A Comprehensive Report on Toyota's Operations Improvement Strategies

This report provides a detailed analysis of Toyota's operations improvement strategies, focusing on how the company can regain market share. The report begins with an overview of Toyota's business operations and services, including its position in the automotive industry. The main body of the report delves into the application of operations improvement strategies, emphasizing the Six Sigma model and the DMAIC methodology. The report explains each phase of the DMAIC cycle (Define, Measure, Analyze, Improve, Control) and how Toyota can implement it to address its challenges. Furthermore, the report explores various tools and techniques used in operations improvement, such as the Five Whys analysis and the Five S approach, and how they can be applied to enhance Toyota's processes. The report also discusses operational strategies that Ford and GM can use to gain market share from Toyota. Overall, this report offers valuable insights into how Toyota can improve its operations and regain its market leadership through strategic improvements.

Introduction to Business
Operations and Services

Table of Contents
INTRODUCTION...........................................................................................................................1
Overview of the Organization................................................................................................1
MAIN BODY...................................................................................................................................1
1. Introduction of company wide operations improvement strategy and its related tools and
techniques...............................................................................................................................1
2.Operational strategies that can be implemented by ford and gm to gain the market share
from Toyota............................................................................................................................6
CONCLUSION................................................................................................................................8
REFERENCE...................................................................................................................................9

INTRODUCTION
Business operations and services can be defined as the functions of business management
team which is related to the production, quality and distribution of products and services being
provided by the organization (MUTOH and et.al., 2019).
This report will cover the operations improvement strategies, its related tools and
techniques. It will also highlight the operational strategies to gain market shares.
Overview of the Organization
Toyota Motor Corporation is a leading multinational company whose headquarters is in
Toyota City, Japan. This company is operating under the Automotive and Manufacturing
industry. It was founded in year 1937 by Kiichiro Toyoda. Organization offers various products
which include automobiles, luxury vehicles, commercial vehicles & engines and services which
consists of Banking, Financing and Leasing. Toyota is the leading company in manufacturing
and auto-mobiles industry in the worldwide. Company has its strong market share in both
Japanese and Global market due to providing high quality products to their customers. After
some years, it got into some downfall due to some reasons which lead to reduction in market
share of Toyota, which lead Ford and General Motors Companies to plan against the Toyota in
order to gain market shares from the company.
MAIN BODY
1. Introduction of company wide operations improvement strategy and its related tools and
techniques.
Operations Improvement Strategy
Operations Improvement Strategy is the combination of three words — Operations +
Improvement + Strategy.
Here, Operations refers to the group of those business activities which is related to the
production, quality, selling and distribution of the products and services. It is generally done by
the administration of the company but in multinational companies, management of operations is
done by a separate department which is known as Operations Management Department.
Moreover, there are various functions under the operations of the firm which must be carried out
by the Operations Management Department. These functions are such as — Product
Management, Quality Management, Supply Chain Management, Inventory Management, Waste
Management and Production Process Management etc. (What are Operations ?, 2019).

Improvement refers to the process of making things better from the previous one.
Improvement in the context of business is very important term. Improvement in business and its
related aspects are necessary due to change in business environment in which firm is operating.
Strategy refers to the plan which is prepared by the high level authorities and
management team of the organization for the purpose of achieving long term organizational
goals and objectives. It is considered to be an action plan in which the action is determined by
the top management team and implement by middle and lower management team.
So overall, Operations Improvement Strategy refers to the action plan which is related to
the improvement in business operations in order to make business process and aspects (which is
done on the daily basis) so that the quality of products and services can be enhanced and
organization is able to achieve its long term sustainability and profitability. It can be understood
as the 2 forms — Continuous Improvement Strategy and Process Improvement Strategy. These
both strategies help enterprise to improve in its operations (Polimeno and Delvino, 2015).
Operations Improvement Strategy adopted by Toyota
There are various operations improvement strategy available. But Six Sigma Strategy is
being adopted by the Toyota in the following mentioned manner -
Six Sigma Model — Six Sigma (6σ) is one of the fashionable approach for the implementation
of operations improvement strategy in the organization. It is a kind of statistical tool which is
mainly focused on the elimination of defects which arise due to business production process. It
also helps in reducing the process variability. In short, Six Sigma can be understood as a form of
strategy through which company is able to determine the action plan which will help them to
reduce the cost, eliminate the waste, improve the quality and increase the revenue. In the
business context, Six Sigma can be seen as a strategy, benchmark, process, goal and vision.
Implementation of Six Sigma Model on Toyota business process can be applied through
the help of DMAIC methodology which is as follows -
D — Define — In this phase, Company will define the problem so that it can be understood that
what problems, company is facing and how to solve the problem by implementing the six sigma.
After defining the problem, organization will plan the project to solve the problem which include
the goal, resources, time and expected results. For the solving any kinds of problem, company is
required to determine the goals, resources and time so that they can work on that problem in
order to achieve the expected outcome. Thus, in this phase, Toyota will define the problem,

