International Relations Sample Paper on International Business

International Business 

Introduction

            The industrial outlook for global corporations highly depends on the operations strategy employed by the organization to help it respond to a variety of cases. These corporations highly depend on innovative strategies in order to sustain their operations. However, a lapse in operational management may in one-way dent the image of the corporation in terms of products manufactured by the company.

            The report highlights the operational management strategy that has been in long been employed to Toyota Corporation, which has seen the company maneuver the challenges and difficulties in the global automotive industry. It also highlights the industry and company outlook in regards to its competitors, mainly highlighting Ford, Nissan, and General Motors as the major competitors.

            The objective of the report is to highlight the operational management strategy that is employed in the organization to cultivate the culture of product innovation, which has also enabled the company to remain at the top of the automotive industry, as well as mitigate the challenges that large corporations face in their production systems. On the other hand, it will also highlight the market outlook in terms of competition, and the tenets of operations management that resulted to a positive outlook among its competitors.

            The report consists of various segments highlighting the trends in the automotive industry, with these being global outlook, company analysis, the main discussion, and recommendation. The global outlook consists of the competitor location, product ranges and state of the global industry, while the company analysis highlights the company analysis through an analytical framework, while the discussion high

lights the challenges and possible solutions to the challenges facing the company, while the conclusion and recommendation gives a summary and the possible course of action that can be undertaken.

Global Industry Outlook

            The global automotive industry is far much predicted to hit higher sales with an increase in production in major automobile production countries such as China and India. It is estimated that close to 100 million vehicles will be manufactured by the year 2017, giving a glimpse of hope to the major automobile producers. Despite the soaring market, a country like China is expected to maintain stable car prices in order to achieve a positive growth trend of about 8% in the year 2015, while the United States automotive market is expected to grow by 3% this year, with the major automobile manufacturers gearing to sell more than 15 million units.

            The other major automobile production countries such as Spain, United Kingdom, Germany, France and parts of Europe that constitute the automobile global market are expected to rip big due to the changing demands in the consumer segments, innovation and an expanded regulatory requirement (“2015 Auto Industry Trends,” n.d.), with some of the major competitors in the global market including Ford, Nissan and General Motors competing for the market.

            Ford

            Henry Ford (“Ford Motor Company Timeline, n.d) founded Ford, an American automobile company in 1903. It is the world’s fifth carmaker company, based in Detroit and occupies about 16% of market share as at 2015. The company manufacturers a range of ford products consisting of vehicles, vans, and trucks with some being SUV and Lincoln ford model car types. The company offers various car and truck models of global appeal, which suits the global car industry. Apart from the vehicle models, the company also offers a range of services such as vehicle service and repair, vehicle security, provision of accessories and fleet accident management.        

        Nissan

            Nissan, a shortened name for the Nissan Motor Company, is an automobile manufacturing company based in Yokohama Japan. Founded in 1933, about 81 years ago, the company is the sixth largest automobile manufacturer in the globe, with the Renault group forming part of the company. The company’s global market share as at 2015 stood at about 8% compared to the other automobile manufacturing companies.

            Nissan motor company manufacturer’s cars of various ranges and models with some being the Frontier, Titan, Murano, Quest and SUVs, being the product ranges. These car models have a global appeal, with many of them being sold in many different countries, hence constituting the market share of the company. Apart from the manufacturing business, the company also offers a range of services such as providing parts and car accessories to its customers as well as support and assistance including fleet maintenance services such as roadside assistance programs. 

            General Motors

            The company is the largest automobile manufacturer and market leader in the automobile industry. Founded in 1908 in Michigan, the company has over 107 years in existence and automobile sales with a substantial number of cars driven in the United States alone consisting of General Motors product ranges. It is the national leader of automobiles in the US market, with various vehicle models being manufactured including cars, busses, trucks, and vans. The company also boasts of other product and service ranges, with products being manufactured consisting of engines, industrial and marine equipment, while on the other hand, the company also has a wider range of services such as locomotive management and maintenance as well as leasing. General Motors occupies about 18% of the world’s total market share in the automotive industry (“Market Share by Manufacturer,”2015). 

            Company Analysis

            Toyota Motor Company, operational management strategy, evolved from various components in its quest to be a global market leader. The company implemented various strategic tenets, which have enabled it to remain at the top in the automobile segment globally.

Strengths

            Toyota Motor Corporation relies in its manufacturing and production system that has undergone various improvements and changes in order to instill a culture of innovation, which enhances product quality. This has been enabled by its vast Toyota production system that has changed the manufacturing process to reduce defects while at the same time to improve product quality.

            The Toyota Production System works to minimize defects, which may occur in the assembly line due to avoidable production procedures. The system works in a way that the manufacturing lines are used to trace for defects along the manufacturing chain. On the other hand, the system also monitors each stage of production to ensure that there are no mistakes and wastes are reduced as much as possible. The system in place delivers various benefits to the company, hence the strength being used as an operational management strategy, in order to sustain its operations. It improves and sustains product quality by removing defects, lowers production costs as well as ensures that product delivers are on time. On the other hand, the production system also ensures that the company’s products are safer, hence contributing to its leadership position.

