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Case Study Critical Analysis for Toyota Motor Corporate Strategy

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Running head: ORGANIZATION CORPORATE STRATEGY 1

Case Study Critical Analysis for Toyota Motor Corporate

Strategy

Tonny O. Ondeng’

2022
ORGANIZATION CORPORATE STRATEGY 2

Contents
Case Study Critical Analysis for Toyota Motor Corporate Strategy ............................................................ 1

Abstract ......................................................................................................................................................... 4

Chapter 1: Background ................................................................................................................................. 5

Introduction ............................................................................................................................................... 5

Background ............................................................................................................................................... 5

Industry Analysis and Overview ............................................................................................................... 5

Toyota Strategic Plan and Focus ............................................................................................................... 6

Toyota’s Marketing Strategy .................................................................................................................... 8

Toyota’s Marketing Goals and Objectives................................................................................................ 8

Toyota Target Market Strategy ................................................................................................................. 9

Toyota’s 4Ps of Marketing Mix ................................................................................................................ 9

Product .................................................................................................................................................. 9

Place .................................................................................................................................................... 10

Pricing ................................................................................................................................................. 10

Promotion............................................................................................................................................ 11

Aims and Objectives ............................................................................................................................... 11

Hypothesis .............................................................................................................................................. 11

Problem Statement .................................................................................................................................. 11

Justification ............................................................................................................................................. 12

Chapter 2: Literature Review ...................................................................................................................... 13

ORGANIZATION CORPORATE STRATEGY 3

Review of Importance of Aligning Toyota’s Project Management with Corporate Strategy ................. 13

Toyota Motors Future Vision and Strategy and Impact on Current Post-pandemic Environment ......... 15

Difficulties Associated with Toyota Motors’ Dynamic Market Nature .................................................. 17

Chapter 3: Research Methodology.............................................................................................................. 20

Data Collection and Analysis.................................................................................................................. 20

Results ..................................................................................................................................................... 21

Responses on Effectiveness of Toyota Corporate Strategic Factors ................................................... 21

Total Annual Operating Cost in Yen .................................................................................................. 22

Toyota Net Annual Revenue in Billion............................................................................................... 22

Discussion ............................................................................................................................................... 23

Conclusion .............................................................................................................................................. 25

Recommendation ........................................................................................................................................ 25

References ................................................................................................................................................... 27
ORGANIZATION CORPORATE STRATEGY 4

Abstract
This paper focuses on the effectiveness of corporate strategy in making engineering

organizations successful with a specific case study of Toyota Motors Corporation. The Study

uses two approaches to data collection, use of primary sources as well as secondary sources. The

primary source of collecting data involved use of online surveys whereas the secondary sources

involved using ten different peer reviewed journals. The primary study had 150 participants of

various races and location but interacting with Toyota Motors Corporation directly or indirectly.

The data was analyzed using Excel spreadsheet and interpreted. The results indicate that

corporate strategy is indeed effective for Toyota Motors Corporation’s success. The result also

indicate that quality management is specifically a great corporate strategic tool that has enabled

Toyota Motors Corporation become a leading motors and engineering company globally.
ORGANIZATION CORPORATE STRATEGY 5

Chapter 1: Background
Introduction
Corporate strategy is vital for organizations as it determines their overall performance

especially in times of corporate storms for instance, the Covid-19 pandemic. Engineering

corporates are usually linked to technicality in their daily operations which makes them complex

and not as simple to manage as most other corporates of different categories. Toyota Motors

Corporation is considered one of the most successful engineering organization and companies in

general being categorized in top ten globally in relation to performance index and annual revenue

(Madoh et al., 2019). This paper therefore focuses on critical analysis of Toyota Motors

Corporation in relation to its corporate strategy.

Background
Toyota Motor Corporation was founded way back in 1937 with a Japanese origin

(Bhattacheryay, 2021). The company engages in manufacturing, design and sale of various types

of motors including commercial vehicles, minivans, and passenger cars. It also manufactures and

distributes motor parts of its brands including Toyota, Hino, Daihatsu, and Lexus. Toyota Motor

Corporation has for a long period remained at the top in the auto manufacturing industry and in

the top ten largest company globally.

