The Social Performance of Toyota - Case Study Example

The current economic climate has made Toyota company aim at providing a good environment to its employees through the provision of long-term contracts and income security. According to Jeffrey and Kentaro (2000) social performance of a company is achieved through maintaining effective relationships, minimizing negative activities and creating a better environment. It can also be regarded as the benefits that a company spreads to its customers, employees and the community. This study shows how the company treats the natural environment, its equality policies, employment policies and the assistance it spreads to the entire community. Toyota being the third largest automotive manufacturer in the world, the company mostly aims at selling, leasing and repairing auto motors. Christopher (2003) further claims that Toyota Company also deals in financial services especially through distribution to subsidiaries. In corporate sustainability, the company is on the lead among all other automotive companies. Christopher (2003) describes that recently the company set its vision for 2010 which involves increasing its market share to about 15 percent which is currently at 10 percent. This strategy of expanding its share is incorporated within the provision of a good environment which is aimed at capturing a bigger percentage (Marr 2009). One competitive advantage that the company has is its stable capital structure which will enable the implementation of the desired plans and aggressively improve its technology for instance in carbon emission. Vella (2006) describes that the challenge of climate change has resulted to introduction of electric cars and this shows that the company will position itself better in the market due to its unique competitive advantage. Abuelsamid (2008) shows other advantages that the company has effective operations and increased eco-efficiency. It also has the best supply chain globally. The company on the other hand has some challenges facing it for example the fact that it rarely concentrates on social issues affecting it. Industry Driving Forces According to Lasic and Fackler (2008) production has reduced around the world and if the government would introduce economic stimulus efforts then this will increase growth. One major challenge affecting the sustainability of the companies involved in automotive industry includes global climate change. This is because the industry is known to be a major supplier to anthropogenic greenhouse gas emissions resulting to introduction of strict rules in most countries especially where the industry is located. Fackler (2009) describes that the other major challenge is that the company is unable to with the global demand for example in its fuel-efficient vehicles. This is a problem as most governments have decided to diversify their energy sources thus the industry is to spend more on oil. For the company to be in a position of coping with the above challenges affecting the entire industry, they ought to improve fuel economy as well as reducing the intensity of the carbon used in the manufacturing process (Marr 2009). This will enable the company to expand globally with the maturing markets in the developed countries. More long-term challenges are anticipated from the way the company operates and more so in the emerging markets. According to Stability report (2009) these challenges can be reduced if the company aims at contributing to regional sustainable development for instance through foreign direct investment in addition to improving their social and environmental standards. The company also should aim at developing a profitable business model which will achieve sustainable mobility. The model will also be capable of meeting the fast-growing demand for mobility. The company declared a move to idle its plants to reduce stocks of unsold vehicles among a relentless slide in sales in U.S which is its biggest market. Their sales dropped by 37 percent larger than their rivals such as General Motors and Ford (Fackler 2009). Equality between sexes and other groupings of people within society The company employs both genders though females make up a lower percentage especially in the engineering sector. Maynard (2008) argues that the company is also divided between the award and the non-award category where the females are underrepresented taking around 25 percent. Lasic and Fackler (2008) describes that the company has enrolled most employees to work at the production line. Administrative department takes up the highest percent of females since they are around 60 percent of all. This shows that the entire company is male dominated even in the senior levels. The company has introduced a recruitment method where they offer equal job opportunities to all regardless of age, race and gender. There is equal pay for all men and women where the ratio stands at 1:1. The company has set up policies that ensure that every employee enjoys equal benefits and protects all from harassment and discrimination. The policies also maintain a higher standard of operation thus the culture of the company is sustained. Maynard (2009) show in the year 2008, the company had renewed its workforce relationship training procedures which were offered to the award employees. The management had realized that to retain employees training then they had to change some aspects for example the use of power point presentation in training could be changed to a more effective method. The method proposed included the use of DVD or checklist and the process is to be carried out after two years in all departments such as sales, operational and manufacturing. The Toyota Company is guided by the workplace agreement that ensures that all employees are treated with fairness and that they perform their duties according to the system put in place. This agreement also offers other services such as health and safety to protect employees against dangerous gases and changes in temperature (Stability report 2009). The company has various benefits that tend to attract as well as retaining employees who are mostly valued in the business. According to Jeffrey and Kentaro (2000) these benefits are more of legal conformity and the company’s culture. They include; parental leave where women are offered maternal leave for about 14 weeks which they are paid and the men are also given paternal leave which comes after a one year service. According to Alan and Kae (2009) the company plans to shut one of its plant after a joint venture failed to go through and this may reduce on its demands. Through these funds employees are provided with insurance against death or disability. Other benefits