GROUP ASSIGNMENT
IBM 543/540-CROSS CULTURAL MANAGEMENT
“REPORT ON DECISION MAKING STYLES IN JAPANESE COMPANIES
TOYOTA MOTOR CORPORATION”
PREPARED FOR
:
MR.SHAMSUL BAHARIN BIN SAIHANI
PREPARED BY
:
SURIATI BT OSMAN
(2005108143)
NOOR ISMALINDA BT ISMAIL
(2010946143)
NORAFIZA BT REPAN
(2009846982)
SITI FATIMAH BT ABD.HAMID
(2009609142)
GROUP
:
eBMMB6C (e- PJJ)
COURSE
:
BM 226 – INTERNATIONAL BUSINESS
BM 220 _ MARKETING
………………………………………………………….IBM 543 Cross Cultural Management
TABLE OF CONTENTS
1. INTRODUCTION
1.1 Toyota Company in the Global Market
1.2 The Product Worldwide and Services Offered
2. TOYOTA DECISION MAKING
2.1 An Overview of Japanese Firm in Decision Making
2.2 Toyota Decision Making
3. ISSUE OF DECISION MAKING IN TOYOTA MOTOR SDN.BHD.
3.1 Organizational Structure
3.2 Transparency Dimension
3.3 Participation Dimension
3.4 The Callback Issue
4. CONCLUSION
8. REFERENCES
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1.0 INTRODUCTION OF TOYOTA COMPANY
Toyota Motor Corporations originally known as Toyoda Automatic Loom Works. It
was initiated by a productive inventor and Toyota founder, Sakichi Toyoda in
1890. In 1934, the first engine was developed and Sakichi Toyoda completes the
non-stop shuttle change type Toyoda automatic loom (Type G). In the year 1937,
under Kiichiro Toyoda which based in Japan
it has been one high ride for this
automobile manufacturing company.
To be the largest automaker and develop the car manufacturing, Kiichiro Toyoda
travels to Europe and the United States to investigate automobiles and mainly
focused on development of the automotive industry. Since then, big achievement
for
the Model A1 passenger car and followed by the G1 truck and another
Model AA passenger car. Kiichiro took to an extended research on gasolinepowered engines and “the first truly popular Toyota car,” was built in 1947.
The growth of Toyota manufactories continued as well as Japan which also
changing under the impact of global economic trends. To feed in the modern
world and to be globalizes it produces a profound impact on the functioning and
management. It is important to analyze the management of the production and
basic strategies of the development.
To continue its international market expansion and company profit, it requires a
team of management which need to define and analyze any ethical problems. In
such a situation, management of Toyota need to prepare an ethical issues
related to the changes caused by globalization arise.
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1.1
Toyota company in the global market
Nowadays, Toyota is one of the largest car manufacturers which has remained
within several decades and one of the most influential players and became
leading company in the automobile world market. Toyota has take a step taken
by expands its markets and Increases production especially in developing
countries.
In order to be the leader of automobile manufactures it acquires a new brand
which links to the process of globalization. One of the effective strategies is to
eliminate the financial barriers which to except Toyota cars as one of affordable
cars in world wide. Besides, the international market expansion of Toyota was
possible due to the process of globalization.
There are several factors that contribute to this process which is the economic
integration of countries, elimination of financial barriers between countries and
the promotion of free trade which affects all largest companies. With the global of
company expansion, Toyota has managed to develop and contribute an effective
production chain between its plants. Moreover, with its factories practically in all
continents and its cars are assembling in different countries it shows Toyota was
widely represented and had its own plants.
Toyota has expanded the scope of automobile sales across the entire globe.
With the globalization substantially, Toyota entering new markets by offering
variety of its products and services. In fact, there are existed financial barriers
which prevented Toyota from effective and successful entering markets of other
countries. As such the originate countries can be a competitors for the company
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as it had its own car manufacturing had already well-developed network of
production (Peters, 2002). In such a situation, the company was forced to
localize the production in the markets Toyota wanted to enter.
A policy of "producing vehicles where the demand exists". There are several
factors that the company needs to adapt to the demands of the local market. For
example, Toyota successfully developed cars such as Toyota Corolla and Toyota
Yaris in Europe, while in the US it successfully focused on the production of SUV
and 4x4. As a worldwide automobile car manufacture, Toyota need to
continuously provide the supply of its products to different countries and to make
the assembling of cars in a particular country or region less expensive and more
profitable.
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1.2 The product worldwide and services offered
Sedan & Hardtop
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Allion
Altezza
Aristo
Avalon
Brevis
Camry
Camry Gracia
Camry Prominent
Carina
Carina ED
Cavalier
Celsior
Century
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Chaser
Corolla
Corolla Ceres
Corona
Corona Exiv
Corona Premio
Corona SF
Corsa
Cresta
Crown
Crown Majesta
Mark II
Origin
Altezza Wagon
Caldina
Camry
Gracia
Wagon
Carina Wagon
Corolla Fielder
Corolla Wagon
Corona Wagon





