Free Operations Of Toyota UK Report Sample
Toyota Motor Corporation 4
Four Stage Model of Operations Contribution 8
Correct the Worst Problem 8
Adopt Best Practice 9
Link Strategy with Operations 10
Toyota’s Transformation Process 10
Slack (2007) argues that, Operations management is the key element in the success of any organization. Operation management refers to the business strategies, which are adopted by an organization in order to take it to the highest level of efficiency. In this paper, the operation management of one of the world’s most popular automobile manufacturing company is discussed. According to famous Operations Management Book by Slack, Johnson and Chambers, the three main performance functions of an organization are Research and Development, Marketing and Operations
Going further deep to the operations management of an organization, a set model defines this into five main activities or objectives:
Toyota Motor Corporation
TMC or Toyota Motor Corporation whose headquarters are based in Japan is a multinational corporation. TMC is considered as one of the world’s largest automobile manufacturer who employed 71,116 employees in year 2009. Toyota claims to offer high quality products to its customers and in order to achieve their goal and have developed many business strategies. Following are mentioned all the five operations performance activities of Toyota .
Cost structure of every organization varies from one another at a vast level. The cost depends on all the other four-performance activities of that organization. If high quality, high flexibility, high dependability, and high speed is managed properly, a good amount of operation cost can be saved . Toyota makes sure that its brand recognition manages its position throughout the world by single sourcing pattern and providing finest cost to its customers. The cost management is handled by the senior managers of Toyota who are responsible to take care of the manufacturing processes and all other minor and major steps as according to the cost spent on each one of them .
Toyota is pioneer in introducing hybrid technology in their vehicle’s engines. This has made their cars not only fuel efficient but also cost effective for clients. No doubt, that is one of the most common reasons for the increase in sale of Toyota cars as drivers love to have a car, which is fuel-efficient .
Dependability plays a very important role in achieving performance objective of any organization. Two main metrics, which affects dependability of any organization, are quota and downtime . Thus, this means that an organization needs to perform its operations in minimum time possible and offer products to its customers at the actual deadline.
Toyota TMC claims to provide its customers with just in time production system. With the help of this system, services are provided to customers in the time they were promised. This is made sure with the help of skilled workers who are equipped with best possible tools and machinery. By assuring that good quality work is provided to the customers in lowest time possible, TMC is offering dependability advantage to its clients.
Speed is indeed another important aspect of the operation management in any organization. The common term used in this regard is latency, which means the time that elapses between an API (Application Program Interface) call and receipt of the response . By maximizing speed, an organization needs to make sure that they minimize the period when the order is actually placed to the time when the product is ready to be delivered by the customer .
Toyota Corporation deals with focused operations and makes the company manufacturing process simple by using less complicated machines and trained workers .
All of these factors combine to maximize the speed of any manufacturing process. According to the history of Toyota mentioned on their official website, the manufacturing time of TMC back in 1980s was two times as fast as compared to any manufacturing plant in United States of America or Europe .
Lewis & Slack (2003) argues that no product or brand gets public recognition without quality assurance. This is definitely the core component of any operations performance.
According to records, automobiles manufactured in Toyota comes in top ranking and stated as the number one car throughout the world. In year 2014, Toyota Auris was considered as the best and the most reliable car. Another survey was done by more than 50,000 drivers in UK according to which Toyota was considered as the one of the most reliable car .
According to Detroit Free Press, Toyota is manufacturing automobiles in collaboration with General Motors Corporation and this deal is proven beneficial for both of the companies. Toyota is maintaining its quality work with the help of teamwork and by working in collaboration with good and skilled workers from GMC. Therefore, it is a win-win situation for both companies. .
Toyota analyses its quality by targeting two main aspects of the company. First, the company hires engineers on base of merit and they were mentored for 10 years. Then the company pays good focus on the complaints made by the customers. These complaints were analyzed closely to bring suitable changes to the products and services and meet their satisfaction .
Flexibility as the name suggests means that an organization is offer different set of products and services for different types of target market . However, this does not mean that company can go down on quality or dependability factors of the product. Flexibility also refers to the situation in which an organization process is capable of being molded into any other form without causing an error. The most common types of flexibility are volume flexibility, mix flexibility, product/service flexibility, and delivery flexibility .
Toyota has good flexibility in its manufacturing plant and they have proved it many times. In year 2008, due to some reasons major automobile companies had to bring some huge changes in its manufacturing plant. At that time, only 75% of the Asian Automaker plants in United States of America were flexible to do so. Toyota was one of them and even at that time, the company’s manufacturing plant was good enough to bring these changes without spending extra cost .
