Toyota Wages and Benefits - Term Paper Example

Table of Contents Evaluation: 6 Baker D., 2009, Business Ethics Fundamentals, [Online], Available: http://uwf.edu/bcarper/GEB3453/GEB%203453%20PowerPoints/Chapter%207.ppt [16th April, 2009] 9 Big Three hitting the big bottom, January 2009, [Online], Available: http://www.washingtontimes.com/news/2009/jan/02/big-three-hitting-the-big-bottom/ [16th April, 2009] 9 Company Description, April 2009, [Online], Available: http://investing.businessweek.com/research/stocks/snapshot/snapshot_article.asp?symbol=TM [16th April, 2009] 9 GM vs. Toyota Wages and Benefits, December 2008, Associated Press News, [Online], Available: http://www.manufacturing.net/News-GM-Vs-Toyota-Wages-And-Benefits.aspx [16th April, 2009] 10 Kay .D.C., January 1997, Notes on Deontology, [Online], Available: http://webs.wofford.edu/kaycd/ethics/deon.htm [16th April, 2009] 10 Rowley I., December 2005, Toyota: Greener Cars and Factories, [Online], Available: http://www.businessweek.com/magazine/content/05_50/b3963412.htm [16th April, 2009] 10 Toyota’s CSR concepts, 2009, [Online], Available: http://www.toyota.co.jp/en/csr/principle/index.html [16th April, 2009] 10 Toyota Global Vision 2020, 2009, [Online], Available: http://www.toyota.co.jp/en/csr/principle/index.html [16th April, 2009] 10 Toyota's biodiversity guidelines, 2009, [Online], Available: http://www.toyota.co.jp/en/environment/vision/biodiversity/ [16th April, 2009] 10 Background Toyota Motor Corporation, founded in year 1933 is one of the marquee names in the arena of automobiles world over. From designing to manufacturing and assembly, the company covers the whole range with aplomb. It sells cars, trucks, vans and also car parts and accessories. Other than conventional vehicles, Toyota has made a name for itself in the world of hybrid engine vehicles. These run on a mix of gasoline and electric motors. Other than automobiles the company successfully dabbles in the field of IT, Ecommerce and prefabricated housing-designs and manufacturing. (Company Description, April 2009) Ethical Dilemmas in Business Ethics stands for a discipline which provides a framework for considering what is good or bad in relation to basic principles of morality (Baker D., 2009). Whereas business ethics on the other hand stands for right and wrong in context of the business world along with its principles and practices (Baker D., 2009). A business entity does not function in segregation from the society; in fact it is an integral part of the social environment. Therefore ethics play an important role in its relations to the other stake holders from the society, like customers, suppliers, workers, government, etc. Problem area and dilemma It is being alleged in automotive circles especially in context of the US market that Toyota pays its workers much less than what the Big Three of US auto i.e. Chrysler, Ford and General Motors pay their workers. This is an area of contention for Toyota. An organization like Toyota has a considerable part of its operations in manufacturing. In this era of global warming and climate change, environment friendliness of a company’s manufacturing processes also fall within the realm of its core values and basic ethical philosophy. How the company is performing can be found out by relating it in context of different ethical theories. Moral theories on are segmented into three basic types: teleological theories, deontological theories and virtue-based theories. Teleological theories The basic premise of this theory is that ethical behavior is goal oriented. This approach says that entities are in dilemma while choosing a particular course of action in terms of achieving a goal. Morality lies in the chosen action’s negative or positive properties. If an action is chosen which has negative connotations, the theory then points it out to be amoral and when the opposite or positive connotation is prevalent, the theory points it out as moral. It is the consequence of the actions or approaches chosen , which is termed important teleological theories. Teleological theory does not concentrate upon the motives, rather it focuses on the consequences of the actions or principles which an entity might have chosen over the other. In context of Toyota: It is alleged that Toyota pays its workers less than what is paid by the big three auto giants in the US. But it has been reported that Toyota in fact pays $30 per hour to its US workers while the average wage of big three auto workers is $29.78 per hour. But there is cost parity in between the two, which arises out of the ‘benefit costs’ in case of the Big three auto giants. In this context GM has total hourly costs of $ 69 which includes wages, health costs and pension. IN case of Toyota this amounts to a much less $48 per hour. (GM Vs. Toyota Wages And Benefits, December 2008). In comparison to the Teleological theories, it can be inferred that Toyota’s wage policy though at first seems to be unethical in comparison to its competitors, yet when delved deeper , it seems to be logical since Toyota bears lesser retirement and legacy charges due to the fact of possessing younger work force than its big three competitors (Big Three hitting the big bottom, January 2009) . Deontological theories On the other hand theorists under this system judge morality in relation to moral duties or obligations. It is the good or bad and right or wrong of the rule or obligation which matters to them and not the consequences out of it. One the most famous theories in under this segment are Immanuel Kant’s essential formulations regarding duties and morality which state: “Always act in such a way that you can also will that the maxim of your action should become a universal law.” And “Act so that you treat humanity, both in your own person and in that of another, always as an end and never merely as a means.” Kant believes in