infrastructure and adopt the strong control system in order to meet
business objective.
 The leader should empower their subordinates to work productively that
automatically improve the efficiency of operation.
 Manager of Toyota can improve the operational efficiency by improving the team
work that results in effective bonding and relation of employees that create a
healthy work environment (Dobscha and et. al., 2015).
 Manager can create incentive program that helps in motivating employees to
work hard and work more that improve the operations of the company.
6. Conclusion and recommendation
The overall operation management of Toyota is effective to accomplish present
need and objective efficiently, but there are various changes that should consider by
Toyota for achieving future operational objective.
 Toyota should select train their staff by the proper developing and training
process that can resolve issues regarding proper operational management (Wu
and Parker, 2017).
 Organisation need to establish the proper communication channel through a
formal and informal method that help in enhancing the engagement of employees
12

in decision making and motivate them to enhance productivity through moral
support.
CONCLUSION
The present study evaluates that role of a leader and function of a manager is
essential in Toyota's daily operational activities. The leader and manager of the
company follow various approaches and style to increase the efficiency of operation
management. The report had been evaluated that leaders and managers should not
apply one style in every situation they must adopt different style according to the
situation. The study states that the organisation has to undertake Total quality
management and Just in time inventory in order to bring down cost as much as
possible. The report evaluated that customer, supplier and competitors are the external
factor that can affect the operations of Toyota.
13

REFERENCES
Books and Journals
Bahmani-Firouzi, B. and Azizipanah-Abarghooee, R., 2014. Optimal sizing of battery energy
storage for micro-grid operation management using a new improved bat
algorithm. International Journal of Electrical Power & Energy Systems. 56. pp.42-54.
Chen, Y. and et.al., 2014. IT capability and organizational performance: the roles of business
process agility and environmental factors. European Journal of Information
Systems. 23(3). pp.326-342.
Dobscha, S., Mentzer, J. T. and Littlefield, J. E., 2015. Do external factors play an antecedent
role to market orientation?. In Proceedings of the 1994 Academy of Marketing Science
(AMS) Annual Conference (pp. 333-337). Springer, Cham.
Lobo, M. C. and Curtice, J. eds., 2014. Personality politics?: The role of leader evaluations in
democratic elections. OUP Oxford.
López, M. A. and et.al., 2015. Demand-side management in smart grid operation considering
electric vehicles load shifting and vehicle-to-grid support. International Journal of
Electrical Power & Energy Systems. 64. pp.689-698.
Mendis, N., Muttaqi, K. M. and Perera, S., 2014. Management of battery-supercapacitor hybrid
energy storage and synchronous condenser for isolated operation of PMSG based
variable-speed wind turbine generating systems. IEEE Transactions on smart grid. 5(2).
pp.944-953.
Strande, L. and Brdjanovic, D. eds., 2014. Faecal sludge management: systems approach for
implementation and operation. IWA publishing.
White, P. R., 2016. Public transport: its planning, management and operation. Routledge.
Wu, C. H. and Parker, S. K., 2017. The role of leader support in facilitating proactive work
behavior: A perspective from attachment theory. Journal of Management. 43(4).
pp.1025-1049.
Online
Organizational structure of Toyota. 2018. <http://panmore.com/toyota-organizational-structure-
analysis>
Situational Leadership Theory. 2018. <http://www.selfawareness.org.uk/news/situational-
leadership-and-developing-great-teams>.
Toyota. 2019. <https://www.toyota.co.uk/>.
14

15