Report on the Corporate Communications at Toyota Motor Corporation (TMC) - Essay Example

?Report on the Corporate Communications at Toyota Motor Corporation (TMC) Executive Summary This report examines the effectiveness of both internal and external communications at Toyota Motor Corporation, the Japanese giant automobile manufacturer that offers a full range of models from mini-vehicles to large trucks, with subsidiaries in over 27 countries around the world today. The flow of communication in all directions establishes harmony in operations besides keeping the stakeholders and other related resources up to date, to achieve the organizational objectives, which reflects Toyota’s global image, brand recognition and reputation. Report findings indicate that the corporation has adopted corporate communications structures aiming to brand itself as a leader in the automobile industry, setting the pace of appeal for automobiles, and trends of the industry across the world, while earning recognition as a global enterprise with a profound appeal. Toyota applies both product-led communications, based on its specific products and corporate-led communications, which revolve around the themes in its Global Vision. Advertorials promote Toyota’s environmentally friendlier cars while the leaf care logo conveys its commitment to environmental goals. Toyota also communicates through sponsorships and CSR programs in communities it serves by offering financial grants, and social welfare services through the volunteer time of Toyota associates. The corporative uses multi-cultural marketing strategies and diversity awareness panels to address the cross-linguistic communications barrier that lead to shortcomings in communications, to promote its global integration and diversity goals. The report recommends that Toyota should leverage on the new Information Technology outlets such as social media platforms to reinforce both its internal and external communications functions (The Wall Street Journal, 2013), to achieve optimum benefits and to address its information communication deficit. Introduction This report will examine the internal and external communications functions of Toyota Motor Corporation (TMC), the Giant Japanese automobile manufacture, highlighting both the best practices in communications functions, as well as communications shortcomings. Additionally, the report analyses the effectiveness of Toyota’s communications functions, and makes recommendations on how to improve them to achieve optimum benefits for the corporation TMC: Overview Headquartered at Toyota Aichi in Japan, Toyota Motor Corporation is a giant Japanese automobile maker that offers full range of vehicle models from mini-vehicles to large trucks; the corporation became the largest automobile manufacture in 2012 by production. Kiichiro Toyoda found TMC in 1937 as an offshoot from his father’s company Toyota Industries to manufacture automobiles (Flaccomio 2011, p.1); the Toyota Group is one of the Leading Conglomerates worldwide today. The Toyota Way, the corporation’s philosophy and strategy has evolved over the years, with a focus on core principles such as Lean Manufacturing and Just in Time Production; Toyota aims to achieve respect for people and continuous improvement. The company’s corporate goal is to keep improving its corporate value while continuously growing through global operations and innovative technology; Toyota’s strategy is enhanced technology, production, and marketing, as well as improved quality control, cost-competitiveness, and personnel development. Toyota pursues environmental goals, which influence corporate strategies (Menon & Menon 1997, p.51), through improvements of its unique hybrid technology to create environmentally friendly products; Toyota’s goals entail pursuing sustainability at three levels, research and design, manufacturing, and social contribution. TMC Communications overview In 2002, Toyota took a new strategic direction articulated in the Company’s 2010 Global Vision program, which set out its long-term operational and strategic policies (“Corporate Communications at Toyota” n.d p.1); the vision took a pro-environmental stance, encouraging re-use and recycling of goods, as well as global integration, with respect for people and communities in global markets. Additionally, the global vision highlighted new marketing goals in China, India, and other markets around the world that were yet to be fully motorized. Key stakeholders’ view of an organization is crucial for its survival (Cornelissen, Tibor, & Betteke 2006, p.114); Toyota seeks the image of a leader in global regeneration and innovative application of technology in automobiles for better and safer motorizing. Besides that, Toyota sought to brand itself as a leader in the automobile industry, setting the pace of appeal for automobiles, and trends of the industry across the world (Halliday 2004, p.18); above all, the company sought to brand itself as a global enterprise with a global appeal. Since corporate communications, result to strategic advantages (Balmer 2009, p.544); Toyota applies both product-led communications, based on its specific products and corporate-led communications, which revolve around the themes in its Global Vision; advertorials enlighten readers