Toyota, Essay Example

Toyota should adopt behavioral control (Jones and George) to fix its quality problems. Output control may move the focus too much on financial metrics and result in short-term thinking while clan control may lead to bureaucratic structure and operational inefficiencies. Toyota’s historical reputation was built on quality and reliability of its products and as soon as the company set other objectives such as becoming the world’s largest automakers, its quality reputation suffered, resulting in costly recalls and damage to consumers’ perceptions (Jones and George, Organizational Control and Change).

Thus, Toyota should adopt behavioral controls in which all the employees are encouraged to identify quality problems and suggest potential improvements. The management should particularly focus upon Management by Objectives in which the primary aim for everyone at the company should be to achieve superior quality milestones. The management should measure the company’s performance not through financial metrics but through progress in its quality record.

By encouraging employees to become active participant in improving quality, the management will make it clear that quality is everyone’s responsibility and should be monitored at each step of the production process. Only by encouraging behaviors that focus on quality, the management will ensure company-wide commitment to quality. But if the employees start chasing growth metrics, they will focus more on quantity than quality.

Control behaviors as well as the primary focus on quality will have several long-term benefits for Toyota. The global automobile industry has been becoming more and more competitive, especially, due to ambitious aspirations of Korean automakers such as Hyundai and Kia. Thus, consumers have wider choices than ever and by focusing on quality, Toyota will reestablish its quality credentials and lock-in customers for the long term. Moreover, the quality reputation will also give the company some pricing power despite intense competitive environment as well as preserve resale value of its products better than the competition.

References

Jones, Gareth and Jennifer George. “Organizational Control and Change.” Contemporary Management. 2010. 361.

Jones, Gareth and Jennifer George. “Organizational Control and Change.” Contemporary Management. 2010. 354.