Strategic Human Resources

Management
Toyota Motor Corporation
Strategic Human Resources Management

Table of Contents

1 TOYOTA’S OVERVIEW:....................................................................................................................... 3

1.1 SHRM PERSPECTIVE OF TOYOTA (HIGH-PERFORMANCE HR STRATEGY):.....................................................4

1.2 SWOT ANALYSIS OF TOYOTA:.......................................................................................................................5
1.3 RECOMMENDATION:.......................................................................................................................................7

2 ENVIRONMENTAL ANALYSIS:........................................................................................................... 7

2.1 PESTEL ANALYSIS:.......................................................................................................................................7

2.1.1 Political Factors:....................................................................................................................................7
2.1.2 Economic Factors:.................................................................................................................................8
2.1.3 Social Factors:.......................................................................................................................................9
2.1.4 Technological Factors:........................................................................................................................10
2.1.5 Legal:....................................................................................................................................................10
2.1.6 Environmental:.....................................................................................................................................11
2.2 INFLUENCE ON BUSINESS STRATEGY AND HR STRATEGY:............................................................................11

3 STRATEGIC PRIORITIES/ OBJECTIVE OF TOYOTA:....................................................................12

3.1 ANALYSIS AND JUSTIFICATION:....................................................................................................................13

4 HR STRATEGY IMPLEMENTATION:................................................................................................ 15

4.1 HR PLAN:.....................................................................................................................................................15
4.2 NEW HR STRATEGY:....................................................................................................................................15
4.3 ANALYSIS AND JUSTIFICATION HR STRATEGY:............................................................................................15
4.4 ACTION PLAN FOR STRATEGIC EXECUTION:................................................................................................16
4.5 RECOMMENDATIONS:...................................................................................................................................17

5 REFERENCES:...................................................................................................................................... 18

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Strategic Human Resources Management

1 Toyota’s Overview:

With the emergence of the greater globalization, commerce interaction and intercontinental
business approach the market antagonism has augmented excessively. In this regard, varied
organizations tend to focus on its core competencies, development of competitive edge,
attainment of diversified and talented employee pool and resources optimization to manage
progress. Therefore, one of the biggest and prestigious motor market name Toyota has certainly
distinguished itself from its major competitors by means of providing greater and quality
services to the customers (Hill et al., 2013). Toyota is also measured to be second largest vehicle
manufacturer around the globe. In addition, according to Toyota (2014) it possess chronological
progress regarding technology and innovation and it continuously focused on its production
qualities by means of talented and capable employee accumulation to utilize the Toyota
Production System. Here is given the major information regarding Toyota Corp in particular:

Company Category Public

Industry Automotives
Founded August 28, 1937
Founder Kiichiro Toyota
Services Banking, financing and
leasing
Headquarters Toyota, Aichi, Japan
Personnel More than Three Lac
thirty eight thousand nine
hundred
Website Toyota Global

Source: Toyota, 2014

1.1 SHRM Perspective of Toyota (High-Performance HR Strategy):

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Strategic Human Resources Management

According to Mello, (2014) an organization is required to utilize the activities that support to
fetch out the best talent maintenance and retainment in the pool. It requires strategic human
resources management approach and talent management philosophies as well as supporting
culture (Wright et al., 2011). Toyota main commitment relies on the product and services quality,
therefore; employee accumulations that are talented and competent are the major endurances for
Toyota. In this regard, the Toyota exploits the performance based HR strategy as it tends to
provide greater opportunities to its employee regarding skill development, education and
learning, however, non-talented employees are not kept on long term basis (Kumar, 2014).

The teamwork corporation, communal interaction, incessant decision making are part of
recruitment section while the selection process is highly complex and multilayered. Moreover,
the training and development is provided by means of the Global Training Centre present in
Thailand, Europe, and America where the leadership, quality management, service maintenance
skills acquirement and another important education is provided, therefore, the compensation
criterion of the Toyota also become the merit-based or performance based structure (Toyota,
2015). Toyota traditionally followed the seniority-based pay structure; however, for increased
quality, production, and productivity it has been altered with the Performance-based pay
structure (James & Jones, 2014).

1.2 SWOT analysis of Toyota:

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Here is given the Toyota strength, weaknesses, opportunities and threat analysis with a strategic
overview of the company as well as in HR perspective (Toyota, 2014).

