A Comprehensive Definition of Organization Development
The theory of Organization Development relates to an organization’s process and efforts to change the organization for the better. The process includes several steps that must be performed as a continuous cycle to keep the organization at its most efficient in order to achieve the goal of ongoing success.
Organization Development is an organization’s ongoing exercise in planning processes that span the organization, in order to execute effective change in the organization. This process includes a diagnosis of how the organization and its employees function harmoniously or not. This is followed by identification of the specifics of successes and failures within the organization through data analysis. Armed with this information, planning for necessary changes within the organization may begin. Once a plan is in place, it must be executed. Finally, after this implementation, the organization must again make assessments to determine if the desired change was realized. Organization Development is not a one-size fits all solution for an organization, nor is it a singular process; but one that is ongoing and continually adapting to achieve organizational success.
Organization Development Opportunity
Often Organization Development begins in an organization when an opportunity for improvement is acknowledged by management and a positive change is sought. The function of Organization Development is to focus attention on improving the abilities of the organization and its employees to allow the organization to make positive changes from within to achieve its ultimate goal of success. Whether an organization utilizes the contracted services of an OD practitioner from outside or an OD practitioner that is already on its team, the functions and processes along the way will be similar. The first step taken is known in the Organization Development world as entering and contracting.
Organization Development
Entering and contracting is very much as it sounds. It starts with making clear the organization’s issue that needs improvement, deciding who will represent the organization in the process, and choosing an OD professional that is equipped with the appropriate experience and know-how to guide the process within the organization. Following these decisions, comes the contracting phase, in which, the parties involved establish how the Organization Development process will move forward. Roles are determined, expectations are stated, timetables are determined, and rules are outlined. This phase can be as formal or informal, depending on the desires of the organization, but most organization find that the more detailed the contracting phase the more likely the process is to stay on track and be successful.
After the entering and contracting phase is formulated, the second action to be performed is known in OD as diagnosing. This process is the examination and determination of how the organization is functioning in the present – right now. The OD practitioner and the organization’s team collect the relevant data via interviews, surveys, observations, and reports. Once the data is collected, it is analyzed through the lens of the appropriate diagnostic models which help to recognize and identify trustworthy data. There are several diagnostic models that are commonly used; diagnostic models including the Open System, organizational-level, group-level, and individual level. The OD professional must make the selection of diagnostic model that is most significant and will yield the most advantageous information for the organization. Ideally the model will be selected prior to the data collection so that the data can be collected more accurately, but the data collection can be done and then paired with the most effective diagnostic model. With this fresh data and subsequent analysis the OD practitioner and the organization team can determine what is working well and where improvements are needed. From this diagnosis, the necessary intervention can be developed.
Organization Development Planning
The Organization Development intervention is the development of the plan to be used to generate change that will allow the organization to improve both the organization and its employees and develop more positive interaction between the two in order to drive success. In order for the Organization Development to be successful, the intervention must suit the needs of the organization, founded on fundamental knowledge of the desired results, and be assured that the change-agent can convey the vision to all of the members of the organization. Intervention, execution, and change management must go hand in hand. The fitting intervention must be found for the unique organization from among the four major types of Organization Development intervention: Human Process, Techno-structural, Human Resource Management, and Strategic. After the suitable intervention is chosen, the OD profession must be alert to the organizations readiness and ability to make the changes, the cultural environment’s potential influence, and the expertise of the change agent. Once the execution of the intervention has begun, the process of transition requires close attention and must be carefully managed so that the change momentum can be maintained and resistance to the process can be overcome. As these guidelines are followed, Organization Development can be the coordinated transition by which an organization accomplishes effective and lasting change.
The final stage of Organization Development is the evaluation of the implemented changes and their potential incorporation (known as institutionalizing) into the organization. At this point feedback is gathered and evaluated to determine if the desired outcome for the organization’s improvement has been successfully achieved. If the desired outcome has not been achieved, the OD practitioner and the organization team must return to the previous steps and go through the process again until anticipated result is accomplished. If on the other hand, it is found that the change is effective, the changes will then be made a permanent function of the organization. These changes must become a part of the shared culture of the organization bringing the organization and its employees together. As employees are included in these positive changes, they become more dedicated, more loyal, and ultimately more flexible as change is implemented. With the leadership of the organization and the organization’s employees on board with the institutionalization of the changes; the ultimate goal of organizational success is achieved more efficiently and more rapidly.
The Organization Development process typically begins when someone, management or employee, uncover a need for improvement within the organization. The anticipated results of the OD process are to accomplish positive change for the organization and the employees; as well as any stakeholders related to the organization. For the process to accomplish a best case scenario outcome, everyone within the organization needs to back the process. The OD process begins with the entry of an OD professional, either internal or external, and outlining of the contract between the organization and the OD practitioner. The diagnosis phase follows with information gathering and analysis in order to formulate an intervention. With a plan in hand, the OD professional and the organization team implement the recommended changes within the organization. After the changes have been implemented, they are analyzed again for effectiveness and the determination of their success or failure. If successful, the OD intervention changes become a component of the function of the organization. It is evident that the Organization Development process is unique to each organization, customized just for it, and a process that must be ongoing and adapting constantly to keep the organization moving forward successfully.
The Advantages and Disadvantages of Conceptualising the Organisation as a Socio-Technical System
What Is A Socio-Technical System?
Before discussing advantages and disadvantages of applying socio-technical approach in companies, it is necessary to define it in a few words. Socio-technical system is a system which has both a material technology and a social organization (Buchanan & Huczynski, 2010). The former consist of the equipment and methods of operations used to transform raw materials into products or services; the latter includes the work structure that relates people to the technology and to each other. (Cummings, 1978) These definitions are pretty scarce and do not give us much information about the concept itself, but they are something to begin with. All other, more specific, aspects of socio-technical systems will be presented further in this essay.
Historical Background of the Idea of the Socio-Technical Systems
This concept was developed by Eric Trist and Kenneth Bamforth in mid-twentieth century. Why not earlier? Because at the beginning of the twentieth century there was no need for that kind of approach to organizational design. Ford’s assembly line and Taylor’s scientific management triggered off a chain of changes, some of which are still present in today’s business world.
Unfortunately, they did not bring only new formula for gaining much bigger profit, but also a lot of problems and undesirable side effects. Meaningless simple tasks were not much of an inspiration for workers. Strict rules, clearly defined roles and relationships inside organization killed every spur of joy and enthusiasm in employees. On the other side, technology developed at a great speed and it was not possible any more to operate in relaxed, cosy atmosphere where everyone worked as a big happy family.
Companies expanded, they needed more complex organization, but bureaucracy just did not seem as the right answer to every problem. Socio-technical design offered new solutions. This concept was not developed only to assure that employees earn their living in a more pleasant environment, but also because researchers, such as Elton Mayo, discovered human factor and became aware of its importance in the race for profit. (Ropohl, 1999) Has the socio-technical system managed to fulfil both its purposes or failed to do it?