Crown Estate
Crown Wagon
Mark II Wagon
Mark II Wagon Blit
Mark
II
Wagon
Qualis
Opa
Probox
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Platz
Premio
Prius
Progres
Pronard
Scepter
Sprinter
Sprinter Marino
Tercel
Verossa
Vista
WiLL Vi
Windom
Wagon

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
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Scepter
Sprinter Carib
Sprinter Wagon
Succeed
Vista Ardeo
Coupe

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Cavalier
Celica
Corolla Levin
Curren

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Cynos
MR2
Scepter
Sera



Soarer
Sprinter Trueno
Supra
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Hatch

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Allex
bB
Corolla FX
Corolla II
Corolla Runx
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Corsa
Duet
Funcargo
ist
Raum
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Starlet
Tercel
Vitz
WiLL Cypha
WiLL VS
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Granvia
Hiace
Hiace Regius
Ipsum
Lite Ace
Lite Ace Noah
Master Ace Surf
Nadia
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Noah
Regius
Sparky
Touring Hiace
Town Ace
Town Ace Noah
Voxy
MV&1Box
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Alphard
Corolla Spacio
Deliboy
Estima
Estima Emina
Estima Lucida
Gaia
Grand Hiace
SUV & Offroad
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Blizzard
Cami
Harrier
Hilux Surf
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Kluger V
Land Cruiser
Land Cruiser Prado
Mega Cruiser

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RAV4
Voltz
Pickup

Hilux Pick Up
Open


Celica
Cynos


MR-S
Soarer
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Rarities
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2000GT
Master
Publica
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SA
SD
SF



Sports
Super
Toyopet
Service:
1 – Financing Plan
-
Toyota 2 – Tier Plan (Start with lower mthly payment)
-
Toyota Flexiplan – Flexible and savings on interest
-
Toyota Drive – Drive away with zero downpayment
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Hire Purcahse – Fixed interest rate
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Fleet & Leasing – Customised solutions for business.
2 – Online Tools
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Online Quatation – customer can view the financing package.
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Vehicle Recommender – Monthly payment and tenure of car range.
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Online Application – Submit form through online and their customer
service will follow up.
3 – Insurance
4 – Road Assist
5 – Car Service (Toyota Carplus)
-
General Services
-
Body & Paint
-
Parts
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TOYOTA DECISION MAKING
2.1 An overview of Japanese Firm in Decision Making
Traditionaly Japanese decision making are called ringisei or decision making by
concensus. This system allow the group discussion of solving the problems and
come out with solution. In this system any changes in procedures and routine,
tactics and strategies of the firm are organized by those directly concerned with
those changes. The final decision is made at the top level after an elaborates
examination of the proposal through successively higher levels in the
management hierachy.
The Japanese decision making process is simply called tatamae and honne.
Tatamae means that doing the right thins according to norm while honne means
what
one really want to do. Luthans and Doh in their book “International
Management – Culture, Strategy And Behaviour has give a clear example of this
terms. Japanese employees had a meeting to deciding where to go for a
company trip and they favored to go to Izu but the once the president’s secretary
states that presidents want to go to Suwa the vote was change and everybody
decided to go to Suwa. The idea is that, having a meeting is a tatame for the
president as it is the procedures to make a decision while going to Suwa is
honne as that is what the president want to do. Vice versa, going to Suwa is
tatame for the employee as they have to consider the presidents decision and
going to Izu is honne as it is what they really want to do. From that overview we
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can see that power distance has a big reflection in japanese decision making.
Therefore sometimes it is time consuming to achieve the decision.
2.2 Toyota Decision Making
As a Japanese company, the decision making are based on the other Japanese
firm. Toyota still using Ringisei in decision making process. In every new product
development, they prefer to use group decision making which is good because it
allow the employee to be apart of the decision making and contribute the idea.
Nemawashi is the toyota ways in making a decision. Nemawashi is the process
of discussing problems and potential solutions with all those affected, to collect
their ideas and get agreement on a path forward. The model of toyota decision
making can best be shown in below diagrams:
prefered
Group
consensus,
management
consensus
Seek group
input then
decide and
announce
Seek individual
input then
decide and
announce
fallback
Group
consensus
with fully
authority
Fall back if
consensus is
not agree
Decide and
announce
Time
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The diagram shows that the top management has the authority to reject or
accept the proposal. Toyota found that how you arrived the decision is important
as quality of the decision.
Thorough consideration in decision making includes five major elements:

Finding out what is really going on, including genchi genbutsu.

Understanding underlying causes that explain surface
appearances—asking “Why?” five times.

Broadly considering alternative solutions and developing a detailed
rationale for the preferred solution.

Building consensus within the team, including Toyota employees
and outside partners.

Using very efficient communication vehicles to do one through four,
preferably one side of one sheet of paper.
Beside those method toyota also implies the Kaizen to achieve Total Quality
Management decision. Kaizen in Japan is the continuous improvement. What
ever that the company’s method of decision making there still have the
disadvantages especially when dealing with people in difference culture. We
have discuss the issue arise and what action that the toyota take as the
improvement in chapter 3.
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3.0 ISSUE OF DECISION MAKING IN TOYOTA MOTOR SDN BHD
Toyota has been able to achieve strong growth, positioning product quality as its
corporate mainstay and earning acceptance in markets throughout the world,
based on the reliability of its products.
However, as Toyota grew, its customer base expanded and diversified, and
customer expectations increased. At some point, Toyota also was not sufficiently
aware of these elevated customer expectations. These factors form the backdrop
for the recent problems related to safety and confidence. Toyota views these
issues as an opportunity for renewal and improvement and every single
employee will participate proactively in meeting the challenge of redressing the
problems.
As an automotive company Toyota focused on engineering, this initial focus was
understandable and typical. Nonetheless, there was an unrecognized gap in
perspectives between the Toyota and its customers. The gap was caused by a
lack of systematic efforts to share information by staying close to the customer; it
was an adverse effect of Toyota business.
The inertia and bureaucracy that characterize in Toyota impeded internal and
external communications and resulted in slow responses to emerging customer
concerns. These obstacles all came to the customers to address the recent
safety issues.
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As a result, Toyota failed to meet its customers' expectations for safety and
confidence. Toyota views this issue as an opportunity for renewal and
improvement; It also encourage Toyota and every employee to address the
issues proactively by re-examining and recommitting to principles such as
Customer First, the Customer's Perspective and Genchi Genbutsu (on-site,
hands-on experience). Specific actions have been taken by Toyota to recover all
the issues arise.
3.1 Organizational structure
As many other companies Toyota also have the general meeting and it is
governing by the shareholders which is convened in June every year. Only those
shareholders that own above a certain threshold of shares may attend and vote
at the General Meeting.
Toyota executive body is the Board of Directors. This is composed of a total of 25
directors that include chairman, vice chairman, president, 8 executive presidents,
12 senior managing directors, an Honorary chairman and senior advisor. None of
these is independent directors.
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3.2 Transparency Dimension
Toyota ranks eight among the ten assessed corporations for their transparency
capabilities with a score of 15 percent.
Toyota does not have information of disclosure policy, and Toyota make an
arrangement of general commitment to company –wide transparency in two
policy documents such as Toyota Code of Conduct and contribution towards
sustainable development.
Toyota Code of Conduct stated that order to become an ‘open company’ and win
trust of society, strives to communicate accurately and timely information to its
stakeholders through active public relations and public dialogue to enhance
corporate image and transparency.
Contribution towards sustainable development is Toyota to build and maintain
strong relationships with the stakeholders through open and fair communication.
In respect the policies is lack of good principles such as committing to respond to
all information requests within the certain period of time and making a
commitment to full transparency other than when a set of narrowly defined
conditions such as staff issues.
Toyota also one of two organizations assessed in the 2006 Global Accountability
Report that do not have function on their website that allows stakeholders to
contact the organization.
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3.3 Participation Dimension
Toyota’s participation is base only on external stakeholder engagement and
member control.
External stakeholder of Toyota is the stakeholder which is does not have a