concerning Toyota’s green concepts and environmentally friendlier cars. The car has also been using the leaf care logo to convey its commitment to reducing the environmental impact of its products, plants, and process as it moves towards environmental sustainability goals. Besides that, the company gives back to the communities it serves by offering financial grants, and social welfare services through the volunteer time of Toyota associates; additionally, the company engages local communities in the areas of education, environment, culture and the arts, international exchanges, among other things. Toyota applies multi-cultural marketing strategies (Stoll 2002, p.20), and has a diversity awareness panel comprising of a cross-section of employees that screens all promotional material before distributing it to promote its global integration and diversity goals. Toyota’s participation in motor sports such as the Formula One World Championship Racing is the company’s most successful communication tool so far, both internally and externally; internally, it helped inspire a strong workforce and externally, it attracted stakeholders such as dealers, suppliers, and sales personnel for business ties. The organization of communications combines advertising and public relations functions into one interrelated group of functions to achieve consistency of voice, since corporates must provide credible, accurate, and timely information all the time (McLaughlin 2003, p.22). Analysis and Evaluation of Communications functions Effective external communications, between an organization and other stakeholders such as other organizations, groups, or individual’s that fall outside its premeditated structure, revamps its reputation and public image accordingly (Hui-Yao and Shieh 2012, p.197). Toyota’s external communications is under a corporate manager, and its corporate communication activities follow two principles, regard for diversity along with contribution to socio-economic development of communities, as well as harmonious global growth. Toyota contributes to socio-economic development through corporate activities in the communities since corporates must create positive experiences for their stakeholders (Robert & Kodua 2012, p.332); Toyota pursues growth in harmony with the global community focusing on quality and sustainability. Internal communications in Toyota entail the sharing of information, opinions, and feelings regarding the operations amongst employees and within management (Halliday 2001, p.36); internal communications occur through a number of fronts actively contributing to the effectiveness of operations of teams and individuals within the corporation. Toyota has adopted various skills that better their internal communications making staff more effective such as internal memos, face-to-face communications, among others; communication is both upwards, from supervisor to employee, and downwards, feedback to downwards communication. The employee internal newsletter is a very powerful communications tool that fosters a sense of community among employees while face-to-face meetings between management and employees promote success of the company and remain the most effective mode of internal communications within the corporate. Consistency of messages Consistency of messages is a fundamental benchmark for evaluating the strength of corporate communications at Toyota since it demonstrates a focused approach to communications; consistency of messages demonstrates effectiveness of the corporate communications functions. Toyota maintains an open and fair communication with its stakeholders at all levels, forming strong, healthy, and sustainable relationships, and at the same time enhancing not only its corporate image, but also transparency. Toyota communicates its commitment to environmental protection goals in its advertorials that have focused on notifying consumers in the automobile markets regarding the company’s environmentally friendlier products, and its leaf care logo has conveyed its message of commitment to reducing the environmental impact of its products, plants, and processes effectively. Communication appropriateness of sponsorships This report examines the appropriateness of Toyota’s sponsorship programs because they prove that the corporate is commitment to promoting both social and economic development within local communities, which is part of its global vision. Corporate philanthropy is a lucrative marketing tool (Carrigan 1997, p.40), that enterprises can leverage; Toyota communicates effectively through its sponsorship programs, particularly in areas of education, environment, culture and the arts, as well as international exchanges, thereby underscoring both its vision for the global automobile industry and strategic goals for the future of the company. For instance, the Toyota Teach Primary School Project serves around 140 schools in Umlazi and Umbumbulu in South Africa and it further aims to increase the number of students with math and science competencies, in preparation for a technology-oriented future. Toyota has also collaborated with other organizations to sponsor a number of programs, like the partnership with the Japan Alliance for Humanitarian Determining Support to provide landmine detection technologies and