Toyota case analysis
Operations management has its origins in the study of production or manufacturing management. People can initially think of operations management as being part of a distinct function producing a product and service combination, just as people have marketing and accounting functions in many organizations. Every organization that offers goods or services has an operations activity. As far as the organization structure is concerned, some firms will have a discrete operations function. This might be called a manufacturing department, an operations system, or have no identifiable name at all. However, like marketing and accounting, it is a fundamental function of the firm with professionally trained operations or production managers responsible for conversion of resources into the required product and service combinations. In some organizations such managers will have different titles, a store manager for a retailer, administrative managers within a hospital or distribution managers in a logistics company (2002).
The operations of an organization are all of the activities directly related to accomplishing the main purpose of the organization, whether it be producing some product or providing some service. In either case the operations system will provide the conversion of certain inputs, such as materials and labor, into certain outputs, either products or services. Thus, the operations function can be distinguished from the other main functional areas of an organization, such as marketing, finance, personnel, and accounting, which are no less vital for the firm’s success but which are less directly related to the organization’s day-to-day pursuit of its main business. Of course, all main functional areas of an organization are intricately entwined; all interact with and provide support for the others, and the boundaries are not always clear between them ( 1998). The paper will discuss about the company Toyota Corporation. The paper will also discuss about the behavior and choices made by Toyota.
Toyota Motor Corporation
Toyota Motor Corporation is a major manufacturer of automobiles based in Toyota, Japan. The company also makes trucks, buses, and forklifts and other industrial vehicles. The company was founded by Kiichiro Toyoda, who in 1933 established an automobile department in his father’s loom factory Toyoda Automatic Loom Works, Ltd. following a trip to tour United States automobile plants. The department concentrated on building fuel-efficient vehicles and completed its first experimental vehicles in 1935. In 1937 Toyoda established Toyota Motor Co., Ltd ( 2001). As Toyota rebuilt, it decided to make smaller cars in an effort to avoid direct competition with automobile plants in the United States and Europe, which primarily produced larger vehicles. Toyota released its small-car prototype in 1947. In 1949 the company came close to bankruptcy, failed to meet payroll, and was faced with labor problems.
Toyoda resigned as head of the company in 1949. His successors, Eiji Toyoda and Shoichi Saito, began investing in efficient, modern facilities to produce more sophisticated automobiles. In 1954 the company developed the Kanban system, based on a system for stocking the shelves at a supermarket, which ensured that manufacturing parts remained in stock. The company introduced the Celica in 1970, the Tercel in 1978, and the Camry in 1980, all of which became popular models (2001).
By 1980 Japan produced more cars than the United States, and Toyota trailed only General Motors Corporation (GM) in worldwide production. The company changed its name to Toyota Motor Corporation in 1982. In 1984 Toyota joined with GM to build a car production plant in Lexington, Kentucky. Over the next ten years, Toyota invested $6.5 billion in production plants in North America. In the late 1980s and early 1990s, Toyota shifted its emphasis to higher-priced cars, including the successful Lexus line. A global recession resulted in lowered profits, but Toyota remained among the largest car companies in the world. In 1997 Toyota became the first auto manufacturer to mass-produce a car powered by a combination of electricity and gasoline. The Toyota Prius doubles the fuel efficiency of conventional gasoline-powered cars and dramatically reduces toxic emissions. Toyota sold 30,000 of these hybrid cars in Japan between 1997 and 1999. The Prius became available in North America in 2000 (2001). Toyota is a company known for its innovativeness and passion for its industry. It makes sure that they offer the best products. The company hires the most able and responsible personnel to make sure that the company attain benefits and not problems.
Behavior and choices
Human Resource Management is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an integrated array of cultural, structural and personnel techniques. Extensive training and culture management programs, individualized reward management systems, as well as a range of employee involvement mechanisms, all operate towards achieving enhanced employee contribution. It is a whole range of notions on management theory, style and practice. Perhaps most usefully considered as a generic term that covers the entirety of work organization, working terms and conditions and representational systems, HRM can be depicted as being concerned with all those activities associated with the management of people in organizations (2003).
Businesses rely on effective human resource management (HRM) to ensure that they hire and keep good employees and that they are able to respond to conflicts between workers and management. HRM specialists initially determine the number and type of employees that a business will need over its first few years of operation (2003). The company makes sure that has a good relationship with its personnel. The personnel are the backbone of the company. They are the one that creates the product and the one that sells it to clients. It makes sure that the personnel are given everything they need. The company also makes sure that the personnel are justly compensated.
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