Industry Analysis and Overview

Toyota Motors has undoubtedly like any other leading company had a rough past that has

affected its operations from time to time. Issues with global warming and environmental

concerns, increased fuel prices, and high competition from other automobiles that are electric or

hybrid remains some of the major challenges for the company. The efficient management of the

company, however, always ensure that a solution exists whenever a problem arises. For instance

when global fuel prices went up high in the first half of 2008, Toyota management decided that
ORGANIZATION CORPORATE STRATEGY 6

they would instead focus on smaller vehicles that consume lesser fuel rather than the heavy

commercial fuel guzzlers (Bhattacheryay, 2021). This was at a time when Toyota’s market

competitors refused to shift because most of them thought that fuel prices would eventually

return to normal.

The fuel prices indeed dropped in the second half of 2008 when the US got into financial

crisis which affected the entire world economy negatively. As a result, the motor industry

revenue in 2009 went down with about 15% but then saw a growth of 2.1% by 2013 (Madoh et

al., 2019). This equated an estimate of $2.3 trillion revenue globally.

By 2017, Toyota Motor’s corporate structure had 364,445 staff members globally and

was the 6th largest company globally in relation to revenues (McMillan, 2019). The company is

recorded as the first automobile company to produce over 10 million vehicles on a yearly basis.

Despite competition from Tesla and other global competitors, Toyota remains one of the top

sellers of hybrid electric vehicles. The Company also remains the global leader in sales of

hydrogen fuel cell motors. Toyota’s Prius family also remains the world’s top hybrid nameplate

selling company having achieved over six million global sales of units by 2017 (McMillan,

2019).

Toyota Strategic Plan and Focus

The success of Toyota Motors over the many years of operations has undoubtedly been

due to the great strategic market positioning and management. The management of Toyota

Motors has over the years focused mostly on three key strategies which are key to the

Company’s marketing plan. The three according to McMillan (2019) include Toyota Company

goals, mission statement and core competency as well as sustainable competitive advantage.
ORGANIZATION CORPORATE STRATEGY 7

The company goals goes a long way since the inception of the company. Toyota motors

has for a long time placed its focus on manufacturing cross breed choices and distributing them

to the world for consumer preference. The brand is the most common in many nations and with

various brands and easy availability of spare parts locally in these countries which makes it a

better choice compared to other brands such as BMW and CMC. Toyota Motors is also actively

engaged in its Ecological Activity Plan which focuses on 6 key areas; Societal Collaboration,

Natural Administration, the Nature of Air, Reuse and Improved Resource usage, changes in

Climate and Vitality, and Concerned Substances (Madoh et al., 2019). The main focus of the

Company is reduction of carbon dioxide release to the environment as much as possible to

acceptable global standards.

In relation to its mission statement, Toyota Motors focuses on car manufacturing for a

never-ending progress and successful society. The organization’s mission focuses on

accomplishment of a long haul and steady development and in synchronization with other

significant variables which include nearby served network, Inward Partners Conditions,

worldwide economy and a significant environment (McMillan, 2019).

In relation to its core competency and competitive advantage, Toyota Motors Corporation

focuses on creating a future economy that is not only superior but also sustainable. The

achievement majorly relies on a stable market globally. As such, the Company’s resource focus

is on various empowerment procedures on its set goals and destination coverage over time. The

company remains focused on talents and skills network whose main role is to ensure the

Company remains innovative to changes in the global market demand.

ORGANIZATION CORPORATE STRATEGY 8

Toyota’s Marketing Strategy

Toyota Motors focuses on three main marketing channels; use of traditional marketing

mediums, a huge network of Toyota dealership globally, and four main sales channels (Corolla,

Toyota, Netz, and Toyopet) (Itsuki, 2021) as illustrated in Figure 1 below;

Marketing
Strategy of Toyota

Use of Traditional Toyota, Toyopet, Huge global

mediums for Netz, and Corolla dealership
advertisement sales channels network

Toyota’s Marketing Goals and Objectives

Toyota Motor’s market size and annual revenue makes it a giant and favors its position in

meeting its growth, abrupt changes, for instance the effects of Covid-19 pandemic, and survival.

The demand for Toyota customers is ever growing with a global population increase,

replacement needs and the affordability of Toyota cars and products compared to most other

brands. A good number of drivers globally already own a Toyota brand which gives the

Company a need to keep producing and distributing its products globally and continuously.

