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3 assignment of mis 3 assignment of mis Document Transcript

  • Task-1<br />Historical Development and examine the current issues with reference to the industrial example identified in assignment no. 1 & 2.<br />Historical Development of Toyota Motor Corporation <br />Toyota Motor Corporation was Japan's largest car company and the world's third largest by the year 2000. The company was producing almost five million units annually in the late 1990s and controlled 9.8 percent of the global market for automobiles. Although its profits declined substantially during the global economic downturn of the early 1990s, Toyota responded by cutting costs and moving production to overseas markets. The company represented one of the true success stories in the history of manufacturing, its growth and success reflective of Japan's astonishing resurgence following World War II.<br />The Emergence of Japanese Automobile Manufacturing in the 1930s and 1940s<br />In 1933 a Japanese man named Kiichiro Toyoda traveled to the United States, where he visited a number of automobile production plants. Upon his return to Japan, the young man established an automobile division within his father's loom factory and in May 1935 produced his first prototype vehicle. General Motors and Ford already were operating assembly plants in Japan, but U.S. preeminence in the worldwide automotive industry did not deter Toyoda.<br />As Japan became embroiled in World War II, the procurement of basic materials for automobile manufacturing became more and more difficult. At one point Toyoda was manufacturing trucks with no radiator grills, brakes only on the rear wheels, wooden seats, and a single headlight. Pushing toward the limits of resource conservation as the course of the war began to cripple Japan's economy, the company started piecing together usable parts from wrecked or worn-out trucks in order to build 'recycled' vehicles.<br />When the war ended in August 1945 most of Japan's industrial facilities had been wrecked, and the Toyoda (or Toyota as it became known after the war) production plants had suffered extensively. The company had 3,000 employees but no working facilities, and the economic situation in Japan was chaotic. But the Japanese tradition of dedication and perseverance proved to be Toyota's most powerful tool in the difficult task of reconstruction.<br />Postwar Challenges and Innovations: The Birth of the Small Car<br />Just as the Japanese motor industry as a whole was beginning to recover, there was mounting concern that American and European auto manufacturers would overwhelm the Japanese market with their economic and technical superiority. Japan's automakers knew that they could no longer count on government protection in the form of high import duties or other barriers as they had before the war.<br />Production dropped to 992 vehicles in March 1949, to 619 in April, and to 304 in May. Crucial restructuring efforts included a proposal to incorporate Toyota's sales division as a separate company, leading eventually to the formation of Toyota Motor Sales Company Ltd. in April 1950. Toyota Motor Sales Company handled all domestic and worldwide marketing of Toyota's automotive products until July 1982, when it merged with Toyota Motor Company.<br />Along with improvements in its production facilities, Toyota also worked to develop a more comprehensive line of vehicles to contribute toward the growing motorization of Japanese society. During 1951, for example, Toyota introduced the first four-wheel-drive Land Cruiser. Moreover, as the domestic demand for taxis rapidly increased, production of passenger cars also rose quickly, from 50 units per month to 250 units per month by 1953.<br />In production control, Toyota introduced the 'Kanban' (or 'synchronized delivery') system during 1954. The idea was derived from the supermarket system, where 'consumers' (those in the later production stages) took 'products' (parts) from the stock shelves, and the 'storekeepers' (those in the earlier production stages) replenished the stock to the degree that it was depleted. The Kanban system became the basis for Toyota's entire production system.<br />In 1955, ten years after its defeat in World War II, Japan became a member of the General Agreement on Tariffs and Trade (GATT); but automobiles remained one of Japan's least competitive industries in the international arena. Toyota, foreseeing the coming age of large-scale international trade and capital liberalization in Japan, decided to focus on lowering its production costs and developing even more sophisticated cars, while at the same time attempting to achieve the highest possible level of quality in production. This was a joint effort conducted with Toyota's many independent parts suppliers and one that proved so successful that ten years later, in 1965, Toyota was awarded the coveted Deming Prize for its quality-control achievements. That was also the year that the Japanese government liberalized imports of foreign passenger cars. Now Toyota was ready to compete with its overseas competitors--both in price and quality.<br />Two years later, the 1973 Middle East War erupted and the world's economy was shaken by the first international oil crisis. Japan, wholly dependent upon imports for its oil supply, was especially affected. The rate of inflation increased and demand for automobiles fell drastically. Yet, in the face of the overall pessimism that gripped the industry and the nation, Toyota's chairman Eiji Toyoda proposed a highly aggressive corporate strategy. His conviction was that the automobile, far from being a "luxury," had become and would remain a necessity for people at all levels of society. As a result, Toyota decided to move forward by expanding the company's operations.