Toyota Motors: Risk Management and Company-Wide Operations Improvement

This report examines Toyota's risk management and operations improvement strategies. It emphasizes the importance of implementing a risk management strategy to mitigate future shocks, focusing on protecting assets, people, and the environment, and reducing legal liabilities. The report details implementing a risk management framework, including establishing context, identifying and evaluating risks, treating risks, communication, monitoring, and recording. Furthermore, it evaluates a company-wide operations improvement strategy, highlighting concentrating on order fulfillment, regular training, cloud-based operations, continuous progress tracking, business process refinement, streamlined communications, and leveraging technology to enhance operational efficiency and productivity. The report concludes that continuous improvement in both risk management and operational strategies is vital for Toyota's future success and growth. Desklib provides students access to similar solved assignments and study resources.

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TABLE OF CONTENTS
Introduction......................................................................................................................................1
MAIN BODY..................................................................................................................................1
Implementing risk management strategy which can reduce the level of shock if occurs in the
future............................................................................................................................................1
Introducing company wide operations improvement strategy.....................................................4
Conclusion.......................................................................................................................................8
REFERENCE..................................................................................................................................9

Introduction
This report has discussed about Toyota which is the multinational automobile company and it
has established in Japan. Company have faced many ups and downs in the market. But their
delivering quality strategy has helped them in gaining their lost market share. This report will
analyse why and how company should have implement risk management strategy which will
help in minimizing shock. Further it will evaluate operations improvement strategy and the used
tools.
MAIN BODY
Implementing risk management strategy which can reduce the level of shock if occurs in the
future.
Risk management strategy is important to get implemented because in the absence of this
strategy it will become difficult for the company to attain objectives for the future. If company
make objectives without thinking about the expected risk then there are possibility that they have
to change direction if any risk will hit them (Edjossan-Sossou and et.al., 2020). If Toyota will
make risk management plans then they can save over assets, people, income, time, property etc.
as if company will prepare themselves for risk then there will be fewer risk occur to them.
Having risk management strategy also helps in preparing for the secure and safe environment for
customers, employees and visitors etc. designing risk plan help company in decreasing legal
liability and also enhances stability within the operations. Often it is noticed that in the absence
of risk strategies company becomes unstable. So that is why risk strategies maintains stability of
the company. When company is knowing the possible risk in advance only then they can save
on the assets and also over people for getting harm. It further helps in protecting the
environment or the surroundings. There are various litigation like civil, criminal etc. and risk
management strategy helps in reducing threat of the litigation (Jackson and et.al., 2018).
If Toyota will make risk planning then will help them to decide that what and which type of
insurance they required. They will get clear that exactly what kind of risk they want to cover. So
it will help company in safeguarding them from unnecessary premiums. As it is seen in the case
study that company has to face multiple calamities which are tsunami, earthquake etc. so it is
important to have risk management strategy which will save company from uncertainty. As
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natural calamities are the uncertain event so that is why having risk strategy will help company
in reducing losses to great extent. It is commonly said that prevention is better than cure. As
international business are operating under several risk and having risk management plan will
only help to save company from such big risks. Having risk management strategy will save
company from the disruptions and safe the future of the company. As it is not possible to predict
the future, so that is why company should have use their past experiences so that risk
management program can be designed and will also help company in attaining success and
growth in the future (Guliyeva, 2020). Sometimes company has to face such kind of risks which
can affect major part of company's operations. Due to some of the risk company can also face
wind up situation. This situation is rare but it is possible. Making risk strategy helps company in
going through continual improvements. It also increases understanding of the exposure of the
risks. When company have control over job than they can increase their profitability.
Implementation of risk management strategy-
Implement risk management framework on the basis of risk policy-
while designing company's risk management framework, Toyota should have considered
marketing and communication, information technology issues, resource management, human
resources related issues, services offered, acceptance, regulatory obligations, succession
planning, cash flow management etc. all the issues of the organisation whether it is relation to
human, operations, resources etc should be considered on priority basis.