judging the moral or ethical premise based on the duties and moral obligations. But the fact that it states that a rule followed by a person or duties he performs will only be called moral only when all others do the same, is a point of contention with many researchers. This theory also states that persons or human beings cannot be treated as tools or instruments but with respect. In context of Toyota: In comparison to this concept, Toyota on itself has adhered to certain principles in field pertaining to corporate social responsibility, environment, and traffic safety. Therefore the company voluntarily has assigned to the ethical principles and more over value based practices. ( Kay. D. C., January 1997) . Virtue theories Under this system the theorists put enormous importance on inculcating good practices within one’s own self. Their argument is based on the belief that if an entity has been able to infuse the right values such as courage, wisdom, sense of justice , restraint, faith, charity, trust, etc then that entity would always function within the parameters of moral rightness. The proponents of this theory believe that the basic values should be inculcated within an entity at a young stage which would then go on to form a strong ethical foundation for its future actions. In context of Toyota: Toyota as an organization has put in best practices in context of manufacturing processes, CSR activities, etc. Particularly in the field of green technology it has done commendable work through some very successful products such as hybrid cars. Its basic values and ethical base has been behind all these initiatives. Toyota and its operations and actions when compared in relation to the above mentioned approaches, comes up as an ethical corporation on most contexts. Therefore it might be inferred without much doubt that in terms of morality, ethics and values the organization ranks high. Evaluation: Toyota as an organization has left its positive mark on varied areas of operation through best practices in the fields of environment, Green Manufacturing, CSR. Global warming and environmental degradation due to pollution from factories and vehicles have come into the forefront for the last few years. Experts are predicting ominous consequences for the mankind if right reformative steps are not taken. Toyota on its part has commenced various activities on for betterment of the environment. For its initiatives the firm has been bestowed with the Global 500 award in 1999 by the United nations Environment Programme or UNEP. Moreover the company has focused on reducing CO2 emissions and has been quite successful in this initiative. Globally the company has been able to cut its car’s emissions by 15% from 2002 levels. It also announced that its target is to cut down the emission levels per car by 20% within 2010. On the front of Hybrid vehicles, Toyota’s Prius model has been very successful.(Rowley I., December 2005) Toyota’s CSR policy states : “Contribution toward Sustainable Development to take into account subsequent environmental changes and heightened societal interest in CSR” (Toyota’s CSR concepts , 2009 ). It has put in place a vision 20-20 for itself which focuses on creating a relationship of harmony between people, environment and processes (Toyota Global Vision 2020, 2009). For this vision to be turned into reality, the company has chalked out long and short term plans. Besides this, the organization has also introduced ‘Toyota Way 2001 and Toyota Code of Conduct’ (Relationship between the Guiding Principles at Toyota and Various Regulations) which consist of ethical norms, values and principles to be adhered to by the employees of the company. The company is also working to preserve bio-diversity through its initiatives in collaboration with nonprofit organizations, the society and also governmental organizations (Toyota's biodiversity guidelines, 2009) On wage issues the company has clarified that it pays proper wages to its workers in the US but that totals to a lesser amount because unlike the Big Three of US auto manufacturing , Toyota does not have old employees and legacy costs and therefore does not have to bear high retirement benefits for them. So on areas like this, which should have added a little negative connotation to the company’s image, Toyota has successfully clarified the actual situation and happenings. Overall the company stands out in this era of corporate corruption, as a value based organisation with right amount of focus on ethics and values. References: Baker D., 2009, Business Ethics Fundamentals, [Online], Available: http://uwf.edu/bcarper/GEB3453/GEB%203453%20PowerPoints/Chapter%207.ppt [16th April, 2009] Big Three hitting the big bottom, January 2009, [Online], Available: http://www.washingtontimes.com/news/2009/jan/02/big-three-hitting-the-big-bottom/ [16th April, 2009] Company Description, April 2009, [Online], Available: http://investing.businessweek.com/research/stocks/snapshot/snapshot_article.asp?symbol=TM [16th April, 2009] GM vs. Toyota Wages and Benefits, December 2008, Associated Press News, [Online], Available: http://www.manufacturing.net/News-GM-Vs-Toyota-Wages-And-Benefits.aspx [16th April, 2009] Kay .D.C., January 1997, Notes on Deontology, [Online], Available: http://webs.wofford.edu/kaycd/ethics/deon.htm [16th April, 2009] Rowley I., December 2005, Toyota: Greener Cars and Factories, [Online], Available: http://www.businessweek.com/magazine/content/05_50/b3963412.htm [16th April, 2009] Toyota’s CSR concepts, 2009, [Online], Available: http://www.toyota.co.jp/en/csr/principle/index.html [16th April, 2009] Toyota Global Vision 2020, 2009, [Online], Available: http://www.toyota.co.jp/en/csr/principle/index.html [16th April, 2009] Toyota's biodiversity guidelines, 2009, [Online], Available: http://www.toyota.co.jp/en/environment/vision/biodiversity/ [16th April, 2009] Read More