MNG82001 Case Study: Organizational Change and Toyota's Strategy

This case study examines organizational change at Toyota, a leading automobile manufacturer. It analyzes the external and internal drivers that prompted significant structural changes within the company, particularly around 2010. The study highlights Toyota's commitment to continuous improvement and its strategies for maintaining a competitive edge in the market. It also explores the impact of these changes on workplace behavior, customer service, and sales, especially during challenging periods. Despite facing difficulties like vehicle recalls, Toyota remained optimistic and focused on future improvements and defect prevention. The analysis concludes that ongoing adaptation and strategic organizational changes are crucial for companies like Toyota to thrive in a competitive global market. Desklib offers a wealth of similar case studies and academic resources for students.

MNG82001 - Organisational Change
A case study of Toyota
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Table of Contents
Essay.....................................................................................................................................................3
Introduction.......................................................................................................................................3
The case study of Toyota...................................................................................................................3
External and Internal Drivers.............................................................................................................4
Conclusion.........................................................................................................................................5
References.............................................................................................................................................7
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Essay
Introduction
Organisational change is being defined as one of the main concepts in the world full of
complexities and competition. Organizational is defined as the process where association
makes changes in technologies, operational methods, culture, strategies, and structure to
make an impact of a change in the association. This kind of change can occur in time to the
time interval or can be continuous. In nature, organizational change is interdisciplinary and is
being drawn from the field of political science, sociology, psychology, management and
economics (Nordin, et. al., 2012). There is no unified or grand theory of organizational
change; instead, there will be a distinct theory. In this essay, there will be the discussion on
the topic 'Organisational change', on the basis of the case study of 'Toyota', an automobile
company operating in a market and facing tough competition from the other competitors of
the same industry. There will also be a detailed analysis in regards to the way where change,
power, and teamwork are manifested in an association and secondly proper understanding in
association with workplace behaviour.
A case study of Toyota
The Toyota is one of the most popular manufactures of the automobile in the world. They are
in the manufacturing business of the car from the year 1937. A good position has been
secured by the company in the world and the evaluation of their success is derived from the
implementation of the Japanese efficiency and quality. The company makes manufacturing of
reliable and fast vehicles at an economical price. The organization believes in the
improvement and is in the practice of applying important changes (Millar et. al., 2012).
In 2010, a significant change in the structure of the organization is being announced by the
Toyota as a part of the improvement policy. Toyota is well known for making organizational
changes so as to give a competitive advantage to the company in the market. Such kind of
changes differs from the objectives of management so as to re-evaluate hierarchy in a
company. Some of the major changes that have been made by the company are:
 In order to increase the optimum resource utilization and efficiency, Marine business
division and the development unit of the business is renamed to unit business division
and marine. This unit will also look into the sales functions (Eason, 2014).
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 The planning department of purchase will be restructured into the department of
administrative purchasing as well as the division of global purchasing promotion and
purchasing division of body part will be updated to planning division of purchase.
The main purpose is to make consolidation of foreign and local administrative
function and operates on strategies of cost efficiency and project management
activities of future.
 The marketing, as well as advertising division will be under the Toyota Marketing
Japan Co. The main idea is to make a market of Japan strong with different strategies
of marketing.
 The marketing and the sales support division will be incorporated in the department
of sales enhancement to strengthen actions and marketing strategies (Collins et. al.,
2015).
 The division of strategic production planning will be under the division of customer
service operation to reinforce quality benchmarks and customer service in Toyota.
 The design division in the Tokyo will be known as the division of advanced design to
have more focus on technological growth.
External and Internal Drivers
Each and every change is being driven by the various factors that make encouragement of
change. Various external, as well as internal drivers will also be encouraged here. In the
external drivers, there will be an inclusion of natural, political and economic change factors
that drive the company towards change. In the total productivity level of the organization,
these drivers play the main role. Main external drivers are increased competition, Toyota
always believes in continuous change and this thing provides them in gaining a competitive
advantage over other companies frequently. Another factor is globalization, integration, and
interaction among individuals all around the world is getting close daily. As there is
advancement in the technology, there is a decrease in the distance (Stone, 2012). In regards to
such reasons, an organization must be in coordination latest globalization trends as it is the
main driver of the organizational change. Change in the demand of the consumer, because
of the recession, various changes is there in the buying behaviour of the consumer, the cost is
of the main factor in the decision of the customer's purchase. In this concern, Toyota made a
choice for the cost differentiation. Resource shortage, another effect of the recession is that
there is the shortage in the availability of the resources. Toyota has made a decision to have a
tight leash on the resources.
