Strategic Management Essay Example for Free

Strategic Management EssayToyota Motor Corporation is a famous Japanese multinational corporation, and is considered the worlds second largest car energiser of automobiles, trucks, buses, robots, and providing financial services. When Toyota and other Japanese carmakers entered the American market, they were not considered as a threat to the American auto industry because it was believed their cars had no appeal to American consumers However, in the 1970s, due to several problems like environmental regulations, and quality control issues with American cars, a good number of American car owners began searching for alternatives to poorly make American cars. In response to these changes, Toyota and other Japanese carmakers aggressively marketed their cars to Americans as being fuel-efficient, environmentally friendly, and having better build quality than American cars. In addition, Toyota marketed their cars with commercials involving youthful Toyota drivers jumping in the air. As a result, the Japaneses marketing campaign along with continuing problems from the Big Three auto manufacturers, al sufferinged import cars to make up about 20 percent of the US car market by 1980. Stage1.General Motors, Ford and Daimler-Chrysler focused in the late 1990s on mergers and acquisitions for improving their business positions to meet future challenges. Toyota, meanwhile, centered its business strategy on technological innovation and persistent environmental product development. The price of vegetable oil was not especially high during the 1990s when Toyota started its loan-blend car program. Oil prices were below US $20 barrel in 1994 and were to fall to a 50-year low around 1997 when the Toyota Prius was primary sold in Japan.Clearly something else was driving Toyota and other Japanese companies to invest so heavily in hybrid car development. there are three probable reasons 1 . High petrol taxes in Japan, due to the Japanese government wanting to reduce the depende nce of Japan on imported oil. While this would have certainly driven the Japanese development of hybrid cars, petrol was cheap in the key US market at this time. 2) The potential to gain a market advantage by developing the key technologies required to successfully commercialize hybrid cars, and then owning these developments via patents.3) The expectation that monomania of these key fuel savings technologies would become very valuable when world oil prices rise from the lows of the mid-1990s, which was a fair long-term assumption to make during this period. Stage2 last Making Process In 1994, the executive group acknowledged the potential threat of depleting oil reserves and climate change and change their strategy or products to meet the call fors of future customers. Course of ActionToyota set up a group tasked with meeting the challenge of creating a vehicle for the 21st century, which would crap within the parameters of natural resource constraints and environmental issues . Commitment to course of action Toyota pioneered the concept of Hybrid (petrol/electric) technology to mass produce the worlds first eco-efficient vehicle, the Toyota Prius. Evaluation of decision/re-engineering The first prototype of the car had even faced starting problem. It took almost six months to roll the car. Finally, when the car started, it moved for a some yards only.It was hard to imagine that Toyota, which was known for its efficient production systems, was facing such trouble. Initially it felt that Prius was a case of technological problems, impossible demands and multiple miscalculations. It turn up how a great company could overcome obstacles and turn a dream into reality. Though Prius represented only a small fraction of the nine jillion cars and trucks that the Japanese company planned to produce in 2006, it would be the first vehicle to provide a serious alternative to internal combustion engines, knowing for a world of scarce oil and was branded as The car for the future.Stage3 Toyota carefully studied the US market and sees there is a exploitation oil crisis and foresees a need for change in the structure for cars, converting their needs to oil saving cars. While American car manufactures lacked producing such cars, then Toyota caught that chance and tried to occupy this niche market. By 2002, it was being sold in North America, Japan, Europe, Hong Kong, Australia and Singapore. Analysts opined that the demand for hybrid cars would rise because of the unstable oil prices and the exploitation need for environment friendly products.Post Evaluation By examining the external environment and acknowledging the potential threats of depleting resources and increased maintenance over environmental issues, Toyota have turned a threat into a business opportunity, make headwaying their reputation both as an environmentally conscious and as technological innovators and established themselves as leaders in this growing market. The car industr y faces many complex issues, but the introduction of the Prius provided Toyota with a competitive advantage. RoadMap to the development Process of Toyota Prius.Stage1 Stage2 Stage3 Executive level 1 Expressed concern about the future of the automobile2. Embarked a modern project called G21 to the team3. Communicated the vision and priorities to the team 1. The executive team acknowledged the potential threat of depleting oil2. Challenged the team for the innovation of new model using new technology 1. Toyota unveiled the Prius in Japan in October 1997, two months ahead of schedule. 2. Made strategy plans for introducing cars to US and other likely continents Management and Team level 1.Engaged in improving the existing internal combustion engine technology2. Started making refinements to the existing technology 1. Team move to the course of action using hybrid technology. 2. Came up with around 80 alternatives. 3. Identified numerous problems heat, reliability, noise, and cost. 4. Narrowed the list to four models. 5. After endless fussing and tweaking, the team finally reached 66 miles per gallon the 100% mileage improvement. 1. Team has started putting efforts towards with second and third generation Prius.2. Redesigned the model for making it more appealing to the consumers. merchandising /Sales Team 1. Identification of the growing oil prices. 2. Identification of Growing middle class around the world. 1. Raised the concern that Premium price for the hybrid would make it impossible to sell. 2. Challenged with building consumer technology awareness. 1. Devised new marketing ways to cut down dealership costs in US. 2. Devised new ways to boost the sales through internet, relied on grass-roots marketing, and public relations events.