Toyota Motor Corporation Strategic Planning: A Comprehensive Analysis

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BUSINESS STRATEGY

TABLE OF CONTENTS
LO4.......................................................................................................................................................3
P4/M4 APPLYING A RANGE OF THEORIES, CONCEPTS AND MODELS, INTERPRET AND
DEVISE STRATEGIC PLANNING FOR TOYOTA WITH TANGIBLE AND TACTICAL
STRATEGIC PRIORITIES...................................................................................................................3
INTERNAL ANALYSIS FOR TOYOTA.........................................................................................3
VALUE CHAIN MODEL.............................................................................................................4
EXTERNAL ANALYSIS FOR TOYOTA........................................................................................6
ANSOFF MATRIX.......................................................................................................................6
PORTERS GENERIC STRATEGIES...........................................................................................7
BOWMEN’S CLOCK MODEL....................................................................................................8
REFERENCES....................................................................................................................................12

LO4
P4/M4 APPLYING A RANGE OF THEORIES, CONCEPTS AND
MODELS, INTERPRET AND DEVISE STRATEGIC PLANNING FOR
TOYOTA WITH TANGIBLE AND TACTICAL STRATEGIC
PRIORITIES
BUSINESS INTRODUCTION AND ORGANIZATION BACKGROUND
Strategic planning is very essential for any organization to access their operational activities
effectively and boost future business activities. For accomplishing desired objectives of
organization they have to maintain their effective strategic management (Liker and Convis,
2012). In this process, management is consolidating various parameters and evaluating
different data and information for making effective forecasting plan to the organization. In
this report, discussed the range of theories, concepts and models interpret and devise strategic
planning for Toyota with tangible and tactical strategic priorities.
Taking about the organization, Toyota motor corporation is one of the oldest and biggest
automobile organization in the world and constantly achieving their respected targets from
the market. The strategic management procedure of the organization is far better; it might be
the reason for their success that they have more than eight decade’s experiences in the
automobile industry.
MISSION OF TOYOTA
The Toyota Motor Corporation mission is “To attract customers by their efficient technology
and effectual product and service quality which fulfil the requirement of the customers and
also satisfy their wants.”
VISION OF TOYOTA
The vision of Toyota is "providing automated products to the customers for future mobility,
enriching lives around the world along with the safety and responsible way of moving one
place to another place.”

INTERNAL ANALYSIS FOR TOYOTA
Internal analysis is referred to the internal recognition which evaluates the working structure
of the organization positively to enhance productivity by knowing an organization's
competency level, financial position in the existing scenario and other. it is the main
procedure for managing operational activities of the organization for the development of the
company. There is an approach will help to identify more information about internal analysis
of Toyota.
VALUE CHAIN MODEL
Value chain framework has been introduced by Michael Porter which provides a brief
analysis of the organization’s creating various valuable formations in the organization to get
more advantages from the competitive market. It has been associated with the organization
that there are two segments in this framework which are primary and secondary activities of
the organization in every segment have defined procedure to accomplish analyses which are
given below (Keen and Williams, 2013).
PRIMARY ACTIVITIES
Primary activities are the core activities of the organization which works to managing
operations and other processes, it helps to manufacture finished goods and create more
authentication of resources process (Keen and Williams, 2013). There are several required
activities which are:
Figure 1: Primary Activities
Source: Gertner (2013)
 Inbound Logistics: In this procedure, Toyota receives various activities which
required for the development of the company are scheduling of transportation,
inventory control, receiving and storing material (Uygun and Straub, 2012).
 Operations: There are numerous activities are considered in operations of the
organization are the maintenance of machines, equipment, testing, packaging and
many more essentials.

