Toyota Motor Corporation is a multinational motor company headquartered in Japan. It remains the world’s best automaker and controls not only the largest market share in the United States but in the rest of the world as well. This company has managed to achieve this feat because of its lean manufacturing techniques and adoption of innovative and new technologies. Founded in 1937 by Kiichiro Toyoda, Toyota Motor Corporation has effectively managed to align its practices within its core mission statement. However, the analysis of Toyota’s mission and vision statements in most instances fall short of taking into consideration the desires of the stakeholders.
With a mission statement of “Make Better Cars and Contribute to Society”, Toyota aims at enriching the lives of its customers through the manufacturing of quality cars. The vision statement is “To be the most successful and respected car company in the world”. In both its mission and vision statements, Toyota aims at contributing to the good of the society through the achievement of “stable long-term growth, while striving for harmony with people, society and the environment” (Toyota Motor Corporation, 2010). Whereas Toyota has managed to walk along the path that strives towards the attainment of the aforementioned goals, an analysis of the company’s practices reveals a failure to take into keen consideration the needs and desires of its stakeholders.
“For successful projects, it’s not enough to deliver on the customer’s demand; projects have to meet all stakeholder expectations” (National Research Council (U.S.), Committee for Oversight and Assessment of U.S. & Department of Energy Project Management, 2005). Appropriate identification of stakeholders in company analysis forms a fundamental aspect in decision-making processes before, during, and after the implementation and after the successful satisfaction of the stakeholders’ needs and desires. According to Royer (2001) “identification of stakeholder is a primary task because all the important decisions during the initiation, planning and execution stages of the project are made by these stakeholders”. There are a number of stakeholders that actively take part in project management; however, in the analysis of Toyota Motor Company, the two most important stakeholders are the customer and the shareholders. In the case of Toyota motor corporation, the demands of stakeholders are vast, numerous and varied. The most important needs and desire of both stakeholders in the whole chain of activities is the capacity to avail quality products that are measurable to the money value. It is through this that the company has the capacity to ensure the general safety of the customer and return on investments on the part of the shareholder.
Whereas Toyota has traditionally managed to retain the top position as the most profitable automaker, a myriad of factors have diminished its capacity to align its mission and vision with the needs of its stakeholders. The recent mass recall of Toyota cars worldwide due to safety concerns is a true demonstration of the inability to take into consideration the demands of the stakeholders. According to Michel (2010) “Toyota has announced the mass recall of vehicles in the US, Europe and China over concerns about accelerator pedals getting stuck on floor mats.” In addition to the above, it is estimated that the number of cars recalled by Toyota from overseas markets in the recent months has reached 8 million. This has not only dealt a blow to the largest automaker but has also underlined its inability to take into consideration the need for customer safety which remains entrenched in its mission statement.
In the analysis of the effects of mass recall, Michel (2010) has expounded that “This action is prompted by Moody’s concern that the growing scale of Toyota’s product problems and associated recalls may have longer term impacts on its brand equity, pricing power and market share in key markets.” The case presented demonstrates the latest case in the company’s inability to align its practices within the demands of its core stakeholders. Not only did the substandard products fail to assure the customer of their safety, this also led to a devastating economic blow, reduced level of confidence of its products and eventual loss of business. The spiraling effect is the huge loss of financial revenue that directly impact of the shareholder. According to Michel (2010) “before it announced the Prius recall in Japan, Toyota estimated that its losses would reach $2bn (£1.23bn) in costs and lost sales from its worldwide recall of vehicles that might have faulty accelerator pedals.” Whereas the mass recall may be analyzed from an isolated point of view, the impact it generates on the overall customer confidence is huge. In addition to the above, the automobile industry is characterized by stiff competition and as such Toyota cannot afford to ignore the overall importance of its stakeholders.
In conclusion, it can be discerned that whereas Toyota’s mission and vision statements rest on the need to underline the desire and needs of the stakeholders through the provision of quality products, this has not been fully attained. There is therefore the lack of coherence in the statements and the practices of the company.
References
- Michel, B. (2010). Toyota recalls thousands of Prius cars worldwide. Web.
- National Research Council (U.S.), Committee for Oversight and Assessment of U.S. and Department of Energy Project Management (2005). The Owner’s Role in Project Risk Management. Washington: National Academies Press.
- Royer, P.S. (2001). Project risk management: a proactive approach. London: Management Concepts.
- Toyota Motor Corporation (1995). Vision and Philosophy. Web.