<br />The 1973 oil crisis and its aftermath were valuable lessons for Toyota. The crisis demonstrated the necessity for a flexible production system that could easily be adapted to changes in consumer preferences. For example, Toyota did away with facilities designed exclusively for the production of specific models and shifted instead to general-purpose facilities that could be operated according to changes in market demand for the company's various models.<br />Environmental Awareness in the 1970s<br />In December 1970 the U.S. Congress passed the Muskie Act, which set limits on automobile engine emissions. In the United States the enforcement of this law was eventually postponed, but in Japan even stricter laws were promulgated during the same time with no postponement of enforcement deadlines. When the Muskie Act was first proposed, automakers all over the world were opposed to it. They argued that it would actually prohibit the use of all internal combustion engines currently used, and they requested that the enforcement of the law be postponed until new technology, able to meet the law's requirements, could be developed.<br />International Growth in the 1980s<br />In 1980 Japan's aggregate automobile production was actually better than that of the United States. In the same year, Toyota ranked second only to General Motors in total number of cars produced. Although Toyota made efforts over the years to improve the international cooperation between automakers, in such ways as procuring parts and materials from overseas manufacturers, Japan's successes in the world auto market nonetheless resulted in the Japanese automobile industry becoming a target of criticism.<br />By the end of the 1980s, Toyota's position as a powerful, exceptionally well-run car company was nearly unassailable. After a decade of prodigious growth, the company stood atop the Japanese automobile industry and ranked number three worldwide, a position it had held since 1978 and strengthened in the ensuing years. By the beginning of the 1990s, Toyota commanded an overwhelming 43 percent of the Japanese car market, and in the United States it sold, for the first time, more than one million cars and trucks.. Toyota also spearheaded the Japanese automobile industry's foray into the luxury car market, leading the way with its Lexus LS400 luxury sedan, which by the mid-1990s was outselling market veterans BMW, Mercedes-Benz, and Jaguar.<br />As Toyota's profit decline continued, however, the mounting losses persuaded Toyoda to intensify his cost-cutting measures. Design changes in the company's vehicles coupled with reductions in manufacturing and distribution costs saved Toyota ¥150 billion in 1993, and another ¥100 billion in savings was expected to be realized in 1994. That same year, the fourth consecutive year of negative net income growth, Toyota recorded ¥125.8 billion in consolidated net income, a little more than a quarter of the total posted in 1990, when the company earned ¥441.3 billion.<br />"The New Global Business Plan": 1995 and Beyond<br />When Hiroshi Okuda was promoted to company president in 1995 his chief ambition was to revitalize Toyota's standing in the global marketplace. In June he unveiled Toyota's New Global Business Plan, which placed renewed focus on innovation and international expansion. Okuda's targets were clearly defined: to raise production to six million vehicles a year; to increase Toyota's international market share to 10 percent; and to increase its share of the domestic market to 40 percent. He believed the first two goals would be achieved through the construction of new manufacturing plants in foreign markets, along with an increased emphasis on the "localization" of parts production. The purpose of localization was to reduce the time and expense involved with shipping components across great distances, enabling Toyota to increase its overall automobile production and devote greater resources to research and development. By widening the scope of operations in Toyota's overseas locations, Okuda envisioned a more streamlined, cost-effective manufacturing process. Furthermore, the stimulation of local economies was an effective public relations tool, enhancing the value of the Toyota brand name in foreign markets.<br />One of the most promising automobile markets to open up in the late 1990s was in China. By March 1998 Toyota already had stakes in four Chinese parts manufacturing plants, one of them a wholly owned subsidiary. The company took a more significant step in November 1998, when it established the Sichuan Toyota Motor Co., Ltd., Toyota's first vehicle production plant in China. A joint venture with the Sichuan Station Wagon Factory and Toyota Tsusho Corp., the new plant was scheduled to begin manufacturing coaster-class buses by 2001.<br />Although a weakened euro caused Toyota to suffer losses in Europe toward the end of the 1990s, the new operation in France, scheduled to begin production in 2001 at a rate of 150,000 vehicles a year, was expected to reverse this trend. The company also experienced strong sales in the United States and Japan during this time, and in 2000 Toyota's total worldwide production exceeded five million vehicles for the first time ever.<br />Principal Subsidiaries:<br />Toyota Motor Sales, U.S.A., Inc.; Toyota Motor Thailand Company Limited; Daihatsu Motor Co., Ltd. (51%); New United Motor Manufacturing, Inc. (U.S.A.; 50%); Toyota Motor Credit Corporation (U.S.A.); Hino Motors, Ltd.<br />Principal Competitors: Ford Motor Company; General Motors Corporation; Honda Motor Co., Ltd.<br />Key Dates:<br />1918: Sakichi Toyoda establishes Toyota Spinning & Weaving Co., Ltd.<br />1933: Automobile Department is created within Toyoda Automatic Loom Works.<br />1935: First Model A1 passenger car prototype is completed.<br />1937: Toyota Motor Co., Ltd. is formed.<br />1950: Toyota Motor Sales Co., Ltd. is established.<br />1956: Toyota creates the Toyopet dealer network.<br />1957: Toyota Motor Sales, U.S.A., Inc. is formed.<br />
    • 1962: Toyota Motor Thailand Co., Ltd. begins operations.
