Toyota Operations Improvement Plan Essay

2728 Words Dec 3rd, 2013 11 Pages
Operations Improvement Plan
University of Maryland
MBA 6022
February 17, 2012
Instructor: Dr. Ben Thompson

Tracy Moore
MBA 6022
2237 Gateway Blvd
Baltimore, MD 21202

Abstract: Toyota is faced with an Accelerator crisis after allegedly faulty accelerator pedals in some of their vehicles caused the pedals to depress get stuck or cause them to accelerate. This lead to a massive recall and lead to penalties and fines from the US government and consumer confidence diminished. There are several processes that can be identified that will benefit Toyota and lead to improvement which is what will be discussed in this paper.

Toyota Motor Corporation was founded by Kiichiro Toyoda. Its headquarters is in Japan and was established in
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The problem with the suppliers of components for vehicles outside of Toyota’s network has been going on for a couple of years since they implemented a growth strategy. In1995, then new President of Toyota decided to increase global market share for Toyota they began to expand rapidly. This led to increase production which made it impossible for their network of suppliers at the time to keep up. They had to look outside their network in order to keep pace with the demands of their newfound growth. Before that time Toyota had a business structure for their network which is called the Keiretsu. As described by Douthett,Edward B.,,Jr, Jung, K., & Kwak, W. (2004) “In Japan, industrial organizations is characterized by enterprise groupings, keiretsu, composed of firms in different industries, but interrelated through cross holdings of ownership, and reliant on a single, large commercial bank for financing” (p. 80).

If Toyota continues on as it is and does not change the issue of looking at how they outsource outside of their network they risk losing market share and customer loyalty. If they improved their process of outsource outside their network there are many improvements that would happen. One of the Pro’s would be they would be confident in the components being supplied for their vehicles. On the other side, if they continue on the current