How Toyota Achieve Its Objectives By Implementing Tqm Marketing Essay

How Toyota Achieve Its Objectives By Implementing Tqm Marketing EssayThe Toyota motor party of Japan has taken this ch everyenge seriously and has proved its ability to compete with the once emperors of the industry such(prenominal) as Ford, Volvo, Chevrolet et al. Buy railroad automobileeful adoption of penetrating edge technologies such as Total look focal point, Toyota has turned itself into a game changer in the industry.This assignment focuses on how Toyota achieved its objectives using TQM. It unf gray-headeds in triad stages scoop uping with TQM and its scope. secondly competitive purlieu analysis with SWOT and PESTLE analyses and finally it arrives at conclusion based on a thorough military rank of the organization.Company OverviewToyota Motor Company (TMC) is the crown of Japanese railway car industry. Started as a small car manufacturer on August 28, 1937 it gifted more quality innovations to the world throughout its history. In the early 1980s Toyota won its first quality control award in Japan.The company launched its luxury dirt Lexus in 1989 which became a massive success. It also manufactures Scion an economical automobile home run that targets young adults. Toyota also conquered the hybrid car grocery with the launch of its iconic car Prius in 17.Today with a work force of 71,116 and an annual sale of US$228+ billion, Toyota is as profitable as all the other car companies combined. In 2007 it became the worlds largest auto manufacturer beating General Motors.(Info http//www.toyota-global.com/)Literature ReviewTotal Quality managementTotal quality management can be out key outd asA management psychology that seeks to integrate all organizational functions such as marketing, finance, contrive, engineering, product, guests satisfaction et al. to focus on meeting customer call for and organizational objectives.Abstract Besterfield D, Michna Besterfield C, Besterfield Glen and Besterfield-Sacre Mary Total Quality Management (3rd Edition) (2002)The team of the organization that the TQM is implementing tries to take part in improving attend toes, products, services as well as the culture which they work. This approach is inspired by quality leaders such as Philip B Crosby, W. Edwards Deming, Kaonru Ishikawa and Joshep M. Juran.According to Deming TQM involves 14 principles.1. Create constancy of purpose2. dramatize a new philosophy of co mental process3. Cease dependence on mass inspection to achieve quality4. End the practice of awarding patronage5. change constantly, and forever6. Institute training7. Adopt and institute leadership for the management of heap,8. Drive out fear and build trust9. Break down barriers between departments.10. Eliminate slogans, exhortations, and targets asking for zero defects or new levels of productivity11. Eliminate numerical goals, numerical quotas and management by objectives12. Remove barriers that rob people of rejoicing in their work13. Institute a vigorous program of education and self-improvement.14. Put everybody in the company to work to accomplish the transformation.Today The concept of quality is significant more than ever before. The history of quality goes as far as 1920s to the clocks of gurus such as F.W. Taylor who is the father of scientific management.It erupted in 1950s in Japan in a time where the Japanese were searching ways to boost their economy that was ruined by World contend 2. By 70s high quality Japanese goods had flooded the US and European markets. It took 20 years for the west to catch up the Japanese quality system.By today the growing global disputation the quality has become a decisive factor and is inspired by changing customer needs. Today the customer is the person who defines the quality of a product. Quality management is important because achieving a higher quality is ever changing. also failing to meet the quality standards perpetually would result in losing customers.An organization can take many initi atives to assure quality of its products.Standardization is one such initiative that assures quality. Standardization can be carried out by round interchangeability, variety reduction improved communication of technical criteria, commonly agreed safety and performance parameters. Standardization applies to raw materials, testing, view methods as well as processesInstitutional breeding is another way of ensuring quality. Here the training process for workers are recorded and will be utilize in the learning process. The learning forms such as lessons as well as good practices are the primary sources of the knowledge working process. The institutional learning process can be further enhanced through training workshops, evaluation material as well as electronic training media.Also by way of knowledge management an organization can assure the quality of its products. Under knowledge management the capacity to retain knowledge, educational capacity, design and training methods, the t raining programs as well as qualified trainers are the majors concerns under knowledge management.The fruits of knowledge management can only be picked whenThe learnt knowledge puts in to practice.The knowledge is material in innovation.Turning tacit knowledge in to explicit knowledgeGathering and preserving knowledge from every manageable source such as breeding, experience etc.SWOT AnalysisSWOT analysis is a method used to analyze the internal and external environment of an organization. Following is a comprehensive SWOT analysis of Toyota Motor Company.StrengthsToyota operates factories in US and China that led to increase in company gain since 2005.The organization through careful segmentation, Targeting and positioning offers the right product mix to the market.Toyota is highly efficient in its manufacturing which uses total quality management.Toyota has a strong brand name which