1. Introduction
Toyota Motor Co., Ltd. is a multi-national company established in 1937 by
Kiichiro Toyoda at Toyota City, Japan; which years later, branched out not
only through out Japan but also through out Asia, Western and Europe. Toyota
as a leading automobile company employs 338,875 (as of March 31, 2014)
and is headquartered in Toyota City, Aichi, Japan. Business expansion-wise,
Toyota has many subsidiaries such as manufacturing divisions in North
America, China, Thailand; design development division in France; vehicles
and evolution division in Belgium and many others. By the end of Dec 2013,
it conducts its business globally with 52 overseas manufacturing divisions in
27 nations/regions. (Toyota, 2013)
In 1967, Toyota started the merger with Daihatsu to strengthen the automobile
market and in 1983, luxury-car line ‘Lexus’ was launched by Toyota.
(autoevolution.com) Toyota practices quality management methodologies
such as Just-In Time production (JIT) and Toyota Way.
2. Recruiting
How a company recruits for its labor force is one of the factors that decide the
future of the company. For Toyota, a big company with reputation to keep up
and quality to maintain, the employees play the backbone of the company as
wrong staffing can land company into operational crisis.
2.1. Analysis on How Toyota Recruits
Toyota Production System (TPS) demands not employees but team
workers with no working experience in automobile industry as Toyota
believes it might not be easy for experienced staff to replace the prior
knowledge attained from former job with new knowledge. Also, Ability to
multitask is highly demanded from candidates. In order to fulfill the quest
for the right employees, Toyota does not hesitate to put a lot of employees
at recruiting tasks. Toyota Motor Sales (US) aka TMS division alone has
approximately 25 associates at headquarters and field divisions, assigned
the recruiting responsibilities.
When it comes to recruiting, a corporation can pull the labor force from
internal resources and external resources. In search of suitable candidates,
Toyota goes for external resources and uses recruiting methods such as
advertising on newspapers and magazines, electronic recruiting on
Toyota’s websites and email blasts with the recent jobs. Public recruiting
agencies play as a part of recruitment process. Employees registered with
public agencies can be located by Toyota through the agencies. Toyota
has also been accepting direct applications but knowing that it needs to
keep up with constantly changing technology, Taleo: a data base system is
a go-to cloud service for TMS division to keep the records of every single
candidate. Dana Green, talent acquisition & relocation manager of Toyota
believes that Taleo has been able to keep up with the technological
changes and has a recruiter-centric focus. (Rigoli, 2007)
While it may seem like Toyota is in good hands of Taleo, Taleo has a
negative reputation among applicants for its tediously long applicationprocess and user-unfriendliness. In worse scenarios, applicants are
convinced that their application never reached to the company; as they
cannot trace their applications on Taleo. (Greenberg, 2013) Regardless of
all these flaws, Taleo does not come cheap since it offers advanced
options and high configurability. Thus, high cost on Toyota and recruiters
might not be able to cope with the features of Taleo.
Despite all these external recruiting mentioned above, Toyota still could
not locate the right employees with necessary skills for advanced
automobile manufacturing. The employees in demand are motivated
youths who can learn fast and cope well with fast-paced TPS. ‘We can’t
just go out and throw up some ads and hire some skilled people. They’re
not out there’ said Dennis Dio Parker, an assistant manager at Toyota.
Being innovative enough, Toyota has come up with the famous ‘in-house
grooming’. The goal of this recruitment is to recruit potential but
inexperienced people to be trained by Toyota so that after training,
trainees will be able to grow with the company. In-house grooming which
is intended for fields such as marketing, IT and engineering; is powered
by Toyota graduate and undergraduate programmes. (Cana, 2013) For the
graduate programme, the career exhibitions are held at universities and
colleges. (Toyota) In Kentucky, an undergraduate 2-year-programme
called ‘Advanced Manufacturing Technician (AMT)’, which is a merger
between Toyota Motor Manufacturing and Bluegrass Community and
Technical College has been a great option among undergrad students who
would rather pay little or none at all for the degree and get paid while
studying at Toyota shop floors. It is no doubt that ‘in-house grooming’ is
one of the creative recruitment strategies Toyota has come up with.
Surprisingly, it is still a challenge for Toyota to recruit the AMT students
as most of the youths do not find manufacturing and working at a factory
attractive. Plus, most applicants of the programme do not qualify.
(Hanford, 2014)
As for the top management levels, Toyota uses headhunters and executive
firms to locate the right employees. Though it may seem like the right
move to hunt for an executive or a manger externally, there is always a
high chance to hire someone who is efficient but not familiar with Toyota
policies and core values at all. Moreover, it costs a fortune using
headhunters to recruit a management level staff for a big company like
Toyota. It is always better to hire someone who is already familiar with
the Toyota policies and core values for head departments.
