Toyota Pavilion, Aichi (Japan) : Executive Summary

BUSNESS SCHOOL OF DELHI
TOYOTA PAVILION , AICHI (JAPAN)

EXECUTIVE SUMMARY
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The Toyota Motor Co. Ltd was first established in 1937 as a spin-off from Toyoda Automatic
Loom or!s" one of the world#s leadin$ manufacturers of wea%in$ machinery.
The Toyoda Automatic Loom or!s was then headed by &apan#s '(in$ of )n%entors' *a!ichi
Toyoda. The patent ri$hts to one of his machines had been sold to +latt ,rothers -.(/ and
pro%ided the seed-money for the de%elopment and test-buildin$ of Toyota#s first automobiles.
)n 1901 the company e2perienced its one and only stri!e. Labour and mana$ement emer$ed
from this stoppa$e firmly committed to the principles of mutual trust and dependence" and that
corporate philosophy still $uides our $rowth today.
+roduction systems were impro%ed in the late 1901s" culminatin$ in the establishment of the
#Toyota +roduction *ystem.# )t became !nown as T+* in 1971 but was established much
earlier by Taiichi 3hno. ,ased on the principles of &ido!a" &ust-in-time and (ai4en" the system
is a ma5or factor in the reduction of in%entories and defects in the plants of Toyota and its
suppliers" and it underpins all our operations across the orld.
Toyota launched its first small car -*A Model/ in 1967. +roduction of %ehicles outside &apan
be$an in 1909 at a small plant in ,ra4il" and continued with a $rowin$ networ! of o%erseas
plants. Toyota belie%es in locali4in$ its operations to pro%ide customers with the products they
need where they need them7 this philosophy builds mutually beneficial lon$-term relationships
with local suppliers and helps the company fulfill its commitments to local labour.
3%er and abo%e manufacturin$" Toyota also has a $lobal networ! of desi$n and #8esearch and
9e%elopment# facilities" embracin$ the three ma5or car mar!ets of &apan" :orth America and
;urope.
)n e%ery community in which the company operates" Toyota stri%es to be a responsible
corporate citi4en7 close relationships with people and or$ani4ations in the local community are
essential contributors to mutual prosperity. Across the world" Toyota participates
enthusiastically in community acti%ities ran$in$ from the sponsorship of educational and
cultural pro$rammers to international e2chan$e and research.Toyota Motor
Corporation commonly !nown as Toyota and abbre%iated as TMC is a
multinational automa!er head<uartered in Toyota" Aichi" &apan. )n =111" Toyota Motor
Corporation employed 317"736 people worldwide" and was the world#s lar$est automobile
manufacturer by production.
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TABLE OF CONTENTS
+a$e :o.
1. EXECUTIVE SUMMARY---------------------------------- 2
2. INTRODUCTION------------------------------------------ 4
3. LOGO AND BRANDING--------------------------------- 6
4. COMPANY AT A GLANCE------------------------------ 7
5. OBJECTIVE------------------------------------------------ 9
6. METODOLOGY----------------------------------------- 9
7. TECNOLOGY------------------------------------------- 1!
". OPERATION STRATEGY O# TOYOTA--------------- 16
9. MAR$ETING STRATEGY----------------------------- 2"
1!. #INANCIAL SOLUTION------------------------------- 4!
11. R POLICY---------------------------------------------- 55
12. CONCLUSION------------------------------------------ 6!
13. BIBLIOGRAPY---------------------------------------- 61
14. CONTRIBUTION -------------------------------------- 62
INTRODUCTION
Toyota Motor Corporation is hea!"artere in Toyota City# $ichi% Its To&yo o''ice is (ocate
in B"n&yo# To&yo% Its Nagoya o''ice is (ocate in Na&a)"ra*&"# Nagoya%

In aition to
)an"'act"ring a"to)o+i(es# Toyota pro,ies 'inancia( ser,ices thro"gh its Toyota Financia(
Ser,ices i,ision an a(so +"i(s ro+ots%
In preo)inant(y Chinese*spea&ing co"ntries or regions "sing traitiona( Chinese characters#
e%g% Hong -ong an Tai.an# Toyota is &no.n as In preo)inant(y Chinese spea&ing
co"ntries "sing si)p(i'ie Chinese characters/e%g% China0# Toyota is &no.n as /prono"nce
as 1F2ngti3n1 in Manarin Chinese 0% These are the sa)e characters as the 'o"ning 'a)i(y4s
na)e 1Toyoa1 in 5apanese# .hich trans(ate to 1'erti(e rice paies1 in the Chinese (ang"age
as .e((%
The Toyota Co)pany is a (eaer in the car )an"'act"re# asse)+(y an istri+"tion the .or(
o,er% $ ,ery e''icient )anage)ent sty(e that the co)pany "ses has +een one o' the reasons 'or
the 'ir)6s goo per'or)ance% There are )any other sa(ient 'actors that ha,e )ae the co)pany
achie,e the niche o' )ar&et (eaer% The )ar&et str"ct"re the co)pany operates in cannot +e
e'inite(y state% So)e )ay consier it to +e a )onopo(y% This is "e to the 'act that the
co)pany is a o)inant )ar&et p(ayer in car e7portation% In 'act# its i''erentiation strategy has
)ae it enjoy an a()ost )onopo(istic presence especia((y in the e,e(oping nations o' the .or(%
On the other han# the )ar&et str"ct"re can +e seen as an o(igopo(y% This is "e to the 'act that
there are other &ey p(ayers (i&e 8M .ho are peer co)petitors% Toyota is &een to see .hat these
co)petitors are oing an )a&e s"re it reacts to their actions in a .ay that .i(( g"arantee its
)ar&et (eaership%
Fro) (e't# I.ate 8o,ernor Ta&"ya Tasso# Presient $&io Toyoa# an Miyagi 8o,ernor 9oshihiro M"rai
The new headquarters of the Toyota Motor Corporation
Opened in February 2005 in Toyota City
Logo and Branding
Employee at Toyota Museum explains development of Toyota name and brand
In :;<=# Toyota entere the passenger car )ar&et .ith its Moe( $$ an he( a co)petition
to esta+(ish a ne. (ogo e)phasi>ing spee 'or its ne. pro"ct (ine% $'ter recei,ing ?@#AAA
entries# one .as se(ecte that aitiona((y res"(te in a change o' its )oni&er to 1Toyota1 'ro)
the 'a)i(y na)e 1Toyoa%1 It .as +e(ie,e that the ne. na)e so"ne +etter an its eight*
stro&e co"nt in the 5apanese (ang"age .as associate .ith .ea(th an goo 'ort"ne% The
origina( (ogo no (onger is 'o"n on its ,ehic(es +"t re)ains the corporate e)+(e) "se in
5apan%
Sti((# there .ere no g"ie(ines 'or the "se o' the +ran na)e# 1TO9OT$1# .hich .as "se
thro"gho"t )ost o' the .or(# .hich (e to inconsistencies in its .or(.ie )ar&eting
ca)paigns%
To re)ey this# Toyota intro"ce a ne. .or(.ie (ogo in Octo+er :;B; to co))e)orate
the CAth year o' the co)pany# an to i''erentiate it 'ro) the ne.(y re(ease ("7"ry Le7"s
+ran% The (ogo )ae its e+"t on the :;B; Toyota Ce(sior an !"ic&(y gaine .or(.ie
recognition% There are three o,a(s in the ne. (ogo that co)+ine to 'or) the (etter 1T1# .hich
stans 'or Toyota% The o,er(apping o' the t.o perpenic"(ar o,a(s insie the (arger o,a(
represent the )"t"a((y +ene'icia( re(ationship an tr"st that is p(ace +et.een the c"sto)er
an the co)pany .hi(e the (arger o,a( that s"rro"ns +oth o' these inner o,a(s represent the
1g(o+a( e7pansion o' Toyota4s techno(ogy an "n(i)ite potentia( 'or the '"t"re% M"ch (i&e the
esign o' the cars .e se((# o"r (ogo has "nergone a n")+er o' re'ine)ents an i)pro,e)ents
o,er the yearsD

COMPANY AT A GLANCE
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Type P"+(ic co)pany
T9OD @?A<
LSED T9T
N9SED TM
Industry
$"to)oti,e
Ro+otics
Financia( ser,ices
Founded $"g"st ?B# :;<@
Founder(s) -iichiro Toyoa
Headquarters Toyota# $ichi# 5apan
Area served Eor(.ie
Key people F"jio Cho /Chair)an an
Representati,e Director0
$&io
Toyoa /Presient an
Representati,e Director0
Produts $"to)o+i(es
Financia( Ser,ices
Prodution
output
@#<AB#A<; "nits /FY20110
F:G
!evenue H:B%;; tri((ion /F9?A::0
F:G
/USI?<C%B; +i((ion0
"peratin#
inome
HJ=B%?B +i((ion /F9?A::0
F:G
/USIC%B? +i((ion0
Profit HJAB%:B +i((ion /F9?A::0
F:G
/USIC%A@ +i((ion0
Total assets H?;%B:B tri((ion /F9?A::0
F:G
/USI<@A%< +i((ion0
Total equity H:A%<< tri((ion /F9?A::0
F:G
/USI:?B%<? +i((ion0
Employees <:@#@<J /?A:A0
F?G
Parent Toyota 8ro"p
$ivisions Le7"s
Scion
OBJECTIVES
*tudy any or$ani4ation in detail. Collect data pertainin$ to the followin$?-
3perations strate$y
@inancial strate$y
A8 policy
Mar!etin$ strate$y
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METHODOLOGY
All the analysis is done with the help of secondary data.

