Operational Management: A Deep Dive into Toyota's Strategies Report

This report provides a comprehensive analysis of Toyota's operational management, examining its key performance indicators (KPIs) and total quality management (TQM) efforts. The introduction highlights the importance of operational management in providing a competitive advantage, particularly through strategies like lean manufacturing. The discussion section delves into Toyota's operational processes, presenting a balanced scorecard that evaluates performance from financial, customer, internal business processes, and learning and growth perspectives. The report also analyzes Toyota's performance characteristics, including efficiency, dependability, conformity, durability, serviceability, and aesthetics. Furthermore, it explores the Kaizen method and its application within Toyota, emphasizing continuous improvement and employee involvement. The conclusion summarizes the key findings, emphasizing the role of performance and quality management in Toyota's business success. The report utilizes figures and tables to illustrate key concepts and provides a reference list of sources.

Running Head: OPERATIONAL MANAGEMENT
OPERATIONAL MANAGEMENT
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Table of Contents
Introduction................................................................................................................................4
Discussion..................................................................................................................................4
Answer 1.................................................................................................................................4
Answer 2.................................................................................................................................6
Answer 3...............................................................................................................................10
Conclusion................................................................................................................................11
Reference list............................................................................................................................13

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Introduction
Operational management is necessary to be for the development of the strategic
business. These strategies are used to offer a plan for designing and managing the different
functions of operations in a way to assist business production. In this aspect, the operational
process is one of the ways in which business operates functionally. The main purpose of
operational management, in particular, is to provide a competitive advantage to the
organisation. Therefore, this specific ability of the company to gain success in the market is
often known as competing priorities. It is by the way of providing excellence in business the
company makes it possible to place itself as the winner in the particular market.
In this context, the assignment presents the operational processes of Toyota with
respect to the key performance indicators and the total quality management effort taken by
the company.it has been seen in the case study that Toyota faced several challenging issues
while growing its business. However, it is the operational manager of Toyota who determined
to enhance the process of production within the company through years of the trial as well as
mistakes. The company’s hidden weapon of success is lean manufacturing that is a
revolutionary initiative towards business. It has helped the company to balance the duties of
the employees within the company while valuing the continuous improvement of the
company.
Discussion
Answer 1
Balance score card through the aspects of Key performance standards
Aspects Lagging indicators Leading
performance
indicators
The Financial perspective
 There is increase in productivity with
the growth in sales within the market.
 There is an sharp increase in sales in
the areas of growing market
 It has been seen that almost 38% of
the dependable models have been
 Increase of
profit and
productivity
 High
collaboration
with the
 Mixture of
revenues
 Huge
investment
in the
market

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produced by Toyota in the last five
years (Henderson, Cheney & Weaver,
2015).
 Toyota success in scorecard has come
mostly from the incredible quality
reputation that recalled almost 79% of
the vehicles in the United States
growing market
 Profitable flow
of cash

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The Customer perspective
 The major objective is to gain the
trust of customer
 Develop a high brand recognition in
the worldwide scenario
 The company
focuses on
offering
quality service
to the
customers, for
addressing the
issues faced by
the customers.
 Huge brand
trust gained
from the
customer.
 The
customers get
the benefits of
quality
management
and auto
service that
flexibly
adjusts to the
requirement.
 There is an
overall
satisfaction of
the customer
found.
The Internal business processes
perspective
 To strengthen the development of
internal processes that intended to
enhance the quality
 Enhanced development of products
 High
customer
satisfaction
index
 The use of six
sigma
initiative to the
process of
operations is
initially
established by
other company
(Daniel,
2015).
 Huge amount
of time
invested for
training the
employees
(Bryson,
2018).
 All the
production
launches are
essential as
they assist the
new models
and the
redesigned
products of
Toyota.

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The Learning and Growth perspective
 The goal is to enhance the quality to
react quickly to address quality
problem from the customer
orientation
 Enhance employee requirement
 Implementation training program
 In case of
learning and
growth
perspective the
company
invests a lot on
growth capital,
learning
capital along
organisational
capital to
increase
production
opportunities
(Pearce,
2015).
 Employee
satisfaction
 Employees
training
 In case of
production
and cost the
company
manufactures
autos that led
to incredible
consistency in
process as
well as
service
product.
 Teamwork
recognition
 High
customer
satisfaction
Table 1: Balanced Score Card
(Source: Elmes & Barry, 2017, p.34)

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Figure 1: Balance score Card of Toyota
(Source: Roness, 2017, p.23)
Answer 2
Performance
In the case of performance, Toyota is known as the most successful company in the
world. The performance of Toyota is linked to the objectives set by the company. The
company aims to produce fuel effective cars to satisfy the consumers. It is the management
that improves the sales proves to speed up the operational processes. In order to provide
customer oriented service they maintains the product quality, Toyota also maintains a
Japanese method of operation known as the principle of Kaizen that mostly focuses on the
procedure of continuous improvement of processes
Characteristics
In the case of business features, they have introduced several efficient processes that
help the company records the information while offering them to the consumers. These
specific steps taken by the company have been analysed that assists the management to take
effective steps. Therefore, using the operations the company limits waste usage thereby
High
Quality
Customer
First

