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Toyota: The accelarator Crisis
Transcript of Toyota: The accelarator Crisis
Why was Toyota facing a recall crisis? -Strategic drivers 2. Michael Porter claims that
“operational effectiveness” is not a strategy.
Why was operational effectiveness such a focus at Toyota?
What are the downsides of “lean manufacturing”? -Toyota's Production System (TPS) 3. Has Toyota successfully enacted principles espoused in the Toyota Way?
What did they do well, and where is there room for improvement? Principle 1:“base your management decisions on a long-term philosophy, even at the expense of short-term financial goals” 4. In pursuing its aggressive global expansion,
what tradeoffs did Toyota make?
How effectively did they manage the tension
between global standardization
and local responsiveness?
Did they manage their value chain activities effectively? Toyota's tradeoffs: Toyota's PESTEL analysis: Toyota's SWOT analysis: 5.Has Toyota effectively managed public relations in the U.S.?
Who should be accountable for this activity? How could Toyota's crisis management be improved? 6.What should Akio Toyoda do now to restore Toyota's reputation and position Toyota for sustainable competitive advantage? 7.What lessons can other companies take from Toyota's crisis? hanks for listening ! - Structural drivers -Cultural drivers -Toyota's Just-in-Time -Downsides of "lean-manufacturing" employees’ dependability , schedule issues, customer’s dissatisfaction, the cost of purchases, continuous improvements Principle 3: “Use pull systems to avoid overproduction” Principle 9: “You should Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others” Principle 11: "“Respect your extended network of partners and suppliers by challenging them and helping them improve" less equipped car + firm’s “reliability +waste of time and focus +economic compensations +“Reputation”. Managing the tensions local pressures+"Customers first" program + Headquarters in Japan Value Chain Activites: Inbound logistics => Operations => Outbound logistics =>Marketing & Sales =>Service
Legal Factors:-Health and Safety law, international agreements on Human rights Political Factors:-Firms taxation policies, Trad-Unions, rules for cost and Quality requirement. Economic Factors:-Increased demande for vehicules (emerging countries) , fluctuatoins on the oil market. Social Factors:-Demographic changes, cultural preferences (SUV, Hybrid etc...) Technology Factors:- Electronic innovative systems, new marketing mix channels, purchase market (e-commerce) Environmental Factors:-Production of eco friendly vehicules: hybrid cars, CO2 emissions legislations. -more than 8,900 U.S based employees -Toyota Centralized management structure and increasingly complex web of suppliers led Toyota loosing foreign subsidiaries, especially in the U.S. -The Cultural differences between Japan and U.S. Strengths:
-Global organization, with strong international position in 170 countries.
-1997 Toyota began manufacturing world's best-selling hybrid car, the Prius. Weaknesses:
-2005, Toyota faced criticism because of large scale re-call and quality issues.
- May 2009, Toyota Motor Corporation reported a recorded yearly net loss of u.s $4.2 billion. Opportunities:
- Produce fuel-efficient higher quality and smaller automobiles.
-Consumers shifted to more fuel-efficient and higher-quality product of European and Japanese auto market. Threats:
-The financial meltdown resulted in liquidity deficit in the U.S banking system which ultimately decreased consumer wealth.
-Increase maintained costs of vehicles, rising fuel price and change in customers preferences. -U.S and Japanese Culture are way different -The new default detection system -Decision-making -Integrating market firms to catch up with the Culture -Great Communication - Never Underestimate the Customer's complaints