Technol ogy

The latest corporate crowd sourcin$ e2periment comes to us from Toyota" which this
wee! launched its ')deas for Cood' initiati%e--an opportunity for consumers to
repurpose Toyota automoti%e technolo$y to benefit society outside of the automoti%e
space. )n return" winners will $et to choose from one of three Toyota cars -=111
+rius" =111 Ai$hlander Aybrid or =111 Den4a/ and be part of an ')dea 9esi$n
*ession' e%ent.
The campai$n" which is bein$ produced in con5unction with *aatchi E *aatchi LA"
as!s entrants to wor! with fi%e Toyota technolo$ies?
Total Auman Model for *afety -TA.M*/ F An ad%anced in5ury-simulation software
that measures more than the con%entional crash test dummy can.
Aybrid *yner$y 9ri%eG -A*9/ F A*9 con%erts bra!in$ ener$y into electricity. The
hybrid system helps lower emissions while raisin$ mp$.
*olar +owered Dentilation *ystem F The Toyota +rius offers this system that helps
!eep the interior air temperature near the outside ambient temperature" when the
%ehicle is par!ed in direct sun.
Touch Tracer 9isplay F An ad%anced touch-acti%ated display system that allows
dri%ers to control music" temperature and other features from the steerin$ wheel
without ta!in$ their eyes off the road. Touch Tracer is the first display system in the
world to allow steerin$ wheel controls to read out on the instrument panel.
Ad%anced +ar!in$ Cuidance *ystem -A+C*/ F A%ailable on the Toyota +rius" this
system utili4es ultrasonic sensors in the front and rear bumpers to detect open
par!in$ spaces and helps $uide the car into those spaces with only soft dri%er
bra!in$.
*ome of these technolo$ies are already bein$ used outside Toyota. TA.M*" for
e2ample" is bein$ used by a!e @orest .ni%ersity to study the effects of tac!les and
hits on football players. )t is also bein$ used by :A*CA8 to analy4e the effects of
hi$h-speed impacts.
The benefits of Toyota#s crowd sourcin$ e2periment are twofold? the brand $ains
reco$nition for some of its more inno%ati%e technolo$ies" and it $ets to le%era$e the
ideas of the crowd" to boot.
Toyota is far from the first company to dabble in online crowd sourcin$. +epsi#s
multimillion dollar 8efresh $rant pro$ram has been wildly successful" and C;#s recent
H=11 million ;coma$ination Challen$e captured the attention of en%ironmentally-
aware )nternet 5un!ies. Toyota#s promise of a shiny new car will probably be enou$h
to $et a decent number of participants in its contest.
About t%e Te%nolo#ies
T&H&'&M&(&
1. (olar Po)ered *entilation (ystem
=. Hybrid (yner#y $rive
+
3. Advaned Par,in# -uidane (ystem
6. Tou% Traer
T.H.U.M.S.
T.A...M.*. -Total Auman Model for *afety/ is an ad%anced in5ury-simulation software
that measures in5ury to parts of the body not measurable with con%entional crash test
dummies.
T.A...M.*. -Total Auman Model for *afety/ is an ad%anced in5ury-simulation
software. T.A...M.*. has two million distinct parts" includin$ bones" li$aments"
tendons and the muscular systems" enablin$ Toyota to better understand in5ury
mechanisms in crashes that ha%e historically been difficult to analy4e with current
crash test dummies.
Toyota is usin$ T.A...M.*. to better understand the mechanisms that cause in5uries
to %ehicle occupants and pedestrians in car crashes" usin$ the data collected to help
de%elop ad%anced safety technolo$ies for airba$s" seatbelt systems and %ehicle body
structures. )n one case" T.A...M.*. was used to study low-speed rear impacts to help
reduce the ris! of whiplash in5uries.
)nternal or$ans are particularly %ulnerable durin$ collisions" with in5uries to them
accountin$ for appro2imately half of all in5uries sustained durin$ automobile collisions.
T.A...M.*. pro%ides Toyota with more data than e%er before to help them create the
ne2t $eneration of safety features on their %ehicles.
Engines
Toyota#s new-$eneration en$ines combine dri%in$ pleasure and en%ironmental
responsibility
Award Winning Engines
Toyota pri4es itself for its ad%anced and intelli$ent en$ines. )ts DDT-) en$ine won
';n$ine of the Iear =111' and recently the DDTL-) has won a similar award for its
re%olutionary 'liftin$' %al%e control technolo$y. And the de%elopments $o on? At +aris
Motor *how =11= Toyota will launch its new 9-CAT clean diesel technolo$y%
Engines - VVT I
DDT-) -Dariable Dal%e Timin$ with intelli$ence/
hy DDT)
)n contrast to the fi2ed %al%e timin$ of con%entional en$ines"
the DDT-) system is an computer controlled mechanism that
continually %aries the timin$ for openin$ and closin$ the inta!e
%al%es in accordance with the %ehicle#s operatin$ conditions.
,I determinin$ the le%el of performance that is demanded of
the en$ine at a $i%en time by way of the dri%er#s accelerator
operation and the en$ine rpm" the DDT-) enables the o%erall performance of the
en$ine to be enhanced all the way from the low to the hi$h rpm ran$e.
Design
DDT-) is comprised of three ma5or components
1.The electronic control unit-;C./" which calculates optimum inta!e %al%e timin$
based on en$ine operatin$ conditions.
=. The oil control %al%e -3CD/" which controls hydraulic pressure under the ;C.#s
instruction and
3.The DDT pulley" which continuously chan$es the inta!e %al%e timin$ usin$
hydraulic pressure.
The DDT-) is an en$ine control system that has achie%ed hi$h le%els of the
seemin$ly opposin$ performances of Ai$her power out-put" Lower fuel
consumption" Cleaner e2haust $ases.
D-4D
D-4D High technology, clean diesel
3ri$inally introduced in ;urope in the top sellin$ A%ensis ran$e" 9-69 is widely
reco$nised as one of the most ad%anced diesel technolo$ies on the mar!et today.
Toyota 9-69 en$ines are a%ailable on select models of Iaris" Iaris Derso" Corolla
Derso" )nno%a" A%ensis" A%ensis Derso" 8AD6" Land Cruiser and +re%ail models.
.ntil recently" diesel en$ines relied on relati%ely simple technolo$y with a low-
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pressure mechanical in5ector deli%erin$ fuel to a pre-combustion chamber in the
cylinder head" where a sin$le i$nition - fired by the intense heat of hi$h compression -
ta!es place.
The system was reasonably fuel efficient but lac!ed precision and refinement" leadin$
to %ibration and noise. @uel combustion can be incomplete" allowin$ smo!e and other
emissions to pass into the e2haust%
D-4D components
Toyota#s common rail system ma!es use of a hi$h pressure pump and intelli$ent"
computer controlled in5ectors to deli%er precisely the ri$ht amount of fuel" at precisely
the ri$ht time" directly into the centre of the combustion chamber.
Safety
hile you#re $ettin$ out of your car" we#re thin!in$ about how to !eep you in.
The most important aspect of protectin$ passen$ers in a collision is
to minimi4e collision forces transmitted to them. At Toyota" we
desi$n automobile bodies with crumple 4ones to absorb collision
ener$y" and we ha%e put a $reat deal of wor! into desi$nin$ e%er
more efficient passen$er restraint systems such as seatbelts and head restraints. e
search for impro%ed webbin$ elon$ation characteristics" impro%ed ways of clampin$
the webbin$" and impro%ed pretensioners. +assen$er safety be$ins with buc!lin$ up.
And at Toyota" we are wor!in$ hard to ma!e seatbelts more comfortable and easier
to wear. )n addition" we are ma!in$ si$nificant pro$ress with airba$s
as supplemental restraint systems -*8*/.
)n a collision" seatbelts are the primary safety de%ice that helps
protect the occupants. 9urin$ the de%elopment of a new
automobile" Toyota uses dummies of se%eral different si4es to
ma!e sure the seatbelts" anchors" and buc!les are positioned for a
safe and comfortable fit. hile road-testin$ prototypes" real people
use the seatbelts and report on their fit and comfort. Ad5ustable
shoulder anchor are pro%ided for wearers to chan$e the hei$ht of
the belt for additional comfort and safety.
Toyota continually stri%es to desi$n new and better seatbelts that
ma!e the most of the ride-down effect of our automobiles# crumple
4ones and enhance the deceleration effects. Toyota e%en desi$ns
the structure and shape of the seats in its cars to complement the
restraint of the seatbelts. Ma!in$ the shape of the seats and the
position of the anchors to ensure that the belts fit low across the
pel%is.
9ependin$ upon the seatin$ confi$uration" some of our %ehicles
ha%e 3-point belts for the passen$er sittin$ in the middle of the bac!
seat.
3ur Tension-8educin$ ;mer$ency Loc!in$ 8etractor -;L8/
automatically loc!s when you pull on the belt to ensure its secure
enou$h to wor!" yet loose enou$h to feel comfortable.
And some of our %ehicles ha%e +re-Tens ioner *ensors which
<uic!ly pull the seatbelt bac! at the first shoc! of a se%ere head-on
collision" while the @orce Limited !eeps that tension from in5urin$
you. )t all wor!s to !eep you safe and secure in the e%ent of an
accident.
Brakes
3ur bra!es allow you to do somethin$ you ne%er thou$ht possible
Toyota has de%eloped new electronic control systems that ma!e the
most of the basics and add to o%erall performance. These electronic
systems include A,* for the bra!es and T8C for traction control.
A,* helps pre%ent wheel loc!. hen the bra!es are applied" the
tyres be$in to slip. A,* measures the de$ree of slip to determine
when wheel loc! will occur from the de$ree of slip" and reduces
hydraulic pressure to pre%ent it. ,ecause A,* allows the wheels to roll - albeit at a
slower speed than the %ehicle %elocity - the %ehicle maintains directional control and
steerability. A cars wheels may tend to spin when startin$ off or acceleratin$. )n some
cases" loss of traction can cause the tyres to lose their $rip and allow the %ehicle to
slide sideways. Toyota#s T8C system re$ulates en$ine and bra!es to help pro%ide as
much control of wheel slip as possible durin$ start-off or acceleration. )f a wheel loses
traction" the wheel speed sensor detects a sudden increase in wheel rotation speed.
This information $oes to the T8C electronic control unit -;C./" which commands the
en$ine to reduce tor<ue. At the same time" the ;C. commands the bra!e actuator to
en$a$e the bra!es on the affected wheel until it re$ains traction. 3b%iously" dri%er
awareness of road ha4ards and appropriate response is also re<uired to a%oid
dan$erous situations and to $i%e the %arious systems time to operate. Toyota#s T8C
system uses components of A,* and en$ine mana$ement systems" as well as
components desi$ned specifically for T8C. The system helps the dri%er maintain
control of the automobile and optimi4es traction" e%en on slippery surfaces.