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improving quality encouraging learning and growth opportunities. In case of employee
management the company pays a comparatively high salary to the Japanese workers for
maintaining reputation (Elmes & Barry, 2017).
Dependability
In case of reliability, Toyota has more than 38 most reliable models that lasted over
for 15 years. The system of production used by the company is the most innovative approach
that dominated the process for almost 10 years. It is the lean process of manufacturing that
helps the company to provide customer value and quit in production without any disruption.
Figure 1: Comparison of income and Production
(Source: Elmes & Barry, 2017, p.42)
Conformity
In case of conformity measures the performance of the staffs and analyses the
improvement that has to be made to confirm the outcome of the product. The company
appoints a performance-related task to the employees (Duffield & Whitty, 2015). Through
this process of the company successfully analyses the performance quality of the employee
and progress towards the development of the products along with investing ideas on
innovative products.
Durability
Toyota is one of the most successful companies that aim to sell high-quality products
to the customers from across the world. Durability and dependability are the most necessary
components that are related to the organisation (Psomas & Antony, 2015). Therefore, for

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enhancing the processes of production the company started to develop durable plans that will
help the company to enhance its sales. The management unit of the company has managed
the functional process for reducing the costs that are associated with the activities of
productions. Most of the products of Toyota are durable as they intend to provide the
customers with huge benefit and satisfaction.
Serviceability
The strategy used by the company helped the, to manufacture quality products by
reducing the use of waste and useless production (Influenced by Su, Baird & Schoch). The
company maintains the consistent flow of task as per the planning. The members of Toyota
have the inherent duty to follow the guidelines for continuous improvement of the products.
For enhancing the service of production and employees the company aims to make regular
production in support of the members and team leaders of the company. Based on these
factors the company maintains the philosophy customer-oriented service that gives the first
priority to quality.
Figure 2: Factors of serviceability of Toyota
(Source: Su, Baird & Schoch, 2015, p.53)
Aesthetics
Consistent
Flow Of
Task
Regular
Production
Reducing
The Use Of
Waste

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The aesthetic quality of the company is to retail customer from various markets by
delivering quality and cost-efficient services to the target customers. Toyota is through this
service takes the effort to retain customers and offers the service by manufacturing hybrid
cars that consumers reduced the number of fuels (influenced by Fidel, Schlesinger & Cervera,
2015).
Figure 3: System of Production
(Source: Fidel, Schlesinger & Cervera, 2015,p.1427)
These are the process that makes them unique amongst the competitive market. These
factors have helped them to raise their sales from the group of rivals in the market. For the
customers, the company delivers huge value for cars at an affordable price thereby fulfilling
the health and safety needs of the employee. However, employee’s creativity is getting lost
owing to the unnecessary movement occurring due to overproduction and imbalances in
delivers from the potential suppliers. These processes are required to be noted by the
company.
Observed quality
In order to enhance and increase the quality of the product as well service Toyota
works collaboratively with the system of management to enhance the supply chain system.
Through the technique, the company intends to obtain the competitive edge over the rival
companies and tries to provide the best services to the customers (Duffield & Whitty, 2015).
However, there are certain defective areas in production that concern for repair and
replacement of manufacturing and time. Focusing on these issues, Toyota aims to establish a
supply management system that will help them in distributing the proper products to the
clients. However, the company has shown some process of overproduction that called for

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overwork and delay in service provision due to the lack of stocks. They are, therefore,
required to improve the process of production to retain back customers.
Figure 4: Product life Cycle of Toyota
(Source: Bryson, 2018, p. 14)
Answer 3
Kaizen is a Japanese method of operational process of management that is usually
based on the principle of Kaizen. These purposes of the method are incremental in nature that
helps in continuous change (Bryson, 2018). The initiative of the method is related to the lean
process of production that basically intends to reduce the production of waste resources that
do not give any value to the products. In this process the idea of continuous change on daily
basis to deliver human needs within the workplace and to fulfil the needs of total quality
management. Toyota uses Kaizen management system to reduce the cist, and to increase the
involvement of the employees by fostering a workplace with high value and motivation. The
company has consistent encouragement for implementing innovation in the organisation.
Toyota benchmarks its business in case of efficiency. To maintain the philosophy of
kaizen Toyota invites their team to think about the operations in a timely manner to keeps its
process run in a smooth way (Duffield & Whitty, 2015). They have continuously improved
the company by creating innovation throughout and by contributing high-quality production

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at all the levels of the organisation. The company introduced and total quality management
the statistical quality to adhere to the principle of customer’s first service.
Figure 5: Kaizen’s philosophy in Toyota
(Source: Bryson, 2018, p.22)
Conclusion
Therefore, it can be concluded from the study that performance management and
quality are necessary components of operations management that allow Toyota to contribute
towards the successful business. Drawing from the aspects of Balanced score Card of Toyota
it is evident that the company has a high marketing investment for sustaining the quality of
the product and to maintain the satisfaction of the customers. In this procedure of
management, the company aims to evaluate the problems and challenges that present in their
system of inventory and production. In this course of time the company drafts down the best
methods that are suitable for the company and the tasks that can be effectively archived.
Meanwhile, they regularly supervise the performance of the employees and try to fulfil the
demands made by the customers in the process of production. This component helps Toyota
to manage the quality of service that is offered to the customers.
Invites their team
to think about the
operations
High quality
production at all
the levels
Continious change
through creating
innovation

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