Toyota's Operations: Risk Management, Improvement Strategy Case

This case study provides an analysis of Toyota's business operations, focusing on the challenges the company faces and recommending strategies for risk management and operational improvement. The report highlights the importance of adapting to market changes, addressing production issues, and implementing effective risk mitigation strategies such as avoidance, retention, sharing, and transferring risks. Furthermore, it emphasizes the need for a company-wide operations improvement strategy that includes market research, prediction and loss prevention, leadership improvement, human relation theory, scientific management theory, quality production, effective production operation, and customer service support. The analysis draws upon various management theories and models, including leadership styles (Autocratic and Democratic), Human Relation Theory, and Scientific Management Theory, to provide a comprehensive understanding of how Toyota can enhance its competitiveness and achieve its organizational goals. Desklib offers students access to this and many other solved assignments to aid in their studies.

Introduction to
business operations
and services

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................4
Analysis of case..........................................................................................................................4
Recommendation and advise Toyota on how the company should implement risk management
strategy that can minimise or eliminate it for future ..................................................................5
Company wide operations improvement strategy.......................................................................6
Tools and techniques which are learnt from this module...........................................................9
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business operations and services play a major role in the development of a business by
performing many activities and tasks in a systematic manner. It is the major responsibility of a
business to develop operations and services in a perfect manner for long term growth of the
business (Aćimović, 2021). The major duty of management is to implement best business
practices which are helpful in development of business in precise manner. In this report example
of Toyota company's case study is taken into consideration. The Toyota company is a Japanese
car manufacturing multinational company which operates in market with manufacturing cars.
Toyota is number one company in the whole world, when it comes to car selling and after sales
services. The business entity should focus on developing major goals and objectives and to
achieve them with the help of business operations and services management. In this report
various tools and techniques related to management and models are explained in a precise
manner. This report also contains solutions and recommendations in the given case study to
understand business functions.

MAIN BODY
Analysis of case
The Toyota company which is famous car company, is facing issues and facing a major
downshift in market. The experts suggests that the company should improve the auto line ups for
gaining market advantage. Many field experts predicts that if this situation will be consistent in
the market then Toyota will lose its ability to expand at marketplace with success. The Ford and
General motors can expand operations in the market by accelerating the production and secure
market share gains by making production more competitive. The current scenario in international
market will help the USA car manufacturing companies to re-establish themselves at
marketplace. According to the statistics, Toyota has recalled 9 million vehicles from the market
which is more than entire number sold in past three years. This can impact on long term
operations in the market of Toyota and can be challenging at the marketplace. The major
earthquake which came in Japan also impacted on production process of Toyota as
manufacturing plants were closed due to disaster.

Recommendation and advise Toyota on how the company should implement risk management
strategy that can minimise or eliminate it for future
In a business organisation it is important for the management to implement best practices
to avoid risk and uncertainty. At the marketplace, Toyota should develop and perform quick
actions in order to increase production and survive in the market. There is an urgent need for
Toyota to discover effective business operations practices in order to eliminate risk associated
with the functions. The company should take into consideration various risk management models
to develop a systematic approach at the marketplace. Following are major risk management
methods which can be taken into consideration by Toyota:
 Avoidance- This is a major approach in risk minimisation as it is associated with
mitigating risk by not taking participation in unnecessary and risky approach. In this
method Toyota will totally avoid the new operations that require new approach or
innovation. Also avoidance should be developed by the business in order to continue
current operations and avoid new ones (Adebimpe, 2018). Avoidance of risk is majorly
considered as effective approach which is beneficial in increasing profitability of the
business. In order to also develop awareness in a major sense, it is compulsory for a
business entity to adopt effective approach. In the corporate world this method is used by
many multinational and national companies.
 Retention- The retention is majorly related to accept a risk as a cost to help offset larger
risks down the road. This is a type of risk elimination method in which a low cost
opportunity is selected which provides higher returns. The retention strategy should be
used by the Toyota company to achieve large returns from current operations. It is
important for a business to focus on retention in order to minimise risk related to
operations.
 Sharing- The sharing of risk is important for the business entity in order to develop
revenue and turnover at marketplace. Toyota should regulate sharing of risk with other
business organisations to minimise risk. Sharing the risk helps a business to consider
factors that impact a business in long run for business management.
 Transferring- The transferring of risk should be there in a business to gain desired
competency edge as it eases the operations of a company. In this approach a business

