Code-12349 Foundation Management Wahid Assessment 2
Code-12349 Foundation Management Wahid Assessment 2
Code-12349 Foundation Management Wahid Assessment 2
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
Executive Summary
This report examines the evolution of Toyota's management techniques in response to the
COVID-19 supply chain issue. This report explores the history and evolution of Toyota's
management methods, focusing on the less well-known elements that increased their resilience
and agility to handle crises. The report also examines the causes of the COVID-19 supply chain
issue and assesses how Toyota's management practises have changed in relation to the
performance of its organisation. Additionally, it examines how freedom, authority, and power
contributed to the transition and offers advice for other businesses on how to make similar
changes. The report highlights how flexible and robust Toyota's management techniques are,
Table of Contents
Introduction......................................................................................................................................3
The Impacts.....................................................................................................................................5
The lessons.......................................................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
Introduction
There were considerable hurdles for manufacturers because of the COVID-19 pandemic's
extensive disruptions of the worldwide supply chain. One of the worst-affected industries was
the automotive sector, where shortages of essential parts like semiconductor chips led many to
question the efficacy of more established just-in-time and lean production techniques. Toyota
invented the lean production system, outperformed many of its rivals at this time, displaying the
This report examines the beginnings and evolution of Toyota's management practises, the
contributing factors to the COVID-19 supply chain crisis, the effects of Toyota's management
practises transformation on its organisational performance, the role of power, authority, and
freedom during the transformation, as well as the lessons that other organisations can apply from
this transformation.
Kiichiro Toyoda started Toyota in the 1930s, which is when Toyota's management
principles first emerged. Toyota has developed its management practises over time, with the
required, what is required, and in the appropriate quantity, "just-in-time" (JIT) manufacturing
was first developed in the 1970s. Toyota was able to reduce waste and boost efficiency because
to this strategy, which ultimately gave them a competitive edge. By implementing the Toyota
problem-solving, and collaboration, the corporation greatly improved its management techniques
Toyota’s management practices have continued to evolve over time. Toyota took
proactive measures to lessen the pandemic's negative effects on its supply chain. To find possible
bottlenecks and put solutions in place, the organisation collaborated closely with its suppliers. To
be less dependent on certain areas or suppliers, it also diversified its supply chain.
To maintain production continuity, Toyota had to modify its management techniques. The
business adopted a more adaptable strategy, enabling it to modify its production levels to meet
demand. Contrary to the established principles of the lean production system, this required
raising inventory levels for essential components. The focus on continual improvement that
characterises Toyota's management methods is another crucial factor. The business utilised the
pandemic as a chance to pinpoint problem areas and adjust to strengthen the resilience of its
system. Toyota enhanced its use of digital technologies, for instance, to better monitor its supply
Toyota was not an exception to the tremendous effects the COVID-19 outbreak had on the world
supply chain. A supply chain problem resulted from several numbers of issues the company
encountered, including:
experienced supply chain interruptions (Frieske & Stieler, 2022). Toyota had to cut its
rose and other logistical difficulties that made it difficult to carry goods across borders.
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
3. Factory Shutdowns: Due to lockdowns and other restrictions put in place to stop the
spread of COVID-19, numerous factories throughout the world were forced to close. This
manage its supply chain due to the pandemic's high level of uncertainty and
communication and coordination with suppliers, and use technology to track shipments
and monitor inventory levels in real-time. To have a sufficient supply in case of future
The Impacts
In all over the world all the businesses have been significantly impacted by the COVID-
19 pandemic, and Toyota has not been immune from these repercussions. However, because of
the Toyota Production System (TPS), which was implemented to alter Toyota's management
procedures, has helped the business to get through this trying period and keep up its
customer demand and market situations was crucial. For instance, Toyota was able to swiftly
change production levels and concentrate on creating vehicles that were in high demand, such as
trucks and SUVs, as the COVID started to have an impact on the automobile industry.