SWOT
ANALYSIS

Strength Weaknesses

Superior product demand on global basis due Non provision of greater education after 2011
to superior quality regarding products and n varied training centers (Toyota, 2015).
services deliverance (Toyota, 2014).
Loss of interest, resources and endorsement
Talented employee pool, performance based of employee talent.
pay structure, training and education facilities
enhancing employee skills (Toyota, 2014). Issues regarding altered mode of
transportation, the dilemmas regarding
Toyota Technical Skills Academy losses of approximately
Technical Skills Olympics $ 4.2 billion.
The reason fostered critical situation includes
Superior market name, commerce in more the lower quality, employee no productivity,
than 170 countries, community and welfare resources wastage (Reuters, 2015).
based practices as Hybrid and eco-friendly
vehicles. Vehicles recall (112500) due to safety issues
reelected to lack in production quality
Zero carbon emission vehicle (ZEV) (Reuters, 2015).
potential.
Greater employee supporting services like Employee management issues, labour cost,
training and education centers at Thailand, employee health and safety policies etc such
North America, Europe etc (Toyota, 2014). as the issues regarding the safety guun memo
regarding systematic warning for vehicle
safety by means of employee (Daily-Mail,
2010).
Opportunities Threats

Lower car prices with increased quality to Superior market antagonism and competition
serve novel markets (Toyota, 2014). through the hydrogen fuel stations (Toyota,
2014).
Training and Development reinstatement for
skilled labor force in other countries as well Substitute vehicle and mode of transportation

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Strategic Human Resources Management

as well as fluctuating petroleum costing.

Superior employee and vehicle safety
procedure to ensure quality and reliability
(Toyota, 2015). Pay based market competition and increased
safety rules, CSR based HR policies
The Hybrid engines and hydrogen fuel increasing cost (Luthra et al., 2011).
innovation (environmental friendly) for
community welfare.

Establishment of developing culture, safety

and health programs as mental health
education etc (Forbes, 2015).

Sustainment of diverse employee pool for

higher creativity (Toyota, 2014).

1.3 Recommendation:

From the above-given analysis of the Toyota Corporation strategic and human resources based
SWOT, it has been analysed that the effect of the varied misconduct in impacting the employee
performance and attachment as the production issues are related with less commitment and
support (Toyota, 2014). Therefore, the involvement based HR strategy, CSR based employee
health and safety approaches as well as superior training provision is required to be adopted by
Toyota. Jiang et al., (2012) emphasized that involvement based HR strategy assists in bringing
higher quality, commitment, involvement, responsibility, conviction and support that help in
increasing quality work, bottom-up approaches, assemblage, alliance, positivity, productivity and
performance in particular.

2 Environmental Analysis:

Here is given the external environmental analysis of Toyota by means of utilizing the PESTLE
analysis model in particular:

2.1 PESTEL Analysis:

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2.1.1 Political Factors:

Charan, (2012 ) varied aspects subsist on the political or governmental basis that tends to
influence the organization establishment and continuation possibilities, along with international
and domestic rules, and regulation is important to be obliged and complied as well. The political
instability of the host countries has damaged the Toyota business as well as labor policies
(Toyota, 2014). Toyota has the major business operation in Japan and America, and the
descending Toyota position specifically after 2008 financial crises made the company acquire
loans of 2 billion US dollars from governments (Financial Times, 2009). Moreover, according to
ABC, (2015) regulation from authoritative entireties for utilizing eco-friendly business
operations, vehicle production, hybrid engines, and lower carbon emission engines is also
imposed and it was also funded by means of 30 million pounds.

2.1.2 Economic Factors:

Yüksel, (2012) elucidated that economic aspects directly influence commerce entities as the
dependents such as GDP, inflation ratio, purchasing power parity, employment condition and
erstwhile elements. Toyota business operations are widely spread and working in greater and
larger scale enhances the risk conditions. The customer purchasing power parity is increasing in
Toyota’s main hub that is America by means of 1.5% in 2013 to 1.6% in 2014 providing superior
opportunities and stabilizes purchasing power conditions (World-bank, 2014).

Here is given the global inflation rate index representing the highest 5.51 inflation rate that
damaged the varied international entities however it has been decreasing with 3.31% in 2015
(Statista, 2015).

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Strategic Human Resources Management

Source: Statista, 2015

Source: World-Bank, 2015

Moreover, the purchasing power parity is also increasing as from 2013’s 0.70 to 0.71 I UK and
remained stabilized in USA. However, in Australia it got increased from 1.52 in 2013 to
1.54 in the year 2014 (World-Bank, 2015).

Source: World-Bank, 2015

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Source: UN, 2015

Above is given the world growth ration of gross product that has been increasing form 201’s
2.4% to the 2015’s 3.1% in particular (UN, 2015).