 Outbound Logistics: This process is referred to Toyota to distribute their finished
goods and other activities like warehousing, managing distribution channels in
various locations according to the requirement of customers (Shamah, 2013).
 Marketing and Sales: Organization is required to managing different procedure
which has been essential for the organization are the marketing of products and
services, promotional activities for enhances sales and demand, retail management
and other activities.
 Services: It considered that activities which are increasing product and services value
of the organization including customer satisfaction, which has been essential for
getting more benefits (Uygun and Straub, 2012).
SECONDARY ACTIVITIES
Secondary activities of the organization are providing effective support to primary activities
to enlarging their source and handling external activities. it considered different phases which
helps to manage different activities are followings:
Figure 2: Secondary Activities
Source: Williams Keen and Williams (2013)
 Firm Infrastructure: Organizational infrastructure is essential to manage several
activities which support the operations of the organization by providing planning and
forecasting, quality management, finance and accounts and many more activities.
 Human resource management: It supports organizational employees to make them
efficient by training and development procedure, recruitment and selecting procedure
and also managing other administration activities (Uygun and Straub, 2012).
 Technology development: Advancement of technology and automation is sustenance
to the organization and provide effective quality of products and services (Shamah,
2013).
 Procurement: it deliberated numerous materials which help to manufacture finished
goods and other activities for making the different procedure and considered raw
materials, machines, equipment, and other resources which uses for making products.

EXTERNAL ANALYSIS FOR TOYOTA
External analysis or environmental analysis refers to the numerous factors which affect the
organization from different outside activities and it reflects the working situation of the
organization. In other sense, it identifies the industry environment of the organization and the
core purpose of the analysis is to identify the opportunities and threats in the equivalent
industry (Shaw, 2012). Some theories and models are helping to identify precise analyses
which are:
ANSOFF MATRIX
This strategic management matrix analysis has been introduced by Igor Ansoff in 1950 to
identify the market and product strength in the market. This tool is more helpful in getting
information about the product and market growth strategy. Ansoff is the tool of getting
information about the existing product of the organization in a new or existing market which
refers to the alteration process for betterment in revenue and sales (Darroch, 2014).
Figure 3: Ansoff Matrix
Source: Darroch (2014)
Market Penetration: It refers to the existing market and existing organizational products
which increases the revenue of the organization. With the help of promotional activities and
advertisement and other tools help manage various formation to the development of the
organization and it also supports to rebuilding the position of the organization in an existing
market (Shaw, 2012).
Market Development: In this portion, it focuses on new markets which help them to make
new customers with effective sales procedure. In this category, Toyota identifies that the
organization is efficiently achieving its tasks and activities in the new market with their
existing products and services. For the betterment of the organization, the provided offers and
discount procedure to a new audience from new regions (Darroch, 2014).

Product Development: It consist existing market and new products, it replacing existing
products with new innovative ones which assist to attract customers and also support for
getting new involvement of customers to enhance the sales and revenues of the organization.
Some of the rectification of Toyota is efficiently works but some implementation in the
existing product is reducing the productivity of overall products (Harris and Kamarthi, 2015).
Business Diversification: When an organization take crucial steps to introduce new products
and services in a new market which is the risky decision for the development of the
organization. Some of the organization takes such decisions when the working condition is
not so good and other takes this step to expanding the business. With the concern of Toyota,
they expand their business in new markets in new regions with new innovative products and
services to a new audience (Shaw, 2012).
PORTERS GENERIC STRATEGIES
Porter’s generic strategies are more helpful for getting forecasted information about the
market for their growth and development. Toyota Motor Corporation is one of the biggest
organizations which work to identify the various formations of changes in the existing market
and products. The main purpose of this strategy is to get effective competitive benefits from
the market and other sources (Ouma and Oloko, 2017).
Figure 4: Porters Generic Strategies
Source: McGee (2015)
COST LEADERSHIP
Porter’s Generic Strategy is mostly helpful for the organization to getting things effectively;
the organization is continuously completing their target and gaining more competitive
advantages from the market. It works to develop organization procedure for benefits from a
competitive market (McGee, 2015). The organization is reducing cost and providing effective
quality products to their potential customers which help to make enhance customer base. The