back-up systems to international NGO’s in Thailand and Cambodia. Other initiatives sponsored by Toyota include the Toyota Equal Access for Minorities program that increases opportunities for minorities and women in all areas of business. Sponsorship programs are effective in underscoring company’s bottom-lines (Stoll 2002, p.121), such as commitment to bettering lives around the world by contributing to social and economic development in the communities where it conducts its operations. Communication appropriateness CSR programs This report examines Toyota’s CSR programs because they reflect the organizations commitment to enhancing the quality of lives by creating enhanced experiences for people within communities. Toyota has engaged with communities as part of its Corporate Social Responsibility, which ranks high on corporate agenda (Lindgreen, Swaen, and Johnston 2009, p.120), in addressing environmental issues, thereby passing strong messages regarding its environmental commitment goals. For instance, the company initiated a reforestation project in China’s Hebei province, to address the environmental degradation menace that has taken place over the years in that area; the company’s employees volunteered to plant 500 hectares of land with poplar, pine, as well as wild Apricot trees. In this particular instance, the company sends strong messages concerning its commitments to environmental protection as it gives back to local communities in the area through reforestation to mitigate environmental degradation. In Britain, Toyota collaborates with the British Red Cross to hold interactive road shows to sensitize communities of the levels of road accidents among kids; this underscores the company’s commitment to better and safer motorizing. Toyota’s Corporate Social Responsibility programs have earned the company reputation as an ethical enterprise, an intangible resource that yields competitive advantage (Amine, Chakor, and Alaoui 2012 p.68); responsiveness to social challenges also emphasize Toyota’s contribution to socio-economic development in communities where it serves. Barriers to effective communication The report highlights barriers to effective communication because they constrain successful corporate communications; language-barriers, in particular, lead to shortcomings in communications functions thereby diminishing its effectiveness. Multi-national corporations like Toyota, which operate in different countries, are often constrained by language challenges in their attempt to establish cross-cultural communications; for instance, Toyota has had its fair share of cross-linguistic communications challenges during the recalls that have rocked its global reputation recently. Communication difficulties impede speedy growth and oversights that result from that lead to product deficiency that potentially endangers Toyota users as was the case in the nearly 8m cars recall by Toyota from all over the world (Maynard 2010, p.2). In order to address the communications challenge that distorts communication in the company, Toyota employs multilingual organizers to collapse the cultural and language barriers that are inherent in its operating sites for smoother communications back at the HQ. Inter-cultural sensitivities Presence of intercultural sensitivities is crucial to this report since it underscores Toyota’s recognition and appreciation of the diversity of cultures and practices in its different market environments. Since it operates in different markets with diversified cultures and practices around the world, Toyota has decentralized its communications function in these subsidiaries, thereby promoting the exchange of information within its staff and departments. These global subsidiaries overcome shortcomings in communications by consulting with the central communications team at the Toyota HQ and the strength and integrity of the company’s communications can be deduced from its previous record, where all messages put out as external communications with other stakeholders have been fulfilled effectively. The company also admits its vulnerability to make mistakes and acts responsibly for its external communication in response to the varying needs of diverse listeners; Toyota’s response to the 1998 print issue of the Jet magazine issue about the Corolla and the 2001 postcard that depicted African American features with the gold Toyota model version underscores its cultural sensitivity. Following this communications shortcomings, the company’s executives extended their sincere apologies to all the parties that were offended by the postcard and the Jet magazine article offering that Toyota is a good company that had made a mistake in that instance but was prepared to make appropriate amends. The company’s attention to cultural diversities and concerns by expanding its multi-cultural marketing abilities and establishment of a diversity awareness panel communicates its global enterprise brand image effectively since it portrays it as fully integrated into cultural diversities of the world. Crisis Communications- The Recalls Case Crisis communications is significant to this report since it highlights the effectiveness and/or weaknesses of the corporate communications functions at responding to crisis; Toyota has been the centre of