Toyota Case
The automobile industry is a highly dynamic industry which has witnessed several changes over the last few years. The changes have affected not only the design of the automobiles produced but also the assembling procedures used by different manufacturers. The automobile industry can be perceived to be among the major industry which has highly facilitated movement of goods, service, and people through manufacturing of the transport vessels. Due to its influence and its high profitability, the sector has attracted many investors who have led to high competition within the sector. There also have been changes in the automobiles market which has highly shaped the industry operations.
Toyota motor company has become one of the leading automobiles company over the past few decades. The company started as during the second world war and due to favorable governmental policies, which led to the exit from the market of General Motors and Ford who were the main competitors. The company undertook various operational strategies which have made it successful it is today. Among some of the transformational strategies that the company undertook in the past include entering into a joint venture with GM which created an avenue for Toyota to explore the USA market. The automobile industry operates under an oligopolistic market, with a handful of producers who dominate the market while at the same time competing with each other. Among the main competitors offering stiff competition to Toyota company are, Honda, General Motors, Ford, Nissan, and Chrysler.
Toyota however, has enjoyed massive growth within the 21st century with the company surpassing both Ford and General Motors to become the largest automobile market share as of 2008. The company also recorded profitability of $ 17.5 billion during the financial which had ended in March 2008. Within the automobile industry, any defect on the products may have high impacts on the organization’s reputation as well as the market share. Toyota, for instance, suffered a blow when some of the vehicles produced had faulty break system leading to calling back of the vehicles which costed the company in terms of financial compensation and the organization’s reputation. The competitors have also been noted to have narrowed Toyotas’ competitive advantage especially when it came to the quality of products.
The company has however adopted the use of lean principle in the production in an attempt to streamline its operations. Toyota has employed the use of these principles at various levels of operations, for instance, the organization streamlined the labor force based on the principle. The approach has also been utilized in the die production with the organization determined towards the reduction of lead time within which the dyes are produced. Through this Toyota has been able to reduce the cost associated with the overall production of the dye. The organization also employed the principles in extending the space used for assembly.
The organization introduced the global body line which was to facilitate the welding, due to this the organization freed more space to use for assembly purposes. The organization also enjoyed high efficiency due to the use of the global body line technology since the firm could assemble up to eight different models at a go. The organization also engaged in labor specialization in an initiative aimed at reducing the production rate of the employees. Through this approach, the firms’ employees became more effective and efficient.