When it comes to bringing positive change in the system and improving it to another level of expertise, Toyota believes in following certain set of rules. Several companies have been trying to imitate the production system of Toyota but it has proven to be impossible. The reason behind that is Toyota production system creates a community of scientists. These scientific methods are thoroughly checked and processed and they are quite flexible to any change, which is required by the system .
The rules being followed by the organization are how people work, how people connect, how the production line is constructed, and how to improve.
Four Stage Model of Operations Contribution
Poor financial management can affect an organization badly. There are many key components to manage the finance and operation of an organization and failure in one of them can lead to the failure of the overall system and organization .
The four-stage model of operations contribution is made of following four models:
Correct the worst problem
Adopt Best practice
Link Strategy with operations
Gives an operation advantage
Toyota being world’s best automobile manufacturing industry has earned its name by following four-stage model of operations contribution. McKeown (2010) acknowledges that any company’s biggest success lies in the way it handles problems. Toyota has proven itself quite efficient in this regard by identifying the core problems in its system and correcting them to make system flawless.
Correct the Worst Problem:
Toyota had to lose market share that year (2011) and other competitors gain market value leaving behind Toyota. However, company learned lesson from this mistake and solved the issue in no time. According to administration of Toyota, how company solves most of their big problems is by acting like your competitors, by making a clear distinction between their present state and future options and by turning the meeting into a game or simulation.
Adopt Best Practice:
In year 1980, the change in the economy and customer car buying behavior forced Toyota to bring some changes in their system as well. At that time, the financial services of Toyota assembled 60 of their top leaders to examine a new business model for their organization. This step brought lots of disturbance in the economy initially but overall it was a wise move to be taken by the company.
The service advantage offered by Toyota is one of the most popular reasons behind its popularity. So next time, you go on buying a new Toyota car, you do not need to worry about any hidden cost because every car manufactured and sold by Toyota comes with a low prices service cost. The Toyota service advantage also offers trained technicians to work on your car and a scheduled logbook service .
Link Strategy with Operations:
The term got famous by Toyota, as it is the industrial method chosen by Toyota in their manufacturing plant. There are several principals used by Toyota and the most common ones in that are:
Just in Time and
The Human Touch
The Just in Time principal was set by the founder of Toyota according to which only that number of quantity is ordered by the suppliers, which is needed by the company. This has definitely helped a lot in the success and efficiency of the organization .
The humans are considered as the main part in the success and failure of any process in Toyota. Humans are responsible of building products right the first time and identify if any problem occurs. To ensure that every worker at Toyota gives their best to the company, they are kept happy by good wages and bonuses .
Toyota’s Transformation Process:
The transformation process of Toyota is originated from market and the marketing information obtained from the sold products. Toyota uses a creative way to acquire information from market and transform it into useful and technical information. Kanban signals are used for placing orders and all of the sales information is transformed into technical information without the help of any intermediary.
The production system at Toyota encourages change at group level by utilizing various conversion processes. These changes include transitional, incremental, and developmental changes. Toyota does not expect suppliers to adopt their managerial values, principles, and problem solving techniques. In fact, the suppliers are expected to apply some of the basic operational parameters, which are the reason for the success of Toyota .
Four Vs Model:
In every operation process, few things are common. They take input in form of data, raw material, capital and time and then transform all of this in output. A main four V’s model is used in this regard with Volume, Variety, Variation and Visibility.
Toyota is implementing high Volume Low Cost in their production system by utilizing same process repeatedly for same models of cars. This help the company maintain the cost at minimum.
Toyota offers Variety in form of many different makes and models of automobiles. The cost varies depending on the luxury of the car. The higher variety an automobile offer, the higher cost customers will have to pay. Similarly, if the variety offered by an automobile is limited, the cost will be low.
There is not much variation offered by Toyota Motor Corporation to its customers. Customers are not allowed to give order for customized cars; instead they have to choose only from standard models. This saves cost to the company but offers less variety to the customers.
Visibility dimension offered by Toyota is quite high because every customer can actually see the car before buying it. They can even take a test drive, which offers high visibility to customers, and this does not lower the cost of the car. There are many key factors behind the continuous success of Toyota. However, the above-mentioned five operation performance activities have played a major role in company’s success. Four-stage model of operation contribution is also key factor behind the Toyota’s overall success. So far, the four Vs model is not entirely being implemented by Toyota Motor Corporation. If company starts offering variation in the make and model of the cars by taking special orders from their customers, this will definitely, be beneficial for the company. Customers will be willing to pay extra money for customized cars and this will offer them variety as well. The success story of Toyota is no doubt a role model for any automobile company throughout the world.
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