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Apart from the external, several internal drivers are also there due to which there is the
change in the organization. Main internal factors are the change in technology, technology
keeps on changing and everyday major innovations are there that change the world full of
technology. Toyota makes the inclusion of the various innovative engineers as well as
designers so as to keep competitive edge alive. The growth of the company, growth is the
main desire for all the companies, the creation of goals, action plan and strategies are done
for such reason.
Due to various changes in Toyota, there is a great influence on workplace behaviour. The
transition process of various divisions is completed but several recent strategies had a strong
impact on production of the company. Customer service is the main division which gets
affected as they need to make deal complaints of the customer in regards to the faulty vehicle.
Sales division also get impacted as there was the drop in sales in the year 2010 (Teich and
Faddoul, 2013 ). Production of the Toyota was closed down temporarily for checking faults
in vehicles and until the identification and resolution of faults are done, production of new
cars does not get resumed.
Although the year 2009-2010 was tough for Toyota as they faced many organizational
changes. Besides various difficulties in the behavior pattern of the consumers and in order to
deal with an economic trench, the company was facing massive blow as they have to call
back various vehicles but instead of so many changes, an attitude of Toyota was hopeful and
optimistic.
As per the organization, there can be various mistakes in past but the goal of the future was
very clear with zero defects. By having recall in regards with their faulty vehicles, they were
capable of figuring out defects in the vehicles and made sure that this thing will not get
repeated in future (Waddell et. al., 2016). There are various similar issues which are faced by
many companies and those associations close down their production.
The major goal of each and every business is to have sustainability or the good amount of
profit. From the starting Toyota was not having any issues generating profit and due to this,
they enjoy benefits of cost differentiation.
Conclusion
Despite various things that had been endured by Toyota in a year, still, lots of talent and
aggression was there in the company which will not let them be on the top again. Even today,
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they are in the procedure to take various initiatives so as to ensure that they need not face a
similar situation in future. As per the researcher's opinion market may forgive Toyota if they
will be in the same situation if loss. But they will not be so forgiving if they keep adopting
latest trends. If the company wants to have a strong customer base, strong market base, they
need to come up with new strategies in relation with the organization to make this thing
possible, otherwise, their all the hard work will wash away. Change must take place in an
association from time to time so as to have effect as well as smooth operations and also to
achieve goals and objectives in a proper manner. These goals and objectives are made by an
organization to gain competitive advantage. From the above report that is being made on the
organizational change for the case study of Toyota, it has been analyzed that the company has
made various changes in their working and due to such changes only they are able to cope up
in the market full of heavy competition. The automobile sector is one of the highest growing
sectors in all around the world and is having great competition. In order to have appropriate
survival, a company must adopt new technologies continue to fight and to be on the top.
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References
Nordin, N., Deros, B.M., Wahab, D.A. and Rahman, M.N.A., 2012. A framework for
organizational change management in lean manufacturing implementation. International
Journal of Services and Operations Management, 12(1), pp.101-117.
Waddell, D., Creed, A., Cummings, T., and Worley, C., 2016. Organisational change:
Development and transformation. Cengage AU.
Teich, S.T. and Faddoul, F.F., 2013. Lean management—the journey from Toyota to
healthcare. Rambam Maimonides medical journal, 4(2).
Stone, K.B., 2012. Four decades of lean: a systematic literature review. International Journal
of Lean Six Sigma, 3(2), pp.112-132.
Collins, K.F., Muthusamy, S.K. and Carr, A., 2015. Toyota production system for healthcare
organisations: prospects and implementation challenges. Total Quality Management &
Business Excellence, 26(7-8), pp.905-918.
Eason, K.D., 2014. Information technology and organisational change. CRC Press.
Millar, C., Hind, P. and Magala, S., 2012. Sustainability and the need for change:
organisational change and transformational vision. Journal of Organizational Change
Management, 25(4), pp.489-500.
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