entity should transfer the risk to some other business organisation in order to perform
smooth and accurate operations. The transferring of risk should be there in a business
with the help of management and staff.
Company wide operations improvement strategy
It is major need for Toyota to improvise its strategy in a systematic manner for overall
development at the marketplace. The company also needs appropriate support with the help of
improvement strategy to survive with increase in production. Improvement strategy, is majorly
an effective strategy which supports a business to take advantage of different opportunities
which are available at the marketplace. The companies in international market focus on
development of improvement by seeking assistance from board of directors. Business
organisations should focus more on creativity in order to achieve desired objectives in a precise
manner. The international companies should grow by taking assistance of change management
models in order to lead the competition. Most of the international and national companies in
market adopt professional strategies for the management of business. In the era of stiff
competition between companies, it is very much crucial for a company to develop an
improvement strategy to lead the marketplace. The improvement strategy for Toyota company in
the marketplace is following:
 Market research- This is considered as best way to develop technique to avoid the risk,
this includes market survey in order to briefly analyse the marketplace. Market survey of
Toyota should be performed by marketing management and strategic management to
develop risk free operations.
 Prediction and loss prevention- The prediction of future is necessary to eliminate risk
that is attached to various functions. In the tough times, company has to think
strategically for maintaining loss and its prevention with the help of professional
forecasting.
 Leadership Improvement strategy- Leadership is a technique in which certain people
has a power in order to supervise, coordinate and guide other employees of an
organisation when they performing particular task. Leadership is used in organisation in
order to guide, motivate and inspire its employees for achieving organisational objective
in efficient manner (Apte, 2019). Toyota used leadership strategies in order to improve

their employees performance by guiding, motivating and inspiring them. Different types
of leadership styles are there which helps leaders in order to influence their employees to
accomplish their organisational objectives. Toyota used Autocratic and Democratic
leadership styles for improving its performance in order to achieve its organisational
goals. In context of Toyota Autocratic and Democratic Leadership styles are discussed
below:-
 Autocratic Leadership- Autocratic is a classical and oldest technique of leadership in
which only leader has a power or authority to take decision and does not give any opinion
or suggestion to their followers. At first, Toyota used this Leadership style which results
centralization in its organisation.
 Democratic Leadership- Democratic leadership style is also known as Participative
leadership style in which employees are influenced in order to give their opinion in order
to making organisational decision (Jiang, 2021). For improving its performance, Toyota
used this leadership style in which they allow its worker to interact with all members of
the organisation.
 Human Relation theory- Human Relation Theory is a strategic technique in which it
mainly focus on fulfilling individuals needs in order to achieve organisational objective.
It is used in organisation for managing their employees and their tasks. Toyota use
Human Relation Theory in their business in order to help their employees by improving
its workplace and maintaining their health and safety. Employees' health and safety is a
first priority for organisation as they have a power to destroy their business environment.
Toyota industries used this theory for making strategies which improve its health and
safety management in order to make healthy, secure and positive working atmosphere
for its employees. It is important for the company to make good relationship between
employers and their employees by the help of sufficient communication with them in
order to make comfortable working atmosphere for them (Samuels, 2021). Toyota
industries are also believe that good and strong relationship between employers and their
employees make them comfortable in order to do work in the organisation and also helps
in achieving organisational goals.
 Scientific management theory- Scientific management theory is also known as classical
and traditional Management theory. Scientific management theory is used in organisation

in order to analyse those factors which help them to improve the efficiency and
productivity of its workers. Toyota industries use this theory in their organisation in order
to find one best technique in which workers perform their job by viewing each
performance. According to this hire right person for the right job and train them in order
to maximize their efficiency. It helps organisation for improving its workers efficiency
by monitoring their performance, and also provide them proper instruction and training
when they needed. In Toyota industry work is divided between management and workers
in order to help management to make plan, train its worker and complete the task
efficiently.
 Quality production- Improving and maintaining quality is very important for an
organisation in order to increase its sales and attracting more and more customer.
Toyota industry improving its product quality by making safe, durable and eco friendly
products (Sbors, 2017). By maintaining and improving design quality, manufacturing
quality and marketing quality, Toyota improve its total product quality which help them
to make image and brand in the market. With the use of research and development
Toyota improves its product quality. Each and every steps of production help company
in order to improve its product quality like planning to make product design, production
process, and so on and it also helps to fulfil customer satisfaction. Toyota industry makes
popular and strong image in the market by making advanced quality vehicles in all
countries. Toyota quality assurance team is responsible for making high standard quality
or safety products in all over the world.
 Effective production Operation- Production process of a company refers to a combined
result of all its production factors such as land, labour and capital. For making
production operation effective of the company by improving and maintaining all these
factors of production. Effective production process help organisation to achieve its
organisational goal by combining all these production factors in appropriate manner.
Toyota industry makes its production process most effective by using all these factors in
proper manner (Sherringham, 2020) They used highly skilled and trained labour, huge
amount of capital and advanced machinery in order to make production process effective
for the company. Effective production process help Toyota industry to improve its