2.2. Implementation and Benefits
Based on analysis above, Toyota is spending generously on recruitment
process and yet Green from TMS admitted ‘we are out there recruiting but
we are not on the cutting edge’. Thus, Toyota recruitment methods are not
quite bulletproof based on cost per hire evaluation. To be budget-friendly
and efficient, Toyota needs to focus on the recruiting way that has success
in drawing in quality crowds.
Since AMT can bring in the quality manpower, most of the costs for
recruiting process should be spent more on advertising it. When recruiting
the youths of technology age, advertising on newspapers and magazines
alone is not enough. Toyota needs to level up its game by taking
advantage of networks such as facebook, twitter and many others. Toyota
will be able to reach out to more the potential people through advertising
on facebook or creating a Toyota facebook/twitter page to post job
vacancies, information on AMT and even the stories of successful AMT
graduates. Good image can change what youths think about factory jobs.
This recruiting is not only effective but also cost saving.
Moving forth, Toyota HR departments should be trying out a different
applicants tracking system as user-unfriendliness and features of Taleo is
not helping with attracting the applicants. Filling management level
positions, Toyota should be opened to both external and internal
resources. While Headhunters and private agencies can locate the
employee who would bring in new ideas and former experiences, internal
recruiting can get a candidate who is already adapted to Toyota system
with better knowledge of the position he or she is filling in and lower
recruiting costs.
3. Training & Employee Development
Reputation and success of Toyota are built not only on the products but also
on the principles and core values applied at Toyota. Toyota Way policy is a
combination of five core values- Genchi Genbutsu: making correct decisions
based on solid facts, Kaizen: continuous improvement, Challenge, Teamwork
among the employees to strengthen the performance and Respect: mutual trust
and honoring the responsibilities. (Toyota) After all, the famous expression of
Toyota is: ‘we do not just build cars. We build people.’ (Liker and Meier,
2007) Building people takes not only recruiting the right staffs but also
training them the right way.
3.1. Analysis on Training and Employee Development at Toyota
Job scopes in Toyota Manufacturing Plants are majorly routine-based
because Toyota finds it crucial to standardize the work, i.e., how a task
should be done is laid out in details before it is performed. The
standardization was created based on a sample work done before to lessen
the gap between expected quality and real quality of performance. (Spear,
2004)
Training programs at Toyota are supposed to groom the staffs to perform
up to the expectation. To fulfill this, On-The-Job (OTJ) training is
practiced at Toyota U.S., which is the same method, used for other Toyota
divisions. ‘Newly hired auto assembly plant production staffs at Toyota
U.S. in California and Kentucky will be given intensive training of 42
hours in their first six months in U.S. firms, 225 hours in Japanese
transplants, and 364 hours in Japanese plants. Workers with more than
one year receive 31 hours in the U.S. divisions, 52 in the transplants and
66 in Japan.’ (Sadler, 1999)
All the trainings are conducted in-house under ‘Training Within Industry’
(TWI) philosophy where supervisors and team leaders are responsible to
manage and train their staffs/team members. For skilled trade workers,
instead of having an intensive apprentice at the beginning of the career,
they have short classroom trainings and OTJ training based on
assignments over the 10 years or more. (Liker et al., 1999)
In 2009, 3.8 millions of Toyota and Lexus vehicles sold in United States
market alone were recalled due to floor mat problem. It only got worse in
2011 as the second recall was made after some car accidents involved the
sticking accelerator pedal problem. (Ricky, 2013)
Based on the above crisis, not only the quality of Toyota products but also
the efficiency of Toyota workers was questioned. Sure the faulty gas
pedal components were from U.S. suppliers but it was up to Toyota
assembly, quality check and quality assurance teams to check the quality
and safety of the final products. Reason behind is likely to be drastic
growth of Toyota over the years which has led to hiring more people to
the point where there are not enough trainers to pass along the knowledge
to the rapidly increasing number of new comers. (Ricky, 2013) Despite
the newly hired staffs, Toyota is always facing a labor shortage especially
when the demand for their products grows bigger. ‘As a solution,
temporary contract workers are hired to perform entry-level production
jobs for a certain period with minimum OTJ training and they account for
around 25 percent of workers on most lines.’ (Smith and Borocz, 1995)
Judging on how the production staffs have been trained, there is not so
much shock about the recalls.
Analyzing the employment development, Toyota has annual appraisals
and On-The-Job (OTJ) development completed in 4 stages of Plan-Do-
Check-Act cycle. Suitable work for the employees has been decided at
Plan stage and employees are assigned to the suitable jobs at 2nd stage. At
the 3rd, the managers and supervisors evaluate the employees’
performance and at Act stage, help for employees is discussed and
provided if needed. (Toyota, 2010) The intention of employee
development is to zero defects but the above incidents suggest Toyota
development system is flawed. Since Toyota is team-oriented working
environment – especially the production plants, it is crucial to add in the
evaluations of teammates also.