The Advantages of Socio-Technical Systems
This brief historical introduction implies that just the inventing of the socio-technical system was a radical and constructive move. The social aspect of this system brought many positive changes. Work is now based on collaboration of employees, not on fulfilling segmented assignments.
The feeling of joint effort in achieving goals creates more pleasant working environment. Employees find themselves doing meaningful work in an interaction with their colleagues. As the impact of formalization and standardization has been reduced, it is expected from workers to show greater knowledge and deeper understanding of what they are doing.
This leads to greater number of opportunities for enhancing skills and professional improvement. Of course, it is not something that each employee sees as an advantage. Trist himself (1981) wrote about his observations that there are individual differences in motivation pattern.
Socio-Technical System
Some people need strict orders and defined place in company’s hierarchy or otherwise they will feel insecure and frustrated. The socio-technical design managed to overcome this problem, as members of each group occupy certain positions and have tasks to complete, but have greater freedom to do so and also have better insight in their own contribution.
Not just that there is an increase in the degree of satisfaction among employees, but also in the amount of productivity. These groups mentioned above are one of the most famous ‘products’ of socio-technical theory. They are called autonomous groups. They have not be widely accepted and applied, but they have proved to be efficient. One of the most famous cases – The Mannley Innovation is an explicit example that socio-technical systems functions well in reality, not just in theory.
Another plus for the socio-technical system is that the number of managers who occupy higher positions in hierarchy can be reduced, as focus of the control is partially in the groups themselves. This means that less money is needed for highly-educated managers whose skills must be well paid.
Also, leaders of the groups are in better position to detect problems during production process, as they have the technical knowledge that most external controllers do not have. This means that less money and time will be spent on dealing with the unexpected situations.
In my opinion, the greatest value of this system lies in the fact that it is concerned both with those who gain profit and those who create it. It is designed to meet the social and psychological needs of employees in order to increase the profitability of the work and make it all compatible with the technology in use.
Ideas of socio-technical design are not applicable only in the mining industry, oil refineries, but also in completely different segments of industry, such as textile (Trist, 1981) and even in hospitals. This can be considered as a great advantage, as this approach is broad enough to offer a suitable framework for organizing a whole range of different types of organizations.
The Disadvantages of Socio-Technical Systems
The broad framework of socio-technical system can also have a negative side. Some authors, such as Dillon (2000), claim that this system is not good enough for implementation in companies whose area of work is technology and that applying it can even cause a communication breakdown!
This sounds as a paradox, but Dillon gives a quite reasonable explanation: technology companies are changing fast, becoming more and more customer-oriented and need a usable system, so in order to achieve that they need defined sequence of steps in solving specific problems they face.
Socio-technical system cannot offer something like that. In its strongest spot lies its greatest weakness – the freedom of choice and responsibility. Not all the organizations can rely on the sound mind and decisions of their employees, sometimes the consequences are too serious and no risk is allowed.
Apart from not being applicable to all kinds of organization, there are some other negative sides of socio-technical system. One of them is the fact that it is far from being easy to create autonomous groups which will fulfil their purpose. Some of their characteristics previously mentioned as advantages can be perceived in a different way.
Task differentiation lies in the core of the autonomous groups. It refers to the extent to which the group’s task is itself autonomous forming a self-completing whole. The more autonomous the group’s task, the more differentiated its task boundary from other organizational units (Cummings, 1978). It is easy to define, but hard to accomplish. For some managers it is a great source of trouble to form groups which characteristics distinguish them from others, but not too much, as they are still part of a wider context.
If there is no balanced differentiation, socio-technical system can be not just ineffective, but also damaging for the organization. The problem lies in the fact that there are no strict rules how to form autonomous groups, because it is up to members to build their structure and up to managers to find them place in the organization. If there are no clear boundaries and connections with others groups, its members will not experience the benefit of meaningful work, as they will not be able to perceive the whole picture of the process, which is the purpose of this system.
Another problem also stems from the concept of autonomous group: task control, as defined by Cummings (1981), refers to the extent to which employees can regulate their behaviour to convert raw materials into finished products. Simply, this means that group members choose on their own work methods and sequence of work activities.
If the groups consist of specialists, this is an excellent method for dealing with the unexpected and stressful situations, because there is no need for permission for changing the working routine when the time is of great importance. But on the other hand, too much freedom cannot be given to all groups and reasons can be different. Managers may believe that the staff is qualified enough to take that responsibility, but then in the in the end it can turn out that they were wrong.
Socio-Technical System Differentiation
Same as with the task differentiation – it is quite challenging to find the balance between too much and too little freedom. Both ends of that continuum lead to inefficiency. Also, managers who control these groups have to be aware of the fact that too much interference is not desirable. They have to keep the distance and be more of guides than controllers in a usual sense. If the manager’s impact is too strong on the group then we can no more talk about the group’s autonomy.
The last, but not least important disadvantage of this system that will be mentioned here is the lack of individuality. Almost every individual strives to develop to their fullest potentials and there is less possibility for something like that when one operates as a team member. On the one hand, teamwork contributes to the high spirit of employees, but on the other it can cause a decrease in motivation of individual members.
Some of them can even feel frustrated because they cannot show their potentials. This could be a problem especially with above-average talented people who would be more helpful if they acted on their own. Also, when socio-technical system is implemented, the hierarchy is flatter, which implies that there are fewer opportunities for climbing the career ladder and it is widely known that this serves as the motivation for many of us.
Conclusion
Before giving the final thought on this subject I would like to present the summarized table from Trist’s work that shows what socio-technical system brought with it:
Old Paradigm
New Paradigm
Man as the extension of the machine
Man as complementary to the machine
Tall organization chart, autocratic style
Flat organization chart, participative style
Competition, gamesmanship
Collaboration, collegiality
Organization’s purposes only
Members’ and society’s purposes also
Alienation
Commitment
Low risk-taking
Innovation
(Trist, 1981, Table 2-3)
This table shows that socio-technical system is more human-oriented than others. As I advocate the humanistic approach to management and organizing, I believe that it is much better than bureaucratic or scientific approach. People are not machines and although they are able to adapt to new situations, their power to do so has a limit. Once that limit is reached, consequences can be catastrophic.
Even from the profit-makers’ point of view it is not desirable to have demotivated employees who would have ran as far as they could from their work place just if they could. Socio-technical system balances needs and strivings of both. It is true that it takes a lot of effort to build this system successfully.
It largely depends on effective communication channels, qualified staff and appropriate use of technology in each sector. But before completely rejecting this organizational design one should take into consideration the fact that the socio-technical system frees the organization from restraints of bureaucracy to the content of both employees and managers. Whatever approach you decide to pursue, there will be difficulties.
Socio-technical system has changed since it was developed. Of course, it is still far from perfect, but its adaptability allows managers to customize it for their company’s needs and take the best from it. As Charles Caleb Colton said: Where we cannot invent, we might at least improve.
