HR assignment on: Organization culture of Tesco

1. Executive Summary

This report takes into consideration the basic generic strategies, organizational culture & a formal organizational culture with respect to Toyota. Michael Porter has been describing three types of generic strategies which would help any organization in order to achieve as well as maintain a competitive advantage over its competitors. The three generic business strategies could be defined with the help of two main dimensions such as Strategic Strength & Scope of the strategy.Toyota has been focusing upon this strategy which has helped them in order to attract as well as retain more number of customers towards them. Low cost strategy refers to the main cost strategy which has been focused by Toyota. By providing the cars at a low price with high levels of quality has helped the organization in order to have an edge over its competitors.

There are certain guidelines which were undertaken by Toyota in order to make their products different from other competitors available in the automobile industry. The first type of differentiation which has been done by Toyota refers to the art of ingenuity. Toyota has been referred to as the scientist as in such competitive environment, dealing with tough competition requires high amount of innovation. Use of cleverness, images, original ideas, creativity, and skill also results in high levels of innovation.

1. Introduction

This report takes into consideration one of the biggest MNC’s i.e. Toyota (Japanese). The automobile industry in case of Japan is quite versatile in nature. The automobile industry is quite prominent in the country mentioned above (Toyota, 2010).The automobile industry in Japan is one of the largest in the world. Japan is majorly known for manufacturing vehicles. Japanese automobile industry are the market leaders in manufacturing ATVs, engines, majorly cars, heavy vehicles used at the time of  construction of big buildings such as malls, hotels, hospitals, etc.

Manufacturing of the automobiles in Japan are of the utmost quality which takes into consideration due approval from the Japanese Government (Toyota, 2010). The major Japanese players prevalent all over the globe are Honda, Nissan, Suzuki, Subaru, Toyota, Yamaha, Kawasaki, Mitsuoka, etc.

The annual manufacturing of vehicles by Toyota has been mentioned as under. They are as follows:

1. Body

3.1 Generic Business Strategy:

Michael Porter has been describing three types of generic strategies which would help any organization in order to achieve as well as maintain a competitive advantage over its competitors. The three generic business strategies could be defined with the help of two main dimensions such as Strategic Strength & Scope of the strategy (Toyota, 2010).

Toyota has been using the three generic business strategies which would help in order to have a competitive advantage over its competitors (Rodriguez & Page, 2005). The three generic business strategies are mainly with regards to leadership in terms of Cost, Differentiation strategy in terms of the product offerings & the segmentation strategy. All the three strategies have been used by the organization i.e. Toyota, which has helped them in order to minimize the cost as well as add upon the different types of differentiation (Toyota, 2010).

                                       (Source: Rodriguez & Page, 2005)

The three strategies used by Toyota could be as under:

Þ    Leadership in terms of Cost

Þ    Differentiation strategy with regards to Product

Þ    Segmentation Strategy

3.1.1 Leadership in terms of Cost:

Toyota has been focusing upon this strategy which has helped them in order to attract as well as retain more number of customers towards them. Low cost strategy refers to the main cost strategy which has been focused by Toyota (Rodriguez & Page, 2005). By providing the cars at a low price with high levels of quality has helped the organization in order to have an edge over its competitors.

The leadership with respects to the cost involved would help the organization in order to reduce the overall costs which would help the organization to plan in the near future. With the help of low the cost strategy, Toyota would be able to improve the company in various aspects (Life in Motion, 2006). With the adoption of the low cost strategy, Toyota would be able to have a better cost structure. The cost structure would be able to have a control over its competitors. Such type of strategy would help the organization in order to focus upon the future as well as the years to come (Rodriguez & Page, 2005).

Positioning – low cost strategy

One of the other ways with which the organization i.e. Toyota, would be able to strategically position their status with the help of the cost structure. The low cost strategy would help Toyota in order to increase the market share by converting the cost structure into a price active as well as provide the customers with the best of the quality products at a reasonable price (Life in Motion, 2006). This would help in order to increase the market share of the organization thereby, improving the market share of the enterprise. With the enhanced market share, the organization would be able to attain economies of scale by reducing various types of costs. When the company or the organization would make certain efforts in order to reduce the costs, the company would be termed to be using a Low Cost Leadership Strategy (Life in Motion, 2006). This strategy would help the company in order to attain a competitive edge over the competitors thereby, be in the automobile market for the years to come.Drive low cost strategy:

One of the major reasons as to why the customers stick to one company is due to the cost effectiveness being practiced in the organization. In other words, Toyota has been known as an organization which is bound to adopt low cost strategy (Life in Motion, 2006). They refer to the organization which would have a sufficient control over its logistics, buyer & supplier relationships, etc.  The Toyota Group has been practicing as well as implementing a strong as well as a powerful relationship with its suppliers, buyers & developers.