2.1.3 Social Factors:

Ziolkowska & Ziolkowski, (2015) claimed that varied community based social factors impact
business criterion and model counting the varied consumption patterns, family structure,
consumer likings, prefrence4s, perception, trends, buying power and others. Toyota being a
global corporation impacts by all of these aspects. However, the environmental and social
wellbeing is the biggest influencer (Reuter, 2015). It has become indispensable for the Toyota
Corporation to utilize the eco-friendly approaches to maintaining its market credibility and
demand even by exceeding capital limits.

In this regard, Toyota endured to present varied superior options like the hybrid and eco-friendly
vehicles. International and domestic regulation regarding the cost effective, small displacement
engines, fuel effective and environmental safe has certainly affected the price structure that has
indirectly augmented the increased pressure on production facilities, human resources for quality
and management for marinating stakeholder engagement (Forbes, 2015).

2.1.4 Technological Factors:

Ghezzi et al., (2013) stated that the augmented level of innovation necessities, technological
constraints, and requirements has made Toyota to spend more and more on research and
development, training and development and competency-based aspects. This is due to superior
market antagonism; daily innovation arrivals substitute mode of transportation and others.
However, the environmental considers like carbon emission and others also proffer Toyota to
innovate products that meet customer demand. In this regard, Toyota endure to innovate the
Hybrid Synergy Drive system to meet better customer demand, technological requirements and
rules and regulation, however, more innovation, utilization of e-commerce, approach and
cybercrime strains required greater management support (Toyota, 2015).

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2.1.5 Legal:

Czinkota & Skuba, (2014) stated that legal factors such as the intellectual property
commandment, multifaceted ecological laws as well as compound consumer laws impact a
business directly. Therefore, Toyota follows these rules and laws by providing superior services
to customers, maintain the intellectual property rights in host country plants and offices as well
as meet the quality and environmental standards.

2.1.6 Environmental:

Ziolkowska & Ziolkowski, (2015) stated that environmental regulation has been increasing its
strictness on a global basis. Specifically in developed regions, the entities are operating in,
standards of production and quality maintenance to avoid the bad ecological impacts are
obligatory. The Hybrid Synergy systems innovation done by Toyota is also related with the
externalities issues. However, it has more opportunities regarding the production of more eco-
friendly products and services due to the reducing oil resources, climatic alterations and
sustainability (Toyota, 2014).

2.2 Influence on Business Strategy and HR Strategy:

From the above done PESTLE analysis of Toyota Corporation, it has been analyzed that varied
factors and sways impact Toyota operation regarding operation and HR in particular. These
pressures like the quality production have made Toyota develop a performance culture in the
organization. It can be seen from Toyota way that depends on the respect for personnel
dependent on the five major aspects that are a challenge, Kaizen, Genchi Genbutsu, Respect and
Teamwork indeed for incessant improvement and development (Toyota, 2014).

The Toyota Way:

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Strategic Human Resources Management

Source: Toyota, 2015

Here is given the Toyota SHRM Way regarding the Safety, diversity, development and nurturing
of unity.

Source: Toyota, 2015

However, the impact of these authoritative guidelines and principles increased the quality
improvement issues that indirectly required integrating more personnel development approaches,
and activities liked training and development, technology inclusion and benefits to increased
commitment for higher productivity (Mello, 2014). The pressures have made Toyota to utilize
the green approach in the development of Hybrid Synergy engines, air bags, popup bouts,
hydrogen fuel, Toyota Technical Skills Academy, Technical Skills Olympics, education of
employees and other activities to be integral as part of business and HR strategy of quality
products (Toyota, 2015).

3 Strategic Priorities/ Objective of Toyota:

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Strategic Human Resources Management

Toyota mission is associated with attainment of superior market leadership and provision of the
superior and safe mode of transportations in high price, fuel, effort effective approach (Toyota,
2014). In addition, according to Zandi et al., (2013) Toyota strives to accomplish its major
objectives and business goals and the patterns of objectives have also altered over the history.
Here is given the objectives and priorities based on Articles of Incorporation at Toyota.

To produce, sale, lease and repair the mode of transportation, machines, parts, electrical
device, furnishings, and others (Toyota, 2015).
To design and develop the arrangements by means of utilizing the online facilities,
computers software, warehousing techniques, nonlife insurance-based strategies, mineral
oils (Toyota, 2015).
Provision of safe vehicle convenience, consultation, engineering solutions and superior
customer deliverance to businesses and customers.
To become the global leader by means of providing green transportation solution in
particular (Toyota, 2015).
The tactical and functional strategies based on given five originality conceptions and
activities derived counting optimization, metamorphosis, Duality, Mastery and aesthetic.