enjoyed in the company include the provision of learning and development programs. The company employees are entitled to access the learning center that is located in Altona where the manufacturing takes place. These programs facilitated employees development of skills needed in the business and thus enables them to improve their career. According to Jeffrey and Kentaro (2000) computer training is also offered and employees are taught many languages such as Japanese. The employees enjoy discounted vehicles and spare parts. This is where the company offers vehicles to their workers at a discount according to the position of the employee. They can also purchase spare parts at a discount. Jeffrey and Kentaro (2000) also show the employee assistance program is a benefit offered by the company that is helpful to the family members of the employee through the provision of guidance and counseling services. This is significant especially to the lives of all members as they are able to cope with issues affecting them. According to McWilliams and Donald (1999) the employees well being is also natured where they are encouraged to participate in out-side the work activities such as sports. These activities improve interpersonal skills and enable the members to develop socially and emotionally. Christopher (2003) describes that through employee engagement, the company is able of conducting a performance appraisal. The appraisal is conducted annually where the company also drafts an employee satisfaction index. This shows how satisfying the company is to its employees for example studies show that since 2000, the index has been almost stable though the most satisfying year was in 2008 which measure 79 percent. One advantage that has made the company survives in the industry in their first class delivery to their customers. Dawson (2004) show this improves sales through customer satisfaction and the production of successful products globally. The company also launched a campaign which was aimed at improving relationship between the employees and their customers. Role within the community The Toyota Company has a great impact on the society in terms of provision of employment, improving local economy and the environment. Marr (2009) show the company has tried to partner with UAW to spread skills, knowledge and resources in order to enhance capacity building in the entire society. The company’s social contribution originated from their principle which is meant to show respect to all nations in respect to their culture and values and the need to improve development through corporate social responsibilities. McWilliams and Donald (1999) show these responsibilities are spread to the entire community through the Toyota Community Spirit which is a program that improves relationships between stakeholders and the company. The program also aims at encouraging employees to improve performance in order to enable the company achieve long-term goals. The Toyota Company ensures this participation is achieved through partnering with other non governmental organizations that contributes to the community. The company also shows responsibilities to the community through community sponsorships where they offer contributions for example in building of community health services. According to Alan and Kae (2009) the company makes much revenue from its sales and has about 2 million units operating in U.S and 10 million globally. Marr (2009) shows the company plans to take a 13.4 million loan that will enable them restructure their operations thus improve on viability and profitability. These investments are aimed at addressing community needs, supporting their objectives and strengthening of relationships. Participating in corporate social responsibilities also facilitates multi-faceted partnerships which improves the company’s logo therefore helping to achieve sustainable benefits. The stakeholder’s issues are able to be resolved through participating locally and this builds target audience (Abuelsamid 2008). The London Benchmarking Group introduced in Australia was to measure how every company contributes to the community. According to Dawson (2004) Toyota have to reinvent its style as well as improve its physique which include being faster and stronger. This strategy will improve the company’s management skills and thus will have more for the community. It can involve investments in sports which were at 45 percent, development of the environment was 25 percent and the provision of services such as education took the rest. This showed that every employee contributed about 500 dollars to help the community (Jeffrey and Kentaro 2000). Conclusion The Toyota Company has been involved in various aspects in its performance. These include how the company treats the natural environment where the company has sponsored the national tree day by encouraging the community to plant more trees. The company has also gone beyond legal compliance in terms of the benefits provided to their employees. These benefits have motivated the employees and enabled them to maintain their standards in operations. The company has also ensured equality between sexes as their policies offers equal opportunities to all regardless of race, gender of background. The company’s role to the community has been to satisfy their stakeholders and to improve their reputation. In all the total performance of the company shows that the company has increasingly supported the community and that it values its employees for example through offering them many benefits and avoiding discrimination. References Abuelsamid, S 2008, Toyota tops big company CAFE ratings for 2007 model year with 29.69 mpg. Autoblog.com. Retrieved 25 July 2009. Alan, O & Kae, I 2009, Toyota will shut California plant in first closure. Dawson, C 2004, Lexus: The relentless pursuit, Singapore, John Wiley & Sons Pte Ltd, p. 12. Fackler, M 2009, Toyota to shut factories for 11 days. The New York Times. Lasic, B & Fackler, M 2008, Car slump jolts Toyota, halting 70 years of gain. The New York Times. Marr, K 2009, Toyota passes GM as worlds largest automaker, The Washington Post. Stability report 2009, Toyota motor corporation, Australia. Viewed 21 July 2010. Vella, M 2006, The most recalled Cars, Business week online at Yahoo news. Jeffrey, H & Kentaro, N 2000, Creating and managing a high-performance knowledge-sharing network: the Toyota case, John Wiley & Sons, Ltd. McWilliams, A & Donald, S 1999, Corporate social responsibility and financial performance: correlation or misspecification? Arizona, USA. Christopher, L 2003, The sustainable company, How to create lasting value through social and environmental performance. pp. 14-16. Read More