Toyota Case Study

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Total Quality Management
--- A case of Toyota

Mengtao Ji
Yuting Xi
Feng Huang
Yudi Jiang

Background
Toyota Motor Corporation is a famous global automaker headquartered in Japan, which commonly known as Toyota (Liker, 2004). As a leader in the global car market, Toyota Motor is famous of manufacturing quality cars with low price. Toyota’s world-leading quality and the management system are remarkable. In 2003, the annual profit of Toyota was larger than the combined earnings of GM, Chrysler, and Ford. Also, Toyota’s market share increased 24% over 2002, so a number of analysts estimated that Toyota’s market share would pass GM in few years and become the largest automaker in the world (Liker, 2004). Toyota’s success

Many reasons lead to the success of Toyota Motor. Some researchers stated the “Toyota Way” based on the Toyota Production System (TPS) and concluded 14 principles of the “Toyota Way” which are divided into four categories of Philosophy, Process, People/Partners, and Problem Solving (Liker, 2004). These four categories started from long-term thinking to short-term management. The 14 principles are based on some techniques and human motivations. The quality improvement methods are from lean production, such as just-in-time, kaizen, one-piece flow, jidoka, and heijunka. The superiorities of human motivation in Toyota can be classified to one the four principles – Philosophy, which contains leadership, teams, culture, and supplier relationships (Liker, 2004). Toyota Recall

At the end of 2009 and start of 2010, Toyota faced a big issue which is that 6.5 million cars have been recalled in the U.S. because of the problems of gas pedals (“Toyota's quality lapse”, 2010). Many analysts started to research why the quality issues happened to the world-leading quality car maker. As a large vehicle manufacturer in the world, Toyota had to change the strategies and some management methods to obtain more profit and market shares. Those changes may lead to some big issues and the most affected portion is quality. From a local car maker to a global vehicle manufacturer, Toyota is getting harder to control the quality of every car. For example, Toyota usually bought parts from a small group of Japanese suppliers who have been longtime partners with Toyota. However, as the globalization and sales increasing, Toyota started to buy the parts from companies around the world (“Toyota's quality lapse”, 2010). According to Total Management Quality (TQM), this paper mainly states supplier relationship and employee involvement to discuss the quality management problems of Toyota and give some appropriate recommendations. Problems

Employee Involvement
Employee relation is considered as an important critical factor of total quality management implementation. Implementing employee involvement and quality circles can do a great job when applying total quality management. This includes employee participation in quality decisions, responsibility of employees for quality, employee recognition for superior quality performance, effectiveness of supervision in handling quality issues and on-going quality awareness of all employees. (Saraph, Benson & Schroeder, 1989)

However, Toyota Company did not do well in this part so far. In the TQM approach used by Toyota, the assembly line teams are responsibility for the steps related to their own work. It is no doubt that, in order to apply TQM approach, workers are cross-trained and when there is a problem occurring in their work areas, they can stop the assembly line processes in some cases. Although they are responsibility for continuous improvement processes, they must achieve management approval before they can make changes in their work. (Edward, 1994; p68-76) Managerial behavior and leadership are playing important roles in both TQM and employee relations, but Toyota seems a little bit weak in these...
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