            Other than that, the company has acquired much global reputation due to innovation and quality, with innovation being defined as the latest management concept or production techniques due to technological breakthrough (Charantimath, 2006). These two factors have largely been attributed to the company’s research initiatives aimed at finding modern methods of manufacturing. This has contributed immensely to quality products, making the company achieve much in cross-border sales and a global outlook in the automobile industry.

            The company has also outweighed its rivals in product delivery times. The company’s production system enables the company to deliver vehicles in the least possible time hence reducing the time the company spends in product delivery during manufacturing until the product is delivered to the consumer. This acts to boost customer retention hence benefiting the company at large. The company is best known for manufacturing durable vehicles that are reliable and has value for money for most consumers.   

Weakness

            However, in a large corporation such as Toyota, there are instances where the products may not fully comply with stipulated procedures. This may be due to engineering lapses leading to poor product quality (Bommel, 2010), especially when defects are not discovered. Defects henceforth have led to the massive recalls of Toyota products leading to poor corporate image as a result of the recalls, which have mostly hit the country in the current times.

            The global massive recalls that occurred across the globe dented the corporation’s image as the company struggled with a series of recalls mostly attributed to the break system. On the other hand, the company also suffered from recalls due to steering problems hence negatively influencing of the sales of the automobiles. These were attributed to poor manufacturing procedures that resulted to the lapse.

Opportunities

            Toyota Motor Corporation sees a lot in terms of opportunities especially when they are able to impact positively on the organizational performances. The company sees growth due to opportunities in green manufactured vehicles, an increase in the price of fuel, dynamic needs of consumers and well as acquisitions that help the company grow its market share. The company’s strategy towards developing green vehicles or hybrid models manufactured by the company greatly increases its market share since more customers are sensitive to fuel-efficient car models, which have lower levels of carbon emission.

            On the other hand, the increase in oil prices greatly benefits the company, since the company can increase its sales due to a shift in the demand and purchase of hybrid car models manufactured by the company. The company has also increased research and innovation so as to design quality cars that can respond to the shifting needs of customers towards the use of more customer friendly vehicles. The company has continued to rely on research and innovation to produce products that are customer tailored in order to suit varied customer perspectives.

  Threats

            Threats are unfavorable situations within an organizations environment (Rao et al, 2008).

            These unfavorable environments hinder the full operations of the organization. This may be due to unseen factors that may affect the operational strategy of organizations, hence hindering the firm from fully operating. Toyota Motor Corporation also experiences major threats in the global automobile industry, from rival companies, which have continued to be a threat to the company.

            This is due to the stiff market the company operates in, where other rivals are involved in stiff market campaigns aimed at wooing customers hence eating the company’s market share. The company also continues to face more threats as a result of the impact brought about by high foreign exchange conversion rates. The global trade relies on the US currency, which at times appreciates due to changes in the global oil supply. This interferes with the financial standing of the company, especially in instances where the company has experienced a drop in sales. On the other hand, the company also suffers from unstable monetary conditions, especially when there is an economic slowdown, such as the great economic recession of 2008, which emanated from the United States economy, spreading to other nations (Stewart, 2012).  

            The various factors of strengths, weaknesses, opportunities, and threats affect the overall operational strategy employed by organizations such as Toyota Corporation. These factors are internally bred or motivated and affect the performance of the company giving a rival firm an upper hand over the company.   

            The internal factors may contribute to a reduction in the market share since the company’s financial capability cannot support the operations of the company. This is due to weakness or an opportunity that a rival firm has taken advantage.

Case analysis and discussion

            Toyota Corporation as an organization has employed strategies aimed at mitigating the undesirable effects, due to changes in the economy, operations, and internal factors. These strategies are aimed at enabling the company to stay afloat, as well as overcome the operational hurdles. Operations management as a field is employed in the organizations fundamental areas of production, personnel, and supply chain to enhance efficiency and product quality. These facets have been used at Toyota Corporation to reduce defects and operational lapses that hinder or interfere with the production processes of an organization.

Findings

            Toyota Corporation faces a myriad of challenges, especially in the production system within its assembly line. This is classified as a challenge due to its magnitude, as it affects the final product quality while on the other hand has a negative impact on the company’s performance. On the other hand, it is also classified as a problem since it is wide scale and involves many consumers upon its occurrence. For instance, the break and steering problem is classified as a challenge since it has a bigger magnitude, in that its occurrence affects the global consumers of the product.

            This problem is global hence need to be managed in the best possible way. The break and steering systems can be machine automated in order to ascertain the quality of the final output. This is because of the materials used to develop the sections. Metals can erode leading to tear and wear in the critical components of hydraulic system of the steering system. An automated checkup system can be used to monitor the production system for possible lapses, which can occur in the steering system.