specific policy. In Toyota Code of Conduct practices the principles should
underpin the company’s relationship with different stakeholders. In other words
Toyota listens to and respects its stakeholders’ criticisms and suggestions and
incorporates these as appropriate into its business. However the Code does not
meet any of good practice principles on stakeholder engagement for example
Toyota does not identify the conditions under which stakeholders can expect to
be involved in corporate decision making.
Member control is not under scoring well by Toyota due to weak of shareholder
protections provided by Japanese Law. Japanese law provides some rights to
shareholder. The law stipulates that rights are granted through unit shares
instead of individual shares. Under this system shareholders have one voting
right for each unit of shares that they own, where 100 shares constitute one unit.
Any number of shares less than a full unit carry no voting rights, leading to
shareholders not have the right to vote.
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3.4 The Callback Issue
In November 2009, Toyota announced a voluntary safety recall on floor mats.
Whereby if improperly secured in the vehicle, some floor mats used in the U.S.
may move forward and hold the accelerator pedal down in a fully or partially open
position.
In January 21, 2010 on some Toyota-brand vehicle models sold in the U.S. for
the accelerator pedal problem. In the accelerator-pedal assembly of affected
vehicles, condensation resulting from cold-weather use of the heater or other
causes may form on the worn surface of what is known as a friction device. If this
occurs, there is a possibility that, in the worst case, the accelerator pedal returns
slowly, or does not return, to its idle position.
In February 9, 2010 Toyota announced a recall in Japan, the U.S. and Europe on
four models, including the new Prius, for a brake problem whereby braking
performance may be reduced, resulting in increased braking distance (compared
to performance before ABS activation) when vehicles switch at low speed to
hydraulic braking-only to activate ABS, which is used to stabilize handling on
slippery surfaces, such as snowy and icy roads.
Toyota also has taken the action by operating 24hours per week their service
center and recalls their entire customer to get the job done. As a results Toyota
has repaired more than one million vehicles in just a few weeks for the sticking
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accelerator pedal and more than half a million vehicles subject to floor mats
recall.
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CONCLUSION
As a conclusion the Toyota Motor Corporation has a good decision making by
using their business culture and ethics.It is because the Japanese hierarchy is
base on consensus and co-operation a opposed to top-down decision making
process typical in western model of hierarchy.Over here,people feel actively
involved
and
they
are
committed
to
achieving
their
purpose
and
targets.Therefore, the company can solve thier problem by good deal and
negotiations in business transaction,especially in their customers services
department, technical, financial and marketing. Besides that,the company also
has to build up and up grad their marketing strategies to return back the royalty
and trusth of their customers becaues of their call back issues.However,as a
suggestion Malaysian’s company should respect and follow the decision making
process in Japanese company.
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REFERENCES
1.
Gomory, R.E. (2002) Globalization: Causes and Effects. New York:
Touchstone.
2.
Peters, T. J. (2002). In search of excellence: Lessons from America’s
best-runcompanies.NewYork:Harper&Row.
3.
Luthan.Doh, Mc. Grawhill “International Management: Culture, Strategy
and Behaviour”. international edition 2009.
4.
Online search, “The Kaizen Forum: Business decision maker”.
URL: http://www.slideshare.net/razakamal/decision-making-1045260
5.
On line search, “The Toyota Ways”
URL : http://malvasiabianca.org/archives/2008/05/the-toyota-way-andnemawashi/
6.
On line search, “Toyota, Kaizen, and Professional Service Firms”
7.
URL: http://marketingasia.typepad.com/marketing_asia/2010/02/toyotakaizen-and-professional-service-firms.html
http://www.pressroom.toyota.com march 30, 2010 retrieve on 15.03.2011
8.
What we are doing to get back on track, March 23, 2010 by Michael
Rouse
9.
Global voice of quality news march 11, 2011 on automotive news retrieve
on 15.03.2011
10.
http://media.toyota.ca retrieve on 15.03.2011
11.
http://www.businessweek.com February 24, 2010 retrieve on 15.03.2011
12.
http://www.toyota.com by Shinichi Sasaki February 5, 2010 retrieve on
15.03.2011
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