References
Buchanan, D. A., & Huczynski, A. (2010). Organizational Behaviour, Harlow. Financial Times Prentice Hall.
Ropohl, G. (1999). Philosophy of socio-technical systems. Techné: Research in Philosophy and Technology, 4(3), 186-194.
Trist, E. (1981). The evolution of socio-technical systems. Occasional paper, 2, 1981.
Dillon, A. (2000). Group dynamics meet cognition: combining socio-technical concepts and usability engineering in the design of information systems. In The New SocioTech (pp. 119-125). Springer London.
Cummings, T. G. (1978). Self-regulating work groups: A socio-technical synthesis. Academy of management Review, 3(3), 625-634.
Paparazzi, is the term refers to the annoying and persistent photographers who take embarrassing pictures of celebrities to earn some money. These people, not only target these celebrities, but also their other family members including their minor children who are often harassed as well. This madness should come to be considered a criminal activity as well and regulations should be enacted to place limits on their activities. The purpose of writing this research paper is to analyse the term Paparazzi, why they should be their behaviour should be considered wrong, and what should be done to limit their improper activities.
The term paparazzi was introduced into the public lexicon by the globally admired film ‘La Dolce Vita,’ which was directed by Federico Fellini, it concentrates on the life of a washed-up journalist, Marcello and his colleague who is a photographer, whose name is Paparazzo (Celant, 1994). As described by Fellini in his interview with Time magazine Paparazzo is an Italian word that refers to the irritating noise made by a buzzing insect, darting, stinging, and hovering. This character in the film is given a human-like bone structure, and somehow looks like a “vampirish insectile” (Celant, 1994). This image of the paparazzi in the film looks like a parasite, a mosquito as depicted from the following picture. By the end of 60s, the term paparazzi had entered into the public usage as a generic term in English language that simply meant an intrusive or interfering photographer (Wilton, 2007) and the individual being photographed is known as being ‘papped’.
According to Sonenshine (1997), Paparazzi refer probably to an independent contractor and are typically not affiliated with mainstream media companies. They take advantage of opportunities by taking pictures of the high-profile famous people they are observing constantly, whenever they get any sightings of them (Sonenshine, 1997). According to Wilton (2007), a paparazzo is a local clam, which is used as an implied comparison to the paparazzo that opens and closes the lens of camera (Wilton, 2007). Many of the experts consider the behaviour of these paparazzi to be similar to stalking (CNN, 2006), which is an act of obsessive or unwanted pursuit given by one person towards another.
Why Paparazzi is Considered Wrong?
Certain celebrities and high-profile public figures have expressed their concerns regarding their privacy and personal space and the extent to which these paparazzi try to interfere in their personal space (Dakss, 2005). According to Carnahan (2014), these insistent photographers (paparazzi) continuously stalk high-profile people and celebrities and bother them while they are eating, or shopping, etc. (Carnahan, 2014).
Some publicists believe that the paparazzi are just going out of control with their outlandish job of collecting most embarrassing pictures; they are making it difficult for their high-profile targets to live in their own personal space and have a normal life. Not just in films, but they live with the constant threat that they will have a camera always in their face (Papasmear, 2013). Sometimes, the extreme behaviour of these insane photographers has led to serious accidents faced by celebrities. As an instance, Lindsay Lohan’s famous accident in the year 2005 in which the actress was almost killed because the paparazzo intentionally drove into her car (Dakss, 2005). This shows that the extreme behaviour of the paparazzi has rapidly transformed into criminal activities.
paparazzi essay
Instead of this, they do not only target these celebrities, but also their family members that also include their minor children. Some celebrities complained about paparazzi harassing them by focusing on their minor children Furthermore, there must be some level of privacy given to them, particularly when it is the case of their family and most importantly, their minor children and their family (Papasmear, 2013). A survey by fanpop.com, also illustrates that 58% of the total population are against these annoying activities by the paparazzi (Fanpop). They can do practically anything to get a picture since they earn a lot of money for these photos. Just for the sake of earning some money (Nastec International, 2011), these people are stealing the right of privacy and freedom from these high-profile people and celebrities.
Carnahan (2014) further stated that celebrities and other high-profile people are also human beings and they deserve respect; and therefore, it is necessary to apply certain limitations to the paparazzi.
What Limitations Should Apply to Paparazzi?
The majority of people are against the paparazzi and since they are citizens who deserve the right to privacy and freedom just like everyone else, some countries are applying legal regulations, like anti-stalking bills to resolve the harassment issues faced by the high-profile people and celebrities. Some countries also restrict their activities by imposing curfews on them. For instance, California has approved a law in 2014, which will help in preventing these extreme people from misusing the privacy and from taking embarrassing photographs of the celebrities (Business Insider, 2014). Even after all such laws have been enacted, Nastec International (2011), noted that even after hard pressing the paparazzi with privacy laws for years, their activities are still on the rampage.
In order to limit these Paparazzi according to Nastec International (2001), a videotape or surveillance must be used to undercover such activity and these surveillance videotapes can later be provided as a proof in court against these annoying intrusive individuals.
These people can also be prevented to some extent by restricting them only to staged events. Although, it is not possible always to restrict them, because they can enter secretly as they are able to creep into the private places, like the homes of celebrities, but privacy can be maintained by only providing admission rights to celebrities and their families or the extremely important people and restricting rest of the people including, journalists, photographers, etc. One remedy to this can be that during the events special cards can be issued only for those are extremely important for the celebrities and to whom they personally want to invite to the event.
Moreover, celebrities can also limit improper activities of the Paparazzi through campaigning. If all celebrities would unite and do social media campaigning against the paparazzi, they can also do public campaigning programs to prevent these intrusive photographers and to get back their right of freedom and privacy.
References
Business Insider. (2014, September 30) California bans paparazzi drones.
Carnahan, S. (2014, April 3) Should Limitations Be Applied to the Paparazzi?
Celant, G. (1994) The Italian Metamorphosis, 1943-1968. New York: Guggenheim Museum Publications.
CNN. (2006, May 14) Why paparazzi are wrong.
Dakss, B. (2005, June 10) Paparazzi Going Too Far?
Nastec International. (2011) FIGHTING THE PAPARAZZI.
Papasmear. (2013, May 15) Top Reasons Why the Paparazzi Are Wrong!
Sonenshine, T. (1997, October) Is Everyone a Journalist?
