Toyota: Management, Leadership, and Operational Efficiency Report

This report provides a comprehensive analysis of Toyota's management and operations. It begins with an introduction to Toyota's organizational structure, defining the roles of managers and leaders, and comparing their functions. The report then delves into different leadership and management approaches, exploring their strengths and weaknesses in various organizational situations, including the application of systems, contingency, and chaos theories. Key operational functions are examined, alongside the impact of the external business environment on decision-making. The report also discusses management and leadership strategies to improve operational efficiencies, offering recommendations for future improvements. Finally, the report concludes with an overview of the key findings, emphasizing the importance of effective leadership and management in achieving organizational goals. The report covers leadership approaches such as charismatic, authentic, and transformational styles, as well as management approaches like classical, quantitative, and behavioral methods. The impact of these approaches on the organization is discussed, providing insights into how Toyota can sustain its position in the competitive market.

UNIT 04: MANAGEMENT &
OPERATIONS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Introduction to the organisation Toyota and its management structure.................................1
Definition and roles of both leaders and manager and differences between management and
leadership................................................................................................................................2
Different roles of management and leadership in different organisational situations............3
Strength and Weakness of different approaches of leadership and management..................4
Impact of leadership and management on the organisation and recommendations for future
improvements ........................................................................................................................6
TASK 2............................................................................................................................................7
Introduction to key operations of Toyota...............................................................................7
Roles and responsibilities of manager in different key operational functions.......................8
Key operational approaches to operations management and their value...............................8
Impact of external business environment affecting decision-making by leaders and manager. .9
Management and leadership approaches to improve operational efficiencies.....................10
Recommendations for future improvements taken by organisation.....................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Management operations of the business organisation aims at accelerating efficiency of
the people within organisation so that it leads to bring better results and outcomes through
bringing innovation in the business activities. Process of effectively converting raw materials
into finished goods, proper utilisation of available resources is the responsibility of management
operations. Toyota is the Japanese company that deals in car and automotive manufacturer
products. In this following report, roles and functions of both manager and leader are explained.
Different approaches to leadership and management and their strength and weakness are
analysed. Key operational functions of organisation and responsibilities of manager and leader
are discussed. Effect of external business organization environment and ways of improving
operational efficiency is explained further.
TASK 1
Introduction of organisation Toyota and the management structure
Toyota company was founded by Kiichiro Toyoda in the year 1937. the Toyota company
still leads the market. Organisation provides employment to '364,445' employees around the
world. The Toyota company enjoys the position of sixth in the list of the highest revenue
generating company (Wu, 2016). Toyota manufactures and deals in vehicles, air- conditioning
compressors, engines, car electronics, materials handling equipment and machinery for textile as
well.
Management structure of Toyota
Management structure refers to an hierarchy of management followed in the organisation.
Toyota is hierarchically organised with individual employee knowing the position of employees.
The belongingness sense present in the employees gives strength and value to overall
organisation. An effective management structure of the organisation ensures that each
operational function is supporting in achieving overall goals and objectives. Toyota being a
multinational organisation also follows global hierarchy that allows it to properly manage the
business spread across the world.
An hierarchical organisational management structure of Toyota allows employees to
transfer and share information easily which brings effective results and outcomes (Uhl and
Gollenia, 2016).

Definition of leader and manager, the comparison between their functions and roles
Definition of Manager: Manager is defined as the administrator of organisation (Bromiley and
Rau, 2016). Manager is responsible to control the employees or group of employees in the
organisation Toyota.
Characteristics of manager are given as follows:
 must have conceptual and communication skills
 knowledge of problem-solving and decision-making
 planning strategies and policies
Roles of Manager:
 Manager of Toyota is responsible for initiating and developing new policies and
procedures for improvements.
 Manager of Toyota also plays the role of coordinating activities with employees and also
delegating authorities and responsibilities to them.
 An important role played by the manager is decision-making for different types of
business activities and operations of the company.
 Proper communication hierarchy is maintained by the manager which helps in easy flow
of important information and smoothness in business activities.
Definition of Leader: Leader is defined as the commander of an organisation(Mahadevan,
2015). Leaders leads the employees or group of employees within Toyota.
Characteristics of leader are given as follows:
 confident and creative
 able to delegate authorities and responsibilities
 honest with work
 able to communicate properly with team members
Roles of Leader:
 Leaders in the company Toyota are responsible for managing day-to-day activities and
organisational operations.
 Training and development programs given to employees to increase their skills and
potential is done by the leader.
 Participation of team members in business activities and operations is guided and
monitored by the team leader.

