Introduction
Currently, the car industry is undergoing a major shift in priorities: if earlier, the main stakeholders of a company were rather concerned with stability and profit, nowadays, predictable earnings growth does not suffice. Car building has grown an overwhelmingly competitive sector where innovation reigns supreme. A Japanese multinational company headquartered in Tokyo, Toyota seems to be excelling in both sales numbers and putting forward innovative ideas and projects. On the one hand, the world’s second-largest car manufacturer has succeeded in striking a balance between meeting customers’ needs and making them interested in purchasing new models.
For instance, Toyota has produced and introduced the world’s first and best-sold hybrid car, Prius, successfully. Furthermore, year after year, the Japanese manufacturer ranks among the most innovative companies for its thoughtful consideration of fuel efficiency and safety standards. On the other hand, some experts are convinced that the company might be on its way to long stagnation due to its rigid bureaucratic structure. This essay will discuss what an organizational change consultant could suggest Toyota do regarding making meaningful changes and reinventing itself.
Planned Change
Lewin’s Planned Change Model
When a company considers changing its course of action, managers and OD consultants may entertain the idea of applying Lewin’s planned change model. Nothing is as compelling and motivating as soaring sales statistics. In 2018, alongside other large Japanese car manufacturers, Toyota saw a substantial decrease in sales numbers: for instance, there was an 18.6% decline in Camrys sales (Bomey, 2018).
All points are taken into consideration, one may conclude that Toyota cannot and should not rely on its reputation as the main driving force behind sales. Instead, launching a change model might be more preferable, which provides a clear rationale for Lewin’s Planned change model.
Lewin’s planned change model implementation usually takes three steps. At the first stage, a company needs to do a so-called defreezing in which it makes major changes to the prevailing paradigm and vision among all corporate levels (Hussain et al., 2018).
In the case of Toyota, both the managing board and employees should realize that fixing faulty features and avoiding recalls is a short-term solution. Once decision-makers have found a long-term solution, they introduce a change, which constitutes the second stage. Lastly, if the outcome is positive, a company should proceed with refreezing, stabilizing the structure, and making meaningful patterns for future action.
Action Research Model
Akin to the planned change model, the implementation of the action research model consists of three stages. The action research model goes into detail as to how an organizational change consultant should interact with a company that hired him or her to make the collaboration mutually beneficial. The first stage is communication, during which the clients share what they find troublesome about the company at the moment, and the consultant provides feedback (Willis & Edwards, 2014). The end goal of the first stage is to define causal relations between a company’s past decisions and current challenges. For instance, in the case of Toyota, an organization development consultant could examine how new design solutions or lack thereof affected sales numbers.
The next step would be data collection and problem diagnosis by the consultant. The findings of the second stage would determine objectives and, hence, the action plan. An essential subpart of the second stage is defining what action behaviors would be most effective in achieving the set goals (Willis & Edwards, 2014). Lastly, an OD consultant would do further research on the outcomes and gather data to decide whether the right course of action was taken.
It is imperative to maintain continuous two-way communication with the client and react to his or her feedback promptly. If a company and an OD consultant aim at long-term cooperation, the data gathered at all stages will help to make a new plan. Long-term cooperation would be preferable in the case of Toyota since such large companies need more time to make incremental changes.
Collecting Data
Methods
If a company wishes to elaborate a workable organizational development plan, it is imperative to gather and evaluate both qualitative and quantitative data for assessment. Furthermore, one needs to outline the advantages and disadvantages of the chosen research methodology. One of the most popular methods to collect data is conducting a survey among employees (Transparency International, 2014).
One of the pressing issues a survey could target could be the turnover rate at Toyota (Glassdoor, 2019). A high turnover rate leads to the necessity to train new employees while those who quit prematurely did not unlock their potential fully (Oladele, 2016). One may contend that Toyota owes its success to inbred leadership, in which managers are promoted within the company.
The data drawn from the first survey could be further processed using statistical methods to put together a clear picture of employees’ satisfaction in the workplace. A cross-sectional survey is a good method of assessing a situation in a given time span. However, it is important to evaluate the findings critically as they might be susceptible to voluntary basis: the most troubled and dissatisfied employees are more likely to come forward. At the same time, since participation would not be mandatory, a 100% outreach would not be possible, and thus, some of the voices would not be heard.
Another essential survey would take place among the top management of Toyota. In alignment with the action research model, an OD consultant would have to draw an extensive body of data from the company’s key figures. The second cross-sectional survey would aim at defining the company’s prevailing paradigm to establish what could be changed to guide Toyota on the way to innovation.
What an OD consultant would seek to attain through the series of such insightful interviews is to define what innovation means in the context of Toyota Company. Analyzing qualitative data of such kind would involve seeking similarities in responses to expose patterns. By doing that, it would be possible to seek customized solutions, which is not readily workable if a company uses a broad nebulous notion.
