Change Management Toyota

Chapter 1

General presentation of the organization

Toyota Motor Corporation is a multinational corporation headquartered in Japan. The company was founded by Kiichiro Toyoda in 1937 as a spinoff from his father's company Toyota Industries to create automobiles. Three years earlier, in 1934, while still a department of Toyota Industries, it created its first product, the Type A engine, and, in 1936, its first passenger car, the Toyota AA.

Toyota sets specific and high standards for product development and manufacturing processes. That is one of the major reasons for its success: the company has succeeded in all the aspects of production management. The effectively used approach tends to clarify and standardise all the parts of both Toyota manufacturing and production systems.

Toyota employed approximately 320,000 people worldwide and it is the world's largest automobile maker by sales. Toyota also owns and operates Lexus and Scion brands and has a majority shareholding stake in Daihatsu and Hino Motors, and minority shareholdings in Fuji Heavy Industries, Isuzu Motors, Yamaha Motors, and Mitsubishi Aircraft Corporation. The company includes 522 subsidiaries.

In addition to manufacturing automobiles, Toyota provides financial services through its Toyota Financial Services division and also builds robots. Toyota Motor Corporation (including Toyota Financial Services) and Toyota Industries form the bulk of the Toyota Group, one of the largest conglomerates in the world.

The Toyota Prius is a full hybrid electric mid-size car developed and manufactured by the Toyota Motor Corporation. The Prius is the most fuel efficient gasoline car currently sold in the U.S. according to the United States Environmental Protection Agency. The EPA and California Air Resources Board (CARB) also rate the Prius as among the cleanest vehicles sold in the United States based on smog forming and toxic emissions.

In 1994, Toyota executive Takeshi Uchiyamada was given the task of creating a new car which would be both fuel efficient and environmentally friendly. After reviewing over 100 hybrid designs, the engineering team settled on a hybrid engine design based on a 1974 TRW patent, but many technical and engineering problems had to be solved within the three years that the team was given to bring the car to the Japanese market, a goal they barely achieved as the first Prius went on sale in December 1997. A main problem was the longevity of the battery, which needed to last between 7 and 10 years. The solution the engineers came up with was to keep the battery pack between 60% and 40% charged, proving to be the "sweet spot" for extending the battery life to roughly that of the other car components.

The car was a modest success in Japan in 1997, making it the first mass-produced hybrid vehicle, and after gathering several years of test data from the Japanese early adopters, the company felt it was safe to put it on sale in the U.S. and European markets in 2001. Sales were limited and customer waiting lists of up to 6 months were common during the first few years. In 2004, a complete redesign, increased production, and soaring fuel prices led to significant increases in sales. Nowadays, The Prius is sold in more than 40 countries and regions, with its largest markets being those of Japan and North America.

Prius is a Latin word that means before or ahead. That's why the Toyota hybrid is named Prius to suggest it is before or ahead of it's time.