 Clear instruction and guidance to employees is given by the leader that brings innovation
and creation in the business activities and operations of Toyota.
Differences between Leadership and Management:
 Managers of Toyota aims at setting goals and objectives. Whereas, leaders focuses on
completing those goals and objectives (Maylor, Meredith and Browning, 2018).
 Management is commonly considered as task-oriented. Whereas, leadership is defined as
people- oriented task.
 Management focuses on managing the task and activities and creates plans, policies' and
strategies' (Slack and Brandon-Jones, 2018), whereas, leadership aims at guiding and
leading employees and also implementing the plans, policies' and strategies' to bring
improvements in business activities.
 Different management styles are transactional, democratic, autocratic, authoritative,
dictatorial and consultative. And different leadership styles are participative,
transformational and consultative.
Different roles of management and leadership in different organisational situations
Both managers and leaders play an important role regarding the success of business
organisation. Toyota implements various theories and concepts of leadership and management to
bring better outcomes and results. Various theories and roles played by the leader and manger
helps in increasing efficiency, productivity and profitability of the company Toyota. Both
managers and leaders aims at best utilisation of human resources and other resources of
company.
Management Concepts and Theories
Systems theory: The system theory is an approach that treats business organisation as an
open or closed system with complex nature and set of different parts and activities (Hitt, Xu and
Carnes, 2016). This theory refers that part of organisation gets interaction with whole
organisation and also with external factors of the market. Managers aims at making proper
utilisation of every part of organisation such as raw-materials, human resources, financial funds,
etc. The manager administers the different functional departments of Toyota.
Contingency theory: This theory explains that an effectiveness of management is
contingent and dependent on the circumstances and specific situation (Wu, 2016). Managers
needs to make changes in leadership and management styles according to the changing

environments such as, changing needs of employees and customers, advancements in
technological factors, legal and regulatory changes. Business corporate objectives of Toyota are
communicated effectively and divided into functional goals so that individual employees put
their best efforts in business activities.
Chaos theory: according to this theory, change is necessary and constant in nature within
an organisation (Schönsleben, 2016). Changes in business organisation are sometimes
controllable or sometimes makes situation complex. Managers needs to apply Chaos theory so
that it can effectively predict upcoming events and accordingly change the decision-making
process. Manager aims at recruiting and hiring employees to fill the vacant positions in the
Toyota so that productivity and profitability increases. Manager arranges training and
development programs, delegating authorities and responsibilities in order to achieve overall
objectives.
Leadership Concepts and Theories
Trait Theory: This theory of leadership assumes that people have qualities and traits that
make them better leader (Schönsleben, 2016). Theory focuses on identifying personality and
characteristics in a person that make them effective leaders. Leaders show their inherit qualities
at the time of emergency. Leadership is required at all the levels and departments in the Toyota
as he acts as the representative of the organisation. Leaders also aims at formulating strategies to
achieve overall goals and objectives of Toyota and put all the efforts to execute those strategies
effectively.
Behavioural Theory: This theory assumes that people get qualities and learn through
teaching and behaviour of others (Piper, 2016). Specific behaviour of leaders of organisation
gives guidance to their followers or employees (leadership in organizations: concepts and
theories, 2012). Leaders aims at integrating and linking personal goals with organisational goals
within Toyota.
Situational Theory: According to this theory, the person is able to manage the
complexity of the situation and their behaviour and quality is referred to as the best
leaders(Pilkington, Meredith, 2018). Leaders change their leadership style according to the
occurrence of the situation in the Toyota.
Path-Goal Theory: This theory explains that leaders who properly aligns the individual
goal with organisational goal is considered as best leaders and is able to drive success