Operation Strategy of Toyota
Toyota is &apan#s bi$$est car company and the second lar$est in the world after
Ceneral Motors. )t produces an estimated ei$ht million %ehicles per year" about a
million fewer than the number produced by CM. The company dominates its home
mar!et" with about 61J of all new cars re$istered in =116 bein$ Toyotas.
Toyota also has a lar$e mar!et share in both the .nited *tates and ;urope. )t has
si$nificant mar!et shares in se%eral fast-$rowin$ *outh ;ast Asian countries. The - 1
-company produces a lar$e ran$e of %ehicles which are hi$hly re$arded for their
<uality" en$ineerin$" and %alue7 their desi$ns set $lobal standards for safety" reliability
and ease of maintenance.
The Company +hilosophy '9o the ri$ht thin$ for the company" its employees" the
customer and the society as a whole.'
Origins
The story of Toyota Motor Corporation be$an in *eptember 1933 when Toyoda
Automatic Loom created a new di%ision de%oted to the production of automobiles
under the direction of the founder#s son" (iichiro Toyoda. *oon thereafter" the di%ision
produced its first Type A ;n$ine in 1936" which was used in the first Model A1
passen$er car in May 1930 and the C1 truc! in Au$ust 1930. +roduction of the Model
AA passen$er car started in 193>.
Althou$h the Toyota Croup is best !nown today for its cars" it is still in the te2tile
business and still ma!es automatic looms -fully computeri4ed" of course/" and electric
sewin$ machines which are a%ailable worldwide.
9urin$ the +acific ar" the company was dedicated to truc! production for the
)mperial Army. ,ecause of se%ere shorta$es in &apan" military truc!s were !ept as
simple as possible. @or e2ample" the truc!s had only one headli$ht in the centre of
the hood.
Toyota earns H1=01 per %ehicle produced while CM loses H=311 per %ehicle
produced.
JUST IN TIME (JIT)
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&ust-)n-Time -&)T/ is a &apanese manufacturin$ mana$ement method that was
de%eloped in the 1971Ks. )t was first adopted by Toyota manufacturin$ plants by
Taiichi 3hno. 3ne moti%ated reason for de%elopin$ &)T was a need of a better
production techni<ue after orld ar )). &apanese people had a %ery stron$ incenti%e
to de%elop a $ood manufacturin$ techni<ue to help them rebuild the economy. They
also had a stron$ wor!in$ ethnic which was concentrated on wor! that caused
continuous impro%ement. These !inds of moti%ation had dri%en &apanese economies
to succeed. ,ecause of the natural constraints and the economy constraints after
orld ar ))" &apanese Manufacturers loo!ed for a way to $ain the most efficient use
of limited resources. The Toyota Company implemented this into their plant and
turned the mana$ement and accountin$ principles around to effecti%ely and efficiently
mo%e in%entory in and out %ery <uic!ly while also concentratin$ on the manufacturin$
aspects of their cars. After the first introduction of &)T by Toyota" many companies
followed up and around mid 1971sKand it $ained e2tended support and widely used
by many companies around the world.
&ust in Time is an in%entory strate$y implemented to impro%e the return on
in%estment of a business by reducin$ in-process in%entory and its associated carryin$
costs. &)T can lead to dramatic impro%ements in a manufacturin$ or$ani4ation#s return
on in%estment" <uality" and efficiency. &ust-in-time means" <uite literally" that an
assembler on a line recei%es his consi$nment of parts '5ust in time' to use them. The
system is based on an ideal situation in which a part arri%es 5ust in time to be used.
The system also operates on the stren$th of %ery small lot <uantities of replacement
parts. This type of system produces only <uantities necessary to fulfill the demands of
the ne2t operation. The <uantity is pulled when it is needed" where it is needed" and
in the e2act <uantity which is needed. The company will also need to ensure that the
process has ade<uate response time to maintain an uninterrupted schedule.
Companies can ma!e $reat strides in &)T by reducin$ setup and chan$eo%er times for
machinery. &)T reco$ni4es that any motion which does not add %alue to a product
increases the no %alue added cost of the product. 8eduction of setup and chan$eo%er
time reduces the no %alue added costs attached to a product.
ith &ust in Time mana$ement" a company can dramatically impro%e its product
<uality. .sin$ &)T" a company only holds enou$h in%entories for current production"
4ero defects must be maintained. 3nce parts are put into production" attention to
<uality must continue since no finished $oods in%entory will be held. &)T is $enerally
reco$ni4ed that the implementation of &)T will result in si$nificant reduction in
in%entory. )n%entory le%els are a !ey measurement of the &)T process. The &)T
philosophy on in%entory mana$ement is simple. )t includes? stri%e for a le%el of 4ero
in%entories" produce items at a rate re<uired by the customer" eliminate all
unnecessary lead times" reduce setup costs to achie%e the smallest economical lot
si4e" optimi4e material flow from suppliers throu$h the production process to the point
of sale of the finished product" so that in%entories are minimi4ed" ensure hi$h <uality
5ust-in-time deli%ery from suppliers" minimi4e safety stoc!s" implement a total <uality
control pro$ram which will minimi4e scrap" rewor!" and resultant delays in production.
)n the &)T manufacturin$ en%ironment" in%entory is 'demand' pulled into and throu$h
the process on a part-by-part basis in small <uantities. The mo%ement of in%entories
is no lon$er from the storeroom to a wor! centre" to a storeroom" to another wor!
centre and so on. &)T accountin$ systems are similar to process costin$7 the %ehicle
for collectin$ costs is the time in the system" not a wor! order.
There was a ma5or need for this process because before the introduction of &)T" there
were a lot of manufacturin$ defects for the e2istin$ system at that time. This included
in%entory problem" product defects" risen cost" and lar$e lot production and deli%ery
delays. The in%entory problems included the unused accumulated in%entory that was
not only unproducti%e" but also re<uired a lot of effort in storin$ and mana$in$ them.
3ther implied problems such as parts stora$e" e<uipment brea!downs" and une%en
production le%els. @or the product defects" manufacturers !new that only one sin$le
product defects can destroy the producerKs creditability. They must create a 'defect-
free' process. )nstead of lar$e lot production - producin$ one type of products" they
awarded that they should produce more di%ersified $oods. Lastly" the system before
&)T did not mana$e well for fast deli%ery re<uest" so" there was a need to ha%e a
faster and reliable deli%ery system in order to handle customersK needs. Thus" &)T
manufacturin$ mana$ement was de%eloped based on these problems.
&)T was hi$hly needed especially in the automoti%e industry thatKs why Toyota was
the first company to use it. )n order to ha%e an efficient production system in the
automoti%e industry" there were many issues that needed to be sol%ed. The first main
problem was that the automoti%e industry is a typical mass production assembly type
where each %ehicle is assembled from se%eral thousand parts that ha%e under$one
numerous processes. Therefore" a trouble in any of the processes will ha%e a lar$e
o%erall effect. The second issue was there are %ery many different models with
numerous %ariations and with lar$e fluctuation in the demand of each %ariation. The
last issue is e%ery few years" the %ehicles are completely remodelled and there are
also often chan$es at a part le%el. The ordinary production control system in such an
industry consists of fulfillin$ the production schedules by holdin$ wor!-in-process
in%entory o%er all processes as a means of absorbin$ troubles in the processes and
chan$es in demand. Aowe%er" such a system in practice often creates e2cessi%e
unbalance of stoc! between the processes" which often leads to dead stoc!. 3n the
other hand" it can easily fall into the condition of ha%in$ e2cessi%e e<uipment and
surplus of wor!ers" which is not conformable to Toyotas# reco$nition. )n order to a%oid
such problems as in%entory unbalance and surplus e<uipment and wor!ers" Toyota
reco$ni4ed necessity of schemes ad5ustable to conform to chan$es due to troubles
and demand fluctuations. @or this purpose" they put their efforts in de%elopment of a
production system which is able to shorten the lead time from the entry of materials to
the completion of %ehicle. This is where &ust in Time was needed. The 5ust-in-time
production is a method whereby the production lead time is $reatly shortened by
maintainin$ the conformity to chan$es by ha%in$ Lall processes produce the
necessary parts at the necessary time and ha%e on hand only the minimum stoc!
Project On Operation Research Page 1B
necessary to hold the processes to$ether'. )n addition" by chec!in$ the de$ree of
in%entory <uantity and production lead time as policy %ariables" this production
method discloses e2istence of surplus e<uipment and wor!ers. This was the startin$
point of the Toyota +roduction *ystem.
There are many ad%anta$es in usin$ the &ust in Time in%entory. 3ne ma5or benefit of
&)T is the elimination of separate raw materials and wor!-in-process in%entory
accounts. These accounts are replaced by one account called 8aw and in-+rocess
)n%entory. All materials and con%ersion costs are char$ed to this account. 9ue to the
reduction of in-process in%entories" the computation of e<ui%alent units of production
is simplified. *ome other ad%anta$es include minimi4in$ raw material" minimi4e
defects $oods" simplify the production process" and create a timely" multi-s!illed wor!
force. ,y usin$ the &)T production plannin$ approach" mana$ers reduce in%entory to
a minimum le%el" !eepin$ on hand only the amount needed in production until the
ne2t order arri%es. This approach eliminates the double handlin$ of products which
occurs when stora$e is relocated to the wor! area or shippin$ area. The &)T
production sta$e is dri%en by ha%in$ continuous deli%ery of items. The use of
production plannin$ eliminates the need for material re<uirements plannin$ -M8+/ as
a production plannin$ tool. )n contrast to the &)T system" a M8T system is a 'push-
throu$h' system dri%en by forecasted demand. )t e2amines the finished $oods
re<uirements before determinin$ the demand for raw materials" components" and
subassemblies. &)T is an attempt to chan$e the manufacturin$ process and to
eliminate non-%alue-added acti%ities in order to 5ud$e the cost hi$h or low. This
method can also help or$ani4ation tremendously.
There are also some disad%anta$es that &)T can brin$. The &)T systems can be
disastrously affected by outside forces. *eptember 11" =111 caused massi%e amount
of financial dama$e to companies operatin$ &)T )n%entory or +roduction systems
because so many lar$e transport systems li!e @ed-;2" .nited +arcel *er%ice -.+*/"
and the +ost 3ffice could not $et the $oods deli%ered. )t also affected the other
transportation industries. ith the increased security at the ..*. border crossin$s
with Canada and Me2ico as well as at ..*. ports" truc!s reportedly waited 1B to =1
hours at some crossin$ points. :ot only did crossin$ times increase but" more
importantly for &)T systems" they became unpredictable problems and increased
financial losses especially in perishable products.
There is a definite downside to &)T. )n the &)T system often a sole supplier is used for
products for the manufacturin$ process. A company becomes %ulnerable if that sole
supplier shuts down for some reason. The Ceneral Motors Corporation recently faced
such a problem. hen the Lordstown body stampin$ and fabrication plant went on
stri!e" the CM *aturn di%ision was forced to shut down. Lordstown is the sole supplier
for about 311 *aturn parts. ;i$ht more CM plants followed suit within days" at a daily
cost to CM of between HB and H11 million in preta2 profits. )t is easy to see that a &)T
in%entory mana$ement system intensifies the impact of a stri!e. Ceneral Motors
pli$ht painfully illustrates the ris! of a &)T strate$y? )t puts a company at the mercy of
its !ey suppliers.
Companies that use &)T principles are fre<uently used by lar$e re$ional companies"
or companies that e2pand nationally or e%en $lobally. Ta!e for instance *ears
9epartment store. hene%er a sale is made" that information is transferred to the
computer and stored" to later be submitted to %arious computers that use the
information to update in%entory" calculate sales and create other statistical reports.
Another e2ample would be a restaurant such as ApplebeeKs. hen food is ordered"
the waiter submits this into a computer. At the present time" the information is used
for the coo!s and for chec! calculation. Later" the stored information is used in
reports for mana$ement to clearly see what items ha%e been sold and need to be
reordered. The uses span far" as mana$ement can also use this data to see sale
pro$ressions of certain items and to see what sells the most at %arious times of the
day" wee! or month. 3ther companies such as" The Muincy" )ll." plant of Muincy
Compressor" )nc. has reduced its in%entory to H6 million from H=1 million o%er 11
years. Muincy uses &)T techni<ues to speed up deli%ery time for its lar$e industrial air
compressors" used in ser%ice stations" factory machinery" and climate-control
systems. 'e are producin$ more than we e%er did" with less people"' says 9a%id
)ric!" traffic mana$er. 'hen ) started here 13 years a$o" if you called for a basic air
compressor" we <uoted you nine months# deli%ery time. :ow we <uote 11 days" and
we are a%era$in$ about fi%e. That#s 5ust the way the mar!et is. :obody carries any
in%entory.'
The &)T in%entory method is now bein$ used 5ust about anywhere. )t is a common
practice that many companies ha%e adopted and many more are reali4in$ the need to
pursue the concept. This method is becomin$ the most effecti%e and efficient in
operations today. ;liminatin$ waste" which is the most of important in &)T" can be
used for all le%els of operation in a company" not 5ust in%entory. More and more uses
of &)T will be introduced and implemented as businesses see! to ma2imi4e the <uality
of their operations.
Toyota adopting three-stage plan
The &apanese carma!er was a latecomer to the China mar!et. ithin its $lobal
strate$ies" :orth America is the top priority" followed by its home country &apan.
China has been included in Toyota#s top de%elopment strate$y in recent years with its
first China-made D)3* sedan produced in Tian5in in 3ctober =11=.
Considerin$ China is an immature auto mar!et" the company has adopted a three-
sta$e de%elopment plan -- first to establish a local sales networ! and launch brand
promotions" then to build auto parts manufacturin$ bases" and" finally" to establish
5oint %entures -&Ds/ with local players and produce automobiles.
Project On Operation Research Page =1
About 07 per cent of respondents said Toyota adopted the ri$ht strate$y for
e2pansion in China and a%oided possible ris!s.
Althou$h a latecomer" Toyota has 5umped to the front in terms of imported car %olume
-- 01"111 units annually. )t has 07 &Ds and wholly funded auto parts companies
scattered across China.
:ow" the company is steppin$ into the most important and critical sta$e -- speedin$
up the locali4ation of its products" since its ri%als" such as Aonda and Ceneral Motors"
are acceleratin$ their penetration into China.
After the mar!et entry of the +rado and Land Cruiser with China#s @irst Automobile
or!s" its new product with Cuan$4hou Automobile Manufacturin$ Co -- Camry"
which was a $reat success in the .nited *tates -- is also bein$ de%eloped.
About B1 per cent of the respondents predicted Toyota will continue its brilliant
performance in the .* mar!et" since the company has established a far-reachin$
sales networ! -30.> per cent/ and its product brands are hi$hly reco$ni4ed by
Chinese customers -0=.9 per cent/.
Aowe%er" there are also unsatisfactory results of the de%elopment strate$y. *e%enty-
fi%e per cent of the 116 senior company mana$ers sur%eyed said Toyota only wants
to sell cars in China" but does not want to share technolo$ical !now-how.
*ome 61.6 per cent of respondents said the company does not $i%e enou$h attention
to China mar!et.
@orbes ma$a4ine commented on Toyota#s success in the .* auto mar!et" sayin$ that
once the company sets $oals" it will mana$e to e2ceed the tar$ets. hat is more
challen$in$ to its ri%als is Toyota#s strate$y to reali4e these $oals.
That assessment may well apply to its China e2pansion. Althou$h Toyota missed the
first opportunities" it will li!ely catch up if it pays more attention to the China mar!et
and introduces hi$h-end brands.
Toyota Motor Corporation - SWOT Framework Analysis
*3T Analysis" is a strate$ic plannin$ tool used to e%aluate the *tren$ths"
ea!nesses" 3pportunities" and Threats in%ol%ed in a pro5ect or in a business
%enture. )t in%ol%es specifyin$ the ob5ecti%e of the business %enture or pro5ect and
identifyin$ the internal and e2ternal factors that are fa%ourable and unfa%ourable to
achie%in$ that ob5ecti%e.
The aim of any *3T analysis is to identify the !ey internal and e2ternal factors that
are important to achie%in$ the ob5ecti%e. *3T analysis $roups !ey pieces of
information into two main cate$ories?
)nternal factors - The stren$ths and wea!nesses internal to the or$ani4ation.
;2ternal factors - The opportunities and threats presented by the e2ternal
en%ironment
The internal factors may be %iewed as stren$ths or wea!nesses dependin$ upon their
impact on the or$ani4ation#s ob5ecti%es. hat may represent stren$ths with respect to
one ob5ecti%e may be wea!nesses for another ob5ecti%e. The factors may include all
of the 6+#s7 as well as personnel" finance" manufacturin$ capabilities" and so on. The
e2ternal factors may include macroeconomic matters" technolo$ical chan$e"
le$islation" and socio-cultural chan$es" as well as chan$es in the mar!etplace or
competiti%e position. The results are often presented in the form of a matri2.
*3T analysis is 5ust one method of cate$ori4ation and has its own wea!nesses.
@or e2ample" it may tend to persuade companies to compile lists rather than thin!
about what is really important in achie%in$ ob5ecti%es. )t also presents the resultin$
lists uncritically and without clear prioriti4ation so that" for e2ample" wea!
opportunities may appear to balance stron$ threats.
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Toyota production system
Harmonizing with the Environment
Clobally" Toyota has indicated a stron$
and di%erse commitment to the pursuit of
harmonious $rowth throu$h its
technically ad%anced and en%ironment-
friendly products. There ha%e been
relentless efforts in the crucial fields of
mobility" city transportation" resources"
society and en%ironment" throu$h
research E de%elopment.
+rotectin$ the en%ironment has always
been a priority at T(M" startin$ with the
eco-friendly en$ines that are
manufactured for the Toyota %ehicles" to
the ad%anced technolo$y that is used for
purification or recyclin$ of waste water at
the plant. Apart from this" the plant at
,idadi" (arnata!a" is surrounded by a
$reen belt" meets hi$h en%ironmental
standards and has achie%ed the )*3
16111 certification in its %ery first year of
operations.