3.1 Analysis and Justification:

To achieve the above-given objectives and priorities of the Toyota regarding quality, leadership,
innovation, solutions and others are strive to attain by means of superior efforts, operational
strategies and tactical approaches (Zandi et al., 2013). In this regard, the Japanese originality
concept is attained all the way through given aspects people development, productions, and new
possibilities (Toyota, 2015).

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Strategic Human Resources Management

Source: Toyota, 2015

Accomplishment of Toyota’s Vision and Business Strategy:

Here is given the Toyotas business strategy depends on the maintenance of the Customer delight,
environmental leadership, self-reliance quality production, citizenship in particular (Toyota,
2015).

Source: Toyota, 2015

The HR based employee support, management, education and progress and administration based
production process is maintained by means of the Toyota way structure to achieve tactical
functional and business priorities as quality services and production. The chart represents the
Toyota way as part of strategic priorities (Toyota, 2015):

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Strategic Human Resources Management

Source: Toyota, 2015

In addition, Matsuo, (2015) stated that Toyota strives to incorporate each and every aspect that
provide its competency to bring innovation, personal development opportunities, production
utility and services deliverance ability. In this regard, Toyota accomplishes its objective and
priorities, however; there are some of the issues present that damage its ability to effectively
sustain its position. The issues regarding, safety, employee health, economic condition and other
impacts the personnel productivity, mental health, commitment, production strictness, expenses
and other elements that require superior management considerations (Toyota, 2015).

4 HR Strategy Implementation:

4.1 HR Plan:

Hendry, (2012) explicated that HR strategy tends to incorporate tactical, functional and business
approaches to better achieve the organizational goals and objectives. Here is given the Human
resources plan and its implementation process to increase the personnel performance,
productivity, commitment at Toyota in stipulation:

4.2 New HR Strategy:

As per the above-given analysis using PESTLE, SWOT and company objectives, t has been
analyzed that Toyota performance has been declining due to varied quality issues. The vehicle

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Strategic Human Resources Management

recalls, employees complaints safety issues, quality concerns and other drives attention towards
the lack of employee involvement and engagement in particular (Toyota, 2015). In this regard,
Toyota is required to apply Strategic leadership based employee involvement strategy as novel
Human Resources a stratagem (Truss et al., 2013).

4.3 Analysis and justification HR strategy:

The new suggested HR strategy would be highly beneficial for the Toyota quality production and
services deliverance process. Snell et al., (2015) stated that the as per the involvement based
theory, personnel tends to attain and maintain the trust level, quality production and services
provision when a supporting, flexible, engagement based and leadership oriented environment is
being provided to them. Therefore, this HR strategy would increase team working,
accountability, quality, productivity, emotional association, bottom-up approach and equality,
mutuality, flexibility and Alliance (Truss et al., 2013). Consequently, this strategy would result
in lower production error, services mistakes and lower involvement in operational activities
(Matsuo, 2015).

4.4 Action Plan for Strategic Execution:

Here is given the strategic action plan for the implementation of the new HR strategy at Toyota:

Mo Resp
Month Mont Mon Mont nth onsib
Action Plan 1-2 h -3 th -4 h 4-5 5-6 le
Suggestion Box: Provision of suggestion HR
box to get better insight into employee mana
perception and creativity: ger
         
Development of Safety Committees:           Admi
Employee working site safety depends on nistra
the provision of higher discipline and tion
facilities. Therefore, training and and
development should be provided in this HR

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Strategic Human Resources Management

depar
regard.
tment
Ideas Program: provide opportunity to share Hr
ideas to built better involvement, support mana
and performance. ger
         
Mana
ger
and
Personal Projects: Encouragement of
HR
personal projects to bring accountability
office
structure additionally.
          r
Mana
ger
Increments: Increased performance based
and
however, increments to better attach
HR
employees involvement in performance and
office
productivity.
          r
Mana
Transformational And Supportive ger
Leadership: Support by means of and
transformational and supportive leadership HR
style would also bring positivity, dedication office
and strategic direction to Toyota.           r
Mana
ger
Training, education and development
and
regarding higher health and mental safety,
HR
working conditions precautions, and sense
office
of self actualization.
          r
Source: Truss et al., 2013

4.5 Recommendations:

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Moreover, Toyota is recommended to provide an economic incentive to its employees to lower

down their personal apprehension that results in productivity issues, especially in host countries.
360-degree feedback for better support and assistance to employees should also be proffered
(Snell et al., 2015). In addition, training regarding quality production, time management,
customer services technology, monitoring and controlling aspects utilization and other should
also be provided to increase personnel competence and also gain the superior competitive edge
and long-term sustainability chances (Truss et al., 2013).

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Strategic Human Resources Management

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