Discuss about the Entrepreneurship and Innovation Skills.
Entrepreneurship and innovation are the two most important characteristic of organizations, which help it in acquiring a competitive edge over the competitors (Shendage, 2012). These are the two skills, which is of utmost urgency in the present scenario of the global market.
Kiichiro Toyoda laid the foundation of the Company in the year 1937. Ever since the inception, the Company is continually deploying new and emerging trends in their business counterpart to give its competitors a strong competition in the Automobile industry (Imai, 2012). However, the earned fame of selling the largest number of vehicles in the world is now at stake as it is facing a stiff competition from Germany’s Volkswagen. There is an urgent requirement of incepting the entrepreneurship and innovation skills to add new dimensions to the products, which could help in dominating the market by attracting added customers (Scarborough, 2012).
This report tries to cover the strategy of the Company along with its current position in the market. It also shows the necessity of entrepreneurship and innovation skills in the Company.
The strategy of the Company constructs the relationship of its characteristic with the origination, which validates the objectives as “Lean development” and Instant Production (Imai, 2012). The strategy of the Company boasts on certain principles, which are acting as the driving force in the manufacturing of largest number of hybrid vehicles in the world. These forces include analysing the challenge, having trust in teamwork, respect, curiosity to bring improvement and observation (Shim & Steers, 2012). Further, they believe in long-term philosophy as a foundation of management decisions. Moreover, they believe in following a process in solving the identified problem. The Company believes in developing leadership quality in employees to keep on adding values to the organization. The organization encourages learning through a continuous observance of the chief problem (Imai, 2012).
Toyota Motors has the reputation to sell the largest number of vehicles worldwide. It is the first company to attain a global sale of more than 10 million units, a feat never achieved before by any competitor (Sundberg & Sjödahl, 2012). However, the Company is getting a stiff competition from one of its competitors- Germany’s Volkswagen. China is the biggest market for any motor brand but eventually it has emerged as a serious challenge in front of the Company to get hold on the market (Rajasekera, 2013). Further, this is for the reason that Toyota has a minimal market shares in China, which is only 4%.
Entrepreneurship and innovation are the two most effective element of an organizational behaviour that produces differentiating results in between the competitors (Shendage, 2012). There are three kinds of innovation, which include Revolution, Renewal and Resilience. They have creativity in them, which provides new dimensions to the organizations. Moreover, they believe in competition and have strong determination for innovative ideas (Shendage, 2012).
Revolution relate to a path, which shows a destructive nature of an outsider for enhancing the competition in the market (Christensen, 2013).
Renewal is a process, which a company adds to its existing thinking to narrow the failure performance in the market (Keeley et al., 2013).
Resilience signifies the most fundamentalist approach of an organization, which is very rare in practice but has the capabilities to produce wonder in favour of the Company (Christensen, 2013).
Further, there are two types of innovation, which include the sustaining innovation and the disruptive innovation (Keeley et al., 2013). Sustaining innovation include targeting its customers based on established facts that had helped organizations in their achievements. However, the disruptive kind of innovation believes in such products, which are lesser in quality but match with the changing nature of customer behaviour (Keeley et al., 2013). This kind of innovation compels its followers in bringing the cheaper product to capitalise on the growing urgency for a lesser pricing of a product.
Inception of entrepreneurship and innovation skills in the Toyota automobiles has the potential to bring the desired result for the Company (Scarborough, 2012). However, the serious failure of the Company in the China part has compelled it to go for a disruptive and a renewal kind of innovations (Shendage, 2012). Moreover, these innovations are extremely helpful in encouraging the Toyota Company for a cheaper production to match up with the market requirement. Nonetheless, the Company failed in capitalising the China market, which has created enough reasons for the adoption of these kinds of innovations (Rajasekera, 2013). The Toyota Company need to give solid fundamentals to its management for establishing respective roles for its management (Sundberg & Sjödahl, 2012). This indeed is helpful in ensuring utmost care of the work responsibilities in the Company. There are numerous processes, which help in winning the competitive edge. These processes include determination of project’s objectives and calculation of assumptions (Rajasekera, 2013). This can help in a comparative lesser failure in the business operations of the Toyota Company (Scarborough, 2012).