(Uhl,Gollenia, 2016). Leaders makes sure to understand their roles and duties through trait
theory and evaluate actions to bring effectiveness in business activities of Toyota.
Strength and Weakness of different approaches of leadership and management
LEADERSHIP APPROACHES
Charismatic approach: Leaders have the ability to motivate and encourage other employees.
Strength:
 the higher level of efficiency and increased performance
 turnover of employees lower downs (Swink, Melnyk and Cooper, 2017)
Weakness:
 too much dependence on individual leaders' energy or charisma
 fits only with an organisation having the rigid structure
Authentic approach: Leaders with this approach emphasizes to act in the real and sincere way.
This leads to build loyalty and trust of employees.
Strength:
 Aims to bring effective results by integrating morals and strong ethical features that
benefits the overall business of Toyota.
 The presence of emotional intelligence and empathy for employees' needs and wants acts
as the strongest strength.
Weakness:
 leads to promote rigidity as leaders evolve their ideas and experiences (Leadership
Approaches, 2010)
Transformational approach: This approach of leadership brings effective changes in the social
system and individual employees.
Strength:
 Aims to achieve the higher level of efficiency by engaging employees into activities
brings effective results for Toyota.
 uses inspiration for motivating employees and lower down employee turnover
Weakness:
 over-reliance on truth and passion
 consistent feedback is required (Mahadevan, 2015)
MANAGEMENT APPROACHES

There are four approaches to management which are enlisted as follows:
Classical approach: This management approach aims at managing business activities in
classical methods and applies common and original studies.
Strength:
 Gives the clear hierarchical organisation structure with different management levels.
 Breaks down tasks into smaller groups' which makes it easier to complete the task and
meet objectives of the Toyota company.
 Example: the task of production is divided into many parts so that it turns out to be
easy to handle.
 Ensures that employees' get motivated through monitory benefits.
Weakness:
 Does not consider satisfaction of employees and their perspective which brings
negative impacts in the organisation Toyota.
 Does not fit to the complex nature of business environment.
 Example: today's competitive business environment requires new and innovative
ideas and following classical approach will not bring effective results.
Quantitative approach: This approach of management uses statistics and maths while making
decisions in the organisation Toyota (Bazargan, 2016).
Strength:
 Provides summaries of information and data of large amounts and can benefit
organisation like Toyota.
 accurate decisions can be drawn with numbers rather than judgement
 emphasizes accurate measurements and results of polls and surveys'.
Weakness:
 used only in statistical data
 assumes that every information can be quantified or transferred in numerical terms'.
The Behavioural approach: This management approach is concerned with every individual of
the organisation and focuses on providing better treatment to employees.
Strength: This makes it easy to understand the behaviour of employees (Bazargan, 2016).
policies and strategies can be developed easily according to the needs of employees.

Weakness: Nature of this approach is very narrow and can not be used in large and complex
organisations like Toyota. Toyota focus only on behaviour of human nature and fails to interpret
other factors of business environment.
An Impact of leadership and management on the organisation and recommendations for future
improvements
Manager and leader both aim at bringing improvements and making better use of
available resources. Plans and policies are made in a way that leads to increase efficiency of
employees and also increases the effectiveness of business operations and activities (Uhl and
Gollenia, 2016). Toyota operates its automotive business around the world requires effective
management and leadership in order to sustain in the competitive market and gain profitability.
Managers of different functional departments of Toyota inspires and encourages team
members to bring innovation and creation in business activities so that it can achieve better
outcomes. Leaders' welcome views and opinions of employees and allow them to take part in
decision making. Employees of Toyota feel motivated and encouraged and they put their best
efforts in the business activities which brings success for the overall organisation.
Leaders should come up with the effective solution for resolving conflicts. They need to
focus on building effective relationship with its team members in order to bring positive
response. Being a multinational company Toyota has wide range of functions to operate that
requires promoting open communication culture (Bromiley and Rau, 2016). Managers and
leaders need to focus on setting achievable goals and objectives. Toyota should regularly take
feedback from its employees, leaders and managers so that effective policies can be made for
improvements.
TASK 2
Introduction to key operations of Toyota
Every business organisation plays various functions for transforming raw materials into
finished goods and/or to deliver services. Toyota deals in the car and manufactures various other
machinery requires performing important key operations. Important key operations of Toyota are
production, finance, purchasing raw materials, hiring and recruiting workers and employees,
accounts, selling finished goods.