Tesco is a multinational grocery and general merchandize retailer which is based and has its origin in the United Kingdom. The organization is the third largest retailer in the world with a global presence in more than 12 countries. The United Kingdom is the main market for the organization which has been successful because of its brand reputation and image. The organization offers products and services which are according to the customers’ preferences. Tesco has been able to create a dynamic business strategy which is based upon meeting the needs of customer segments. It conducts extensive market analysis as a means of ensuring the highest levels of efficiency and effectiveness (Blythe, 2006). It has a product diversification strategy as it has transformed itself from a food retailer to offer non-food products and services like beauty products, consumer electronics, DVDs, financial and insurance services. Tesco has also been successful because it employs technology for its robust business activities. Tesco.com is one of the highest successful online shopping portals in the United Kingdom. Technology is being used to integrate and streamline business operations and achieve operational excellence. The success of Tesco has been its ability to make accurate forecasts. Tesco needs to pursue an aggressive internationalization strategy by targeting new markets. China is a potential market which can help to achieve its business goals. This proposal will seek to elucidate the importance of penetrating the Chinese market.
Literature Review
Globalization has been a powerful social and economic force which has a profound influence on the business environment of the twenty first century. The creation of a single market has led to the development of numerous opportunities for organizations as they strive to focus on emerging economies (Beamish & Ashford, 2008: p. 76).Moreover, the nature of globalization is such that there is an emphasis on remaining profitable by taking advantage of the opportunities that specific markets offer. Globalization creates intense competition which can lead companies to reduce their costs and improve their products. Organizations under competition have to perform at optimum levels by offering superior products and services. Technological adaptation is another byproduct of this phenomenon as it can help to streamline and automate the key processes. This has further increased competition among international corporations and has allowed them to expand their businesses across the globe. In the supermarket industry, international companies such as Tesco and Walmart are some of the prominent names that have successfully expanded their businesses internationally. These expansions allow organizations to increase their presence in the market, sustain competitive advantage, generate revenues and win loyalties of customers(Blythe, 2006, Beamish & Ashford, 2008, Darwar& Chattopadhay, 2012). Their marketing strategy is based on meeting consumer demands and ensuring that they adapt within the market they operate.
The production and manufacturing capabilities of organizations are enhanced when they take advantage of low labor rates in developing countries. The results are that production costs are reduced while selling products at competitive rates which in turn can increase the market share of the organizations (Darwar& Chattopadhay, 2012, Doyle & Stern, 2006). Organizations seeking to penetrate international markets strive to increase the value of their products and services while striving to reduce the cost base (Cravens & Piercy, 2006: p. 34).The external and internal variables can play a key role in the performance of organizations as they move into international markets. Organizations must be able to have access to technology, labor, capital, logistics, and infrastructure in order to succeed. The goal of conducting business in international markets is essential since any organization that fails to penetrate markets will witness a reduction in its competitive advantages.
The huge size of the international markets means that potential customers are living abroad. Moreover, the failure to penetrate international markets means that organizations will be unable to enhance their customer loyalty and brand recognition. Serving multiple markets in a seamless fashion is important part of success. Empirical studies have sought to identify the critical success factors which enable organizations to penetrate international markets (Haji-Basri, 2012, Levy, 2012). Firstly, organizations are able to select the best market entry mode which is according to their expertise and experience. The market entry mode should be based upon conducting research of the market in an efficient and effective manner. This is important because competitors’ analysis and customers’ behaviors can help the organization in understanding the needs of the market environment.
Secondly, organizations must be willing to leverage their core competencies in such a manner that they are able to reduce costs and improve profits. A global business strategy should be customized in accordance with the conditions of the market. Adaptation to the local market means that the organization is able to create a customized marketing strategy (Doole & Lowe, 2005: p. 76).Thirdly, the organization must be able to implement innovation at multiple levels. This approach is beneficial since it will help the organization to attain strategic competitive success. Finally, it is important for organizations to develop the robust frameworks that can enable them to create flexible, agile, and scalable business structures (Doyle & Stern, 2006: p. 93).The use of multiple strategies is important for success as it will lead to long term innovation that will benefit the entire organization.
Research Methodology
Research is defined as the process of investigating new phenomenon and validating existing theories and frameworks. It seeks to understand the theoretical assumptions behind specific studies by challenging them or modifying them. Selecting the appropriate research methodology is important part of the process. Primary research for this report will be carried out through a questionnaire which will be emailed to the business unit managers of Tesco. The benefits of primary research are that it enables the researcher to directly participate in the process. Moreover, the results can be quickly obtained through the questionnaire method. This method can save significant time. Secondary research for this report will be carried out through the systematic analysis of existing studies related to marketing and global business. Specifically, the studies will be selected based upon their relevance, reliability, and authenticity.
Secondary research is beneficial in many ways. Firstly, it helps to reduce time as existing studies can be employed for success. Secondly, it uses the vast literature in order to create a theoretical framework which can be beneficial in answering the research aims and questions of the report. Thirdly, secondary research helps the researcher to have access to resources in an efficient manner which will be used to solve the research problems (Levy, 2012).
Organizational Strategy and Market Characteristics
Empirical studies have found evidence that grocery sales in China are estimated to be around £600 billion in the year 2013 (Zhao, 2014: p. 184). There are 221 cities in the country which will witness an increase in population by the year 2025 (Zhao, 2014: p. 184). Moreover, urban dwellers are the largest customer segments which offer significant market potential for organizations like Tesco. Shopping malls are now popular places for supermarkets. The impressive standards of living among the middle class have enabled Chinese customers to focus on higher quality of life. This creates superior business opportunities for organizations like Tesco that are working in the retail market. Household spending on healthcare, transportation, and telecom services have doubled as compared with the last decade. The indicators prove that the customer segments have disposable incomes that allow discretionary spending. Tesco’s strategy in China can be based upon its key competitive advantages (Tesco PLC, 2014).
Branding and reputation are the key attributes of the organization which helps it to achieve core strategic advantage. Careful branded packaging and promotion can generate excellence value for Chinese customers (Zhao, 2014: p. 184).Supply chain management and logistics in China should be able to respond to the dynamic and complex environment by enabling Tesco’s management to make accurate forecasts. Technology can be used to maintain inventory and assess business transactions. This will help the management to make forecasts about the entire environment through the use of innovation and creativity (Levy, 2012). ICT technologies can help the organization to play a critical role in business strategy formulation. Creating value for customers and offering products that are difficult to emulate can be the core strategies in China provided Tesco is able to understand the dynamics of the market.
Tesco Marketing Proposal
SWOT Analysis
Strengths
Tesco has transformed itself into an international retailer that sells food, clothing, household products, banking services, and others. The traditional market of the company has been the United Kingdom but in the past ten years, it has sought to expand into different international markets. International expansion is considered to be vital for the growth of the company as it helps to diversify income streams and enables it to take the advantages of globalization by using an efficient and effective marketing strategy (Zhao, 2014: p. 184).The competitive strength of Tesco is that it is the third largest international retailer in the world. The growth rate annually has been projected to be around 12% since the past decade. Strong partnerships with suppliers and other partners help the company to offer products and services in different markets. An effective supply chain management system helps the organization to manage its operations in a lean and flexible manner.
Weaknesses
The international expansion strategy of the company remains weak as compared with that of its competitors. Product diversification is a weakness because the profitability can be impacted because of bad debt from credit cards. Tesco has inexperience in certain growing markets like smart phones and tablet PCs. New web technologies and IT require investments which can streamline and automate the core processes (Imrie & Dolton, 2014: p. 84).
