Asian Management for Toyota - Case Study Example

The automation (ji-do-ka) consisted of equipping machines with an automatic system to stop them in case of problems. Automation applied to operators who stopped their production line if they ran into problems, so that product quality could be guaranteed and the problem solved on the spot the number of workers per line was diminished through the kaizen (continuous improvement) of production processes. The Asian values of lifetime employment, seniority-based wages, and the company union form the triptych of Japanese-style industrial relations.

The relationship between the union and management hinges on reciprocal trust as provided by the 1962 Management-Union joint declaration. The union had no more strikes after 1954. Collective bargaining was replaced by a summit conference organized by company administrators and union executives. Worker bonuses were paid twice yearly, and a retirement bonus was provided. Toyota's weaknesses are its aging workforce, the exit of the Japanese salary man and the end of the era of lifetime employment. . This case relates closely to the general theories and practices in Asian Management Systems.

First, Toyota's Human Resources Division prides itself in treating its workers and suppliers as part of a big family. This close relationship based on trust is seen in the entire production system. First, the company encouraged the workers to propose solutions to production problems. The increased profitability is shared by huge bonuses given to the workers at the end of the year. Second, the company gave them a sense of ownership over their workplace through participation in its improvement.

Thirdl, they reinforced bonds among workers by encouraging them to discuss and reflect upon their work. Finally, they promoted leaders from the rank and file and helped them develop their communication skills. Human relations activities were aimed at promoting the manager's personal touch and it has a mentoring system within the company. Toyota helps its suppliers in their production processes, work organization, production costs, and product quality. Toyota chose suppliers for each new model.

Toyota informed its suppliers of its quarterly production plan so that they could prepare themselves. By creating competent suppliers, Toyota is able to increase its price and quality competitiveness. Customer satisfaction and dealer satisfaction is important. Dealer contracts prohibited them from selling other brands. Toyota provides financial support on condition that they remained loyal. Each dealer signed an annual contract indicating sales per model. The role of the dealers consisted of getting the complaints, requirements, and desires of current and future customers, so that these factors could be taken into account in the design of new