Product quality of Toyota products have for many years remained excellent with a one-time

sudden and unintended acceleration issue which was a major global issue but was quickly sorted

by the Company’s leadership which announced major recalls and service campaigns. Toyota

continues producing and distributing quality spare parts, an act that makes its customers loyal to

the company.
ORGANIZATION CORPORATE STRATEGY 9

Toyota Target Market Strategy

Target market is a key factor in the operations activities of Toyota Motor not just in Japan

but also on a global market. Every of the Company’s product is intended for a particular and

specific market. The Company considers its target market in three main factors; outside

appearance, carrying capacity and best speed (Bhattacheryay, 2021). A high speed with two

situate vehicles, for instance, targets moderate youth gap most of whom are not married. An

enormous five situate model on the other hand targets big families.

Toyota’s 4Ps of Marketing Mix

The 4Ps of marketing mix include product, place, promotion and price.

Product
Toyota focuses on a wide range of both tangible and intangible products based on target

market. These products range from automobiles, to spare parts, to warranties. The company takes

product quality so serious and this has majorly contributed to its existence and success in the

global market. The Company has at least 19 various car models which when broken down to

other categories increases the number. According to Bhattacheryay (2021), Toyota automobiles

can be classified as Commercial vehicles which include Coaster, HiLux, Landcruiser, and

HiAce. A second classification includes Hybrid automobiles which include Camry and Prius. A

third classification includes SUVs and 4WDs for instance, Rav4, Landcruiser 200, Prado, and

Kluger. The forth classification which is the passenger automobiles include vehicles like Yaris,

Tarago, Rukus, Corolla, and Aurion among other types. Toyota Motors also manufacture vehicle

quality spare parts including gears, and engines.

Intangible products by the Company include warranties, car services, and financial

services and other car related services. Unlike most other Companies, Toyota Motors have a
ORGANIZATION CORPORATE STRATEGY 10

special research centre which focuses on predicting future customer needs for Toyota consumers

among other research subjects of interest to the Company.

Place
Customer maintenance is something of great importance for Toyota Motors. As such, the

company always do all it takes to ensure that its automobiles and spare products are always

available to its target customers globally. It is easier to get Toyota product compared to any other

company’s in most countries that have Toyota Motor’s accessibility (Itsuki, 2021). Their sales

are made through dealership in their various branches globally and the selling is conducted by

their competitive sales representatives. The sales team in the various dealerships are highly

skilled to not only sale but also offer adequate product information, order taking, finance

insurance, and data collection. Being a global brand, Toyota is found in nearly all countries

globally and its products remain relevant due to its quality assurance and customer service.

Pricing
Toyota invests heavily in promotional activities which seems to offer the company great

results. The Company’s innovative designs enable it to build high quality vehicles, distribute

them globally, and yet keep its pricing moderately (Itsuki, 2021). Toyota Motor’s products are

considered among the highest quality automobile products yet the pricing remains affordable for

the past many years of its operations.

Many businesses uses the cost price and profit margin in calculating the selling price.

Toyota Motors, however, uses a different approach in which it specifically focuses on calculating

profit. That is, the management calculates the profit by subtracting the selling price from the cost

price. It the result is positive then it is a win for the Company irrespective of the profit margin.

This is a clever way of attracting more customers thus creating a wide customer base and
ORGANIZATION CORPORATE STRATEGY 11

maintaining its needs from time to time. Pricing differentiation for the Company is done based

on technology used, superior design, and quality.

Promotion
Toyota Motors is known to use different promotional strategies which gives the Company

a competitive advantage over other motor companies. The Company advertises its products on

billboards, internet, brochures, word of mouth, television, newspapers, flyers and yellow pages

among other channels. The Company’s slogan is catchy which is, “Moving Forward”, which is

alternated with, “Let’s Go Places” (Itsuki, 2021). The introduction of cash back offer which are

given to the Company’s dealers or corporate for use by consumers in case of a rebate.

Aims and Objectives

The main aim of the research is to critique Toyota Motors Corporation Corporate Strategy that

makes the Company successful in its performance. As such, the main objective is to demonstrate

the corporate strategies used by Toyota Motors Corporation.

Hypothesis
Toyota Motors Corporation corporate strategy impacts the organization’s performance in terms

of revenues and costs.

Problem Statement
Many engineering organizations struggle to survive and become successful due to a

heavy initial investment by its owners and the management team. Despite the heavy initial

investment, these companies still struggle to survive the competition for reasons such as poor

management and leadership and poor strategic plan and implementation.

