Instruction
Introduction
In the commercial world, businesses respond differently to the process of change and other events. Somefrequently seek opportunities for growth while others just wait until changes are forced upon them. Businesses that are lazy in implementing change often run out of energy and close down, while others move forward in the face of tough competition (Miller, 2008).
A business-level strategy is a plan of how businesswillachieve its objectives and gain competitive advantage in the industry or in a market. It involves among others, the resources that will be required to attain the goals. Having a competitive advantage is important for a firm to compete favorably in the market but this must be sustainable.
Business level Strategy: for Toyota and Ford
Toyota
Toyota Company useslow cost and differentiation as generic strategies to gain a competitive advantage over otherplayers in the automotive industry.
Scope of the market that Toyota uses isa broad one that incorporates nearly every type of customer in the market to buying an automobile (Tatsuhiko, 2004). This gives the company a wider market for its products.
Toyota has something for majority of people that gives the company a large market (Dearborn, 2000).
Toyota manufacturesvehicles for the outdoor and vehicles for those who live in areas that face severe weather conditions, along with the standard cars for general, everyday use.
Toyota provides vehicles for all price ranges. From the low price cars to the high priced luxurious line of cars.
Toyota also differentiates on several levels from their competitors based on superior quality and design.
This has made it possible for Toyota to create a strong brand image and one that brings to mind quality and long lasting cars for the customers (Liker, 2011).
The strength of Toyota’s brand name has been evidence in recent years with the reduction in recalls and other problems the company faced.
Toyota also differentiates is in technology. Toyota was the first successful mass producer of the hybrid cars when it released the Prius in 2003. This gave Toyota a large percentage of the market share in hybrid cars (Liker, 2011).
Toyota’s Lexus products provide high reliability, durability and high performance sound systems at competitive cost.
Ford
Forduses the focus strategy and is using its resources to acquire and maintain a market advantage by reducing its scope.
Ford’s corporate level strategy of putting all resources into the current product line and only looks to enter into new markets once the market lead is achieved and sustained (Tatsuhiko, 2004).However, this form of strategy slow; its upward trending stability can hardly be argued.
The One Ford strategy is a business plan that combines the product design and development into one to make it the best possible.
Many of the new Ford models will use the same chassis, a practice that the Japanese have used and has gained more responsive product releases and cycles (Magee, 2007).
Ford focuses on manufacturing cars that mainly targets a specific group of people to produce cars that have prestige and status.
Taking specifically one specific vehicle, the Ford Focus vehicle brought a shift in the manufacturing and sales.
In 1998,Ford launched the Ford Focus in North America and Europe, and it eventually became the world’s best-selling model in 2012 (Ingrassia, 2010).
Ford continues manufacturing class-leading vehicles while posting encouraging sales and financial results.
Recommendations
- How they compete
- The basis of competition,
- Where they compete and
- Whomtheycompete against.
These recommendations will help a firm identify its position comparative to the competition in the market.
Organizational structures and controls For Toyota and ford
Ford Motor Company has headquarters in Dearborn, Michigan. It has employed thousands of people.
The Ford Company has an elected board of directors that isresponsible to the shareholders.
Their duty is to monitor the performance of the management to guarantee shareholder interests are being served (Osono, 2013).
The Board established the following committees to aid their work: Compensation, Audit, Finance, Environmental and Public Policy, and Nominating and Governance.
Strategic operations: This includes the global manufacturing, global product development, human resources and labor affairs, and regional strategic operations such as the Americas, Europe, Asia Pacific & Africa and Mazda) are managed by senior managers (Magee, 2007).
Recommendations
- Restructuring to operate profitably.
- Financing the strategy and improving the balance sheet
- Fast-tracking development of new products that meet customers wants.
- Improving teamwork and working together effectively globally.
Toyota’s Organizational structures and controls
Toyota’s organizational structure is globally centralized.
The global centralization is not very good and the company needs to shift towards better local control and authority.
Toyota Companyhas structured its global operations to increase control by Toyota Motor Corporation in Japan (Magee, 2007).
Decision-making structures involving everything from communications, marketing, recalls and vehicle design and development are centrally managed and tightly controlled by from Japan.
Instead, there are unit heads, each of which reports directly to Toyota Motor Corporation in Japan.
Toyota has made many reforms to reduce the effect of waste on the environment, and continuing program to increase sound practices for the environment.
Toyota has managed to cut energy consumption in the area of operations.
Most of Toyota companies have received Leadership in Energy and Environmental Design (LEED) certification after they met standards of US Green Building Council (Osono, 2013).
Most of the waste from the Toyota factories is processed.
Toyota has been Energy leader since 2003, and Toyota plants have received 14 awards Energy Star from 2006.
Use of water per vehicle hassignificantly reduced and the use of containers for Toyota parts distribution network has saved millions of pounds of wood and cardboard since 2003.
Toyota has promoted the use of renewable resource materials in the car. For example, Lexus HS 250h luggage of plastic from renewable resources (Magee, 2007).
Toyota’s organizational structure has, in some part, led to poor public relations that the company has to deal with.
Recommendations
- Work to further break down the regional unit’s structure in North America and consider appointing chief executive for operations in North America with responsibility the regional functional organizations.
- Identify other critical cross-silo processes and establish decision-making teams around them. Toyota must always be mindful that when responding to serious and emergent safety issues, decision making by committee can betime-consuming and ineffective. Toyota should develop other decision-making models that might be employed in emergencies.
- Toyota should also find means to ease communication across regions, especially concerning critical safety issues to support communication among global regions, on vehicle safety issues in vehicles that may have similar parts across regions.
International level strategy for ford and Toyota
Firms expand their foreign markets in order to gain economies of scale. Economies of scale benefits and learning and location effect could be realized and boost product and service standardization. However, problems of localization due to demand for response by the firm to local conditions such as customer taste and preference, cultural traits, local government regulations among others arise (Tatsuhiko, 2004).
In the international business strategy the firms deal with cost reductions and pressure for local responsiveness, transnational strategy has the highest degrees along these dimensions.
Toyota, like many other multinational companies, uses transnational Strategy (Magee, 2007). Implementation of this strategy is a complex issue that large multinational companies are tackling.
The need to compete favorably with international competitors such as, Ford made Toyota look for greater cost economies. However, variations in government regulations and consumers taste across countries require Toyota to respond to local demands. Therefore, Toyota deals with significant pressures for local responsiveness and cost reductions.
Ford on the hand uses the demand conditions. That is the domestic market demand for an industry’s services products (Tatsuhiko, 2004). Ford adds features, tailoring the finished product to local needs.
Ford is able to realize many of the benefits of globalmanufacturing and respond to needs for local responsiveness by differentiating its product among international markets.
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