Toyota Change Management Case Study 

Change management plays a key role in the growth and success of businesses and organizations in the fast-evolving business environment. Automobile companies like Toyota have earned a reputation for innovation and creativity. In fact, the company has launched various programs to improve the production, operation, and service quality of its products. Today, we’ll discuss the Toyota change management case study; its historical background, examples of change management, challenges, and the impact of changes.

Some of the main products and services of Toyota are as follows;

• Automobiles
• Spare parts
• Leasing
• Financing
• Banking

Historical Background of Toyota 

• 1937 – Kiichiro Toyoda laid the foundation of Toyota Automobile Motor Company on 28 August 1937
• The 1950s – Toyota learned from the American automobile manufacturer and improved its production processes in Japan’s alliance with the US after the WWII
• 1960s – Automobile company exploited Japanese growing economy and produced vehicles for the middle-class
• 1997 – The company launched fuel-efficient hybrid electric vehicles with the model Toyota Prius
• 2012 – Toyota established the record of producing more than 10 million vehicles per year
• 2022 – Toyota made a deal with the government of the UK’s Department of Business, Energy, and Industrial Strategy to develop FC Model Hilux for 11.3 million British Pounds

Toyota Production System

TPS

Toyota Company developed a TPS (Toyota production system) that follows the lean manufacturing system and it focuses on improving efficiency and decreasing waste in its production and manufacturing processes. The TPS focuses on two key principles and they’re as follows;

• Recognizing and removing all types of waste in the production and manufacturing processes
• Making continuous improvements in the production processes

JIT

JIT (just in time) is one of the key tools of TPS and it focuses on developing such products that customers need and looking for and of the proper amount.

Kanban

Kanban is a form of a scheduling system that employs visual signals that focuses on controlling the flow of material.

Andon

Andon helps employees and workers to stop producing and manufacturing things when the problem came up and sends signals for help.

Kaizen

TPS doesn’t just offer tools; it is a form of philosophy and a working methodology that focuses on implementing change management at different levels of the company. However, it encourages and promotes employees to recognize and make improvements in the manufacturing processes. It comprises testing and executing changes at a small scale before launching it at a mass scale. In other words, Kaizen is the process of continuous improvement; it has become the main part of Toyota’s working culture.

Hoshin Kanri

The TPS allowed the company to develop a change management program (Hoshin Kanri), and it follows the top-to-bottom approach ranging from strategic planning to goal setting.

• Allows senior management and leadership to give direction to the company
• Collaborating with middle managers and front-line workers
• Making improvements and aligning with the overall company’s strategy
• Ensure to manage change in a coordinated and structured way across the organization
• Encourages everyone to move towards the common goal

Toyota Change Management Programs – Examples 

Toyota has a long history of implementing change management programs across the organization, and it helps the company to stay ahead of the competition in the automobile industry. The two main examples of change management programs that the company launched in the Toyota change management case study and they’re as follows;

Industrial Robots in Production

Toyota is the pioneer to employ robotic technology in its production and manufacturing processes. The automobile company first introduced industrial robots in 1967. The company kept on investing capital resources in automation and robotic technology; it allowed the company to improve efficiency, quality, and safety in its production processes.

The company successfully launched “cobots” (collaborative robots) in the industrial production and industrial line. They perform tasks alongside employees to do physically demanding and repetitive tasks. However, it allows employees to change their attention toward complicated tasks that need human judgment and skill. It not only improves efficiency and safety, but it also develops more satisfying relationships with employees.

Prius Hybrid

Toyota first launched the fuel-efficient hybrid car at the mass scale by the name “Prius Hybrid.” It was a great technological advancement and it said goodbye to gasoline-powered vehicles. The company invested a lot of resources in the development of hybrid technology by keeping in mind the potential growth in the future. Some of the key issues the company faced are as follows;

• Doubts about consumer demand
• High cost of hybrid technology

But Toyota stayed committed to the sustainable future of hybrid technology and kept on refining its technology. The Prius model earned worldwide recognition and the company sold 10 million Prius vehicles.  

How Toyota Responded to Issues and Challenges 

Implementing a change management program wasn’t easy. Toyota faced a lot of challenges. But the automobile brand effectively responded to the challenges and issues in the Toyota change management case study following ways;

Recalls to Ensure Safety

Toyota recalled its vehicles from the market various times in the early 2010s and late 2000s; because of the quality control and safety issues in the company’s various models. It happened due to;

• Faulty brakes
• Unintended power acceleration

The product recalls badly impacted the reputation and credibility of the company. Additionally, the company faced criticism from the media, consumers, and regulatory authorities.

Quality Control & Collaboration

In order to deal with such issues, Toyota made significant quality control changes in its production processes. In fact, the company launched a new department and a new position of Chief Quality Office to make sure the safety and quality of its products. Along with quality control, the company promoted collaboration, coordination, and communication inside the organization. The automobile brand has also launched a new reporting system to deal with quality issues.

Continuous Improvement

Toyota follows the Kaizen principle of continuous improvement despite facing all the challenges and issues. The company invested a significant amount of resources in the latest technology to develop innovative products like;

• Mirai Hydrogen Fuel Cell
• Electric and Hybrid Vehicles

Investment in technology helped the company to refine its production and manufacturing processes and launch new systems, methods, and procedures. It helped the company to improve its quality and efficiency.

TNGA

Toyota developed a new platform TNGA (Toyota New Global Architecture) to achieve continuous innovation and development. It helped the company to launch a wide range of vehicles and cars that are quality focused and efficient. Toyota Prius and Toyota Camry are some of the products of its platforms.

Impact of Toyota Change Management Program 

Some of the key results and impacts Toyota change management programs in the Toyota change management case study are as follows;

Safe & Sustainable

Toyota showed a strong commitment to safety and sustainability through making technological growth and progress. It helped the company to reduce the environmental impact of its vehicles, decrease carbon emission rate, and develop safe products.

Employee Satisfaction

Toyota has created a workplace culture of teamwork, collaboration, and employee engagement. In fact, the company encourages its employees to share their ideas to develop innovative products; it allows the company to have a fulfilling and engaging workplace environment. Ultimately, Toyota has a high level of employee retention and employee satisfaction rate.

Innovation & Creativity

Toyota has always shown a strong commitment to innovation and creativity and it helped the company to launch the TNGA platform, Mirai fuel cell, and Prius Hybrid vehicles. The innovation in technology not only helped the company to develop new products but also has a positive impact on the environment.

Quality & Efficiency

The focus of Toyota is on continuous improvement and it helps the company to achieve quality and efficiency. The company has standardized and streamlined its various production processes and that’s why the company’s vehicles have earned the reputation of durability and reliability. It allows the company to achieve a market leadership position in the automobile industry.

Conclusion: Toyota Change Management Case Study 

After an in-depth study of Toyota change management case; we have realized that Toyota has successfully implemented transformational changes at different times. If you are learning about Toyota’s change management programs and strategies, then you should keep in mind the abovementioned factors.