The Covid-19 pandemic has in a way disrupted the order of business for most companies

especially engineering companies. While some companies especially the entertainment

companies have performed very well, most motor companies for instance suffered a major blow
ORGANIZATION CORPORATE STRATEGY 12

and had to lay down its staff members. Some closed indefinitely while others are still struggling

to recover.

Justification
Despite the struggle by most of the engineering companies to survive the competition,

Toyota Motors remain among the topmost competitors globally and in the category of top ten

companies globally. The Company has been successful for many years and has withstood various

global challenges such as fuel cost increase, and the Covid-19 pandemic.

The success of Toyota Motors Corporation is however, attributed to by its corporate

strategic plan and implementation. This is what makes the Company a great choice for case study

on corporate strategy.
ORGANIZATION CORPORATE STRATEGY 13

Chapter 2: Literature Review

Corporate strategy majorly involves understanding the scope and aim of the activities

taking place in an organization in this case Toyota Motors Corporation (Toma & Naruo, 2017).

Other critical factors include the business environment, competition, and positioning in a given

market which singly or collectively affect an organization’s corporate strategy and ability to

perform. Business plan and corporate planning are key tools in implementing corporate strategy.

Strategy is what allows an organization and compete and survive in a highly competitive open

market environment. It is not enough to have a product, many other organizations may be having

a similar product thus the need for a strategy.

Review of Importance of Aligning Toyota’s Project Management with Corporate

Strategy
Toyota has for many years remained not only successful but also relevant globally

because of its corporate strategy. According to Bencheikh & Djafar (2019) the Company has

achieved tremendous success because of its Jidoka corporate implementation strategy which

simply mean Just in time production of products and service provision. Jidoka also includes the

company’s ability to detect not so standard quality of products in good time before they are

released out to the market. It involves ensuring that Toyota products and services are available to

as many locations as possible just when the customers need them.

Another important strategic tool used by Toyota Motors is referred to as the A3s which

basically are used by the Company’s management as mechanisms for mentoring the junior staff

on scientific thinking as well as root cause analysis (Bencheikh & Djafar, 2019). This is done

while also considering that the staff is aligned to their suitable respective departments throughout

Toyota Motors global organization. The A3 management system focuses on creation of

structured opportunities that allow employees within the organization to acquire knowledge in a
ORGANIZATION CORPORATE STRATEGY 14

way that they do not feel like they are in classroom, instead, through learning from the mistakes

they or their colleagues make, their experiences at the organization as well as through a trial and

error kind of approach promoted and planned on by the Company’s management (Bencheikh &

Djafar, 2019).

Toyota’s project management is important in achievement of sustainable success through

corporate strategy (Nkomo, 2013). Political, social, technological, and economic factors are

crucial when aligning Toyota’s project management with its corporate strategy.

Political factors are critical for Toyota Motors not just in Japan where it originates from

but in all other countries of operation (McMillan, 2019). Political factors are strong enough to

either uplift or bring down a company as big and successful as Toyota Motors. Political factors

has a lot to do with political goodwill, government policies and issues to do with importation and

tariffs set up by each government of operation. Without political goodwill, Toyota would not

have made it to the top.

Social factors majorly contributes to project planning and implementation of Toyota’s

corporate strategies. According to McMillan (2019), customs and cultures of a nation or a

community of operation majorly determines the kind of product customers will require and be

willing to purchase. Toyota Motors uses this factor as a major strategic approach through

organizing of corporate activities. Other than Toyota’s corporate Social Responsibility strategic

approach, Toyota Motors has also maintained a good symbol of trust, comfort, luxury, and

reliability (Thompson, 2017). Toyota believes that its success is as a result of the communities

and countries from which it operates thus the need to give back to these communities.
ORGANIZATION CORPORATE STRATEGY 15

Technological factors are critical for Toyota Motors as they form the productivity part of

the Company (Toma & Naruo, 2017). Toyota goes a step further compared to its competitors in

the technological aspect. For example, in the process of developing a good quality car, the

company may decide to add a Pitospaate Primer to make the car more durable and anti-corrosive

thus making it a better brand to buy a car from. The Company also ensures that its technical team

is well trained to ensure quality before any other factor thus making it a world class motor brand.

Economic factors ranges from economic policies and costs of doing business in a

particular niche. Economic policies of the environment of operation of Toyota Motor branches

may affect the ability of the branch to make progress. Sales tax increase for instance,

automatically affects pricing of Toyota products thus affecting the purchasing power. On a

positive side, According to Thompson (2017), Toyota Motors may decide to produce 1000 more

vehicles at a particular niche which requires the company to employ more manpower and in the

process improve the economy of the niche.