Setting benchmarks for Production Excellence
Muality is ensured in e%ery %ehicle
that rolls out of Toyota (irlos!ar
Motor" throu$h in-built audits at e%ery
process of the system. The
company#s operational e2cellence is
based on the impro%ement tools and
methods de%eloped by Toyota under
the Toyota +roduction *ystem -T+*/"

$reatly emphasi4in$ superlati%e
<uality and minimal waste.
)n line with Toyota#s $rowin$ comfort
with its )ndia operations" the
company set up Toyota (irlos!ar
Auto +arts -T(A+/" which
commenced production of
transmissions in May =116" for its
$lobal re<uirements. Another
initiati%e is the Toyota Techno +ar!
)ndia -TT+)/" a non-profit industrial
infrastructure company aimed at
boostin$ local industries and related
5ob opportunities.
*ettin$ benchmar!s for the
automobile industry" the
manufacturin$ facility consists of 6
di%isions -shops/ F +ress" eld"
+aint and Assembly.

Production System
A production system which is steeped in the philosophy of 'the complete elimination
of all wasteN imbues all aspects of production in pursuit of the most efficient methods.
Toyota Motor Corporation#s %ehicle production system is a way of 'ma!in$ thin$s'
that is sometimes referred to as a 'lean manufacturin$ system' or a '&ust-in-Time
-&)T/ system"' and has come to be well !nown and studied worldwide.
This production control system has been established based on many years of
continuous impro%ements" with the ob5ecti%e of 'ma!in$ the %ehicles ordered by
customers in the <uic!est and most efficient way" in order to deli%er the %ehicles as
<uic!ly as possible.'
The Toyota +roduction *ystem -T+*/ was established based on two concepts? The
first is called '&ido!a' -which can be loosely translated as 'automation with a human
touch'/ which means that when a problem occurs" the e<uipment stops immediately"
pre%entin$ defecti%e products from bein$ produced7 The second is the concept of
'&ust-in-Time"' in which each process produces only what is needed by the ne2t
process in a continuous flow.
,ased on the basic philosophies of &ido!a and &ust-in-Time" the T+* can efficiently
and <uic!ly produce %ehicles of sound <uality" one at a time" that fully satisfy
customer re<uirements.
TPS Concept
Jidoka
Ai$hli$htin$O%isuali4ation of problems
-Muality must be built in durin$ the manufacturin$ process
)f e<uipment malfunction or a defecti%e part is disco%ered" the affected machine
automatically stops" and operators cease production and correct the problem.
@or the &ust-in-Time system to function" all of the parts that are made and supplied
must meet predetermined <uality standards. This is achie%ed throu$h &ido!a.
Jidoka means that a machine safely stops when the normal processin$ is completed.
)t also means that" should a <uality O e<uipment problem arise" the machine detects
the problem on its own and stops" pre%entin$ defecti%e products from bein$
produced. As a result" only products satisfyin$ <uality standards will be passed on to
the followin$ processes on the production line.
*ince a machine automatically stops when processin$ is completed or when a
problem arises and is communicated %ia the 'andon' -problem display board/"
operators can confidently continue performin$ wor! at another machine" as well as
easily identify the problem#s cause to pre%ent its recurrence. This means that each
operator can be in char$e of many machines" resultin$ in hi$her producti%ity" while
continuous impro%ements lead to $reater processin$ capacity.
ust!in!Time
P +roducti%ity impro%ement
- Ma!in$ only 'what is needed" when it is needed" and in the amount neededQ'
+roducin$ <uality products efficiently throu$h the complete elimination of waste"
inconsistencies" and unreasonable re<uirements on the production line.
)n order to deli%er a %ehicle ordered by a customer as <uic!ly as possible" the %ehicle
is efficiently built within the shortest possible period of time by adherin$ to the
followin$?
Project On Operation Research Page =>
1. hen a %ehicle order is recei%ed" a production instruction must be issued to the
be$innin$ of the %ehicle production line as soon as possible.
=. The assembly line must be stoc!ed with re<uired number of all needed parts so
that any type of ordered %ehicle can be assembled.
3. The assembly line must replace the parts used by retrie%in$ the same number
of parts from the parts-producin$ process -the precedin$ process/.
The precedin$ process must be stoc!ed with small numbers of all types of parts and
produce only the numbers of parts that were retrie%ed by an operator from the ne2t
process.
MARKETING STRATEGY
Strategic Focus and Plan
There are three aspects of the e2istin$ corporate strate$y that are de%eloped in
relation to their o%erall impacts caused to the mar!etin$ plan of Toyota Company.
These are7
Mission Statement of the Company
Toyota see!s to create a more prosperous society throu$h automoti%e manufacturin$
-Airoshu" =113/. Therefore" the Company is aimed at achie%in$ a stable and lon$-term
$rowth in future" and this is supposed to be in synchroni4ation with a number of
factors? the si$nificant en%ironment" $lobal economy" local communities ser%ed" and
the )nternal ;n%ironment of sta!eholders.
The Companys Goals
The company has committed itself to offerin$ of hybrid alternati%es for e%ery model
that is sold in the mar!et. This is aimed at enablin$ the Company to ma!e a total sale
of 1 million hybrid %ehicles within a year" and this $oal has been set to ha%e been
achie%ed by the year =11=. Toyota Company has impro%ed its =111 ;n%ironmental
Action +lan and it is committed in si2 different !ey areas" which are? the
;n%ironmental Mana$ement7 chan$es in ;ner$y and Climate7 the Muality of Air7
concerned *ubstances7 the aspects of 8ecyclin$ and )mpro%ed 8esource utili4ation7
and *ocietal Cooperation. The Company is committed to reduce carbon dio2ide
emission and it is belie%ed to ta!e combined actions of ensurin$ that the en%ironment
is !ept clean all the time by obser%in$ the stated fuel economy %alues.
Core Competency and Sustainable Competitive Advantage
Toyota Company is wor!in$ towards the achie%ement of a better and more
sustainable economy by ha%in$ a stable $lobal mar!et. ith ad%ancement in new
technolo$y and other related matters" the Company is in%estin$ in %arious strate$ies
that will enable it to reali4e its set $oals and ob5ecti%es o%er a period of time. The
Company has a well de%eloped and e<uipped networ! of e2pertise that are into
research and de%elopment o%er aspects that are to !eep the Company on top in
product and ser%ice deli%ery to its $lobal mar!et..
Project On Operation Research Page =B
Situation Analysis
ToyotaKs capacity to stay on top of producti%ity efficiency and <uality ran!in$s can be
credited to its internal en%ironment. This entails the way production process is mana$ed
by the top mana$ement who are famous for their competency. The production team
has an insatiable obsession to impro%e the efficiency and effecti%eness of its
manufacturin$ operations. Therefore" to fully understand the situation analysis of
Toyota Company" a *3T analysis is determined and it mainly consists of the
CompanyKs stren$th" wea!nesses" a%ailable opportunities" and finally the threats that
the Company is e2periencin$ or pro5ected to $o throu$h.
S"#T $nalysis
*tren$th and wea!nesses are referred to as internal factors of the Company as their
impact starts from within the Company" while opportunities and threats normally
ori$inates from outside of the Company" hence referred to as e2ternal factors.
Figure 1: SWOT Analysis of Toyota Company (Internal Fators!
Internal Fators Strengths Wea"nesses
Management Having competent and
experienced management team
and board members
Large size of management
team reduces chances of
moving fast into the targeted
market, because of slow rate in
decision making
Offering Hybrid products that are
customer friendly
Expensive in proofing the
market that are right products
for them
Marketing Distribution of products into
the market through wide range
of identified branches
Expensive in establishing this
distribution network
Personnel Have good skilled workforce
who are relied upon
The gap will be big if the
employees left the ompany
Finance !mproved revenues from sales
made in the global market
Limited workforce and
material may slow down the
growth of the ompany in
relation to competitors
Manufacturing "ain supplier of material
ensure fast and #uality
material
Different supply interests
among the ompany suppliers
and other competitors$
R&D %uality of products delivered
is enhanced through out the
period of doing business
Figure #: SWOT Analysis of Toyota Company ($%ternal Fators!
External Factors Opportunities Threats
Consumer/social *tability of the
upcomin$ mar!et is
hi$hly pro5ected
Low priced products
may proof that the
<uality of the products
is <uite low
Competitive 9ifferentiated products
and prices ma!e the
Company to be <uite
distincti%e in the mar!et
+roducts of hi$h
technolo$y are bein$
introduced into the
mar!et by other
competiti%e companies
Technological ,rea!-throu$h in
technolo$ical standin$s
is a better course for
the Company to
impro%e on the <uality
of its products
Economic )mpro%ed consumer
income has made it
con%enient for the
Company to $et deep
into the mar!et
)ndi%iduals optin$ for
other products since
they ha%e enou$h
disposable income
Legal/Regulatory 8e$ulatory measures
ensurin$ fairness in the
mar!et and a%oid o%er-
e2ploitation by other
competitors
Figure &: The SWOT Analysis Matri%
*tren$ths?
Rin%estment in new factories
Rdi%erse ran$e of products
Rimpro%ed mar!etin$ techni<ues
3pportunities?
Rhybrid cars
Rsellin$ technolo$y
Rrisin$ urban youth population
ea!nesses?
RMaintainin$ client base
RMaintainin$ production
Threats?
R@aulty products
R.pcomin$ manufacturers
%ndustry $nalysis
Toyota Company is able to apply its stren$ths and opportunities it has to create a
competiti%e ed$e in the industry. @or instance" the widely differentiated product line is
helpin$ the company to ha%e more $lobal presence. This can also be achie%ed
throu$h enterin$ new mar!ets li!e China and ;urope. Toyota has pre%iously
concentrated on the &apan and American mar!ets and it needs to setup strate$ies to
penetrate the other mar!ets as well.
Toyota has ta!en a $ood position as far as sustainable de%elopment is concerned.
ith the fear of depletion of the fossil fears coupled with the $lobal warmin$ effects"
there is a ready mar!et for the ToyotaKs hybrid car. The company can also use this
opportunity t sell its technolo$y to other firms
Company analysis
Toyota Company is one of the worldKs leaders in car e2port and it appears to literally be
li%in$ its mission" which is to be the world leader in the creation of automoti%es that are
best in terms of %alue. The company is wor!in$ towards the end of creatin$ a society
that is prosperous by pro%idin$ their clientele with the best %alue for their money. They
belie%e in $i%in$ the best prices for the client yet still deli%er a %ehicle that is at per with
those bein$ offered by their other ma5or competitors. This could be the reason why their
