BUSINESS ENVIRONMENT OF TOYOTA

Business Environment of Toyota

Business Environment of Toyota

Introduction

Toyota created and revolutionised by Sakichi Toyoda the inventor of the world's first automated loom in 1918. Sakichi sold his patent for the automatic loom for the sum of £100,000 in 1929 and then donated the proceeds to his son to develop automotive technology at Toyota. Production of the first prototype known as the Toyoda AA passenger vehicle begins in 1936, the Toyoda motor corporation began (Pettigrew, 1985). The Toyoda family were superstitious and changed the letter 'd' to a 't' as the letter 't' only requires 8 strokes and 8 is a lucky number in Japan.

Toyota Motor Corporation was formally founded on 28th August 1937 with a total investment of 12 million yen (approx. £300,000). Toyota is at the heart of global manufacturing, a company that has grown within 70 years to become the leading far eastern and world's 2nd largest car manufacturer. Toyota a global business, building vehicles in factories on six continents around the world and employing more than a quarter of a million people. The United Kingdom is a key market for Toyota both in terms of sales and manufacturing, building two production centres (Pettigrew, 1985).

Toyota's automotive business, including sales finance, accounts for more than 90% of the company's total sales. Toyota totalled 8.81 million units from January 1, 2006 to December 31, 2006 making a new record (Poire and Sable, 1984). The unit sales consolidated to ¥21.03 trillion yen in the fiscal year to March 2006. Toyota is hoping for a 6% increase in the next financial year to over take General Motors and make Toyota the biggest car manufacturer in the world.

Business Environment of Toyota

In the contemporary business world there are cataclysmic economic events which are now driving almost every organization in the developed Western economies to place learning at the pinnacle of the corporate agenda. Factors such as widespread recession, increased foreign competition, structural unemployment and the uneven spread of economic regeneration are a few, among many, reasons. Driven in large part by these events, many theorists and writers are pointing to the “crisis” of mass production currently being witnessed throughout the developed economies.

Growth and the economic engine of regeneration will come in large part through the adoption of “flexible specialization” in manufacturing and the general updating of production and human resource management. These, together, are seen as holding greater promise for business overhaul and efficient manufacturing than adhering to inappropriate, inefficient and outdated mass-production techniques (Sable, 1989). The adoption of these so-called new wave manufacturing techniques is, it is argued, essential for firms in order to survive the foreign - mainly Japanese and Pacific Rim manufacturing onslaught. It is easy to see that organizational learning plays a key role here, for firms are now being urgently called on to reappraise almost every aspect of their business operations. Most critical scrutiny, however, would appear to be directed at the ways in which manufacturing as a social process is being undertaken, and how jobs are actually ...