Opportunities
There are different opportunities for Tesco which can move into various product categories like digital entertainment, smart phones, and tablet PCs. Foreign markets like China, Malaysia, South Korea, and others offer significant business potential for the entire organization. Online shopping can be enhanced as a means of ensuring robust success within a short period of time. Increasing value proposition for existing and new customer segments can be a beneficial strategy by the organization as it can lead to the highest levels of efficiency and effectiveness (Tesco PLC, 2014).
Threats
Tesco can face significant threats from local and international competitors. Furthermore, the economic recession has reduced the spending power of customers which means that there can be a reduced profitability for non-food products and services. International expansion is a good option for Tesco but each country has different levels of regulation and laws which must be complied by international organizations in order to achieve critical success within a short period of time (Imrie & Dolton, 2014: p. 84).
PEST Analysis
Political Factors
The political factors inside any country can be related to taxes, legislation, and country stability. China is a rapidly emerging economy which has pursued investor friendly business policies. There is an increased demand for retailers which can help to create jobs for the local population and improve the local economy. The Chinese government is authoritarian in nature but it has been pragmatic enough to pursue policies which can help it to remain integrated with the overall global markets (Dowling, 2006: p. 91). Political stability in China is relatively high which offers a congenial environment for foreign investment. This is important because it helps to ensure the highest levels of efficiency and effectiveness.
Economic Factors
The economic factors are concerned with the costs, profits, and prices that a company must take into consideration while operating in a foreign market. The goal of the company should be to conduct an internal and external analysis which can be used to understand the dynamics of the market. China’s rising middle class enjoys highly disposable incomes which makes them one of the largest customer segments in the world (Ferrell & Hartline, 2007: p. 98).Furthermore, the middle class has awareness and perception regarding foreign brands which is considered to be part of their affluent lifestyle.
Social Factors
Social factors exert a profound influence on the purchasing behaviors of customers. Tesco needs to take into account the social and demographic changes which have taken place in China in order to formulate a robust and dynamic strategy for change (Hooley & Piercy, 2008: p. 123). The goal should be to create efficient and effective approaches which can be used to penetrate the market. Food and non-food items can be introduced in the Chinese market in accordance with the dynamics of the market. Customers in China have high levels of awareness and perception regarding foreign products.
Technological Factors
Operating in any market means that companies should be able to focus on operational excellence and competitive advantage. Technology helps to achieve this critical goal with the focus on achieving long term market share. The goals of companies like Tesco should be to make investments in technology which result in efficient business processes and help to provide real time data to the management which can be used in the decision making processes. Outlets should employ technology to reduce waiting time for customers. RFID can be employed for inventory management. Communication systems can be used to link main office with various outlets for making decisions and obtaining real time information (Hooley & Piercy, 2008: p. 123).The use of an integrated strategy can help to accomplish the critical goals within a short period of time.
Conclusion
Tesco is the third largest retailer in the world which has been achieved because of its core competencies. The core competencies of the organization have included the ability to successfully develop a core business model that is flexible and adaptable in accordance with the competitive nature of global markets. Strategy formulation in Tesco is based upon the use of market research which helps to achieve efficiency and effectiveness. A complete internal and external analysis is conducted by the organization in order to achieve its critical targets within a short period of time. Tesco’s strategic growth model seeks to focus on cost and product differentiation as mixed strategies that enable future growth and development. China is an attractive market for internationalization because it will help Tesco to take advantage of the business opportunities. China’s middle class segments have increased with highly disposable incomes. Moreover, Chinese customers are spending on clothes, luxury products, healthcare, and others as part of the drive to improve their quality of life. This helps to ensure the success of the retail market. Tesco can take advantage of the Chinese market by using a systematic and calculated approach. It needs to use its core competencies which can be adapted in accordance with the local market conditions. Moreover, it needs to focus on using its core competencies as a means of ensuring the highest levels of success within a short period of time. Technology can be used to maintain inventory and assess business transactions. This will help the management to make forecasts about the entire environment through the use of innovation and creativity. ICT technologies can help the organization to play a critical role in business strategy formulation. Creating value for customers and offering products that are difficult to emulate can be the core strategies in China provided Tesco is able to understand the dynamics of the market.
References
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Toyota is a multinational automobile organization that has its headquarters in Japan. The success of the organization has been its ability to develop lean production and manufacturing philosophy that focuses on creating organizational and workforce capabilities. The success of Toyota is because of its core philosophy which is to focus on enhancing its competitive advantage. The organization has sought to focus on continuous innovation and creativity as strategic tools that help in accomplishing the key targets. Toyota has the expertise, capabilities, and capital to dominate the global automotive industry. The efficient distribution and production network of the organization has been responsible for achieving critical targets. Moreover, the organization has sought to focus on achieving dynamic capabilities that can be employed for attaining strategic competitive advantage. The development of a comprehensive strategy has been considered to be important for the success of global firms like Toyota. The firms must be able to apply the business strategies that can lead to long term success and innovation within short time period. The competitive position of Toyota is that it has been facing threats in the current environment. The company needs to develop effective and appropriate strategies that can be used to counter such problems. Moreover, the organization needs to focus on achieving its critical objectives by using innovation and creativity at multiple levels.
Comparative Analysis of Toyota’s Competitive Position
Porter’s Five Forces
Toyota operates in a highly competitive market that is characterized by the presence of organizations that are striving to dominate it through their strategic positioning and marketing strategies. The threat of new entrants in the industry is still low because of the huge capital that is needed to compete with leading companies like Toyota. Porter’s five forces analysis for Toyota is discussed as follows:
Threat of New Entrants
New entrants might be able to bring innovative products and ideas but the major companies are able to dominate the market through their capital and market control (Bennett, 2003: p. 44). Theoretical framework argues that companies that are dominant in any market are able to achieve success because of their brand image and reputation. The automobile industry is characterized by the success of companies that are able to focus on design and engineering quality. Large companies are able to attain economies of scale that helps to ensure their domination in an efficient and effective manner.
Bargaining Power of Suppliers
The power of suppliers in the automobile industry is weak because of the huge presence of suppliers. Toyota retains control over the behaviors of suppliers that are keen to do business with it because it represents a huge portion of profitability for the suppliers (Chris, 2005: p. 92).The procurement of raw materials is easy given the fact that outsourcing has now become a major trend because of the advent of globalization. Automobile companies like Toyota are now able to establish offshore manufacturing plants in countries that have low labor costs.
Bargaining Power of Buyers
The power of buyers in the automobile industry is large because individuals are continuing to focus on cars that meet their needs and requirements. Toyota has a strong and loyal customer base because its products are known for versatility, robustness, quality, power, endurance, and fuel efficiency. Toyota offers products for different customer segments based on their lifestyle and incomes. This helps to increase the power of buyers that have high levels of choice with respect to the purchase of automobiles (Chris, 2005: p. 92). In addition, they are able to focus on achieving critical success through the use of integrated and innovative strategies.