            On the other side, poor rubber products can be the cause of break failures, especially when the rubber products corrode quickly without the knowledge of the owner. This can be prevented by using quality rubber products, which have been tested as a result of improved research. Product research can therefore be used to reduce break problems, especially when the chemical composition of rubber products cannot sustain the heating nature of metallic components. They may reduce in size, hence sliding over metal surfaces providing poor grip.

Recommendations

Employing proper design practices during manufacturing can be utilized in order to visualize problems prior to their occurrence. The company may increase its use of the Toyota production system to detect malfunctions, which may arise due to a defective component within the steering and brake modules. This system is automatically operated and scans for defects automatically, and triggers an alert when a possible defect is detected during the automobile manufacturing processes.

            Improved engineering practices can also be used to prevent possible mechanical flaws and problems. An elaborate Just in Time system can be used to prevent errors arising from materials being used in the manufacturing process. This is a preventive strategy that can be employed to prevent the use of defective materials from being used in the manufacturing and assembly lines (“Toyota Production Systems,” n.d.).

            Other manufacturing standard practices could also be put into use in the company. These could be the use of kanban and quality circles. The kanban system is a system with controls that are used during a production process at Toyota Corporation to control the required quantities in the production process (Monden, 2012). Through the use of this management practice, defective or materials with error are not passed to a subsequent level of production during the assembly process. This increases sensitivity, as such can detect the slightest defect or error within the steering or break system of the company’s products.    

            On the other hand, the use of quality circles can also be employed to reduce the problems and challenges that occur as a result of mechanical problems in the Toyota production system.

             A quality circle is a management technique of problem solving used by employees in their work (Rathakrishnan, 2010). This is a solution that could be employed by the workers in order to identify, analyze, and resolve mechanical and engineering problems that have a wider impact on the organizational products. On the other hand, quality circles would be used to solve critical issues related to work performance, which may have a direct impact on the quality of the products. It is a management practice where employees would be used to voluntary contributes to improving quality and work performance in the organization.  

            These approaches could be used to reduce defects and flaws in the steering and brake systems of the company’s products. It is important that the company employ these methods in order to reduce worldwide backlashes as a result of break and steering glitches. The company should therefore incorporate the kanban method and the use of quality circles in order to manage the production process, as well as reduce the defects and flaws, which bring discontent among the consumers.  

            On the other hand, the company should employ operational strategies upon studying various elements, which have direct or indirect impact on the performance of the company. These strategies need to be used to counteract both internal and external attributes, which may hinder a production process to proceed without interruption in the organization.

            The organization should highly customize its products in order to remain at the helm of the automobile industry. Product customization in terms of consumer segments will add value to foreign markets since it will be able to customize its products according to the needs and wants of the consumers abroad. In using this approach, the organization will likely gain more in terms of operational excellence. Achieving this will mean a lot, since it will be able to dominate other markets which are lessely dominated by other vehicle giants such as Honda, Nissan, Ford and General Motors.    

            Human resource being an essential component in innovation. The company should therefore invest in people management strategies such as off job training. This could be done in partnerships, which lead in scientific research especially in automobile technology. This would then turn underperformers to a high-level workforce, which is able to detect the slightest errors in the manufacturing and assembly lines within the company.     

            It is essentially important that the management at Toyota implement the quality circles and kaban in the production process to maintain and improve product quality. The report strongly highlights the major issues, which have continued to interfere with product quality of the company’s products, hence there should be a need to re-strategize of all aspects of manufacturing, and assembly within the vehicle manufacturing processes.

References

2015 Auto Industry Trends. (n.d.). Retrieved April 30, 2015, from http://www.strategyand.pwc.com/perspectives/2015-auto-trends

Bommel, P. ., & PoEM. (2010). The practice of enterprise modeling: Third IFIP WG 8.1 Working Conference, PoEM 2010, Delft, The Netherlands, Novermber 9 – 10, 2010 ; proceedings. Berlin [u.a.: Springer.

Charantimath, P. M. (2006). Total quality management. New Delhi: Pearson Education.

Ford Motor Company Timeline. (n.d.). Retrieved April 30, 2015, from https://corporate.ford.com/company/history.html

In Rathakrishnan, L. (2010). Innovation and competiveness of small and medium enterprises. New Delhi: Kalpaz Publications.

Market Share by Manufacturer | Edmunds.com. (2015, February 2). Retrieved April 30, 2015, from http://www.edmunds.com/industry-center/data/market-share-by-manufacturer.html

Monden, Y. (1993). Toyota Production System: An Integrated Approach to Just-In-Time. Boston, MA: Springer US.

Rao, C. A., Rao, B. P., & Sivaramakrishna, K. (2008). Strategic management and business policy: Texts and cases. New Delhi, India: Excel.s

Stewart, J. (2012). The Toyota Kaizen continuum: A practical guide to implementing lean. Boca Raton, FL: CRC Press.

Toyota Production System. (n.d.). Retrieved April 30, 2015, from http://www.toyota-global.com/company/vision_philosophy/toyota_production_system/