goals, resources and time in order to plan the implementation of six sigma. In short, Toyota will
try to find the reasons behind the downfall of the company. It will help organization to
understand the root and cause effect of the downfall and its impact on the business process. It
will lead them to easily define about all the situations to their employees and stakeholders
(Bilicki and Roeder, 2016).
M — Measure — Next phase of DMAIC model is measure. In this phase, Toyota will identify
the problems in terms of number and accordingly prepare the plan to collect data and
performance yardstick. On the basis of collected data and yardsticks, company will determine the
performance matrices through which they can measure the outcomes. It involves data collection
plan and installation of measurement system in order to validate the accuracy of collected data.
The objective behind the phase is to review the improvement in repeatability & re-productivity
and capability of process. It will help in easily change in metrics, data collection process or
measurement system if there is no improvement. In short, Company will evaluate and meausre
the business process through which Toyota is producing the goods and services and distribute it
to their customers (Kiehtreiber and et.al., 2016).
A — Analysis — Here, in this phase, Toyota will do analysis the collected data in order to
understand the reason behind the problems. In short, company is trying to determine the root
cause of problems so that problems can be solved permanently. There are various tools through
which company is able to easily do analysis the data and compared it with the performance of
business process. Here, after that firm will try to identify the variance and accordingly take
action further in order to improve the business process of the Toyota. In short, Company will
analysis the impact of downfall on the business process so that impact can be acknowledged and
accordingly plan for the future actions which is needed to be taken for the purpose of reducing
that impact. For the planning of further required to be taken actions, Company will involve every
staff members of the organization and encourage them to think about the ways of solving the
problems. In this stage, the optimal solutions will be gathered and developed with the help of
employees of the firm (Hazen and et.al., 2018).
I — Improve — In the improvement phase of DMAIC method which is related to the Six Sigma,
Company with the help of measurement system and analysis of the data identify the reasons
behind the problems which helps firm to identify the possible solutions to solve the problems in
order to improve the business process of Toyota and for that company will implement the new

business process. Here the improvement will be validated by statistical methods so that it can be
ensured that improvement are achieved and implemented accurately in the organization. In short,
Company will implement all the optimal solutions which are determined by them in order to
solve the problems and improve in the business process so that quality can be improved and
business can again grow and able to regain its market share (Matsuo, 2017).
C — Control — Control is considered to be the last phase of the model. Under this phase,
Toyota will monitor and control the outcomes which arise due to implementation of new
business process in the organization. The monitor will be done on the basis of the situations
related to the before and after implementation of new process in the organization. If there is any
kind of defects or variability in the outcome of implementation, in that case, company will take
actions accordingly in order to control them. In short, After the implementation of all the
solutions in the business process, Company will analysis all outcomes and measure them on the
one basis — Improvement in the quality. It can be done on the basis of comparison of all the
results which occurs due to implementation of solutions (Bilicki and Roeder, 2016).
Like this, Toyota will implement the Six Sigma Strategy in their business process with
the help of DMAIC approach in order to improvement in the business process.
Tools and techniques used for the implementation of Operations Improvement Strategy in
the Organization
There are various tools and techniques which can be used by the Toyota Corporation for
the purpose of implementation of operations improvement strategy so that business process can
be improved and quality of goods and services can be enhanced. Following tools and techniques
are being used by the Toyota which are mentioning below -
Five Why Analysis Tool — One of the most important tool, Company can use is that Five Whys
Analysis. It is considered to be an important technique to get to know about the cause-effect
(Root Cause) relationships behind the problem (8 Powerful Lean Six Sigma Tools for
Streamlined Manufacturing, 2018). The way of using this tool by Toyota is as follows —
Company will appoint a lean team who will analysis the problems by writing down. After
that, team members will ask each other and do discuss on it in order to get to know about the
reasons behind the problems, Toyota is facing related to the market shares. After getting the
answers, Team will take action against it and try to correct the situation by solving the problem.
For example -

Team analysis that company is facing downfall issues. Application of “5 WHYS tool”,
help company to get to know about following reasons -
Problem — Downfall of the Company
Why ? — Quality related issue
Why ? — Staffing related issue
Why ? — Management related issue
Why ? — Loss of Customers
Why ? — Loss of Market Shares
Five S Tool — Another tool which can be used by Toyota for the purpose of implementation of
strategy is Five S Approach. This approach is being used by the company for the purpose of
removing those items which are not use of business process (Karlsson, 2016). These 5 “S” stands
for -
S — Sort — It refers to the activity of business in which company will properly arrange all the
items, materials and resources by removing those items which is not important for the
organization.
S — Set in Order — It means organization will place all the required items at the designed
location and keep essential & non-essential items separately.
S — Shine — It states that company will clean all the machineries, tools and techniques on the
daily basis so that maintenance of the firm can be done on time to time (Six Sigma Tools and
Techniques, 2019).
S — Standardize — Standardize can be defined as the process of making above 3 steps as the
business standards so that employees can follow them and it becomes their habits.
S — Sustain — Here, in this step of Five “S” approach, Company will take action in order to
ensure about the above 4 mentioned steps in order to sustain the business process in Toyota
(Heizer, Render and Munson, 2017).
2.Operational strategies that can be implemented by ford and gm to gain the market share from
Toyota.
Due to down shift in the market share of Toyota, turned out to be aggressive competitors
as to secure the market gains. The companies are trying to implement various strategies by

