Running Head: PROCESS IMPROVEMENT

Process improvement 1

Process Improvement Plan for Toyota

Brandon Murdock

07/23/2015

MBA 6122

Zhimin Huang Process improvement 2

Problem Statement

Toyota has manufactured and sold motor vehicles across the world and it is popular for the innovation and new technology. But, in recent years, Toyota has faced many issues related to quality and safety of its products, so, company recalls millions of its vehicles due to defects that cause death of few customers (Liker, Meier & Liker, 2005). It is because company focuses on cost advantage and increasing profitability, so, they compromise with the quality of the products.

Background of the Issue

Due to different defects and issues, company recalls 6.39 million vehicles from the world including 30 of its models. Toyota’s Lexis car has issue of injury and death of four people due to defects in the manufacturing. It influences the reputation and brand image of the company adversely. In the manufacturing process, company focused on cost advantage and compromise with the quality of components due to profits and market share (Liker, Meier & Liker, 2005).

Along with this, there is complexity in the company’s product due to fast innovation and management is high ambitious for rapid growth of the company.

Implications

If the problem is continued, then company could face more issues related to quality and safety of its vehicles. It could decrease the brand image of the company in the minds of customers when the problems are increased and company can’t take any actions for solving the issues. On the other hand, if the process is improved, quality of the products could be improved and quality issues could be resolved. Process improvement is helpful for the company to develop high quality products and meet quality standards (Liker & Franz, 2011). It increases the sales and Process improvement 3 revenue, customer satisfaction and market share of the company. Other side, process improvement increases the cost of the products due to rejection of defective products.

If the company is ignoring this issue, it could damage the brand image, market share, sales and revenue of the company, while, company can achieve its cost advantage and increasing profitability objective. When Toyota is improved its process and quality of products, the company will gain its market share and brand image again. It is leader for innovation and technology. With new improved process, company can maintain its innovation and quality that helps to satisfy its customers (Liker & Franz, 2011). At the same time, the new process would be improved the learning and value of employees in the organization and the company would develop its main goal to make quality products rather than make new or innovative products at low cost.

Desired Outcome

In order to solve all issues, kaizen process is beneficial for the company that helps to reduce wastages and improve the process by continuous learning of employees. Company should invest time and money to provide training to their employees regarding quality management. It is different from existing process because it focuses on continuous improvement of quality where, existing process focuses on cost advantage and increasing profitability and production. This new process will be helpful to gain competitive advantage of quality leadership over competitors

(Liker & Franz, 2011). Through this process, employees learn new skills and gain value to organization, customers gain high quality products and it enforces others to eliminate problems and make quality products.

This new process improvement is costly for the organization due to rejection of defective materials, training cost and improvement of existing process. But this cost will be offset by the Process improvement 4 benefits that would be derived from the sales of new improved quality vehicles and increase brand image of the company (Liker, Meier & Liker, 2005). Process improvement 5

References

Liker, J. &Franz, J. K. (2011).The Toyota Way to Continuous Improvement: Linking Strategy

and Operational Excellence to Achieve Superior Performance. NY: McGraw Hill

Professional.

Liker, Meier, D. & Liker. (2005). The Toyota Way Field book. NY: McGraw-Hill Education.