Threat of Substitute Products
The threat of substitutes in the automobile industry is relatively small because bicycles, motorcycles, trains, and buses have limited efficacy in meeting the needs of the customer segments. The convenience offered by automobiles cannot be replicated by other substitutes which mean that Toyota has been able to focus on achieving its critical goals within a short time period.
Competitive Rivalry
Competitive rivalry in the industry is very strong as Toyota has to face competitors from the United States like General Motors and Ford. It has to compete with Japanese manufacturers like Honda in different markets. The state of the automobile industry is very huge which means that customers are loyal to their brands (Chris, 2005: p. 92). Pricing and other factors need to be taken into account as competitors can change the dynamics of the market in an efficient manner.
Bowman’s Strategy Clock
Toyota’s competitive advantage has been because of the fact that it has been using a flexible production and management strategy. It uses capital equipment that is managed through the use of well-trained and well-qualified workers in order to achieve critical success. The presence of a talented workforce helps to achieve the goals of the organization because there is an emphasis on employee empowerment and engagement (Graham, 2005: p. 85).The organization strives to create a collaborative environment that focuses on attaining the critical goals within a short time period. Work teams are divided on the basis of operational, administrative, and strategic entrepreneurial actions that leads to long term success. Another competitive advantage for Toyota is that it has a 360 tier supplier network that is integrated with accurate scheduling and coordination. The firm is able to achieve success so that it can be used to create a flexible, lean, and agile supply chain management system. The goal of the strategic alliances is to ensure that the supply chain partners can be reliable and flexible in meeting the needs of the organization. Toyota’s competitive advantage is based on its equity ownership and technical exchange that helps to create reliable supply chain partners (McDonalds, 2002: p. 52).A symbiotic relationship between Toyota and its suppliers is based on knowledge sharing and developing strategic partnerships for long term growth and development.
Porter’s Generic Strategies
Empirical studies argue that corporate innovation is based on ensuring the economic growth of organizations. Innovation is a broad concept that goes beyond the notion of simply creating new products and services. On the contrary, it is concerned with the development of processes, systems, ideas, and competencies that can be used to resolve problems in the work environment while enhancing the strategic competitive advantage of the organization (Jobber, 2001: p. 56).
New production methods and functions have been identified as a core competitive advantage for Toyota which has been able to focus on achieving its critical goals through the use of long term approaches. Toyota’s manufacturing philosophy has been based on innovation which seeks to focus on flexible batch production. Just-in-time inventory system is utilized together with the goal of removing waste. The use of an integrated strategy has been considered to be an important step towards achieving efficiency and effectiveness (Jobber, 2001: p. 56).Moreover, the empowerment of front line workers ensures that assembly line problems can be analyzed in an efficient manner. Toyota’s efficiency has been based on creating centralized design and decision making that has helped to achieve the critical goals. The application of smart and innovative strategies has been Toyota’s competitive advantage.
Toyota’s Competitive Position
Core Competencies
Toyota’s core competency has been its ability to develop automobiles that have superior quality. The competitive prices of the company’s products mean that it has loyal customer base. The core competency has been because of its innovative production methods and processes. Toyota has created strategic management and philosophy as the core element of its growth strategy. Moreover, the company has sought to create a collaborative structure for success that is based on implementing cost leadership strategy (McDonald, 2002: p. 83).The Toyota Production System (TPS) has been considered to be instrumental in enhancing the innovative practices like Six Sigma and Just in Time in the production facilities of the organization.
Toyota’s Market Share
Toyota has a strong market position in different markets as evident in the fact that it has 45% share in Japan while 12% share in the North American market. Strong market position has resulted in the organization striving to expand into international markets. A strong product portfolio helps the organization to achieve competitive advantage. Research and development has been identified as being critical for success of organizations. R&D helps to enhance the product quality and functionality. Toyota’s strategic drive has been to offer safe and efficient products with an emphasis on environmental compatibility. Strong emphasis on R&D ensures that Toyota is able to become a technological leader in the automobile industry. Another critical success factor for Toyota has been its ability to have a massive distribution and production network that enables it to produce 7,400,781 vehicles in the year 2011 (Andrews et al, 2011: p. 1064). The geographically dispersed production base shields the company from global business risks while an extensive distribution network helps to enhance the global reach of the organization.
Product Diversification
Toyota’s strategic competitive advantage has been reduced because of high number of product recalls in recent years. For example, the company had to recall some vehicles that had problems with their hybrid systems in the year 2011. Some 180,000 vehicles were recalled in Japan after complains of oil leakage and abnormal noise (Kakuro, 2004: p. 3691).There have been some problems with the safety mechanisms of the company that has created negative reputation for the organization. Another critical weakness is that there have been declining sales in some geographical areas due to stiff competition. North America and Middle East were the regions that have seen a decline in demand for the products of the company. Another significant weakness for Toyota has been the fact that it has poor allocation of resources when compared with its competitors. Honda and Nissan have been able to have higher return on equity (ROE) as compared with the company that has resulted in weaknesses for the company.
Toyota group has faced a severe negative feedback on their quality and safety matter. This has led to a shrinking of loyal customer base while creating declining revenues and profits. It is essential for the Toyota management to amend their existing strategies and introduce a new method of production setup (Amasaka, 2004: p. 10).This can be done by enhancing leadership capabilities that focus on retaining customer loyalty and satisfaction. Toyota’s management needs to implement transformational changes into the situations. They have introduced the Toyota Production System (TPS) which can be used for identifying the quality of the product and mainly to eliminate the waste.
Toyota Strategic Analysis
Re-engineering of the finished products has created robust and durable products. This leadership style has captured back the customers’ loyalty towards the product. Hiroshi Okuda has used the power to make necessary changes during the time of crisis in business. The workers were forced to accept certain changes in the company. Here Toyota group has efficiently utilized the situational leadership style (Amasaka, 2004: p.10). Okuda states that changes are threatening, but at certain situations there is no alternative but to accept change in order to maintain the competitive edge of the organization. Political power will be used in any organization when there are different opinions during tough situations. Toyoda has used such power when the U.S government has blamed the Toyota Company for the bad quality in production. There occurred a lot of accidents due to brake complaints. This has forced Toyoda to accept certain changes in the organization, and which was also neglected by some of the executives. But Toyota has pushed too hard, violates too many interests for achieving the success. Toyota will be able to focus on the recent growth of the global automotive industry that is recovering from the global economic downturn. The profitability of the global automotive industry has been $1,600 billion in the year 2013. This means that there is enough demand for the company which can fulfill the increased customer demand.