products are ha%in$ a %ery $ood mar!et in the de%elopin$ nations. The Company is
also conscious about sustainable de%elopment" and this can be clearly seen in its
different corporate social responsibilities as well its sustainable de%elopment initiati%es
aimed at reducin$ the pollution of the en%ironment.
Customer $nalysis
ToyotaKs customers are %ery di%erse and they ran$e from the low income earners to the
%ery rich. They are widespread around the world. Toyota has catered for all car needs
that may arise for any indi%idual with their wide ran$e of motor %ehicles. They ran$e
from small sports cars to bi$ family %ehicles and truc!s as well as %ans. The customers
comprise a %aried $roup of people" with differin$ a$es" incomes" $eo$raphical locations"
and social and cultural statuses. Customers $o for Toyota products to satisfy different
wants and needs. Low income earners are pro%ided with a basic mode of transportation
that is both within their price ran$e and efficient. Clients $oin$ for class and ele$ance
are also catered for.
Customers purchase Toyota products on indi%idual basis accordin$ to their specific
needs. )n some cases we ha%e or$ani4ations purchasin$ cars for their firmKs usa$e or
for their employees. )n such a case" the product buyer and purchaser is not actually the
product user. 3nce indi%iduals purchase the companyKs product" there is an increased
e2posure to its other products. +roduct awareness is enhanced throu$h
ad%ertisements" newsletters" website information" and other informational sources. The
opportunity for Toyota to $enerate income from complimentary products such as boo!s
and seminars by members is %ery bi$.
"here do they Purchase&
Most of ToyotaKs products are sold throu$h retail distributors located all o%er the world.
+urchase can also be made directly from the factories" as is the case with limited
edition models. The increase in the use of electronic commerce" Toyota as well" that is"
purchasin$ products on-line. Ma5ority of the ad%ertisin$ materials can be obtained in full"
on-line %iew o%er the )nternet. 3n-line publications diminish paper waste while $i%in$
e2istin$ and direct a%ailability of the product to clients. Customers are able to order a
product in stores and with a toll-free number directly from the company as well -,oo4"
=117/. This $rants customers around the world access to the companyKs products.
"hen do they Purchase&
)ndi%iduals can purchase the companyKs products anytime that they li!e" at any time of
the year. This is because Toyota sells its cars all year round" e2cept for the limited
editions which are purchased directly from the factories. :ew users often purchase cars
after ac<uirin$ a dri%erKs licence in the case of some countries when $oin$ to hi$h
school or to colle$e in others. 3ther users usually purchase a new car when the old one
brea!s or $ets too old or when they want to trade in for a newer car or a different model.
"hy do they Purchase&
Customers select Toyota products o%er other manufacturers primarily because of their
comprehensi%e" yet speciali4ed" nature. Toyota offers a di%erse ran$e of cars that
encompass all needs of the clients. They are focussed on buildin$ and maintainin$ hi$h
standards when it comes to the products. They offer cheaper alternati%es to the clients
for the same products from other manufacturers that are <uite e2pensi%e. Toyota has
also in%ested hea%ily on safety in their cars. As the $lobe $oes $reen and clients call for
an appropriate response from their car manufacturers" Toyota ha%e responded by
in%estin$ in hybrid cars" the +rius. This may be the future of the motor industry. The
hi$h <uality products ma!e it all that easy for a customer to $o bac! to the shop and
purchase another Toyota product -@lana$an" =117/.
"hy Potential Customers 'on(t Purchase.
As is the case for many lar$e or$ani4ations" ToyotaKs tar$et mar!et defines a much
wider population than their customer base actually reflects. There are many car
manufacturers who ha%e come up and the motor industry is currently flooded with many
products. Many of these products are similar" often differin$ due to one or two features
that may or may not be si$nificant. )n this case" it comes down to personal li!e and
disli!e. The other reason is the issue of class and social status. Toyota products do not
always $i%e the implication of a hi$h social standin$. A customer may choose to buy a
car from a competitor and not from Toyota simply because of that" and yet the car is the
same.
Product!)arket *ocus
)n this section" the Company three year de%elopment pro5ections is clearly e2plained in
%arious cate$ories" which are de%elopin$ of a strate$ic focus7 mar!etin$ $oals and
ob5ecti%es7 tar$et mar!et7 and the Company position in the mar!et.
$evelopin# a (trate#i Fous
Toyota has already embraced product differentiation as a ma5or strate$y in mar!et
penetration and the strate$y is wor!in$ well. )t is determined to use a pricin$
mechanism that will $i%e it a competiti%e ed$e o%er its main competitors. The cost of
production of a unit for Toyota is pro5ected to be lar$e but due to possible mass
production plants" the o%erall cost will not be a hu$e issue in this case. This means
the company will be able to sell its products at an e%en lower price yet still remain
profitable. The company is ta!in$ an ad%anta$e of this and usin$ it to penetrate the
mar!ets of emer$in$ economies with affordable products.
Mar,etin# -oals and "b/etives
ToyotaKs enormous si4e and capacity is a $reat ad%anta$e in meetin$ industry
$rowth. The number of clients in need of cars is constantly increasin$" thus creatin$ a
bi$$er mar!et for Toyota and re<uirin$ more of their products. The percei%ed
importance of ownin$ a car due to increased tra%ellin$ needs in todayKs lar$ely
corporate world is constantly increasin$ as well. ToyotaKs $reat si4e will enable them
to successfully meet the needs of this $rowin$ population of customers in need of
cars -9obbin" =11=" p.61/.
The company !eeps ma!in$ <uality product and ma!e it a rule not compromise on
this" and not to $i%e in to the competitorsK pressure and raise their prices then clients
will remain loyal to the company -Armstron$ E (otler" =11=/. Then" e%eryone has a
chance to !now the real %alues behind ToyotaKs past" current" and hopefully future
e2istence -Armstron$ E (otler" =113/.
Toyota is in the process of en$ineerin$ lesser platforms to be used in the assembly of
its different models. This is as a cost cuttin$ measure7 they intended to compress
their platforms from =1 to ten in the ambitious e2ercise. This is especially important
since their chief ri%als7 CM and @ord ha%e made notable impro%ements in their
production process. Toyota is also thin!in$ twice about its bloated assembly points. )t
is thin!in$ of best ways to reduce them without hinderin$ its efficiency -Mullins"
al!er E ,oyd" =111/.
Target )arket
Each o' Toyota6s pro"cts is esigne to target a speci'ic )ar&et% The esign criteria range
'ro) top spee# capacity an e7terior appearance (i&e co(o"r an shape% There is a high spee#
s)a((# t.o*seat )oe( cars 'or the re(ati,e(y yo"nger an sing(e peop(e .ho are a,ent"ro"s
to the +ig 'i,e*seat )oe(s 'or the 'a)i(y set "p% De)ographica((y# they a(so target sit"ations
on the s)ooth tar)ac roa as .e(( as the ro"gh an r"gge o'' roa terrain%
Toyota has +een pre,io"s(y +(a)e +y the $)erican Mar&ets that their pro"cts are (ac&ing in
'(air an esign "n(i&e those o' 8M an For% This has (e the co)pany to +e )ore attenti,e
to its $)erican esigners to )a&e s"re this nees are )et% The KB pic&"p .hich .as (a"nche
recent(y .as as a res"(t o' this a)+itio"s% The hy+ri )oe(# Pri)"s# has a(so +een
trans'or)e since at its inception# it in6t hit the $)erican )ar&et% Ehen they )ae it (oo&
)ore '"t"ristic# it res"(te in +ig ,o(")es o' sa(es%
O,er(y# the Toyota Co)pany is gi,ing its co)petitors a har ti)e% E,en tho"gh it has
e7perience cha((enges (i&e the recent reca((s# it is sti(( nota+(e in )ar&et (eaership position%
I' the c"rrent i)pressi,e res"(ts an g(o+a( positioning o' the co)pany is anything to go +y#
then this is a position Toyota is not (i&e(y to (ose any ti)e soon%
Company Position in the )arket
Toyota Company has been producin$ %ehicles and si$nificant products that are not
e2pensi%e and readily a%ailable. This has been a si$nificant factor that has enabled the
Company to ha%e a ma5or cut in the mar!et " and it is pro5ectin$ to ha%e most of the
mar!et by the end of =113" as it has put a cross a number of strate$ies to enable it
reach the set tar$et.
Market Program
This consists of the four mar!etin$ mi2 elements that are desi$ned to fit the mar!et in
terms of their needs and ability to access such products and ser%ices.
Product Strategy
The Company is belie%ed to be mo%in$ with a strate$y of mass production of which it
has enabled it to sell widely in the $lobal mar!et. )t has also included the strate$y of
hybrid product" where it can double the amount of production for the arisin$ needs in
the mar!et.
Price Strategy
The reputation of the Company has been de%eloped by producin$ hi$h <uality %ehicles
that can be bou$ht at a reasonable price. The Company has also been usin$ tactful
pricin$ strate$ies throu$h price differentiation so that they are different from other
automobile producers.
+ocation Strategy
,ein$ a $lobal producer and supplier of Toyota automobiles and their components"
Toyota Company has positioned itself all o%er the world $i%in$ it a clear cut within the
mar!et. ithin three years to come" it is wor!in$ towards the achie%ement of about 30
percent of the mar!et share" and this will ma!e it to be best and top supplier of
automobile products.
Promotion Strategy
The Company is determined to use a pricin$ mechanism that will $i%e it a competiti%e
ed$e o%er its main competitors. This is a mechanism that it is usin$ to mar!et itself so
that it can $et hold of mar!et share that will see it better in achie%in$ the hi$hest le%el
in the mar!et.
)arketing %mplementation $nalysis
Toyotas main focus will be in reachin$ the new mar!ets of China and ;urope. )t will
also be concerned about the competition from other firms li!e @ord and CM. An
ad%anta$e the company has is the widely differentiated product ran$e. ;stablishin$
new factories in these new mar!ets as well as openin$ up new franchises will help
the company in $ettin$ an ease of penetratin$ the new mar!ets
Auman resource is one of the most important aspects in this plan. The company
should always ma!e sure they ha%e hi$hly moti%ated staff as this is directly
proportional to $ood production both in the <ualitati%e and <uantitati%e aspects.
Toyota can do this by comin$ up with schemes of rewardin$ their employees li!e
helpin$ them own cars subsidi4ed rates. The company should also ma!e sure the
personnel are the best in terms of technical !now-how. The company needs to carry
out fre<uent trainin$ towards this end.
*inancial data and Pro,ections
The pre%ious years ha%e seen ToyotaKs profit $rows each year with an e2ception of
=119 due to the economic downturn as well as the recalls. The fi$ures below illustrate
this
*igure-. Toyotas impressive performance in the last four years /ohnson0 12234

