Strategic Management: Internal Analysis and SWOT - Essay Example

The strategic management has two important components, Direction and Methods. The direction of the company is determined with regard to the decisions such as pricing, diversification, product profile and the markets, whereas the methods to be adopted include forward or backward integration, mergers & acquisitions, strategic partnerships and joint ventures in the case of a company like Toyota. The internal strengths need to be integrated with the mission and goals of the organization by recognizing the weaknesses in the organization for exploiting the opportunities available by eliminating the weaknesses recognized, and reorienting the company’s strategies to ward off the threats posed by the environment for a sustainable growth and development.

According to Collis and Montgomery (2008) the Resource Based View of the firm (RBV) combines the internal analysis of phenomena within companies with the external analysis of the industry and the competitive environment.  Who could ask for anything more? Toyota’s advertisement pitch through its slogan ‘who could ask for anything more’ in the 1980s reflected its technological strength in the industry. Import tariffs and the Chicken Tax introduced in1964 by the US to protect the indigenous automobile industry paved way for setting up manufacturing facilities by Toyota in the US.

“As of November 2010, the 1964 tariff of 25% still affects importation of light trucks.” (Isnare, 2013) Thus the threats to the business were converted into opportunities through effective management strategies like introduction of premium brands like Lexus and collaboration with the General Motors. It is in this backdrop we make SWOT analysis of the company with reference to the current position and the environment. “SWOT analysis is a tool for auditing an organization and its environment” (Marketing Teacher, 2013).

Strengths Toyota introduces new models in tune with the changes in technology and tastes and fashions of the customers. “As we expect many full-model changes for both Toyota and Lexus brands, we plan to launch products in developed markets as well as emerging markets, which are so attractive that our customers would feel they "must have" them” (Toyota, 2012). Toyota is synonymous with quality. “With our forthcoming models, we will improve our vehicles steadily towards "better and even better cars.

" (Toyota, 2012) Improved results during 2011was as a result of efforts on marketing and cost reduction despite a negative impact of around 100 billion yen from the Great East Japan Earthquake. Inherent organizational prowess of the management is reflected in the tangible results achieved through internal efforts in spite of the hardships faced by the company during the year due to earth quakes and floods. President Toyoda stated “Our vision is to establish a strong business foundation that will ensure profitability under any kind of difficult business environment.

” (Toyota, 2011 & 2012) Toyota has its operations globally in the developed and developing countries with established channels for marketing and distribution. Toyota’s high quality and efficient service network ensures customer satisfaction in after sales service. Innovations in Toyota encompasses such as Safety Technology, Smart Grid for use of natural energy through Plug-in Hybrid vehicles (PHVs) and electric vehicles (EVs) and Partner Robot Technology strategically positions the company ahead of its