A strategic partnership with BMW will bring benefits for the company as it can achieve joint ventures. The collaboration on sports vehicles and power train electrification are projects that can increase the capabilities of Toyota. Strategic marketing and development of organizations is based on their ability to have clear and precise goals for success (Amasaka, 2004: p. 10).Companies must be able to conduct a complete analysis of the external and internal environments in order to succeed in an efficient manner. Moreover, the goal should be to create a collaborative environment through the use of cost leadership and product differentiation strategies that are successful elements of surviving in a highly competitive market.
Toyota’s Globalization Strategy
Global environmental factors play a critical role in the development of marketing strategies. These factors help the organization to develop a robust and reliable response to business problems. Toyota’s marketing department needs to take into account the various global environmental factors in order to make smart business decisions. Globalization has created opportunities and challenges for large organizations. An effective marketing campaign should seek to conduct extensive research and analysis of the external environment. Some global environmental factors like technology have revolutionized business processes. The Internet has become a powerful medium for conducting business transactions. Customers can purchase goods using online portals at any time (Aaker, 2008: p. 92).Toyota has sought to use this medium by devising efficient and effective internet ads. Websites can have content in native languages for specific countries. This approach helps to improve the revenues and sales of the organization. Similarly other technological advances like communications enable the rapid coordination between the head office and branches. RFID is a powerful and versatile technology that allows the organization to keep track of its inventory. Similarly there are other factors like corporate governance and responsibility. Multinational organizations have come under the limelight due to a series of high profile corporate scandals.
Corporate Social Responsibility
Toyota has sought to focus on corporate social responsibility as a means of creating positive image and reputation. Marketers need to demonstrate that the organization is offering safe and secure products and services (Rothaermel, 2012: p. 82).An advertising campaign must also focus on the corporate social responsibility of the organization. Organizations like Toyota need to take into account the economic fluctuations in the global market. Marketers must be able to devise cost effective strategies that can enable them to survive in times of economic recession. This means lowering operational and administrative costs. Marketing procedures should seek to evaluate cost effective products for new target segments. Marketers must be able to identity and recognize new business opportunities and threats. The global nature of business has created diverse source of suppliers and distributors for organizations.
Competitors seek to purchase goods that are produced at low costs. Marketers must evaluate the cost effective way of obtaining raw materials and finished products. This can be achieved only through a logical and practical manner. It requires the pursuit of dynamic and prudent business strategies (Rothaermel, 2012: p. 81).The organization must be able to achieve excellence and quality. Toyota uses strategies to become acquainted with the political regulations in the global market. Government regulation for instance has become a standard practice following the sharp economic recession. This means that marketers will need to revise and restructure their business strategies in coordination with global fluctuations.
Strong and Robust Marketing Strategy
Toyota’s management knows that targeting international consumers requires the presence of customized and specified marketing strategies. Marketers need to conduct an extensive analysis of local requirements and preferences. An effective strategy for a specific consumer segment might not work for another segment. Diversification, innovation, and creativity are the key to success when operating in a global environment. Toyota has sought to have flexible, reliable, and agile business structures. Marketing activities must develop unique conceptual frameworks that can be utilized for efficiency and effectiveness. Global environmental factors have become crucial for marketing processes and strategies. This is due to the global nature of corporate business in the twenty first century. Factors like technology, corporate governance, local preferences and industry trends need to be taken into account by marketing departments. Robust and logical strategies help to ensure optimum results.
The organization must conduct an extensive appraisal of new business markets (Rothaermel, 2012: p. 80).Appropriate strategies should be devised in order to achieve excellence and quality. Cost effective solutions need to be devised by marketers in order to maximize investments. These various factors need to be analyzed and assessed in a smart manner. The organization should be able to conduct an extensive audit and appraisal of the global market. Appropriate strategies should be in place in order to achieve superior results. Contingency plans should be in place in order to response to problems in marketing strategies and plans. A comprehensive approach towards marketing in the global environment will produce positive outcomes for the business organization (Rothaermel, 2012: p. 80).
Leadership and Management Styles
Toyota’s work culture emphasizes on efficiency but the management has awareness that this is insufficient to meet the needs of global workforce. The company perceived employees as knowledge workers that can apply their wisdom for the benefit of the work environment. There is heavy investment with respect to people and organizational capabilities. The work environment focuses on taking ideas from individuals so that success can be attained within a short time period. The senior executives of the company remain Japanese men that have played a crucial role in the development and evolution of the company. The concept of workplace diversity is still foreign in the environment as expatriate managers are also hired from Japan. The concept of Japanese management philosophy is that managers have the expertise and work ethic to drive success in an efficient manner (Hines, 2011: p. 34). However, this can be problematic as globalization encourages workplace diversity.
The concept of diversity is that individuals with different knowledge and expertise will be able to enhance the overall competitive advantage of the organization (Hines, 2011: p. 34). The hierarchy remains strong in the company culture as managers and top executives rise above the ranks in a slow manner. This means that there is an element of considering managers to be individuals that must be obeyed and respected in accordance with Eastern cultural notions about business.
Organizational Structure
Toyota’s organizational structure does have hierarchies but it does have concept of employee empowerment and engagement. The workforce is given freedom to successfully resolve complex business situations. Moreover, the organization strives to create a collaborative environment in which the workforce can perform at optimum levels. The goal of the management is to create a collaborative environment that can nurture and grow the competencies of the workforce. Safe and healthy environment has been identified as being vital for the success of Toyota as it leads to long term efficiency and effectiveness (Humphrey, 2011: p. 94).The workforce is encouraged to work as teams so that they can support each other and divide the work activities. The goal is to enhance the capabilities of individuals and organizations while striving to gain respect among the different members.
The duties must be performed in an efficient manner so that long term efficiency can be attained. Team work is based on creating cohesive and disciplined workforce. The goal of the organization has been to focus on achieving the critical targets through the use of innovation and creativity. The company places an emphasis on customer opinions as being vital because the information obtained can be employed to create superior and safe products (Schmitt, 2011: p. 74).
Global Business Strategies
Toyota uses different marketing strategies when it strives to expand into different markets. Diversified business strategies have been identified as playing a critical role in the success of business organizations. This is because of the fact that organizations strive to create integrated and coordinated approaches for success (Johnson, 2008: p. 62).The organization strives to create integrated and innovative approaches that can be employed for long term success. For instance, Toyota’s expansion in North America was to adopt a sequential strategy when it sought to introduce environment friendly automobiles in the market. Successful global marketing strategies occur when companies are able to conduct a comprehensive analysis of the external and internal environments. The goal of organizations must be to create an integrated strategy that will be able to achieve strategic focus. This helps the organization to successfully develop an integrated strategy in which the organization is able to focus on long term goals. The organization must be able to complete a comprehensive analysis of the internal and external environment.