quality, reduce waste, improves customer satisfaction and safety in order to become
successful manufacturing industry in the world.
 Customer service support- In the functioning of a business at the marketplace, it is the
main job of management to develop effective customer service support. In the market,
Toyota should follow effective customer relationship management in order to increase
customer satisfaction. The customer relationship management is mainly related to
providing desired and effective services. In the business functioning, most of the
companies focus on customer service support to resolve queries of different customers.
Toyota should focus again and revise its customer service support plans to develop
effective competitive edge.
 Porter's generic growth strategy- The generic strategies of porters is a universally
adopted approach which is beneficial in developing and gaining competitive advantage.
The porters generic growth strategy is having four major source of competency edge and
that are cost leadership, differentiation, cost focus and differentiation focus. The cost
leadership means focus on product cost and reduce it to the maximum extent. This
approach will be beneficial in increasing the profit and turnover of the company. Toyota
should focus on development of cost leadership in order to survive in tough situation
(Sherringham, 2020). Toyota should also focus on developing differentiation in the
products on basis of quality. Most of the successful business organisations at the
marketplace apply this theory to lead marketplace with cost advantage and development.
 Training and development- According to the current situation, it is important for a
business entity to provide, effective training and development to employees. The training
and development should be provided to employees on the basis of market downfall and
the business should provide professional training to the employees. In a business, it is
major responsibility of management to provide desired training to employees in a fixed
manner.
Tools and techniques which are learnt from this module
Learning is an important part of life which develops the knowledge and practical
approach of a person. Tools and techniques should be analysed in an effective manner in order to
develop desired strategies in the business. The tools and techniques which are learnt from this
module are essential for a person to develop a good knowledge about business operations. In a

business, it is major duty of management to develop and apply effective tools and techniques for
the success of a business entity. In the professional career life all the necessary and useful things
will help the business to develop effective strategies. It is also mainly important to develop
effective tools and techniques which are effective in dealing with problems that are faced by
business. The main things learnt from this module are mentioned below:
 Readiness for uncertainty- In the given case study, the uncertainty is major practice
which helps a business to overcome challenges and issues. Uncertainty should be
considered by a business entity and take major steps like implementation of risk
avoidance and elimination methods. It is essential for a business to develop various
practices that are effective in avoiding uncertainty.
 Contemporary management- It is very much important for a business to develop
contemporary business management in order to perform dynamic functions. Most of the
successful companies in corporate world analyse importance of contemporary
management in order to manage various employees. In the recent times, many successful
global companies are indulged in developing contemporary management for increasing
focus on employee productivity. The contemporary management is majorly responsible
for developing time desired steps. In order to effectively develop contemporary
management, it is important for the management to take support of scientific
management theory. It is also majorly important for Toyota to develop contemporary
business practices for management of large number of employees. Contemporary
management also develops a major approach in establishing world class business
practices in order to grow at marketplace.
 Implementation of organisational policies and plans- It should be major duty of the
top level management in a business to formulate effective policies and plans. The
business should then focus on implementation of designed plans and policies for
establishing business standards (Sherringham, 2020). It is the desired duty of
management and staff to look for effective implementation of policies and plans for
achievement of business goals.
 Strategic management- The strategic management is considered as backbone of every
organisation which helps a business to develop effective strategic plans. In the

functioning of a company strategic management play a vital role in developing the
business organisation with future aims. In an organisation, the management is concerned
with implementation of practices which are essential in the achievement of short and long
term objectives. In a business, there is major role played by strategic management in
order to utilise resources in an optimum manner.
 Assessment- The business organisation should develop effective assessment of all the
operations and functions from time to time. This will help the company to perform
functions as per the demand of environment. It is major role of a business entity to
analyse risk management models in an effective manner and conclude the assessment of a
given situation. In the marketplace, various companies perform yearly assessment of all
activities and functions to grow in a major sense. The successful business organisations at
the marketplace analyse the business environment in order to develop business practices.
It is important for a business like Toyota to majorly take into consideration all the
business tools which are effective in business development. The assessment of business is
necessary on annual basis in order to develop effective strategy. The international
business organisations should follow the trade practices with formal assessment of all
tasks that are performed by management.

CONCLUSION
From the above stated report it can be concluded that, it is major duty of management of
a business to hire skilled and trained employees for business growth. This project concludes that
it is very much important for a company to develop a well managed business plan in order to
grow at marketplace. Above discussion mainly concludes that it is major duty of the company to
implement universally accepted management theories and models in order to succeed at the
marketplace. This project concludes that improvement strategy is the main motive of every
organisation to gain competitive advantage. The above stated report also concludes that it is the
major role of human resource and strategic management to develop effective organisational
planning. This project concludes that in a company the decision making should be performed
with consent of all employees in order to develop at marketplace.