Establishing context-
it is important to take into consideration the environment and the surroundings under which the
company is operating. For example operational, cultural, legal etc. also determine internal and
external stakeholders (Wicaksono, 2020). Internal stakeholders are employees, managers and
owners etc. external stakeholders are consumers, public, investors, government etc.
identification of risks-
company must identify the potential and the existing risks. Potential risks are contract risks,
service performed, continuance risk, performance risks etc.
evaluating risks-
on the regular basis it is important for the company to evaluate and analyse the risks. If company
will evaluate risk on daily basis then it will help organisation to know about actual losses,
opportunities, degree of control, tolerance level etc. in order to identify the cost of control is to
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know about the likelihood of the occurrence of particular event and the results of the event. If
company wanted to know the level of risk is high or low then company should have look
towards the anticipated areas, expertise of firm, control procedures etc. while evaluating risks it
is important that company should have consider both internal and external risk (Bondarenko and
et.al., 2020).
Treating risks-
it is important to make the strategies so that risks can be managed. Company can accept the risk,
can avoid, reduce the likelihood etc. in order to treat the risks action plan can be made on the
basis of current risk so that to know about strategy and time to get solution of the risk.
Communication-
it is also important to communicate about the risks and also get consultation from all the parties
and it includes both external and internal parties. So that everyone gets informed about the
strategy and their consequences. Example- to avoid the risk taking responsibility of the client
then advice should be given to the client to write the dates and the consequences. As it will be
helpful in transferring risk of non compliance on the client to follow up.
Monitoring and review-
on the regular basis management should have review their risk management strategies. As with
the time it is possibility of developing new risk, existing risk can get high or low, risk priority
can also change which results in making treatment strategies less effective. So that is why it is
vital to monitor the existing risks, checking any trouble spots or the effectiveness of the current
risk strategy (Clarke and Liesch, 2017). Monitoring the risk make sure that to bring new
measures which helps in controlling the new risks which arises. Strategy should be also review
time to time so that company will be always in the risk control position.
Recording-
always keep handy the written records of the procedures and policies which involves
documentation of the process, identify major risks so that company can come up with actions to
decrease the impact of the risks. If company fails in terms of documenting policies then that can
also impact performances because of misinterpretation. It is also important to purchase the
insurance coverage for the organisation which is vital when it comes to managing risk. If any
loss arises then company can get financial safety. As they are covered by the insurance.
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Introducing company wide operations improvement strategy
Operational efficiency or strategy refers to the ability of the company to offer good quality of
services with limited resources. If company will be able to produce more output in the given
amount of time and input then it can be said that those entity's operations are more effective.
This consists of two variables which are quality of operations and operating expenses.
Operational strategies are important for the success of every company (Lysenko, 2017). So that
is why process of improvement should have never stopped.
Some of the operational improvement strategies are as follows-
concentrating on order fulfilment-
when the company will grow then they will receive many order which will be in high volume.
Then the operational department of the company should have right tools which they use to fulfil
demands of their customers timely. Company can implement replenishment software and should
have also go for routine maintenance. Organisation should have make such environment or
surroundings which can increase the productivity of their employees and can get quality order
fulfilment services.
Regular training-
operational efficiency may not get improved if employees of the company will not have access-
over the practice methods. So that is why company should have provide training to their
employees over the systems which they are using or in future they will be using it. So that is
why employee should be given time to time training. Training helps in increasing the efficiency
and productivity of the employees (Vincent and Pinsker, 2020). Company can also organise
coaching program for the employees which will motivate them.
Run the operations through cloud-
companies are much more comfortable for the remote working and especially after covid 19. as
remote working lowers the overhead costs. So company can opt cloud based solutions so that
workplace productivity can be enhanced even though in the case of remote working. So owners
of the business can go for cloud based technology because it will help them to handle all the
operations of the projects and technology can also easily collaborate with the team members
although employees are not present in the office. Company can also lowers their operational
expenses after they will adopt cloud technology. Cloud technology will also help company in
dealing with cyber security issues.
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Tracking progress continuously-
in order to improve the operations company can make intelligible strategy (Mburu, 2017). So it
is important to make the measurable goals and it is also important to track the progress of the
company. Operations should have focus on the efficiency in order to increase the level of
production. In the case of production department if there is low output and the machine has went
through downtime then the whole production process will get stopped and machine will require
immediate maintenance. So that is why organisation can use software or the wireless sensors
which will be helpful to inform that when the faults will going to occur. This will be helpful in
creating effective maintenance routine.