ith the ad%ent of more efficient production technolo$ies coupled with the entrance
into the new mar!ets" it is e2pected that the increase in profits will continue for the
ne2t fi%e years. ,elow are the pro5ections for the ne2t fi%e year period
*igure1. Pro,ected financial returns for the next five years /ohnson0 12234
S%&'( #)*'+%(, M-&&-).( )/ Y'.
Iear =119 =111 =111 =11= =113
:et *ales
3peratin$
income
3rdinary )ncome
:et )ncome
8esearch
9i%idendsOyen
1"=63"660
06"1=1
71"91=
6>"1=3
31"101
3=
1"600">01
>0"1=3
B1.>3>
67"999
3="101
66
1"911"361
B9"906
11B"6B6
>1"=31
31"101
01
1"907"B79
9B"1031
1=0"666
B1"=36
=1"101
>1
="111"036
99"7>1
16"363
07"07>
31"101
7B
Tactical )arketing $ctivities
Toyota has ta!en a bold step in bein$ a leader in sustainable de%elopment. This
position will need some inno%ations which translate to e2penditure. They are howe%er
necessary as a way of stayin$ ahead of competition. The acti%ities the company will
embar! on are $i%en in fi$ure 3
Fi#ure 01 Tatial Mar,etin# ativities
*pecific Tactical Acti%ities
+ersonO9epart
ment
8esponsible
8e<uired
,ud$et
millions of
yen
Completio
n
9ate
+roduct Acti%ities
1.Car air conditionin$ compressor
=.9C-9C con%erters for fuel
efficiency
3.Low ;2haust ;mission ;n$ine
+roduction
en$ineers and
+roduct
mana$ement
31.60 =111
+ricin$ Acti%ities
1.:ew Technolo$ies
=.Compression of +roduction
platforms
3.Mer$er of Assembly points
3perations
mana$ement
10.=0 =11=
9istribution Acti%ities Lo$istics =1.61 =111
1. 3penin$ up of new factory in
America and china
=. Machine handlin$
3.Lo$istical operations
mana$ement
)MC -+romotion/ Acti%ities
1.Concerts
=.Dolunteer
3Iouth )n%ention club
Mar!etin$
mana$er
9.=1 =11=
%mplementation Plan
There are a number of acti%ities that ha%e been pro5ected within a life span of three
years and the followin$ representation shows the aspects that ha%e been tar$eted
and within what strate$ic period of time.
Year To be Achieved e! Targeted
Markets
"millions#
Cumulative
Targeted
Markets
"millions#
Today "$%&%# or!in$ towards
hybrid products
$'% $'%
&
st
Year "$%&&# )ntroduction of
pricin$
mechanism and
price
differentiation
strate$ies.
($% )%%
$
nd
Year "$%&$# ;nhancin$ hybrid
products by use
of new
technolo$ies
(*% +*%
(
rd
Year "$%&(# +roduct
differentiation to
meet the needs
of the mar!et
,$% &($%
Evaluation and Control
There is a monitorin$ and e%aluation team that will be set to watch o%er the pro$ress of
the company in reali4in$ the strate$ic $oals. The short term $oals will be clearly
watched and corrections put in place where tar$ets are missed for they are the !eys to
fulfillin$ the lon$ term $oals. Currently" the Company has made a clear step forward in
ensurin$ that hybrid %ehicles are bein$ produced" and so far the mar!et has started
impro%in$ in terms of o%erall reception of these brands of %ehicles. Another aspect that
is supposed to be considered here is the speed of the roll-out pro$ram of pricin$
mechanism introduced. Currently" it has ta!en the mar!et by surprise as most of Toyota
products are found to be customer friendly. The Company has been able to come up
with a differentiation pro$ram for its products and this has helped it to ha%e a hu$e
mar!et share. )t is pro5ects to impro%e and reach the tar$et within three years and this
will be determined by the rate of $rowth and the total number of mar!et reached.
FINANCIAL SOLUTION
%ncome Statement
Diew? Annual -ata All numbers in thousands
+eriod ;ndin$ (&.Mar.$%&& (&.Mar.$%&% (&.Mar.$%%+
Total Revenue $$+/&*&/%%% $%$/0&,/%%% $%*/0'$/%%%
Cost of 8e%enue =11"676"111 17B"001"111 1B>"B0>"111
1ross 2ro3it $0/)+)/%%% $,/$)(/%%% $%/++)/%%%
3peratin$ ;2penses
8esearch 9e%elopment - - -
*ellin$ Ceneral and Administrati%e =3"16>"111 ==">B0"111 =0">>3"111
:on 8ecurrin$ - - -
3thers - - -
Total 3peratin$ ;2penses - - -
4perating 5ncome or Loss '/)'%/%%% &/'*+/%%% ",/))0/%%%#
)ncome from Continuin$ 3perations
Total 3ther )ncomeO;2penses :et 1"011"111 1"B9B"111 -031"111/
;arnin$s ,efore )nterest And Ta2es 7"101"111 3"677"111 -0"199"111/
)nterest ;2pense 306"111 30B"111 670"111
)ncome ,efore Ta2 >"79>"111 3"119"111 -0">76"111/
)ncome Ta2 ;2pense 3"776"111 99="111 -071"111/
Minority )nterest ->91"111/ -37="111/ =6>"111
:et )ncome @rom Continuin$ 3ps 6"9=0"111 ="=6="111 -6"6=6"111/
:on-recurrin$ ;%ents
9iscontinued 3perations - - -
;2traordinary )tems - - -
;ffect 3f Accountin$ Chan$es - - -
3ther )tems - - -
et 5ncome ,/+$'/%%% $/$,$/%%% ",/,$,/%%%#
+referred *toc! And 3ther Ad5ustments - - -
et 5ncome Applicable To Common
6hares
,/+$'/%%% $/$,$/%%% ",/,$,/%%%#
Currency in .*9.