Know your customers

Apart from implementing a low cost strategy, the organizations should know their customers very well. This would help them in order to have a vague regarding the taste, preferences of the customers. Manufacturing & providing the product at a low cost does not serve the purpose fully (Life in Motion, 2006). The organizations should keep the entire aspect sin mind which would help the enterprise in order to focus upon the needs of the customers at large. Unless & until the customers would be fully satisfied & they would not be able to stick with company for the years to come in near future (Life in Motion, 2006). With the help of cost reduction strategy, the organization would be able to explore new options which would help them in order to focus upon the niche market segment as well (Dyloco, 2011). This would give the company insight regarding the various future opportunities for the same.3.1.2 Segmentation Strategy:

The segmentation strategy which would be utilized by Toyota refers to the following. The entire market is to be divided according to the following points, they are as under:

Þ    Segmentation on the basis of Behavior

Þ    Segmentation on the basis of Demographics

Þ    Segmentation on the basis of Psychographic

Þ    Segmentation on the basis of Geographic

Þ    Segmentation on the basis of Behavior

3.1.3 Differentiation Strategy:

There have been various types of differentiation which have been done by the Toyota & have also helped them in order to make their products different from the other in various respects (Bunkley & Nick, 2008).

Þ    Differentiation done by Toyota

There are certain guidelines which were undertaken by Toyota in order to make their products different from other competitors available in the automobile industry; some of the guidelines are as under:

Þ    The Art of Ingenuity: The first type of differentiation which has been done by Toyota refers to the art of ingenuity. Toyota has been referred to as the scientist as in such competitive environment, dealing with tough competition requires high amount of innovation. Use of cleverness, images, original ideas, creativity, and skill also results in high levels of innovation (Dyloco, 2011).

Þ    The (relentless) Pursuit of Perfection: The second type of differentiation done by Toyota refers to the pursuit of perfection. Toyota prefers to be perfect in all the respects. It states that all the cars which would be manufactured by the company should be to the best of quality as compared to the price attached to it (Bunkley & Nick, 2008).

Þ    The Rhythm of Fit: Lastly, the type of differentiation which has been practiced by Toyota would refer to the rhythm of fit which means that high levels of innovations would be done in order to fit in the entire system. Various safety technology measures should be used as well as solid performance, environment friendly as well as the cost of production should be low which would help them to keep the price of car at low price (Dyloco, 2011).3.2 Organizational Structure:

Organizational Structure refers to the type of culture, attitudes, values, beliefs which the company has in its mind while operating the same. According to the various authors, Organizational Culture has been defined as a “collection of various norms, beliefs, attitudes, which has been shared by group & people in the various groups, the way the organization would interact with one another including the customers, stakeholders, shareholders, etc inside & outside the organization” (Dyloco, 2011).

According to Drypen 2011, organizational culture would refer to set of assumptions which would help the company i.e. Toyota, to define as well as interpret the various action plans which has been formulated by the company. These plans have been implemented in order to define the various assumptions regarding the different types of behavior during the varied situations. According to the various authors, organizational culture has been rendered to be holistic in nature, determined historically, mainly related to concepts of anthropology, difficult to change, quite soft, socially constructed (Drypen, 2011).

Toyota represents one of the top automobile manufacturer’s offices in North America to work for. Toyota boasts that their, “integrity, passion, and innovation extend beyond vehicle manufacturing” (Dyloco, 2011). This bold statement is backed by a strong example of what policies and procedures have been put in place.

Toyota refers to a corporation which would help in order to portray their thinking ability in regards to organizational culture. Toyota refers to one of the corporation which has been ranked at the top in the North American as well as the entire automobile industry. Toyota has a pure formal organizational structure (Drypen, 2011) which has helped the entire organization in order to have a structured hierarchy system. This structure very well helped all the people working inside the organization & those who are outside the company as well to understand each other’s needs, etc (Drypen, 2011). This type of culture has also helped in order to pose the strengths, benefits, abilities of the organization in the near future. This would help in order to cater to the various possible growth opportunities to be catered to in the future years to come.

Toyota’s diversified employment approach births the new ideas and future concepts that keep emerging on the frontier of the automotive industry, thereby maintaining Canadian and Global industry leadership (Bunkley & Nick, 2008). One of Toyota’s top ten official business strategies is to recruit the best and brightest, thereby creating new opportunities for partnerships. These key strategies give the perception to the consumer and employee that Toyota holds a “reputation for excellence”8 on all levels of operation (Bunkley & Nick, 2008).Toyota has been believed to use various ethical practices which would help the organization in order to have a social sense. Use of the various ethical means has been regarded to one of the major concerns of the company (Alagse, 2010). The top level of management would implement various diversification strategies which would help them in order to face various complexities in the near future.

Socially, the enterprise i.e. Toyota shares quite a healthy corporate image in the eyes of the media & its shareholders, stakeholders. As per the chairman of the organization, it has been believed that “Toyota helps the people in order to improve its quality as well as their way of living. It has been regarded that, Toyota works with various schools, educational universities, institutes & other big business houses which would help in order to support the world & make it a better place to live in” (Alagse, 2010).

1.3  Formal Organizational Culture:

            (Source: Rodriguez & Page, 2005)

1. Conclusion

Hence, it could be concluded that the basic generic strategies, organizational culture & a formal organizational culture with respect to Toyota. Michael Porter has been describing three types of generic strategies which would help any organization in order to achieve as well as maintain a competitive advantage over its competitors. The three generic business strategies could be defined with the help of two main dimensions such as Strategic Strength & Scope of the strategy. Toyota has been focusing upon this strategy which has helped them in order to attract as well as retain more number of customers towards them. Low cost strategy refers to the main cost strategy which has been focused by Toyota. By providing the cars at a low price with high levels of quality has helped the organization in order to have an edge over its competitors.

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