Toyota Motors Future Vision and Strategy and Impact on Current Post-pandemic
Environment
The vision of Toyota Motors Corporation remains maintaining the Company’s global

leadership position in automobile manufacturing and repair industry (Itsuki, 2021). Its mission

statement continues to focus on producing low cost yet good quality motors and motor parts for

its customers for safety, comfort, and mobility of Toyota model users globally. The Company’s

vision and mission remains relevant and SMART even after the Covid-19 pandemic globally.

The Company’s corporate culture plays a critical role in defining its way forward.

In relation to management, Toyota Motors Corporation do not just have managers to

manage as most other companies, its managers are with and for a great difference. Itsuki (2021)
ORGANIZATION CORPORATE STRATEGY 16

notes that the top-most managers have a unique feature of not bossing their junior employees.

Instead, the management team focuses on improving the performance of the junior employees for

example through their planned risk taking program and letting employees reason freely and try

new and innovative ideas for the sake of improving the Company’s overall performance. Toyota

Motors continues to give its management and junior staff the same focus as it looks forward to

achieving more goals.

The aspect of competition at Toyota Motors is not simply competition per se, the

company focuses on self-improvement thus competition is self-critical and internal. The

company continues to focus on continuous solution provision to root problems through

encouraging organizational learning for all staff members globally. Decision making for the

company majorly involves most if not all of the Company’s staff hence is characteristically

through consensus and allowing each work the freedom to not only think but also act (Itsuki,

2021). The company continues using this strategy to improve innovation and for a better Toyota

Motors than it currently is known.

Many motor companies exist, some making expensive and quality vehicles yet Toyota

Motor continues to top the list. This is partly because, in its strategy, Toyota does not see its

business as the products they produce and distribute (Madoh et al., 2019). It focuses more on

how the products are produced, that is, the process of bringing products to existence. As such the

management team of Toyota Motors continue to believe in not just making vehicles but making

quality vehicles.

Another strategy that Toyota Motors use is through developments and trainings for its

workers globally (Madoh et al., 2019). Organizational learning enables workers to not only

produce good quality products for the company but also make it a norm even after replacement
ORGANIZATION CORPORATE STRATEGY 17

of some workers for reasons such as retirement. The Company has for a long time given

trainings and development a special focus in addition to its research institute which in turn has

improved the workers value creation, workplace ethics, leadership, management, and creative

thinking in response to global changes. Given these (trainings, product quality, management, and

competition approach) strategic actions, Toyota Motors Corporation seems to have a more

promising future.

Difficulties Associated with Toyota Motors’ Dynamic Market Nature

Bloch (2014) notes that success comes with challenges and as successful as Toyota

Motors is, there are numerous challenges, both internal and external that continue to threaten its

existence and success. Difficulties to do with operational malfunctions, bureaucracy,

overconfidence, seasonal weak management, and staff fallout include some of the major

difficulties associated with Toyota Motors (Bloch). Most of the difficulties experienced in the

Company are not as a result of individual errors but a collective error. Surprisingly, many of

these errors could have been foreseen (or were foreseen) and avoided with the guidance of the

management.

Bureaucracy, for instance, has become the centre of attention in Toyota Motors (Bloch,

2014). As a result, the Company has shifted from focusing on the management of the Company

to creation of solutions. This is a wise step but not to an extent of forgetting about how smooth

the company should run. One bureaucratic problem occurred during the Company’s mission to

expand in the United States market. At some point, it was noted that one of Toyota’s US

executives went ahead and established a de facto company in the New York by the name of

Toyota Motor North America. The same high ranking executive member decided to quit Toyota
ORGANIZATION CORPORATE STRATEGY 18

and join a competitor, Chrysler (Bloch). This got the Company unawares and unprepared thus

resulted in appointment of an unexperienced replacement.

Overconfidence has become one of Toyota Motor’s major weaknesses. Having been at

the top for years, the Company seems to have mastered ways of keeping inside secrets (Bloch,

2014). Information to do with strategic plan and implementation and other useful information is

only shared on the basis of need-to-know. Most of the published information about Toyota

Motors Corporation is apparently an overview and not the in-depth information. One of the

reasons why the Company manages to keep a lot of its information as secret is because it does

not require loans for expansion or any other activity which would require the Company to share

its private information (Bloch, 2014). As a result, the management and the entire Toyota

Company seems to have given up on its public relations strategy.

