A cross cultural management study on Toyota

A cross cultural management study on Toyota The aim of this paper is to identify what role culture has played in the organizational structure and management technique of Toyota. Toyota is now the world’s leading automobile industry, knocking out rivals car maker; General Motors (Marr, 2009). The Toyota Motor Company was established in 1937 and 30 years later it entered the US market in 1967. By 1980, the company already had about 20% of the US car market as the indigenous car companies started experiencing customer dissatisfaction. The company based its entrant strategy into the US on the following; Fuel efficiency as compared to ‘gas guzzling’ American cars Environmental friendliness Superior build quality The introduction of the luxury-car line The real reason for the company’s success nevertheless was based on the introduction of Japanese style of production, operation and management. According to Liker and Morgan (2006), management principles must extend beyond the shop floor as they do at Toyot a. The ‘Toyota Way’ is a set of standards that harness the Toyota (Japanese) culture. These standards are applied by the Japanese in virtually all their dealings. Although they are moderate by nature hardly showing emotions, they are still very thorough and they apply the successful cultural traits in almost everything they do. The most important aspect of Toyota America is the techniques the company has used to stay successful given the obvious cultural differences between Toyota Japan and its biggest foreign subsidiary. The Japanese and the Americans have distinctly different business cultures however; the company has been able to work in harmony for decades. The major differences are; communication skills, winning attitude, methodology of maintaining strategies etc for both the countries – Japan and United States. Thus, we can say that while establishing a new company in host country culture is highly important. HOME-COUNTRY BUSINESS VALUES (JAPAN) Managerial Autonomy and Long-term Planning Very often, Japanese employees are engaged to the companies for ‘lifetime employment’. It is therefore probable that managers are not pressured to meet requirements financially and employee related. Corporate Rigidity and Hierarchy Japanese companies like Toyota are very hierarchical in nature and as such have distinctive and autonomous power bases. The roles of top managers are defined and incline towards strategic development of the company. The business unit managers are the ones responsible for initiating and supervising new projects. Participatory Decision-making The practice of exploring ideas of employees by senior management is known as Nemawashi in a given project. The idea behind the Nemawashi is to obtain participation of all employees in the decision-making process. The Japanese style of management is a bottom-up approach as compared to the rather autocratic top-down style of management. HOST-COUNTRY BUSINESS VALUES (UNITED ST ATES) Low Context There is more or less an uncongenial nature of communication in American organizations. Expectations of employees are communicated in competency statements or the criteria of their performance. On the other hand however, the Japanese may be more contained in their communication. Individualism Employees and indeed managers in the United States are often defined by their personal achievements and place little importance in group achievements. Americans also do not place much value on trust as they are likely to engage in business with strangers not necessarily friends or family unlike their Japanese collectivist counterparts.