Has Controlling and Cost-Cutting Contributed to Toyota Recent Massive Recalls?

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Strategic controlling is a dire need for any organization if they want to be successful. It is defined as “The process of monitoring and ensuring that organizational goals and objectives are met” (Dr. Luca, unknown). It’s a highly debatable subject as how much control is needed but in the end, without control you have no organization.

Toyota has been the number automaker in the world since 2008 according to Forbes. But recently it has lost its rank due to massive recalls. It’s evident that cost-cutting and lack of control plays a big role on why Toyota vehicles are failing at the rate they are going. Even (the former) CEO of Toyota Mr. Wantanbe noticed a lack of control within the organization; He stated “In each division, function, or region, we still have numerous problems to cope with. We need to identify each one of those tasks or problems and fully recognize them and pursue the causes” (Rowley, 2005).

One major reason for such obstacles was that it expanded without having a system in place to monitor the changes. Demand is good for any business and if you want to keep up, but you need to forecasting change if expansion is the solution. Toyota’s management didn’t realize that there was more to demand than just infrastructure. “The breakneck speed of Toyota's expansion in recent years, its continuing reliance on production at home, and slower decision-making as it has grown have all aggravated Toyota's woes” (Rowley 2009). Slow and expansion should never be on the same sentence.

When it comes to controlling you need various methods if you want controlling to be effective. Management needs to look at the administrative aspects of the organization. Computers, software, copiers and other office equipment are keys to monitor all areas within the organization. Next, you need delegation. Delegation is “an approach to get things done, in conjunction with other employees” (McNamara). Additionally, evaluations and feedback should be the...
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