$556$+ '$T$ #* %5C#)E ST$TE)E5T

7alance Sheet
Diew? Annual 9ata All numbers in thousands
+eriod ;ndin$ 31-Mar-=111 31-Mar-=111 31-Mar-=119
Assets
Current Assets
Cash And Cash ;<ui%alents =0"110"111 19"9>7"111 =6"76B"111
*hort Term )n%estments 17"=6>"111 =3"396"111 0"67="111
:et 8ecei%ables 7B"613"111 70"B09"111 >="997"111
)n%entory 10"737"111 10"==="111 16"77>"111
3ther Current Assets >"=63"111 0"67="111 >"616"111
Total Current Assets 16="736"111 139"916"111 116"39>"111
Lon$ Term )n%estments 13="933"111 110"=61"111 97"76>"111
+roperty +lant and ;<uipment 7>"1=6"111 71"B=1"111 76"939"111
Coodwill - - -
)ntan$ible Assets - - -
Accumulated Amorti4ation - - -
3ther Assets 7"9B0"111 7"B=3"111 7"109"111
9eferred Lon$ Term Asset Char$es - - -
Total Assets 309"770"111 3=6"B11"111 =96"=61"111
Liabilities
Current Liabilities
Accounts +ayable 61"B9="111 61"109"111 =9"=76"111
*hortOCurrent Lon$ Term 9ebt 7B"B13"111 >6"9>>"111 71"76B"111
3ther Current Liabilities 11"01>"111 B"=61"111 7"1B9"111
Total Current Liabilities 131"=11"111 116"3>6"111 117"=1="111
Lon$ Term 9ebt 77"B16"111 70"179"111 >3"799"111
3ther Liabilities 11"==9"111 9">76"111 9"39B"111
9eferred Lon$ Term Liability Char$es 9"770"111 B"713"111 >"013"111
Minority )nterest 7"191"111 >"11B"111 0"6>="111
:e$ati%e Coodwill - - -
Total Liabilities ==B"11B"111 =17"B=="111 1B>"91="111
*toc!holders# ;<uity
Misc *toc!s 3ptions arrants - - -
8edeemable +referred *toc! - - -
+referred *toc! - - -
Common *toc! 6"791"111 6"=69"111 6"1=1"111
8etained ;arnin$s 16="B10"111 1=3"B1B"111 11>"70="111
Treasury *toc! -10"=19"111/ -13"6B9"111/ -1="7>>"111/
Capital *urplus >"11="111 0"3>0"111 0"170"111
3ther *toc!holder ;<uity -13"B1="111/ -9"1>3"111/ -11"=1>"111/
Total *toc!holder ;<uity 1=6">>7"111 111"B71"111 111"B>0"111
:et Tan$ible Assets 1=6">>7"111 111"B71"111 111"B>0"111
Currency in .*9.
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@undamental company data pro%ided by Capital )M. Aistorical chart data
and daily updates pro%ided by Commodity *ystems" )nc. -C*)/.
)nternational historical chart data" daily updates" fund summary" fund
performance" di%idend data and Mornin$star )nde2 data pro%ided by
Mornin$star" )nc.

C$SH *+#" #* T#8#T$ )#T#9S
Diew? Annual -ata S All numbers in thousands
+eriod ;ndin$ (&.Mar.$%&& (&.Mar.$%&% (&.Mar.$%%+
et 5ncome ,/+$'/%%% $/$,$/%%% ",/,$,/%%%#
4perating Activities/ Cash 7lo!s 2rovided 8y or 9sed 5n
9epreciation 16"1B6"111 10"139"111 10"13B"111
Ad5ustments To :et )ncome -1"=>1"111/ 1"61B"111 ="919"111
Chan$es )n Accounts 8ecei%ables 0"1B0"111 ->"17="111/ B"113"111
Chan$es )n Liabilities -="016"111/ 11"3=0"111 -11"60="111/
Chan$es )n )n%entories >=0"111 >11"111 1"96B"111
Chan$es )n 3ther 3peratin$ Acti%ities =">70"111 3"6>B"111 3"10>"111
Total Cash 7lo! 7rom 4perating Activities $,/,$&/%%% $*/(0$/%%% &,/+'(/%%%
5nvesting Activities/ Cash 7lo!s 2rovided 8y or 9sed 5n
Capital ;2penditures -7"093"111/ ->"671"111/ -13"B1>"111/
)n%estments -1B"0>1"111/ -=6"096"111/ BB1"111
3ther Cash flows from )n%estin$ Acti%ities >19"111 0>="111 6B1"111
Total Cash 7lo!s 7rom 5nvesting Activities "$'/'('/%%%# "(%/'%(/%%%# "&$/,''/%%%#
7inancing Activities/ Cash 7lo!s 2rovided 8y or 9sed 5n
9i%idends +aid -1"713"111/ -1"B6>"111/ -6"600"111/
*ale +urchase of *toc! -360"111/ -111"111/ -710"111/
:et ,orrowin$s 7"=BB"111 -1"119"111/ 1="=60"111
3ther Cash @lows from @inancin$ Acti%ities - - -
Total Cash 7lo!s 7rom 7inancing Activities '/$,%/%%% "$/+*'/%%%# */%*'/%%%
;ffect 3f ;2chan$e 8ate Chan$es -1"033"111/ -90"111/ -1"316"111/
Change 5n Cash and Cash E:uivalents $/'+,/%%% ")/&+$/%%%# 0/$'+/%%%
Toyota )otor Corporation Common
-:IM? TM /
Last Trade; )*<(,
Trade Time; 11?39+M
Change; 1.11 -1.>=J/
2rev< Close; >B.60
4pen; >B.13
8id; >7.30 2 =11
Ask; >7.3B 2 311
&y Target
Est<;
07.36
-ay=s Range; >7.11 - >B.16
'$!k Range; >1.37 - 93.91
>olume; 169"117
Avg< >ol<
"(m#;
039"9B9
Market Cap; 110.0B,
2/E "ttm#; 61.B7
E26 "ttm#; 1.>0
-iv ? Yield; 1.90 -1.61J/
Muotes delayed" e2cept where indicated otherwise. Currency in .*9.
*%5$5C%$+ '$T$

Capital in%estment and 8E9 Dehicle production

Dehicle production by re$ion Dehicle sales

Dehicle sales by re$ion
:et re%enues operatin$ income
*inancial Performance /Consolidated4
7iscal 7inancial 5ndicator
Year
4perating income
return on
revenues
2reta@ return
on revenues
2reta@
return on
capital
Return on
assets
"R<4<A<#
Return on
e:uity
"R<4<E<#
6hareholders=
e:uity ratio
7Y$%&&=.0J 3.1J 1.9J 1.6J 3.9J 36.7J
7Y$%&%1.BJ 1.0J 1.1J 1.7J =.1J 36.1J
7Y$%%+ =.=J =.7J 1.BJ 1.6J 6.1J 36.>J
7Y$%%0B.>J 9.3J 7.0J 0.3J 16.0J 3>.>J
7Y$%%*9.3J 9.9J 7.BJ 0.6J 16.7J 3>.3J
7Y$%%)B.9J 9.9J 7.9J 0.=J 16.1J 3>.BJ
7Y$%%'9.1J 9.0J 7.>J 0.1J 13.>J 37.=J
7Y$%%,9.>J 11.=J B.6J 0.0J 10.=J 37.1J
7Y$%%(B.=J 7.9J >.=J 3.BJ 11.6J 30.3J
7Y$%%$7.7J >.9J 0.6J 3.1J 7.BJ 37.>J
7Y$%%&>.1J B.0J >.>J 6.1J 9.>J 61.>J
A7inancial 3igures are based on 9<6< 1AA2 "1enerally Accepted Accounting
2rinciples#
$ividend Poliy (As of Mar% 023 4522)
TMC /Toyota Motor Corporation0 ee)s the +ene'it o' its shareho(ers as one o' its priority
)anage)ent po(icies# an it is .or&ing to i)pro,e corporate str"ct"re to.ars the rea(i>ation
o' s"staina+(e gro.th in orer to enhance its corporate ,a("e%
TMC .i(( stri,e to contin"e to pay i,iens .hi(e gi,ing "e consieration to 'actors s"ch as
+"siness res"(ts 'or each ter)# in,est)ent p(ans an its cash reser,es%
In orer to s"r,i,e sti'' co)petition# TMC p(ans to "ti(i>e its interna( '"ns 'or the ear(y
co))ercia(i>ation o' techno(ogies 'or the ne7t*generation en,iron)ent an sa'ety# gi,ing
priority to c"sto)er sa'ety an sense o' sec"rity%
TMC pays i,iens t.ice a year L an interi) i,ien an a year*en i,ien% In orer to
sec"re an opport"nity to irect(y see& shareho(ers4 opinions# TMC treats pay)ents o' year*
en i,iens as a )atter to +e reso(,e at the 8enera( Shareho(ers4 Meeting# e,en tho"gh
TMC4s artic(es o' incorporation stip"(ate that retaine earnings can +e istri+"te as i,iens
p"rs"ant to the reso("tion o' the +oar o' irectors%
Consiering these 'actors# an ann"a( i,ien o' CA yen per share .as pai 'or 'isca( ?A::#
consisting o' a year*en i,ien o' <A yen per share an an interi) i,ien o' ?A yen per
share%
NoteD The Boar o' Directors eter)ine the interi) i,ien 'or the (ast ter) on No,e)+er
C# ?A::%

9i%idends per share
5otice Concerning 'istribution of %nterim 'ividends
from Surplus
At a meetin$ held on :o%ember B" =111" the ,oard
of 9irectors of Toyota Motor Corporation -'TMC'/
resol%ed to distribute di%idends from surplus" with
record date dated *eptember 31" =111. )n relation
to the abo%e" we hereby inform you of the followin$?
1. Details of dividends

)nterim di%idend for
@I =11=
Most recent
di%idend forecast
8ecord 9ate*eptember 31" =111*eptember 31" =111
9i%idend
per share
=1.11 yen :ot reported =1.11 yen
Total
amount
of di%idends
>="713 million yen - >="719 million yen
;ffecti%e
date
:o%ember 31" =111 - :o%ember =>" =111
*ource of
di%idends
8etained earnin$s - 8etained earnin$s
2. Reason for the dividend amount