The issue of overconfidence has also seen Toyota Motors stop recognizing the potential

in the strategies getting employed by its competitors (Madoh et al., 2019). The company

continues to suffer huge mistakes due to overconfidence and ignorance of the strength of

competition.

Weak management is a serious issue in many organizations and can lead to zero

performance of an organization (Itsuki, 2021). Not all leaders and managers use similar strategy

for performance and leadership change like any other change tends to shake an organization’s

performance. Toyota Motors has had a number of changes in its management from time to time

which like any other company has affected its operations.

ORGANIZATION CORPORATE STRATEGY 19

According to Bhattacheryay (2021), management challenges seems to have begun back in

2007 when one of its executives left the Company to join another one. He was replaced by a not

very experienced member which resulted to the company dropping in its sales.

Another management challenge occurred recently when the Founder’s grandson, Akio

Toyoda took over as the Company’s new Chief Executive Officer (Bhattacheryay, 2021). As

good as the decision seemed, many argue that Akio Toyoda was simply not yet ready for such a

huge role which comes with a huge responsibility. A huge and world class company such as

Toyota requires an experienced and aggressive candidate who is also able to make the

company’s decisions independently.

ORGANIZATION CORPORATE STRATEGY 20

Chapter 3: Research Methodology

Data Collection and Analysis
The research was conducted and raw data collected from both already existing secondary

sources most of which majorly included journals which are listed in the reference page, as well

as from primary sources using survey. Data collection on secondary sources focused on annual

revenues and annual costs incurred by Toyota Motors Corporation between the year 2009 and

2018. 10 peer reviewed journals by different authors were randomly selected amongst relevant

journals and used for data collection.

Data collection on primary sources involved 150 participants with a working history in

Toyota Motors Corporation or relatives of people with a working history in Toyota Motors

Corporation. The survey focused on the various corporate strategies which included the

competitive strategy, process design strategy, supply chain management strategy, human

resource management strategy, capacity management strategy, innovation management strategy,

and quality management strategy. The selection of Toyota Motors Corporation was to affirm

findings of previous theoretic research findings that Toyota Motors is performing well due to its

corporate strategy. Data analysis was done by use of MS Excel spreadsheet and presented for

interpretation. Raw data was imputed into an empty spreadsheet for the analysis.
ORGANIZATION CORPORATE STRATEGY 21

Results
Responses on Effectiveness of Toyota Corporate Strategic Factors

Responses on Effectiveness of Toyota Corporate Strategic

Factors

competitive strategy Process Design Strategy

Supply Chain Management Strategy Human Resource management Strategy
Capacity management strategy Innovation management Strategy
Quality management Strategy

Out of the 150 respondents through online survey, 14 respondents were in support for

competitive strategy, 9 in support for process design strategy, 10 in support for supply chain

management strategy, 12 in support for human resource management strategy, 1 in support for

capacity management strategy, 21 in support for innovation management strategy, and 83, the

highest number were in support for quality management strategy as the main strategic drive for

the success of Toyota Motors Corporation. Respondents were randomly selected globally

through an online request for participation sponsored form. The graph above represents each of

the strategic components employed by Toyota Motors in relation to their respective response

score portions.
ORGANIZATION CORPORATE STRATEGY 22

Total Annual Operating Cost in Yen

From the ten various peer reviewed journals, data on operating cost of Toyota Motors

Corporation was obtained for the year 2009, 2012, 2011,2012,2013, 2014, 2015, 2016, 2017,

and 2018. From the data collected, results show that Toyota Motors Corporation spent t-

461011 in the year 2009, 147516 in the year 2010, 468279 in the year 2011, 355627 in the

year 2012, 1320888 in the year 2013, 2292112 in the year 2014, 2750564 in the year 2015,

2853971 in the year 2016, 1994372 in the year 2017, and 2399862 in the year 2018 as

indicated in the graph above. The costs were in units Yen which is the Japanese currency and

because Japan is considered the mother of Toyota Motors Corporation.