Questions
One of the responsibilities of the OD consultant at this stage would be to develop questions for participants. The first survey conducted by an OD consultant would be on the intention behind the high turnover rate. A study by Cohen, Black, and Goodman (2016) showed that a turnover intention rate is not a good predictor of an actual turnover rate. The questionnaire could contain yes/ no questions or Likert-scale statements in which the respondents would have to reply to what extent they agree with the statements provided.
For instance, “I feel valued and affirmed at work” or “I’m engaged in meaningful work (Society for Human Resource Management, 2016).” Thus, the survey would not include questions as to whether an employee plans to resign but rather whether he or she is satisfied with their work conditions and overall environment.
As for the second survey, an OD consultant could conduct a series of in-depth interviews to gather qualitative data about the managers’ shared and personal views. Based on a report by Coad et al. (2014), an OD consultant could develop an array of open-end questions. For example, “What is innovation?”, “Do you consider Toyota an innovative company?”, or “How do you see the company’s growth and development in the next five years?” What could also be useful is encouraging managers to reflect on the failures of the year 2009 since it had a rather difficult psychological effect on Toyota.
Feeding Back Diagnostic Data
Force-Field Analysis
Lewin’s force-field analysis is a simplistic at first glance yet a profound strategy for determining primary contributing factors to the company’s growth or decline. According to Lewin, there are two categories of factors: driving forces and resisting forces (McGrath & Bates, 2017). One of the main difficulties emphasized by McGrath and Bates (2017) is that some factors may be both driving and resisting forces. That is why it is imperative to gather data to put each factor in context. In the case of Toyota, the force field may look as follows (see table 1).
Table 1.
Organizational Culture
Assuming that the company aims at making a major change, the OD consultant should find the most effective ways to present what he or she discovered. Due to the great number of employees – more than 369,000 (Statista, 2018), it is impossible to communicate the highlights of the diagnosis personally. To solve the issue, distribution and communication could be delegated to the managers of each department.
When possible, it would be best to organize discussion groups where information would not be presented in the form of a lecture but a conversation. The ability to contribute encourages people to memorize and take action. As for the main points to be presented, it is crucial that an OD consultant employs objective, numerical data as well as summarizes the managers’ views on innovation.
Organizational Change Interventions
Action Plan – Short-term
As for the actions that the company could take on an immediate basis, a short-term plan for Toyota would include practices that would directly address the issues exposed in the survey findings. For instance, once employee engagement and motivation are examined, human resource development specialists could start working on the most pressing problems. Since ethical implications would be taken into consideration, the survey would be fully anonymous.
This means that HRD specialists would not be able to approach specific employees to have a conversation about their challenges and intentions. Instead, the company could address the factors defined in the findings directly. For instance, if it is subpar working conditions in particular quarters that were found to be demotivating, they should be improved. As for further fostering engagement and innovation, HRD specialists could hold brainstorming sessions within general employee meetings, starting shortly after the data has been analyzed. In the meetings, employees could put forward their ideas as to how the company could be changed in a meaningful way (Dawson & Adriopoulous, 2017).
Further, the managers’ views should be consolidated and summarized in the form of a clear mission statement with a short-term and long-term objective. The statement should be published within the company as well as posted online on the official website and other social media resources of the company.
Action Plan – Long-term
The question arises as to what measures the company could take to aid its development in the long perspective. It is obvious that the company needs a continuous assessment of employees’ needs. For this reason, it is only reasonable to conduct subsequent surveys to detect other problems that might be discouraging employees from releasing their full potential. Thus, Toyota would handle the issue of the high turnover rate in several steps.
Overall, it is crucial to foster an atmosphere in which supervisors do not judge new ideas, and constructive criticism is welcome. One of the long-term methods of supporting innovation at the company level could be holding technology startup contests. Since Toyota is a large company, it has enough resources at its disposal to fund the best ideas aimed at sustainability, safety, and fuel efficiency. As for further development of the mission statement, once managers have singled out particular objectives, they need to diagnose each of them.
Conclusion
Toyota is a company with a long, rich history that has been a trailblazer in the car manufacturing industry and set bars for other companies for many years. As of now, despite formal achievements, such as growing yearly revenues, some experts claim that the company is becoming increasingly stagnant. The situation is calling for a thoughtful diagnosis and assessment, which can be conducted by an organizational development consultant.
It is crucial to implement one of the existent strategies such as planned change or action research models. A series of surveys should be carried out and gathered data should help to elaborate an action plan. While choosing the course of action, Toyota should take into account such driving forces as rich resources, loyal customer base, and experience in launching innovative projects. On the other hand, customers reluctant to changes, recent controversies such as massive recalls, and training staff should not be dismissed.
References
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