    • 1982: Toyota Motor Company and Toyota Motor Sales merge to form Toyota Motor Co.
    • 1995: Hiroshi Okuda becomes company president.
    1997: The Prius, Toyota's first 'eco-car,' is launched.<br />1998: Toyota acquires majority share in Daihatsu Motor Co., Ltd.<br />Additional Details<br />Public Company<br />Incorporated: 1937 as Toyota Motor Co., Ltd.<br />Employees: 214,631<br />Sales: $119.66 billion (2000)<br />Stock Exchanges: Tokyo New York<br />Ticker Symbol: TM<br />NAIC: 42111 Automobile and Other Motor Vehicle Wholesalers; 332311 Prefabricated Metal Building and Component Manufacturing; 336111 Automobile Manufacturing; 336112 Light Truck and Utility Vehicle Manufacturing; 33612 Heavy Duty Truck Manufacturing; 336211 Motor Vehicle Body Manufacturing (pt); 336312 Gasoline Engine and Engine Parts Manufacturing; 336322 Other Motor Vehicle Electrical and Electronic Equipment Manufacturing (pt); 33633 Motor Vehicle Steering and Suspension Components (Except Spring) Manufacturing; 33634 Motor Vehicle Brake System Manufacturing (pt); 33635 Motor Vehicle Transmission and Power Train Parts Manufacturing; 336399 All Other Motor Vehicle Parts Manufacturing (pt)<br />Current issues<br />
    • Defeating Driver Distraction through Technology
    Driver distraction has now joined alcohol and speeding as one of the leading factors in automobile fatalities and serious injuries.  Here at Toyota, we’re putting our resources behind bringing attention to, and ultimately defeating, this serious public safety issue.<br /> <br />One of the coolest things we saw during our visit to Higashi-Fuji Technical Center has been the Driving Simulator. It’s an awesome sight: in a hangar-sized expanse, a spaceship-like capsule is perched atop a complex turntable system that allow it to tilt, swerve, and move freely, giving the occupants the feeling of really driving on the road. The purpose of this multi-million dollar, NASA-style driving simulator is to replicate scenarios that mimic actual driving, including driver distraction, and measure various driver behaviors and reactions.<br />
    • Unintended Acceleration: Toyota Addresses the Issues
    Recently, there has been some controversy regarding a safety recall that Toyota is undertaking. We want to take this opportunity to set the record straight with a chronology of the events of the past week. Toyota owners and Lexus owners about a defect related to motor vehicle safety that exists on certain models. The defect is the potential for an unsecured or incompatible driver’s floor mat to interfere with the accelerator pedal and cause it to get stuck in the wide open position. As an interim precaution, we asked owners to take out any removable driver’s floor mat and not replace it with any other floor mat until a vehicle-based remedy can be developed and implemented on their vehicle. When such a remedy is determined, owners will be notified.<br /> <br />In addition, the letter contains instructions for owners on what to do should they experience accelerator pedal interference.<br />
    • Environmental Responsibility
    From the development of sustainable vehicles and making manufacturing plants sustainable to vehicle recycling, "eco-driving" educational programs and reforestation, Toyota is actively engaged in a wide variety of programs to improve the environment.<br />Environmental Technology<br />
    • The Ultimate Eco-car - Toyota has a long history of continuous improvement when it comes to conventional engines, including lean-burn gasoline engines, direct injection gasoline engines and common rail direct-injection diesel engines, as well as engines modified to use alternative fuels, such as compressed natural gas (CNG) or electricity (for Electric Vehicle). In December 2002, we launched limited sales of the Toyota FCHV, a Fuel Cell Vehicle that runs on high-pressure hydrogen.
    • Engineers may disagree about which fuel or car propulsion system is best, but they do agree that hybrid technology is the core for eco-car development. We develop these key technologies in-house to reduce costs and rapidly commercialize their application.
    • Hybrid Vehicle - A hybrid system combines different power sources to maximize each one's strengths, while compensating for the others' shortcomings. A gasoline-electric hybrid system, for example, combines an internal combustion engine's high-speed power with the clean efficiency and low-speed torque of an electric motor that never needs to be plugged in.