having investment of windfall profit to have auto line-ups more competitive foe the next decade.
There are various strategies that can be implemented by GM and Ford to earn he competitive
gains.
1. Corporate restructuring Strategy.
Ford and GM can bring changes in their business structure as to grab the opportunity that
will be address with change.
Organizational shift- Restructuring includes organizational change as this many result
ford and GM to enter the new market share along with separate units of bushiness to have
sharing in administrative function and corporate headquarters (Bilicki and Roeder 2016). This
will help Ford and GM to improve business along with expansion to grab the new market share.
Financial strategies- On the basis of new debt load and the long term financing needs of
company, there should be changed in financial strategies. The companies should have focus on
cost- containment along with product line, labor and operations. This might help in renegotiate
the contracts with vendors, suppliers, contractors, creditors and employees.
New product mix-there should be restructuring of business in new products which require
different types of skills set. Ford and GM can collaboratively introduce new product along with
new technology as to grab the share of the Toyota company.
Different distribution strategies- The companies Ford and GM can opt for different
distribution channels. This might include the changes in order taking process, accounting service,
sales force, product fulfillment along with customer service and information technology.
Re branding-With the change in product mix and distribution strategies, There will be
change in marketing message of company product (Ramya and Ramanaiah, 2018) . It depends on
companies unique selling differential and key benefit change. This will create brand message and
management strategy.
2. Employee engagement strategy.
Employee engagement refers to the extent to which the employee's personal goals and
interest are align along with companies vision and mission. Ford and GM should pay more focus
on employee time, energy and loyalty to keep them motivated and increase the efficiency and
effectiveness of company (Garwood and et.al 2018). There are several steps that the companies
should perform to have the effective employee engagement the company. The steps are-

Road map of success- There should be proper identification of development opportunity as it is
the important factor for decision-making. The company should have proper understanding and
create plans to have development of employees skills as additional responsibility in the future.
Establishment of two-way communication- The company has to follow up with two-way
communication as to with struggle with low engagement and retention rates of employees. The
employees in the company should serve as open door policy whenever they likely to feel ignored
or undervalued.
Fair and realistic approach- There should be proper retention of employee’s respect in the
company by management and leaders. Ford and GM must have the fairness and respect for their
employees so that employees more engaged at the time of heavy workload.
3. Innovation Strategy.
There should be the implementation of the passive and reactive strategy in the company
as to grab the international market share. In the proactive innovation strategies there is need for
the strong research and first mover advantage and turned out as the market leaders (Rahim and
et.al, 2015). This strategy implementation needs access of knowledge along with high risk. The
innovation can be the radical one which come out as the breakthrough change in products nature
and characteristics. The another one can be the constant technological changes which improves
performance of Ford and GM. In passive innovation strategies, the company has to wait till the
potential customer demand for change on specific product. The Ford and GM sh8 Powerful Lean
Six Sigma Tools for Streamlined Manufacturing. 2018ould identify the reason of failure of
Toyota and add that feature in the product according to some specification to grab the market
share of Toyota.
4. Customer satisfaction strategy.
For a business, there is importance of customer satisfaction in improving the performance
of company. Ford and GM can seek the customer through feedback and acknowledge the needs
of customer. There should be the development of strategy by Ford and GM to secure the market
gains against the downshift of Toyota (Harsha and Lakshminarayana, 2017). The strategy can be
implemented such as-
Seek feedback- proper feedback should be taken by ford and gm from their existing customers of
the company Ford and GM to discover the pro and cons effect of the product with their

customers. The feedback analysis will help in identifying the needs of customer along with the
changes required in existing one.
Customers anonymity- There should be the opportunity give to the customer to be anonymous
while giving the feedback as to have the honest review regarding the company products and
services. The customers will be always paramount for a successful company. There should be the
adoption of queue management system for further increase in the customer satisfaction.
CONCLUSION
In this report, it can be concluded that the Operations Improvement action plan which are
related to the improvement in business operations in order to make business process and aspects
long term sustainable and profitable. For the purpose of re-gaining market shares, company
implement various operations improvement strategies so that quality of products and services can
be enhanced. On the other hand, Ford and GM have the implementation of different strategies to
grab the share of Toyota such as corporate restructuring which will lead to different distribution
strategies and Re branding. The companies will also opt for the employment engagement
strategy along with innovation which will provide first mover advantage to grab the opportunity
and increase market share in company.

REFERENCES
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