Review and refine business processes-
improving the operational efficiency by refining the process on daily basis is complex. So it is
important to automate the process so that repeatable work can be eliminated. Reviewing the
business process also ensures the miss happening if it is there. There are many operational work
which Toyota should have automated so that company can save time over that. Reviewing on
such tasks is the time-consuming process and it will also take much time of the employees which
they can spend on different important business activities. So it can be said that it is important to
update and review the documentation so that efficiency can be improved.
Streamlining communications-
Employee should have knowledge about their customers and also how company is engaging
with their customers (Yu, 2019). As it helps in improving the health of the company and
enhances the operational efficiency. As customers are the important for every organisation
because it helps in increasing the profit of the company so that is why providing them good
customer service is the most vital thing and it also contribute in the success of the company. In
order to provide good customer service it is important that company should have use customer
service management system. This system provides the user friendly interface where employees
can use it and provide better customer service to the customers.
Leverage technology-
Using advanced technology is the most important strategy to improvise the operations. So it is
important to have proper data and information about the project management, finance
department, operational department which will be helpful in improvising the efficiency of
production department and technology has made easier to manage data of all the department.
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New management software can also be used by the company in order to improve the operations
and its efficiency. With the automated software company can easily streamline their workforce.
Technology helps in tracking the product profitability, movement of the inventory etc. and it is
also important to update the new software because upgradation can gives to various benefits
(Ferrer, 2021). Toyota can also integrate service management system within the business so that
employee can easily get important information at their fingertips which will be helpful in
boosting the operational efficiency.
Analysing systems functionality-
If any business is using advanced technology or software in their operational department in order
to improve their operational efficiency then they should have make sure that solutions should be
evaluated in the better manner.by reviewing the functionality only helps business to find out that
they are actually providing benefits to the company or it is merely an extra expense for the
business.
Workplace culture-
As workplace culture also impacts the operational efficiency. If any company wanted to increase
the efficiency of their employees then they have to make sure that training should be provided to
them so that they can work smarter and not harder (Kosayanon and Kasemset, 2020). There are
many tools and techniques which are available in the market which can be used by the business
which will make the work of the employees easier. Company can motivate their employees by
providing them rewards and extra benefits because it employee will get motivated then they will
work hard which will increase their productivity. So it is better that company should have
eliminate various distractions or put stop on digital notifications. Cooperation and collaboration
are important within the employees because that is helpful in spreading harmony and peace
within the organisation. If employee will collaborate with each other then it helps in gaining
insights of the organisation (Kubala and et.al., 2021). When it comes to improving operational
strategy than there are various options which can be opt by the company.
Access to the information-
Management should have ensure that every important information should be reached to the
employees because information can be used by the workforce in completing their daily task.
Along with that it is also important to have reliable network because it helps employees in
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reacting to the market changes quickly and easily. Secure network infrastructure helpful in
improving the operational efficiency.
Outsourcing the IT task-
Information technology (IT) tasks are the time consuming and company has to invest in IT
experts, software, hardware etc. if the breakdown in the IT has occurred then that can reduce the
operational efficiency of the business. So in order to avoid them it is important to outsource the
IT related tasks. Outsourcing is the economical option and also helps employees in focusing on
the expected results (Sekar and Pauldoss, 2018). Further it will help company in taking
competitive advantage and also enhance customer satisfaction.
Tools and techniques in operations
Flowcharting-
This is one of the best method or the tool for understanding process within the company. This
tool help in the detailed breakdown of the process. With the help of flowcharts company can get
proper understanding of the work efforts. By using flowchart order getting process becomes easy
and it also can be encoded easily because flowchart have various symbols which is used to
represent each step in the process. There are many shapes which are circles, boxes etc which can
get easily connected with each other by drawing lines in order to provide better direction of the
process (Arellano Caro, Meuer and Netland, 2018). This flowchart can be used in the operations
which will be helpful in communicating and knowing that what is actually happening or what
else is required in the organisation.