Toyota Net Annual Revenue in Billion

Results from the data collected from secondary sources on the total yearly revenues made

by Toyota Motors Corporation shows a net revenue in billions Yen of 20642 in 2009, 18962 in

2010, 19409 in 2011, 17856 in 2012, 22380 in 2013, 27003 in 2014, 28185 in 2015, 28737 in

2016, 27157 in 2017 and the highest sale of 29523 billion Yen in 2018. From the results,
ORGANIZATION CORPORATE STRATEGY 23

comparing the annual sales verses annual revenues, the annual sales have been fluctuating

whereas annual revenues have been a bit steady. Comparing these results with other motor and

engineering companies, Toyota Motors Corporation tops the list globally.

Toyota Net Annual Revenue in Billion

35000

30000

25000

20000

15000

10000

5000

0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Discussion
The first research findings on the effectiveness of Toyota Motors Corporate strategic

factors indicate that indeed all the highlighted options effectively contributed in one way or

another to Toyota’s overall success. The various highlighted factors included competitive

strategy, process design strategy, supply chain management strategy, human resource

management, capacity management strategy, human resource management strategy and quality

management strategy. However, the degree of significance of these strategic factors varies as is

the case for Toyota Motors Corporation.

14 respondents out of the total 150 respondents were in support for competitive strategy,

9 in support for process design strategy, 10 in support for supply chain management strategy, 12
ORGANIZATION CORPORATE STRATEGY 24

in support for human resource management strategy, 1 in support for capacity management

strategy, 21 in support for innovation management strategy, and 83, the highest number were in

support for quality management strategy as the key strategy that triggers growth and progress for

Toyota Motors. The highest score of 83 is a good indication of the significance of quality over

product quantity not just for Toyota Motors Corporation but also any other leading company. All

other strategic factors mentioned are critical but they can only do better when quality

management is in place.

The results comparing Toyota Motors Corporation annual cost verses annual revenues for

a period of ten years between 2009 and 2018 indicate a huge difference between the two with the

Company realization of huge profits which is obtained from subtracting the annual costs from

annual revenues. For example, in the year 2010, Toyota Motors Corporation’s annual cost stood

at 147516 Japanese Yen. In the same year, the company’s annual revenue stood at 19409 billion

Japanese Yen. To obtain the profit for the same year (provided that all other factors remain

constant), 147516 is subtracted from 19409 billion Yen. The difference is significantly high thus

the success story of the Company.

Another way of looking at the success of Toyota Motors so far is to subtract the

cumulative total cost over the mentioned ten years from the cumulative total revenues over the

same mentioned ten years. The difference is still positive and significantly huge thus making the

Company’s performance a success story. The significant drop in annual revenue in 2017 must

have been as a result of annual cost in the same financial year. This may probably have been

triggered by an economic factor or leadership changes within the Company.

ORGANIZATION CORPORATE STRATEGY 25

Conclusion
In summary, corporate strategy is an effective contribution to organizational progress and

success in the global business market. As has been observed in the various case studies in this

paper, there is no doubt that Toyota Motors Corporation is not only successful but also one of the

leading companies globally. The Company’s success, is however, majorly attributed to the

various strategic factors which include competitive strategy, process design strategy, supply

chain management strategy, human resource management, capacity management strategy, human

resource management strategy and quality management strategy. The effectiveness of these

factors varies from company to company but from this study, quality management strategy

appears the most effective strategy used by Toyota Motors Corporation to win its customers’

hearts. As has been previously noted in this report, Toyota Motors Corporation not only produce

good quality motors, products and services but also make them available at a fairly affordable

price for its customers globally. The Company’s global revenue performance has been steadily

increasing thanks to the collective strategies put in place by its management, especially the

quality management strategy which makes Toyota Motors Corporation a company to admire and

emulate its operations.

Recommendation
Toyota Motors Corporation has had an exceptional performance over the past years.

However, certain areas still require improvement to take the Company to a better level of

performance. For instance, Toyota management needs to up its game in the training and selection

process of next generation leaders and managers for the various branches. The company has

from time to time suffered whenever there is a significant change in management. The company

also need expand more on its development of clean energy products as this is where the shift is

leading towards. To remain relevant, the Company needs to up its game and produce more but
ORGANIZATION CORPORATE STRATEGY 26

controlled clean energy motors (hybrid and 100% clean energy motors). Toyota Motors need to

increase its production in the Asian market as well as make Lexus a priority in the Chinese

market as part of its luxury segment. Given its success globally in the past many years, Toyota

Motors Corporation needs to put more focus on Corporate Social Responsibility to the various

countries and communities of operation.

ORGANIZATION CORPORATE STRATEGY 27

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