TMC deems the benefit of its shareholders as one of its priority mana$ement
policies and stri%es to continue to pay stable di%idends while $i%in$ due consideration
to factors such as business results for each term" in%estment plans and its cash
reser%es.
)n order to successfully compete in this hi$hly competiti%e industry" TMC will focus
on the early commerciali4ation of technolo$ies for the ne2t-$eneration en%ironment
and safety" $i%in$ priority to customer safety and sense of security.
,ased on the fore$oin$" TMC#s interim di%idend for the year is =1 yen per share.
Details of Dividends through the fiscal ear
9i%idend per share -yen/
8ecord date ;nd of interim ;nd of fiscal Total
period period
9i%idends for @I=11=
-endin$ March 31"
=11=/
=1.11 - -
9i%idends for @I=111
-ended March 31"
=111/
=1.11 31.11 01.11
$
$
GROWTH OF TOYOTA MOTORS IN 5 YEAR
PRICE CHART
HR POLICIES
P69P#SE.
;mbodiment of mana$ement that respects people to create perpetual prosperity for
the company.
7$S%C P9%5C%P+E.
;stablishment of relationship of mutual trust and respect.
78.
- ,uildin$ a relationship" in which" employee himOherself ta!es up part of responsibility
in corporate acti%ities.
- Contributin$ to self reali4ation of employees throu$h continuously e2ercisin$ their
facilities throu$h the 5ob
The Eight H9 Processes That Contributed to Toyota(s Success
1. Re!ards and recognition P The purpose of any corporate reward process is
to encoura$e and incant the ri$ht beha%iours and to discoura$e the ne$ati%e
ones. )tKs important for the reward process to incant the $atherin$ of information
about problems. )tKs e<ually important to reward employees who are successful
in $ettin$ e2ecuti%es to ta!e immediate action on ne$ati%e information.
=. Training P The purpose of trainin$ is to ma!e sure that employees ha%e the
ri$ht s!ills and capabilities to identify and handle all situations they may
encounter. Toyota is famous for its four-step cycle P planOdoOchec!Oact P but
clearly the trainin$ amon$ mana$ers now needs to focus more on the last two.
)n addition" in an en%ironment where safety is paramount" e%eryone should
ha%e been trained on the symptoms of L$roupthin!N and how to a%oid the
e2cess discountin$ or i$norin$ of ne$ati%e e2ternal safety information.
3. Biring P The purpose of $reat hirin$ is to brin$ on board top-performin$
indi%iduals with the hi$h le%el of s!ills and capabilities that are re<uired to
handle the most comple2 problems. +oorly desi$ned recruitin$ and
assessment elements can result in the hirin$ of indi%iduals who sweep problems
under the ru$ and who are not willin$ to stand up to mana$ement.
6. The per3ormance management process P The purpose of a performance
mana$ement process is to periodically monitor or appraise performance" in
order to identify problem beha%iours before they $et out of hand. )f the
performance measurement system included performance factors to measure
responsi%eness to ne$ati%e information" Toyota wouldnKt be in turmoil today.
0. The corporate culture P The role of a corporate culture is to informally dri%e
employee beha%iours so that it closely adheres to the companyKs core %alues.
,ecause these errors occurred under difficult dri%in$ conditions" itKs hard to
blame the production $roup" which has a well-!nown reputation for *i2 *i$ma
<uality in its construction. The ne$ati%e reports came to functions li!e
$o%ernment" ris! analysis" corporate and customer satisfaction. As a result" it is
the culture within the corporate offices that need to be more closely monitored
rather than assumin$ that the culture was ali$ned. )t appears that the corporate
culture created leaders so concerned with Lsa%in$ faceN and so ad%erse to
ne$ati%e publicity" that they for years postponed ma!in$ the announcement of a
massi%e recall.
>. Leadership development and succession P The purpose of leadership
de%elopment and succession plannin$ processes are to ensure that a sufficient
number of leaders with the ri$ht s!ills and decision-ma!in$ ability are placed
into !ey leadership positions. )t is li!ely that the leadership de%elopment and the
promotion process both failed to create and promote leaders who were capable
of confrontin$ problems and ma!in$ difficult decisions.
7. Retention P The purpose of a retention pro$ram is to identify and !eep top
performers and indi%iduals with mission-critical s!ills.
B. Risk assessment P Most A8 departments donKt e%en ha%e a ris! assessment
team whose purpose is to both identify and calculate ris!s caused by wea!
employee processes. Clearly A8 should ha%e wor!ed with corporate ris!
mana$ement at Toyota in order to ensure that employees were capable of
calculatin$ the lon$-term actual costs of i$norin$ product failure information.
Selection
*election is defined as the process of differentiatin$ between applicants in order to
identify -and hire/ those with a $reater li!elihood of success in a 5ob.
*election is basically pic!in$ an applicant from -a pool of applicants/ who has the
appropriate <ualification and competency to do the 5ob.
9ole of selection.
*election is crucial for the or$ani4ations effecti%eness for = reasons?
1# Cork per3ormance? +erformance of the or$ani4ation is %ery important to the
success of the Company. *o the or$ani4ation always employs people who are well
<ualified and competent.
=/ Cost incurred? Cost incurred while selection process also plays an important role.
5eed for training:
The need for trainin$ of employees is uni%ersally accepted and practical trainin$ in
the form of information" instructions and $uidance is $i%en to all cate$ories of
employees. )t is a must for raisin$ efficiency of employees. Trainin$ is necessary in
present competiti%e and e%er chan$in$ )ndustrial world.
The 3ollo!ing points "reasons# Dusti3y the need 3or training?
o Trainin$ is needed as a $ood supplement to schoolOcolle$e education.
Trainin$ at the )ndustry le%el is practical and is needed for creatin$
confidence amon$ employees. )t is also needed for personal $rowth and
de%elopment of employees.
o Trainin$ is needed due to continuous chan$es in the field of science and
technolo$y.
o or!ers can wor! as per new methods or can use new machines only
when suitable practical trainin$ is $i%en to them. Trainin$ is the only
method by which the !nowled$e and s!ills of wor!ers are updated.
o Trainin$ is needed in order to introduce modern methods or for the
introduction of rationali4ation and computer technolo$y in the industrial
units.
o Trainin$ is needed for raisin$ the efficiency and producti%ity of industrial
employees.
o )t is needed for impro%in$ the <uality of production and also for a%oidin$
accidents and wasta$es of all !inds in the industrial units.
o Trainin$ is needed for personal safety of employees and also for a%oidin$
dama$e to machines and property of the company.
o Trainin$ is needed as it creates hi$hly s!illed manpower in an
or$ani4ation. *uch s!illed manpower is the real asset of an industrial unit.
o Trainin$ is needed for pre%entin$ manpower obsolescence" for impro%in$
health and safety of wor!ers" for impro%in$ or$ani4ational climate and
finally for meetin$ future personnel needs of the or$ani4ation.

PE9*#9)$5CE $PP9$%S$+.
)n simple terms" performance appraisal may be understood as the assessment of an
indi%idualKs performance in a systematic way" the performance bein$ measured
a$ainst such factors as 5ob !nowled$e" <uality and <uantity of output" initiati%e"
leadership abilities" super%ision" dependability" co-operation" 5ud$ment" %ersatility"
health and the ali!e. Assessment should not be condensed to past performance
alone. +otentials of the employee for future performance must also be assessed.
#b,ectives of Performance $ppraisalD
9ata relatin$ to performance assessment of employees are recorded" stored" and
used for se%eral purposes. The main purposes of employee assessment are?
1. To effect promotions based on competence and performance.
=. To confirm the ser%ices of probationary employees upon their completin$ the
probationary period satisfactorily.
3. To assess the trainin$ and de%elopment needs of employees.
6. To let the employees !now where they stand insofar as their performance is
concerned and to assist them with constructi%e criticism and $uidance for the purpose
of their de%elopment.
0. To impro%e communication. +erformance appraisal pro%ides a format for dialo$ue
between the superior and the subordinate" and impro%es understandin$ of personal
$oals and concerns.
>. @inally" performance appraisal can be used to determine whether A8 pro$rammers
such as selection" trainin$" and transfers ha%e been effecti%e or not.
7. ,roadly" performance appraisal ser%es four ob5ecti%es-
)/ 9e%elopment uses"
ii/ Administrati%e usesOdecisions"
iii/ 3r$ani4ational maintenanceOob5ecti%es" and
i%/ 9ocumentation purposes.
)#T%:$T%#5.
Toyota $i%es both financial as well as non financial moti%ator to their employees.
hat type of moti%ational tool $i%en in ToyotaT
U Annual *alary 8e%ision.
U +romotion
U &ob ;nrichment
U 9ele$ation E authority
U Telephone @acility
U ,onus
U Muarters
UToyotaKs share etc
CONCLUSION
Toyota is ma!in$ a product that is both $ood for the societyOen%ironment and practical
at the same time. )t is practical in that there is a demand for it and that Toyota
presumably is ma!in$ money or will ma!e money on the product. Toyota is also
loo!in$ towards further de%elopment of the en$ine" possibly combinin$ an alternate
fuel source other that $asoline with the electric component.
e belie%e that Toyota is actin$ as a social entrepreneur with these lines of cars.
They are pro%idin$ a ser%ice to humanity and the en%ironment while also presumably
sustainin$ a business. Accordin$ to &ames ,roo! of the :ew Ior! Times" Toyota has
claimed that it reached the brea!-e%en point for its profitability on its hybrid models"
but industry e2perts in To!yo find it impossible to !now e2actly how profitable these
cars ha%e been for Toyota so far.
i
;%en if they are losin$ money" ) thin! in the lon$
run it will be where all auto production is headed" e%idenced by the fact that oil is a
limited resource and by the increased competition in the hybrid sector -while Toyota
and its competitors do not disclose how much they put into research and
de%elopment of these cars" Toyota" :issan" and Aonda all raised their bud$ets for
8E9 by ten percent/. Toyota was the one to first mass-mar!et and produces these
cars with the +rius and deser%es much of the credit for leadin$ the way.
Project On Operation Research Page >1
BIBLIOGRAPHY:
,33( 8;@;8;:C;?-
OPERATION RESEARC 0 J.$. SARMA
#INANCIAL MANAGEMENT- I. M. PANDEY
MAR$ETING MANAGEMENT- PILIP $OTLER
;,*)T; 8;@;8;:C;?-
111.TOYOTA.COM
111.TOYOTABARAT.COM
111.TOYOTA.CO.JP
111.ERE.NET
111.RESEARCANDMAR$ETS.COM
111.TEPENSTERS.COM
111.MANAGEMENTPARADISE.COM

Project On Operation Research Page >1
CONTRIBUTION OF TEAM MEMBERS:-
&"&'(EET )*"&'+ !nterpretation, H$' , -peration
.trategy$
&.H!.H )'$ .!/0H+ "arketing .trategy , Editing
&1H!.HE) 2&TEL+ 3inancial .olution

Project On Operation Research Page >=
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