reduced cost structure is more helpful for gaining more achievements and make the
organization better. The formation of cost structure is resulting in the changes in the product
prices which are lower than before (Soltanizadeh et al. 2016).
DIFFERENTIATION
The differentiation is the key to managing various challenges in the competitive market it
helps to bring new innovative and creative changes. There are more numerous challenges are
provided information to managing defends product differentiation helps t capture more
market share. The organization has to use multiple products to maintain its brand value in the
market. According to the information, customers are more interested in shifting from one
similar product to another similar product which has been fulfilling their satisfaction (Viltard,
2017).
FOCUS
Organization manage their strategies are constantly focusing on the development of the
organizational operations which mainly works to provide analysis about the market. In this
theory, organization management has to make different activities to focus on various markets
to get much better output than the existing market. In this focusing process, the organization
has to focus on the current market and also find out various markets to circulate their
products and services which have an effective framework of Toyota (Ouma and Oloko,
2017).
BOWMEN’S CLOCK MODEL
Bowman’s Strategic Clock has been introduced by two famous economists Cliff Bowman
and David Faulkner; the core objective of this theory is to provide essential information about
the position of the organization in the market as compared to their competitors. It is
representing the strategic positioning of the organization in various markets. It helps to
identify the various components which work to get information on how the products and
services of Toyota should be positioning that provides the most competitive position in
various markets (Kays et al. 2016).
According to Bernstein (2016), bowmen's clock model is a complete marketing model that
helps to manage the position of the organization in a competitive market.it works to identify
the cost factors, competitive advantages and other essential activities which helps to bring
some new innovative procedure for the overall positioning of the product in the market.”

Figure 5: Bowmen’s Clock Model
Source: Bernstein (2016)
Low Price and Low-Value Added (Position 1)
In this position, the competitive level is very low for a business. The differentiation of
products is not that effective because the price of product and services is slightly very low.
Bargain basement strategy is another name of this category which works to provide a more
effective response (Kays et al. 2015).
Low Price (Position 2)
In this category of positioning, customers are opposing various formations to manage
different activities which reduce the optimum sources and it helps to reduce the cost of the
product. The reduction of the cost of the product is assisting a profitable structure for the
organization. For generation more profit and organizing the cheapest other organization
activities, this position is more helpful (Bernstein, 2016).
Hybrid (Position 3)
This process reflects the organizational activities by opting both lower cost and the
improvement of product's quality to attract more and more customer with the assumption and
approaches that helpful for Toyota to gain an effective customer base. The hybrid position is
more effectually work to managing different activities of the organization where they provide
effective sources for both cost and quality.
Differentiation (Position 4)
The highest quality of product and services are provided in this position to the customer who
helps to get a more competitive advantage. The organization will be achieving its overall
objectives for the betterment of their internal process. Toyota shall be continuously playing

their roles and responsibility in managing different activities for the development of new
quality products.
Focused Differentiation (Position 5)
Organizations will continuously provide different products and services for achieving their
operational objectives. Toyota should complete their different varieties of products and
services introduced in various markets with the reflection of the effectiveness of the product
and quality. It represents various formation and different steps that an organization takes to
manage their activities (Kays et al. 2016).
Risky High Margins (Position 6)
In this category, the organization shall increase the prices of their products and also increase
the productivity for the same product, the organization is realizing that they are not concern
about the quality structure only they increase the price of the products in an effective way it
increases the sales sometimes.
Monopoly Pricing (Position 7)
The monopolistic personality will refer that there is one organization which consuming
various formations in the market that helps to bring new innovative change. The organization
is continuously providing products and services to their potential customers without concern
of product favouritism.
Loss of Market Share (Position 8)
This position will be a disaster for any organization, is considered a higher price of the
products and services with lower products quality which has been greater than the normal
organization’s products. Sometimes competitors are provided with the same quality products
and services within the same prices or lesser (Soltanizadeh et al. 2016).
Strategic Management Plan refers to the process of Toyota to collecting various applicable
information which has been concluded in required formation for identification that strategies are
achieving more objectives. As per the research process on the identification of various strategically
theories and models representing that competitors and other future factors will affect the
organizational operations and many more administrative activities. External and internal analysis is
referred to the evaluating process of strategic management to delivering better time to the

organization. It has been shown that Bowmen’s Clock Model will be a respectable model that support
strategic management to growth develop of Toyota.
In the automobile industry, organizations have to maintain their brand value in a competitive market
to get more benefits, there are numerous stages are specially done when the organization is following
the various path of the organization. In this assignment discussed the strategic management analysis
along with different theories, models and approaches which helps to bring effectively the strongest
sources that assist to fight with various challenges arises in the market. The strategic management
plan is disclosing internal and external analysis that helps to bring effective formations includes
different theories which are Value chain model. For external analysis, Ansoff matrix, Porters generic
and Bowmen's clock model is much better to identify various factors. Toyota should have to adopt
Bowmen’s clock model to identify numerous positions of the organization in different market places.