both media and expert criticism in the recent past due to the mismanagement of the recalls issue, which is largely attributable to a breakdown in communications effectiveness in the company. This particular instance underscores the cultural divide in crisis management and adoptability of the Japanese automobile maker to globalization, alongside the need to communicate with global customers. Toyota stands to lose brand credibility because of mismanaged communication in this instance of the recalls since both users and stakeholders might lose faith in the brand; the company’s inability to handle the crisis effectively resulted from shortcomings in the company’s external communications (Mezey 2013, p.3). Toyota Communications SWOT analysis Strengths Better quality establishes a strong brand, which is a key driver for added value for stakeholders of company’s (Hawabhay & Peters 2009, p.3) Lower prices make the company a customers’ choice, establishing a strong market share and presence Leading innovator in research and design establishing better and safer motorizing Superior production system that yields improved efficiency and adds value to customers (Treece 2004, p.30) Leader in environmental technologies that seek to diminish environmental impacts of the company’s products, processes, and plants CSR programs establish the company as an ethical enterprise that is committed to alleviating social problems Sponsorship programs underscore the company’s commitment to social and economic development of communities Weaknesses Product defects like in the case of the recalls defame the company’s established quality Diminished brand reputation as a result of recent controversies (Halliday 2007 p.24) PR damages that have exploited the recent recalls to taint the company’s credibility Opportunities Improved vehicle demand due to continued improvement and quality Increased sales in Asian market shows improving market preference Corporative partnerships in sponsorships reinforce communications Tax breaks for hybrid vehicles promote the green agenda in pursuit of environmentally-friendlier cars Threats Competition from old rivals such as Volkswagen (VW) and General Motors (GM) destabilizes market structures since they imply diminished product preference Bad publicity in media distorts communications by shifting attention to flaws Cross-linguistic barriers inhibit cross-cultural communications leading to controversial shortcomings Conclusion This report has dwelt on the internal and external communications within Toyota Motor Corporation, highlighting best practices in communications functions adopted by the gigantic Japanese automobile manufacturer and barriers to communications especially cross-cultural linguistic challenges that lead to communications failure. Furthermore, the report has identified shortcomings in the effectiveness of Toyota’s external communications that had negative impact on the company's brand image all over the world in the context of the recent recalls crisis. The report highlights that Toyota’s failure to handle the crisis underscores the communications weaknesses within the corporation, which management must address to promote communications and to repair the damage caused to the brand image of Toyota Motor Corporation effectively. The report has also undertaken a communications audit, revealing the strengths, weaknesses, opportunities, as well as the threats to Toyota’s communications; overall, the report concludes that Toyota has effective corporate communications strategies, which it can leverage on to promote its goals and global vision. However, there is room for improvement of Toyota’s corporate communications functions to achieve optimum benefits, even as it looks up to emerging markets around the world, which brings us to the recommendations below, for improving communications within and without the corporation. Recommendations In light of these report findings, there are various opportunities for Toyota to enhance both its internal and external communications, to achieve consistence of messages for effective operations within the organization. Firstly, the company can leverage the new social network platforms to enhance its communications both internally and externally to its ardent fans across the global market zones informing them of new developments and trends within the corporation. Social media platforms such as Twitter, Facebook, and Google provide wonderful opportunities for the corporation to pass its messages both internally to its employees and externally to its other stakeholders including dealers and customers within its broad markets. Toyota might also want to intensify its CSR and sponsorship initiatives in the communities it serves across the world, to enhance its diminishing global brand image and to reassure the stakeholders that it is still committed to delivering quality across all spheres to satisfy customer needs. CSR initiatives such as environmental protection programs popularize the brand as an ethical and responsible enterprise thereby underscoring the message for environmental sustainability effectively; similarly, sponsorships increase brand recognition and popularity, influencing brand preference in the global markets respectively. 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