Production planning is very essential part of the Toyota company as it deals as
manufacturer company. Organisation of resources is managed in order to complete the process of
production. Every department of Toyota makes open communication which makes it possible to
have smooth functioning organisation. Recruitment and selection of potential candidates is done
so that they can bring effectiveness in the business process. Accounting functions of Toyota
manages the inflow and outflow of monitory resources. Selling and distribution function focuses
on to attract customers for selling finished products and earning profits (Choi, Cheng and Zhao,
2016).
Roles and responsibilities of manager in different key operational functions
Managers and leaders both put their best available efforts into the key operational
functions so that it brings positive outcomes. The following is given roles and responsibilities of
managers in different key operational functions of Toyota.
Research & Development
This functional department of Toyota aims at developing new and innovative ideas,
improving current products or services, developing new features in machinery or car. Manager of
R&D focuses that employees take effective part in decision-making and also share innovative
ideas. This results in new and creative ideas which can be used to bring improvements and
innovation.
Production Department
Toyota manufactures cars, air- conditioning compressors, engines and car electronics.
Managers of production department aims at properly managing different activities and linking
with other functional departments of organisation (Hill and Hill, 2017). Manager focuses on
utilising modern machinery and human resources to manufacture quality products.
Sales & Marketing
This functional department aims at attracting customers using different marketing tools and
techniques. The marketing manager focuses on using the best techniques so that it can result in
higher numbers of sales generating high profits for company. Manager of the sales department
aims at enhancing the brand image of organisation and generating profits.
Key operational approaches to operations management and their value's
Toyota follows various operation management approaches that supports improvement in
business activities and also increases productivity and profitability (Choi, Chan and Yue, 2017).

Operation management approach aims at properly managing business activities and operations
and accurate utilisation of resources.
Lean Management
lean management is an approach that supports the concept of continuous improvements
and it is long term approach which systematically seeks at achieving goals and objectives of
organisation. This approach focuses on bringing continuous improvements in business activities
and operations. This is a continuous and long-term approach that works systematically focusing
on quality. Managers and leaders look for removing waste of effort, time and money in business
operations of Toyota by identifying each process and step. The Value of lean management in
Toyota is that it creates better values for customers.
Six-Sigma
Six-sigma is data-driven and disciplined approach that aims at removing defects from the
business operations to bring better outcomes (Maylor, Meredith and Browning, 2018). Six sigma
consist of five steps including defining, measuring, analysing, improving and controlling. Toyota
makes use of six sigma management approach in order to resolve some specific problems and to
come up with effective solutions for the same. This approach results in improving current
process using defined methods of resolving problems. Defining problems or defects is the first
step then measurement of process ability is done. Manager and leader aims at analysing of
available data for identifying defect root cause. Manager and leaders brings improvements or
process modification and also monitor it by removing defects and finally controlling the process
to get better results and outcomes.
Total Quality Management
This approach aims at improving quality of the final output of the organisation. TQM
provides value to the organisation as it focuses on providing satisfaction to customers by
improving business process, customer satisfaction, effective involvement of employees and
continuous improvement. This approach ensures that employees know their roles towards
achieving overall objectives (Lee and Tang, 2017). There are elements which needs to be done
for getting the successful implementation of TQM, which are: open communication, teamwork,
effective leadership style, creating trust of employees, providing training and integrity. Manager
ensures to improve organisational culture and increase effectiveness and efficiency so that it can
lead to bring customer satisfaction. Leaders makes effective control over business process in

