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Toyota Organizational Behavior

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Free «Toyota Organizational Behavior» Essay Sample

Toyota mainly targets medium and low income earners. Therefore, in order to successfully sell their cars to this category of people, the company has to ensure that the prices are affordable for them (Rother, 2010). Toyota has therefore ensured that their price range is relatively affordable for their target market. They have managed to stay afloat all the while because they have found the ways of manufacturing vehicles at cheaper costs so as to ensure they still make profits even if the vehicles are sold at cheap prices.

After designing these vehicles, and marking their targeted consumers, it is important to find out about the wants and needs of these consumers, so as to ensure the vehicles manufactured are a perfect fit. When looking at medium and low income earners, a lot has to be taken into consideration. For example, the amount of money the consumer is willing to spend on fuel. Most of low income earners live on a budget; therefore, the likelihood that they will purchase fuel guzzlers is very low. Therefore, Toyota ensured that they have a range of small cars whose fuel consumption is relatively low so that the consumer does not feel that buying the car is more of a burden, than a burden reliever as it is supposed to be (Grinyer & Tiefenbrun, 2006).

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Style and convenience are also important factors to be taken into consideration. Producing only one type of car could have been disadvantageous for the company because sometimes people like to be different from others. Therefore, Toyota produces cars of different design that would meet the needs of the target market. As for convenience, different people buy vehicles for different purposes (Essert, 2002). For example, one may want a small car for a small family, another wants the bigger types of cars, while still other may need to purchase heavy vehicles for business and commercial purposes. Therefore, it is important for Toyota to take all this into consideration, therefore coming up with a wide range of vehicles including Lorries with several ton capacities. For instance, the Toyota Corolla is the best option for those looking for smaller cars. Those who want something bigger can choose such models as Harrier and Lexus.

Successful market opportunity analysis involves serious scrutiny of the intended consumer wants and needs that have not surfaced yet, or that have not been discovered by competitors. In the case of Toyota, they discovered that consumers increasingly notice the negative effects on the environment that are caused by cars. They have therefore introduced what they refer to as ‘green’ cars or in more official terms, hybrid vehicles. These vehicles have put them above their competitors because this range of cars is mostly electric and therefore emits less carbon dioxide into the air (Toyota, 2013).

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Value drivers are entities or activities that raise the value of a product in the eye of a consumer hence providing competitive advantage to the manufacturer. The main value driver for Toyota is the company’s ability to produce a wide range of vehicle models each year. This has managed to raise the ratings for the company due to its ability to satisfy the needs of a vast number of consumers. Most people who look for different types of cars find that their needs are met by the Toyota car models (Barnes, Ponder, & Dugar, 2011). For instance, it continues to produce automatic as well as manually driven cars. Their latest invention might have been the deciding factor of whether the company still rules the world of car manufacture. Although these types of cars have been emulated by other manufacturers because of the market response to the product, most people still prefer to purchase the Toyota models because this company was the original manufacturer and is therefore more reliable.

This refers to the values or properties of a product that puts it above its competitors and convinces the consumer that it is the right choice for them. In the case of Toyota, the company boasts of a wide range of vehicle models from which the consumer can choose. The company also recognizes that most cars usually cost more than they have to. This is because of the high costs of maintenance that the owner incurs throughout the life of the car. Toyota tries to lower this maintenance costs by producing high engine technology vehicles that ensure high efficiency of the vehicle throughout its life. The company also manufactures vehicles that are easy to service and maintain. It also provides the Toyota extra extended warranty cover that helps in the management of unexpected maintenance costs. In addition, it provides a wide range of insurance covers, warranties and other products for road assistance in case one experiences any problems with the car while away from a servicing center (Rother, 2010).

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Toyota has highly invested in supply systems for parts. This ensures that the waiting period for a repair is very limited compared to that of other manufacturers, and the return services are less time-consuming. The company also ensures that the cars are safe for use. This has been done by testing their cars before they are released into the market. This testing is carried out in the best and worst circumstances to ensure that the cars are as durable as can be. They have also ensured that their vehicles satisfy the standards of several countries, including Japan, United States, Australia and Europe.

Toyota is known to have formulated a lean system of production to ensure fewer costs for higher profits. In fact, it is only till recently that other vehicle manufacturers started to emulate the system that was applied by Toyota, since it had proven to work for a long time (Grinyer & Tiefenbrun, 2006). The Toyota system of production, popularly referred to as TPS, aims at eliminating waste and inconsistency. It is also geared towards the provision of high quality vehicles at the lowest prices and at the appropriate time that is convenient for the consumers. This in turn gives the company flexibility in terms of their ability to respond to markets. It is also able to record higher profits due to the reduction of the production cost.

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The tsunami that took place in March of 2011 had a negative effect on the company. For example, almost more than half of the vehicles that are sold by the Toyota Company are manufactured in Japan. After the tsunami, this number had to reduce by a large quantity, and the recovery process took a long time.

In the months that followed, the company had to make announcements about major cuts in their production of vehicles. These cuts mostly affected parts of North America and China. The reason for this is that most of the spare parts that are used even for those vehicles that are not produced in Japan still require spare parts that are imported from Japan. Following the natural calamity, the availability of these spare parts was drastically reduced and this directly affected the production process. Apart from this, the company also had to completely suspend all their products that had been previously manufactured in Canada. There were even periods when the general productions by the company were completely halted due to this drawback. During this time the total profits of the company were also greatly reduced (Barnes, Ponder, & Dugar, 2011).

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In conclusion, despite the fact that the company was able to repay most of its factories that had been destroyed by the tsunami, getting back on their feet took a bit longer due to the fact that the company could no longer use the right amount of parts that they needed for the production.

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