Each market in the global industry works in different ways (Johnson, 2008: p. 61). The company must have knowledge regarding the dynamics of the market by studying the political, social, economic, and legislative variables. Toyota’s global business strategy has been based on steady expansion. The company for instance has training centers that helps in the training of the local workforce. The core concepts of lean production are introduced so that the workforce can implement quality and reduce wastage. Such a strategy helps in the development of the organization as it leads to long term efficiency and effectiveness. Toyota ensures that it is able to apply its global strategy at all its production facilities. The standardization approach is beneficial because Toyota is able to implement consistency and reliability in the multiple business units. This approach is also beneficial since it facilitates the process of enhancing the core competencies of the organization (Johnson, 2008: p. 66).
However, globalization can have disadvantages for Toyota because each market operates in a different way. This can create problems for the organization in terms of adapting to the risk and disruptions that are present in the local markets. Localization is also beneficial because the workforce in each country has different attitudes and notions. The workforce must be able to create an integrated strategy that will help it to achieve the critical goals within a short time period.
Critical Evaluations and Analysis: Toyota’s Improvement Strategy
Hiroshi Okuda, CEO of Toyota, has taken drastic measures in recent years to ensure the profitability of the organization. He has focused on transformational changes which can assist in winning back the loyalty of customers. There has been a focus on action centered leadership as a means of ensuring high levels of efficiency and effectiveness. Furthermore, annual growth plans have been created and forwarded to supervisors. An integrated approach towards meeting objectives and devising strategies has been implemented within the organization. Managing resistance to change can occur through the adoption of innovative and creative approaches. The leaders should have a complete knowledge about the apprehensions and concerns about the employees (Johnson et al, 2006: p. 71).They need to address employees’ needs by opening communication channels. Employee suggestions or opinions should be welcomed because it can be a fantastic way to address concerns in a smart manner.
Realistic expectations should come from the leadership. This can be addressed by analyzing employee reactions and interpretations with respect to the change process. Obtaining feedback from the workforce is critical for success in the environment. Identifying areas of change is essential for critical success in the environment. Empirical studies demonstrate that the need for change should be explained to the workforce. This helps the workforce in understanding the corporate objectives behind the change process (Prahalad & Hamel, 2005: p. 93).Information should be disclosed rather than hiding it because workers will feel a sense of responsibility as they will be able to align their personal goals with the organizational targets. Consulting and negotiating with the employees can also lead to positive outcomes for the organization. It helps to develop a sense of security and trust which can lead to effectiveness in the short term and long term. Toyota’s outdated management philosophy and corporate culture need radical changes. This can be achieved by taking employees into confidence. A gradual process for change can lead to superior outcomes. It is through the use of integrated approaches that the organization can attain success in a competitive environment.
Healthy organizational cultures are characterized by the presence of accountability and transparency. The management seeks to ensure that personal responsibility is embedded inside the minds of the workforce. This helps to create positive relationships and minimizes the chances of denials and conflicts. Furthermore, the organizational culture should promote change by ensuring that risk-taking is rewarded within the limits created by the management (Prahalad & Hamel, 2005: p. 83). Employees work at optimum levels if they are delegated work duties and have the freedom to implement new ideas within the limits created by the firm. Empirical studies have found evidence that an organizational culture should facilitate the process of change through the constant search for excellence. Superior quality of work by the employees can pay off dividends at the organizational level while mediocrity tends to inhibit the change process. Healthy organizational cultures should also focus on learning from mistakes by transforming negative outcomes into positive expectations. The change process is often retarded when employees engage in turf wars and promote negative thinking.
Creating a congenial environment is possible if the organizational culture is able to enhance the strength by creating cohesive and talented employees into work teams. This helps in distributing work activities and creating mutual respect among the workforce (Prahalad & Hamel, 2005: p. 88).Toyota needs to restructure its organizational culture so that it can be healthy and vibrant. Fostering the workforce through constant support and encouragement helps to create a productive workforce (Prahalad & Hamel, 2005: p. 93). Toyota’s managers should encourage employees to act on what they know to try to make the company better, even if their knowledge is imperfect or incomplete. Making mistakes and encountering obstacles should become acceptable factors in Toyota’s culture. For example, starting in 2002, Toyota’s operation in Thailand produced the International Multipurpose Vehicle (IMV), which used a single platform for a sports utility vehicle, minivan or truck. The plan to sell the IMV in 140 markets hit a snag: Meeting each nation’s governmental regulations and driving challenges (from sandstorms to floods) bogged down the IMV team and made delay seem inevitable. Rather than avoiding accountability or blaming someone else, Toyota’s executive vice president, Akio Toyoda, took responsibility. He allowed the IMV team to continue working without pressure. Toyoda said that even if the effort failed, it offered an opportunity for a great deal of learning. Toyota’s management allows failure because it wants people to experiment boldly. If leaders punish failure, people won’t take the risks that could move them to new levels of performance. Toyota’s leaders encourage employees to experiment and to learn from their mistakes. When staff members want to communicate “the essential information needed to solve a problem,” they use the “A3 reporting process,” named after the 11-by-17-inch sheet of paper on which they must clearly condense their information. Managers picked the A3 size because it was the biggest sheet that fit the fax machines available at the time.
The process of change is facilitated through many variables like organizational power, politics, and leadership. The leadership in essence should sponsor elements of the change management process through active participation and communication with employees. This should be supplemented by a desire to transform managerial behaviors by creating new business models. The appropriate organizational politics also impacts the process of change. This is because the goal of the leadership should be to ensure that the change process can be managed in a sound and viable manner (Prahalad & Hamel, 2005: p. 93). Proper evaluation systems can be used in order to achieve high levels of efficiency and effectiveness. Taking proper feedback can be a smart strategy to achieve success in order to produce superior outcomes. For being a global competitor, change is very much essential to any organization. Toyota needs to realize the fact that they will not survive in the competitive market with old techniques and strategies. Thus they need to freeze the old strategies by learning from the past experiences and by foreseeing the future through appropriate changes (Prahalad & Hamel, 2005: p. 93).
Conclusion
Diversification, innovation, and creativity are the key to success when operating in a global environment. Toyota has sought to have flexible, reliable, and agile business structures. Marketing activities must develop unique conceptual frameworks that can be utilized for efficiency and effectiveness. Global environmental factors have become crucial for marketing processes and strategies. This is due to the global nature of corporate business in the twenty first century. Factors like technology, corporate governance, local preferences and industry trends need to be taken into account by marketing departments. Robust and logical strategies help to ensure optimum results. The organization must conduct an extensive appraisal of new business markets. Toyota’s core competency has been its ability to develop automobiles that have superior quality. The competitive prices of the company’s products mean that it has loyal customer base. The core competency has been because of its innovative production methods and processes. Toyota has created strategic management and philosophy as the core element of its growth strategy. Moreover, the company has sought to create a collaborative structure for success that is based on implementing cost leadership strategy. The Toyota Production System (TPS) has been considered to be instrumental in enhancing the innovative practices like Six Sigma and Just in Time in the production facilities of the organization. Toyota has a strong market position in different markets as evident in the fact that it has 45% share in Japan while 12% share in the North American market. Strong market position has resulted in the organization striving to expand into international markets.
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