order to bring better outcomes. TQM brings effective results for Toyota as it requires
improvement in overall business process.
P5: Importance and value of operation management for successfully achieving business
objectives is explained as follows:
Important focus of operations management is to ensure that products are delivered on
time and with proper safety. Turning raw materials into finished goods and managing every
process in between them is the function of operations management. Managing human resources
of the company and properly utilising every available resource is the importance of operations
management. This brings effective results for the company Toyota as it can increases
productivity and effectiveness that helps in achieving overall objectives. Henry fayol's functions
of management are division of work, decentralization, order, direction and unity.
Management and leadership approaches to improve operational efficiencies
Management and leadership approaches aims at improving efficiency of business
operations and activities so that it can successfully meet business goals and objectives (Piper,
2016). Business objectives of Toyota is to ensure that products satisfy needs of customers and it
leads to increase profitability of company. Toyota focuses on providing quality services and
goods to its customers so that it can sustain in competitive business environment and also grow
its business in global markets. Following are given some ways by which operational efficiency
can be improved.
Automation: managers and leaders needs to focus on updating and improving
performance of its employees so that they can bring creativity in business process and final
products that meet demands of customers and satisfy them. Streamlining various functional
operational and making automating scheduling leads to improving efficiency. Automated
scheduling software helps in making operations smoothly and reduces secretarial work.
Providing training sessions: Toyota aims at providing proper training sessions to
employees and workers so that they make the best utilisation of resources and leads to improve
performance (Anand and Gray, 2017). Training and development programs helps in improving
performance of employees, operational efficiency and also increases productivity and
profitability of company.

Improving customer services: management and leaders aims at providing quality services
so that they meet needs and wants of customers and also makes them satisfied. Improving
customers’ services and building effective relationship with them will bring positive outcomes.
P6: An Impact of external business environment affecting decision-making by leaders and
manager
There are various external business environmental factors that affect business process and
activities and also decision-making of managers and leaders which are explained in brief as
follows:
Economic factors: This factors of external environment includes interest rates, inflation,
employment and education rate of the country. For example: When unemployment rate of
country is low, then managers needs to focus on selective hiring.
Technological factors: Advancements, improvements in technology brings changes in
business operations and activities. For example: Leaders and managers needs to make decisions
for providing proper training and development so that proper utilisation of available resources
can be done and productivity can be increased.
Socio-cultural factors: Factors such as values, culture, customs of society bring changes
to business operations are considered in this. For example: Managers needs to make plans,
policies and business strategies by considering social values of people (Wu, 2016).
Culture, ethics and values has a great impact on the business of Toyota, for example:
company use the role culture by assigning specific roles that helps in increasing the effectiveness
in operations.
Political and legal factors: Every country has some legal and political norms and
regulations that needs to be followed by organisation which affects business operations and
activities. For example: Leaders and manager needs to bring changes in accordance with
government policies.
Environmental factors: business organisation around the world are focusing on to
maintain environmental balance. For example: Toyota also aims at promoting sustainable
products by considering various environmental factors and this leads to bring changes in
decision-making of managers and leaders.

Recommendations for future improvements taken by organisation
Toyota organisation should focus on maintaining effective inter-departmental relationship
so that smooth flow of important information happens (Pilkington and Meredith, 2018).
Assessment and performance management should be managed so that employees feel motivated
and satisfied towards job. Proper training should be given to workers and employees so that they
can properly operate the advanced machinery and equipment. Promoting team building activities
will bring effective results and outcomes. Reviewing various business operations and methods
used to remove defects will bring effective results and will also lead to improve performance.
CONCLUSION
Business organisation follows a management structure that allows or restricts open
communication. Different management and leadership theories and concepts are applied by
leaders and manager. Both leader and manager plays various responsibilities that bring
effectiveness ion business process. Key operational function of organisation provides roles and
responsibilities to every employee. Management and leadership approaches leads to bring
efficiency in operations of organisation.

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