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
Toyota was able to control its supply chain with the aid of the TPS. Toyota has been able
to reduce disruptions and maintain its production levels by collaborating closely with suppliers
and utilising just-in-time inventory management (Choi et al., 2023). To guarantee a consistent
supply of components and materials, Toyota has also placed a great emphasis on developing
strong connections with its suppliers. Toyota has been able to sustain employee morale and
productivity throughout the pandemic because to the TPS, which places a high focus on
employee involvement and empowerment. Toyota has put safety measures in place to guard
against the virus, and it has also given staff members more assistance and resources to help them
Toyota has also been able to save costs during the epidemic thanks to the TPS. For
instance, despite the obstacles created by the epidemic, Toyota has been able to keep its
operational expenses low by lowering inventory levels and minimising waste. Toyota was able to
keep its attention on quality improvement because to the TPS. When customers could be more
reluctant to make significant purchases like a car, this has proved crucial in sustaining customer
COVID-19 pandemic thanks to the transformation of its management practises brought about by
the deployment of the TPS. Toyota has been able to be more adaptable, maintain staff morale and
productivity, manage its supply chain, concentrate on improving quality, and lower costs thanks
to the TPS. These advantages have aided Toyota in overcoming the pandemic's obstacles and
was significantly influenced by the roles of authority, power, and freedom. Toyota's leadership
made the TPS as a strategic choice, and it took a lot of influence to transform the organization's
management procedures. The leadership's use of power helped the business implement the TPS
successfully and keep up its organisational performance. It is crucial to remember that employees
were also given authority and given the freedom to make decisions that would affect the
company's success. Toyota, decision-making power resided with the company's leadership,
which was tasked with determining how the organisation should be led. Freedom of Employees
at Toyota exercised their independence by having the authority to make choices that affected the
company's success (Soliman, 2020). The TPS puts a lot of focus on empowering people to
participate in the improvement process and make decisions that have an impact on the company's
success.
The lessons
The value of a strong leadership commitment to change is one of the most important
lessons that can be drawn from Toyota's transformation. The leadership's dedication to altering
its management practises was the key to Toyota's TPS implementation's success. The senior
executives of Toyota understood the need to enhance their management procedures and were
prepared to make risky decisions to accomplish this objective. The TPS lays a heavy focus on
including employees in the improvement process and giving them the authority to make choices
that have an impact on the profitability of the business. Employers will be motivated and
engaged to take part in the transformation process thanks to this strategy. By using this strategy
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
and involving staff members in the improvement process, other organisations wanting to reform
Another lesson that can be drawn from Toyota's transformation is strong customer focus
is emphasised in the TPS, and this strategy has assisted Toyota in maintaining its position as one
of the top automakers in the world (Samson & Swink, 2023). Continuous improvement is a key
component of the TPS, and using this strategy has allowed Toyota to stay one step ahead of the
competition. Organisations can find opportunities for improvement and alter their management
Conclusion
management procedures were transformed, and other businesses can learn a lot from this. A
management transformation will only be successful if there is a strong commitment from the top
to the change, employee involvement in the process, a customer-centric mindset, and continual
development. By putting these concepts into practise, businesses can enhance customer
happiness, enhance managerial practises, and remain competitive in their respective industries.
The lessons from Toyota's transformation serve as an effective reminder that organisational
success is not only feasible but also attainable via a dedication to continuous improvement and a
References
Choi, T. Y., Netland, T. H., Sanders, N., Sodhi, M. S., & Wagner, S. (2023). Just ‐in ‐time for
https://onlinelibrary.wiley.com/doi/pdf/10.1111/poms.13979
Frieske, B., & Stieler, S. (2022). The “Semiconductor Crisis” as a Result of the COVID-19
Pandemic and Impacts on the Automotive Industry and Its Supply Chains. World Electric
Pal, S. (2019). Toyota Production System (TPS)–Applications and Benefits for Indian Pump and
https://www.ijresm.com/Vol.2_2019/Vol2_Iss9_September19/IJRESM_V2_I9_56.pdf
Samson, D., & Swink, M. (2023). People, performance and transition: A case study of
psychological contract and stakeholder orientation in the Toyota Australia plant closure.
https://onlinelibrary.wiley.com/doi/pdf/10.1002/joom.1218
Soliman, M. H. A. (2020). Gemba walks the Toyota way: the place to teach and learn
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%22Toyota
%22+exercised+their+independence+by+having+the+authority+to+make+choices+that+
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THE TRANSFORMATION OF MANAGEMENT PRACTICES IN TOYOTA
Yamamoto, K., Milstead, M., & LIoyd, R. (2019). A review of the development of lean
manufacturing and related lean practices: The case of Toyota Production System and
https://www.researchgate.net/profile/Robert-Lloyd-13/publication/340449306_A_review
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