Toyota's Global Business Strategy

Seminar paper from the year 2011 in the subject Business economics - Operations Research, grade: A, University of Cambridge, language: English, abstract: Toyota, to all intents and purposes, has become a model for the automobile industry. As Taylor & Kahn (1997) write, automobile manufacturers are not trying to compete with Toyota as much as they are trying to learn from it and, strangely enough, Toyota appears to be quite a willing tutor. This is evidenced in the fact that, on a bi-monthly basis, the top automobile manufacturers across the United States are given a tour of Toyota's plants and production and manufacturing facilities (Taylor & Kahn, 1997). This, however, does not put Toyota in any immediate danger of its giving away its secrets to its competitors since, as Schonberger (2001) points out, Toyota's lean manufacturing model is not an industrial model per se as much as it is a management philosophy. This management and manufacturing philosophy is, without doubt, the key to Toyota's global success but, upon consideration of the reasons for its recent overtake of the U.S. market, one finds that it is a combination of both its decision to Americanize and its management philosophy. Toyota has Americanized and, its Americanization is largely, although not entirely, responsible for its success in the U.S. market. As Naughton et al. (2005) explain, a change of leadership at Toyota led to the abandonment of its 'cooperative competition doctrine,' as which outlined that Toyota's presence in the United States would not be that of a competitor whose goal was to overtake leading American car manufacturers such as GM. Instead, Toyota was to maintain a 'respectful distance' in order to avoid arousing both public and political anger as a direct outcome of its appearing to undermine U.S. symbols, in this case GM (Naughton et al., 2005). Therefore, even though it had the capacity and the potential to compete with GM and, eventually, to dominate the U.S. market, Toyota's leadership made the strategic decision to avoid doing so.