Hypothesis testing-
Hypothesis testing are of two types which is alternate hypothesis and null hypothesis. Null
hypothesis represents the equality with the two process outputs and alternative hypothesis shows
non equality within the process of output. With the help of hypothesis testing company can find
out that they want to reject the null hypothesis or accept the null hypothesis. Hypothesis testing
can be done in many ways so that is why it is important to select the best test as per the situation.
Scatter diagram-
It is the other technique which is used in the process improvement analysis. In order to make
current pattern, current variables are used. And also variables are got predicted in order to see
the performance of process. It is important because it helps to see that what changes will give
such outcomes which are favourable. And those changes will be avoided which will give
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negative outputs. While doing the hypothesis testing also scatter diagram is used by the
company. Through this it can be see that there is direct correlation with the variables and the
performance or not (Azevedo, Migueis and Azevedo, 2019). Scattering close represents that
there are higher correlation and scattering apart means that the correlation is less.
Conclusion
Through this report it can be concluded that risk management strategy is necessary to implement
because it safeguards business from uncertain risks and rather help business to fight against
problems or issues. It helps business in solving various issues and also reduces the wastage of
various resources which are human resource, asset, equipment, tools etc. risk management
strategy will be helpful in reducing uncertain problems. If company will implement risk strategy
then they can safe their employees from various accidents. In order to implement risk strategies
it is important to first analyse the risk and then after that monitoring and managing the risk is
also important. Insurance is also helpful in reducing risk. As the premium which company will
pay to the insurance company will help them in saving from uncertain situations.
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REFERENCE
Books and Journals
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Azevedo, I., Migueis, V.L. and Azevedo, A., Operations Improvement in a Manufacturing
Business of Make-to-order Special Vehicles.
Bondarenko, S. and et.al., 2020. Risk management of enterprise restructuring
strategy. International Journal of Advanced Research in Engineering and Technology
(IJARET), 11(5).
Clarke, J.E. and Liesch, P.W., 2017. Wait-and-see strategy: Risk management in the
internationalization process model. Journal of International Business Studies, 48(8),
pp.923-940.
Edjossan-Sossou, A.M. and et.al., 2020. Sustainable risk management strategy selection using a
fuzzy multi-criteria decision approach. International Journal of Disaster Risk
Reduction, 45, p.101474.
Ferrer, A., 2021. Multivariate six sigma: A key improvement strategy in industry 4.0. Quality
Engineering, pp.1-6.
Guliyeva, S., 2020. Enterprise risk management strategy. Economic and Social Development:
Book of Proceedings, 3, pp.704-710.
Jackson, D. and et.al., 2018. The drivers of sea lice management policies and how best to
integrate them into a risk management strategy: an ecosystem approach to sea lice
management. Journal of fish diseases, 41(6), pp.927-933.
Kosayanon, A. and Kasemset, C., BOTTLENECK IDENTIFICATION FOR OPERATIONS
IMPROVEMENT IN HEALTH CARE SERVICE. In TSU–AFBE International
Conference 2018.
Kubala, M. and et.al., 2021. Process improvement strategy to implement an outpatient surgery
center efficiency model in an academic inpatient setting. International Journal of
Pediatric Otorhinolaryngology, 144, p.110650.
Lysenko, V., 2017. Corporate strategy of risk management in agribusiness. Agricultural and
Resource Economics: International Scientific E-Journal, 3(4), pp.97-108.
Mburu, D.K., 2017. Risk Management Strategy and Supply Chain Perfomance Among
Manufacturing Companies In Kenya.
Sekar, K. and Pauldoss, S.P., Control Strategy For Dstatcom Using Reinforcement Learning
Algorithm in MG for Power Quality Improvement. Renewable Energy with IoT and
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Vincent, N.E. and Pinsker, R., 2020. IT risk management: interrelationships based on strategy
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Wicaksono, A.Y., 2020. Applying ISO: 31000: 2018 as Risk Management Strategy on Heavy
Machinery Vehicle Division. Journal homepage: https://journal. trunojoyo. ac.
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Yu, D., 2019. Evaluation of outbound operations improvement projects for distribution
centers (Doctoral dissertation, Massachusetts Institute of Technology).
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