    • Electric Vehicle – The Toyota FT-EV II is representative of clean mobility running on 100% electricity. Developed for short distances, this small electric vehicle (EV) features an innovative packaging design that gives it a compact body and a spacious interior.
    • Plug-in Hybrid Vehicle
    • Fuel Cell Vehicle
    • Technology File
    Task-2<br />Explore the actual and expected impact on employee resistance to change, industry, government an presentation on various alternatives.<br />Actual or expected impact on the Employees-<br />
    • Toyota’s recall problem has negative impact on its employees: Toyota employee that their staff, especially administrative and technical, are overworked and stressed, as well as highly embarrassed. Sales staff are worried about their jobs, and hard-pressed to convince potential buyers that their product is safe. Some assembly plants have reduced shift requirements and hiring. It's expected that layoffs will ensue within a month. Now what's going happen is that the employees have to work more than 20 hours a day to get their customers vehicles fixed.
    • Many people are promoted into managerial positions because they're technically good at their jobs, but they aren't trained as managers to help their subordinates achieve peak performance
    • Improvement in the work efficiency of the employees.
    • Employees will be motivated after getting the training.
    • But in actual the employees expected more salary from the organization.
    • Change in the attitude of the employees.
    • Provide a sound introduction and orientation to your company's culture, including your learning culture, to any new employees you hire.
    • To create a learning culture in their business, to communicate to with their employees and targeted results which they have established as a result of your needs analysis.
    • They provide the Training to their employees regarding new technology by which they can increase the profits of their company and control the inventory cost which is the main goal of the firm.
    • But in actual this is the huge expense of the organization because after training the employees are not giving their 100% because they demanding more salaries according to their skills and knowledge.
    • Saving time and money of the organization and do more Production at the lowest cost.
    Actual or expected impact on the Government<br />
    • Increase in the National Income
    • Increase in the living standard
    • Increase the export and decrease the import
    • The impact of government on Toyota, however, and NHTSA will be under pressure to be more aggressive about safety complaints against any OEM in the future. The Toyota case will energize automotive safety groups, such as the Center for Auto Safety and the automotive safety group at Ralph Nader's Public Citizen, to push NHTSA and the auto industry on safety concerns.
    • Economic Impact of Toyota
    • This section surveys available evidence of the economic impact of Toyota on labor market outcomes (employment and wage) and on firm productivity and investment. Further, it attempts to assess whether the supplied Toyota matches the demand.
    • Labor Market Outcomes
    • There is precious little available data on the economic impact of Toyota’s programs in the region and data were available only about recall problem, by which they are taking work from their labors.
    • Effects on Toyota’s Productivity and Investment: - No published evaluation data on the effects of government training programs on productivity or investment could be found. The levy supported training agencies in the Dominican Republic and in Jamaica both offer services aimed at increasing productivity with client firms. The Dominican Republic has a very large investment in training in the firms and uses is Enterprise Service Consultants Offices to assist firms using a methodology adapted from the ILO/ Cinterfor referred to as Pro MES which involves a systematic approach to measuring and improving productivity.
    Actual or expected impact on industry<br />The full impact of the Toyota recalls on auto industry jobs is yet to be felt, but cuts caused by the announcements are clearly in the pipeline. The European recalls coincided with Toyota’s announcement that the company has a “headcount surplus” at its Derbyshire plant in the UK. Up to 750 jobs may be lost.<br />Toyota has recalled more than 8.5 million vehicles globally in recent months for problems including sticky accelerators, accelerators that can be pinned down by loose floor mats and a braking glitch affecting its hybrid models.<br />
    • Toyota's suspension of sales of eight models in the U.S. is definitely expected to affect the company's sales figures in Q1 2010. Ford and Hyundai were quick to react with incentive schemes to dig into the Toyota customer base, with GM offering incentives of $1,000 and 0 percent financing when customers trade in a Toyota for a GM vehicle. Perhaps one of the key concerns for Toyota is the loss in sales of its flagship hybrid Prius to other market substitutes. Honda is a brand high on the brand recall list for Americans, and the Insight mild hybrid, which is competitively priced, could
    • become an immediate alternative for Toyota customers
    • Bibliography
    • http://www.associatedcontent.com/article/5437196/impact_of_global_economic_slowdown.html
    • http://pressroom.toyota.com/pr/tms/our-point-of-view-post.aspx?id=3204
    • http://www.toyota-global.com/innovation/environmental_technology/hybrid/
    • http://www.theferrarigroup.com/supply-chain-matters/tag/toyota-motor-corporation/
    • http://www.toyota.com/recall.