is a house hold brand name all around the world.WeaknessesToyota is excessively focused on US a nd Japanese markets. Thus suffers from fluctuate economic and political conditions of these countries.Toyota has few layers in its hierarchy and as a result there are few opportunities for promotions.Heavy emphasize on techniques such as kaizen has led to higher level of stress among workers.OpportunitiesToyota and Lexus has pioneered the environmentally friendly technologies. The world needs vehicles inspired by such technologies more than ever.The company is targeting the urban youth market which has a huge potential.The European Union is emerging as a world of opportunities for auto manufacturers. Toyota already has a large market share in countries such as Denmark, Finland, Ireland et al.ThreatsGlobal recession has drastically affected the performance of the global auto industry.Rising gas prices due to the OPEC purpose of price hike is a severe damage.In 200, 2010 the product recall of Toyota was estimated to be million units. This can have adverse effects the organizations re putation.Toyota faces strong competition from rivals. New entrants from China, South Korea and India are growing rapidly.(Info http//www.marketingteacher.com/swot/toyota-swot.html)PESTLE AnalysisThe PESTLE stands forP PoliticalE EconomicalS SocialT TechnologicalL LegalE EnvironmentalPoliticalSince it is a global organization Toyota needs to observe the global political situation. For the past few years Toyota has been enjoying from some of the governments key decisions. The governments decision to limit vehicle imports to Japan and the US governments introduction of quota system in vehicle importing eases the pressure of thick competition from the outsiders.The Japanese government has provided stimulus packages and tax reliefs to deal with the recent economic down turn.EconomicalThe global recession has hit the global auto industry severely. With inevitable losses companies tend to cut jobs. The same is applicable to Toyota.Due to sky rocketing cost of living people might be prioritizing the fulfillment of their needs at primitive levels. In such a background the industry might get a serious blow. Also during the past 5 consecutive years the global auto mobile sales in major markets have sharply dropped.SocialSocial factors are vital in deciding the demand for a certain good. Throughout the past decade Japan is experiencing a growing adult population. It is estimated that by 2030 the 65 year old population will be 25.6% of the total population of Japan. Some critical changes in the age structure of the country can be observed. Also the countrys invalidating population growth rates provide serious implications for the business organizations. Because the shrinking population implies that the business organizations will have to face a shortage in skilled labor in the near future.Source Matsumoto Yoshiko Faces of Aging The Lived Experiences of the Elderly in Japan TechnologyWith the introduction of cutting edge production technologies adoption of such tec hnologies in the auto industry can be widely seen. Use of robotics for production in Japan has become a major trend.In this information age people have more ways to know about products which makes the present consumer a highly aware one compared to some decades back.The development in World Wide Web led to many organizations going on business organisation. The organization will have to adapt to the new ground realities of online marketing to stay forrad of the curve.LegalToday although the free trade is been heavily promoted some key player in the global economy are following protectionism. Countries such as India, Brazil et al are imposing legal restrictions on foreign auto manufacturers in order to promote indigenous manufacturing.With its recall of some of the car models in 2010 Toyota had to face several court cases over accidents occurred due to defect Toyota cars. It was reported that Toyota has paid $ 1.2 million in benttlement of a case that was filed against the company.( Info http//www.dailymarkets.com/ stemma/2010/12/28/toyota-pays-10m-crash-compensation/)EnvironmentThe global warming and climate change has become a burning problem in todays world. The changes in this regard have a major influence on the global auto mobile industry.The global warming has insisted the global auto manufacturing firms to come up with less liberation solutions. Governments all around the world are raising the standards and tightening the environmental laws on this matter.In addition to the global warming problem the dwindling crude reserves in Middle Eastern countries which are expected to come to an end as soon as 2040s has urged the auto manufacturers to seek more sustainable and energy efficient solutions for the future.The green marketing has become a major weapon for any organization competing in todays auto industry. Today the green products as well as green production methods has become a threshold in many cases. Thus any organization lagging behind its counte rparts in green marketing is in the path to destruction.AnalysisAlthough the total quality management is widely adopted in todays highly dynamic business environment Toyota motor company has its own version of quality management called the Toyota production system or TPS. The TPS includes just in time production which means manufacturing products in compulsory amounts avoiding excess inventories Kanban and Jidoko or automation.According to the field research through and published by Harvards Steven J. Spear it leads to the conclusion that Toyota has achieved a dynamic capability by following the Rules-in-Use forOrganizational design, improvement, and adaptation.Source Spear J Steven Just-in-Time in practice at Toyota Rules-in-Use for building self-diagnostic, adaptive work-systems Harvard Business Review Oct 2002The paper identifies that