3.2. Implementations and Benefits
The crisis above proves that the quality of training should not be
compromised under any circumstance. Besides OTJ training, team
training should be provided as well as it will prepare the staffs for team
works. Audiovisual learning should be accessible for all the trainees as
some of the trainees may be a little behind the fast-paced training process.
With audiovisual aids, they can learn things at their pace.
Outsourcing training tasks can serve as the solution to the shortage of
trainers. However, in-house trainers should be the ones evaluating the
training effectiveness by getting trainees’ feedbacks and testing their
performance after training. To evaluate the employees’ improvement
over, annual performance appraisal alone would not be adequate. 360degree evaluation should be practiced on Check stage of OTJ
development. Better understanding of employee’s strengths and
weaknesses through the feedbacks of everyone he works with is one huge
advantage of this evaluation. This will help HR management team with
designing job enlargement for employees. Job rotation method should be
considered as staffs can gain insights of various jobs and skills from it.
The multi-skilled employees will serve as a pillar of strength for Toyota
during labor shortage.
4. Employees Relations
A good company is more than attractive salary package. It must about
providing a good and safe working environment for the staffs. It is unarguable
that an organization’s prospect lies tremendously on its labor force. Toyota is
no exception. Thus, human resource representatives must not only hire the
best people but also retain them. A set of clear principles and procedures are to
be set out within a company to prevent any discriminations and injustice
penalties.
4.1. Analysis on Employees Relations at Toyota
Toyota has been proudly expressing it respects for the diversity – age,
gender, nationality and other differences) and goal to create a sense of
unity but the law suit filed on 19 August 2014 by Gabriella Mullins
against Toyota Motor Manufacturing Texas tells the otherwise. Mullins,
who worked for Texas-based Toyota factory from September 2005 until
January 2013, took a medical leave for an unspecified disability. In
October, she was able to work again with some restrictions according to
both her doctor and Toyota’s medical specialist but Toyota has refused to
return her to work even there were several available positions that suit her
medical restrictions and experience. This clearly is the violation of the
Americans with Disabilities Act (ADA) of 1990.
The plaintiff believes that rejecting her return to work is due to her
previously lodged complaint with Toyota and U.S. Equal Opportunity
Employment Commission. Mullins was sexually harassed in November
2012 by her colleague and filed and a report with her supervisor who did
nothing about it. A month later, she called Toyota ethics hotline to report
the sexual harassment and again there was no action from Toyota.
(Gurrieri, 2014)
Shockingly, Toyota’s lack of action for its female employees who were
sexually harassed is not the first time in history. In 2006, Toyota Motor
North America President Hideaki Otaka was accused in $190 million
sexual harassment lawsuit against Toyota by Otaka’s former personal
assistant, Sayaka Kobayashi after several Kobayashi’s several failed
attempts to report the issue to Toyota HR department. Vice President,
Dennis Cuneo whom Kobayashi approached, did not investigate this
matter because he did not upset the president. (Jewett, 2006) This is
considered gender and rank discrimination. For a corporation that claims
to build employee relations on mutual trust and respect, Toyota has
violated VII Civil Rights Act (1964). These violations destroyed the
mutual respect between employees and HR representatives. The lack of
actions from Toyota HR department has put a bad reputation on the
company. If the above discrimination carries on, it will be extremely
difficult for Toyota to create a safe working environment, let along
retaining good employees.
4.2. Implementations and Benefits
In many cases, employees were not aware that their actions might be
against the discipline. HR department of Toyota should come up with a
formal discipline policy and educate employees for better knowledge
about violations. For disciplines alone would not create the safe working
environment, HR department must always complete their disciplines by
always being attentive to employees and following up with their
complaints. It is always wise to mention black and white whom to report a
discrimination/harassment to.
To rebuild the mutual trust that has been broken between staffs and HR
teams, Toyota should encourage bonding events that will bring the two
parties closer again. Different HR team members should have different
HR responsibilities at Toyota. For example, a few can be assigned for
admin tasks like payrolls and annual leave management while the others
are assigned to focus on dealing with the complaints and decision-making
for the penalties. In addition, external HR management team should be
brought in a few times annually to check the flow of Toyota HR team – if
the payrolls are handled properly or if the reports filed by employees were
investigated.
5. Conclusion
As has been stated, the reputation of Toyota relies on the quality and safety of
its products. Behind the perfection Toyota strikes for, great staffing need to be
established with the right human resource practices. Above, 3 crucial practices
are analyzed: Recruiting, Training and Development, and Employee Relations.
Based on the analysis, it is clear to see that Toyota has rooms for improvement
in labor management.
In conclusion, managing the employees does not have to a rocket science as
long as a company does it right. In the case of Toyota, the goal is to attract the
best employees in budget friendly and fruitful means, provide adequate
training programs, and maintain them. With some changes and good
disciplines, Toyota is already half way to the destination.
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