in TPS managed organizations every operation is performed by carrying out hypothesis testing experiments that makes accelerated generation and acc umulation of individual and organizational learning about coordinating delegating, and performing work done collaboratively. This also includes work which is done repeatedly few times.The findings adds literature by explaining the most tools that got lot of attention in the operations research process were dependable and were giving uninterrupted service without any malfunctioning.lean_cs_toyota.gifSource http//www.icsti.su/rus_ten3/1000ventures_e/presentations/production_systems.htmlJust in timeThe idea behind just in time is manufacturing the required amounts in required numbers at the required time. For instance the assembly line of a car arrives all the sub assembly lines should reach the main assembly line in right quantities. This will eliminate the need for inventories thus removing the requirement for warehouses and storage facilities. As a result the inventory cost will be drastically reduced giving a higher capital turn out to the company.The JIT manufactures quality prod ucts in an efficient manner by completely eliminating waste, inconsistencies and undesirable use of production lines. According to the JIT the Toyota by adhering to the following guidelines can manufacture a car which was ordered by a customer in a soonest possible manner.No sooner an order is received for a vehicle the program lines as well as specifications of the vehicle reach the start of the production line.The assembly line is stored with sufficient parts and components to enable the plant to assemble any kind of vehicle model without any delays.The assembly line must replace the parts used by retrieving the same number of parts from the parts-producing process.The preceding process should store a small number of all types of parts to manufacture only the numbers of parts that were retrieved by an operator from the next process.Although it proves to be a success of following JIT method it is a complicate exercise at Toyota as its business involves hundreds of spare parts and components.Kanban systemAlthough many believe that kanban is TPS, the kanban method exist to manage the just in time method. Simply it is an information system which controls the quantities in every process.In kanban the required amount of units and types are written in a handbill called kanban. It is send to the people in preceding process to the subsequent process which connects many processes in a Toyota plant. This method is supported by followings.Smoothing of processReduction of machine set up timeAutonomationStandardization of jobsImprovement activitiesKanban uses two cards. One a withdrawal card and the other a production order card.jit.gif(Source http//www.toyota-global.com/)According to the above figure there are two operational fly the coops as production instruction kanban and the operational flow of parts retrieval kanban.In the production instruction kanban it involves 3 distinctive steps. Firstly a production instruction kanban A is removed when an operator retri eves parts. Then the numbers of parts that are indicated in the kanban card are only manufactured. Thirdly the kanban is attached to the newly manufacture parts ready for the next process.Then the next process starts on the operational flow of parts retrieval kanban. The parts are transferred to this process from the preceding process. Then as the first step the parts retrieval kanban is removed when an operator uses parts. Secondly the operator carries the kanban to retrieve replacement parts. As the third step the operator removes the production instruction kanban and replaces it with a parts retrieval kanban. Finally the parts that are displaying the parts retrieval kanban are transported to the next process.AutonomationTo gain maximum of just in time 100% good units must reach the prior process. And this process should continue without any interruptions. This means quality control must co-exist with JIT to get the best out of kanban.The idea behind autonomation is built in a we apon means to avoid mass production of defective items in product lines. It involves autonomous inspections for abnormalities in the process. At Toyota all machines are autonomous where every machine is attached with automatic stopping device. This avoids mass production of defective items and also alarms machine break downs if there are any.The above theory also applies to the manual of arms works at Toyota where an employee pushes the stop button if something abnormal happens in the production line. This would eventually cease the operations of his whole lines.In order to detect discrepancies in the process a device called andon, an electric light board is hung very high in the factory that it is visible to everyone this is called Toyotas visual control system.ConclusionThe Toyota production system is a practical and effective as it popped out from the real life experience of the organization. This system is enriched with practical effects, actual practices and implications over t he analysis.This system has a vital role in developing the quality of operations of the companies all around the world. Even to this date hundreds of western companies are using the Toyota quality management methods which are a clear indication of Toyotas success.Since Toyotas founding we have adhered to the core principal of contributing to society through the practice of manufacturing high quality products and services. Our business practices and activities based on this core principal created determine, beliefs and business methods that over the years have become a source of competitive advantage. these are the managerial values and business methods that are known collectively as the Toyota way. Fujio Cho, president ToyotaSource Liker Jeffery, The Toyota Way, McGraw-hill, 2003