However, to produce a desired result with the help of entrepreneurship and the innovation skills, it requires a deep study of the vehicle market in China. The main reason for the flop show of the Toyota Company in China was the high pricing (Idrac, 2013). The product, which the Company offered to the market, is much costlier than General Motors. The marketing personal of the Company misjudged their target customers in China, which resulted in a huge loss to the Company (Maimonides, 2013). The offering of the Company in the form of Yaris gained only an average of 1,250 car sales in a month. However, other soared high by selling more than 12,000 car sales in a month. Moreover, this has contributed significantly for the requirement of entrepreneurship and innovation skills in the Company to mitigate the loss occurred.
Strengths
Based on responsive innovation capabilities, the Toyota Automobile has continually deployed numerous strategies to attain a leading place in the world of market. Sale of 10 million units is a feat, which no company has ever achieved (Hoque et al., 2013). Moreover, this simply describes the leadership quality in the Company.
Weaknesses
Inefficient approach to China resulted in a huge loss to the Company. Moreover, an incapable strategically approach resulted in an average show of the Company. Nevertheless, the Company has only around 5% shares in China, which is comparatively very low than the combined shares of Volkswagen and General Motors (Messaoud, 2013).
Opportunities
Keeping on a close look on the current trend of some potential market, it is evident that enormous opportunities are there for the Toyota Automobiles. Nevertheless, the Company could not perform up to its reputation in China. However, some other potential markets such as India where Toyota can put their excellent show with the help of Suzuki Company. Nonetheless, Suzuki has a dominating performance in India with 50% of market shares (Ng & Tan, 2015).
Threats
Growing market trend for the low cost vehicles is a serious threat to the Toyota Company. This indeed has resulted in an average show of the Company in China. Moreover, the Company could not sustain their same reputation in China where other foreign companies such as Germany’s Volkswagen has a healthy grow. The strategy to put high cost vehicles to the target market was an inefficient approach, which is evident with the market shares of the Company in China (Fung, 2014).
Production of low cost motors is the first recommendation for the Company to compete in the potential market such as China where they have shown an average performance.
Making collaboration with Other Companies can work wonder in favour of the Company. For an example, Suzuki has 50% market shares in India. Moreover, this is a clear indication towards the fact that a joint venture of the Company with the Suzuki might produce a surprising result in India. This could also prove its worth in producing reasonable product offering in potential markets.
To make a thorough study before designing the target market to meet with the requirements of the target customers. The serious failure in this part heavily affected the position of the Company in China. The Company need to bring rapid innovation skills in their offerings, which could help in producing customer friendly products that varies with the geographical and the cultural differences.
Conclusion:
The Toyota Company ever since its inception kept it engaged in deploying new thoughts to produce quality product. However, the Company could not sustain the same reputation in China, which is indeed the potential market in the world. The entrepreneurship and the innovation skills are the two most effective features of an organizational behaviour, which brings responsive nature in organizations with respect to the market inflation. Nevertheless, the collaboration of the Company with Suzuki in India might produce effective results in favour of the Company. To be a global leader, acquaintance with different kind of market with suitable offerings is of utmost requirement. Nevertheless, responsive approach towards entrepreneurship and innovation skills might work wonder in favour of the required market approach of the Company.
References:
Christensen, C. (2013). The innovator’s dilemma: when new technologies cause great firms to fail. Harvard Business Review Press.
Fung, A. (2014). International Business Strategies: A Review and Extension of Theories. Chinese economy, 47(5-6), 116-130.
Hoque, I., Faruque, M. O., Shahid, E. M., Pasha, S. H. A., & Rahman, S. O. (2013). Analysis of Toyota’s marketing strategy in the UK market.
Idrac, I. (2013). How to make a Western brand successful in China: should it rely on its Western image or adapt to its products’ market?
Imai, M. (2012). Gemba Kaizen: A commonsense approach to a continuous improvement strategy. McGraw Hill Professional.
Keeley, L., Walters, H., Pikkel, R., & Quinn, B. (2013). Ten types of innovation: The discipline of building breakthroughs. John Wiley & Sons.
Maimonides, S. P. (2013). Toyota: Dealing With Crisis in a Major (Foreign) Market.
Messaoud, B. (2013). International Sales Strategy. Maketing, Sales and Distribution.
Ng, J. C. Y., & Tan, H. T. (2015). GOING GLOBAL: Do you have the Necessary Strategic and Resources FIT?. Indian Journal of Management Science, 5(1), 96.
Rajasekera, J. (2013). Challenges to Toyota caused by recall problems, social networks and digitisation. Asian Academy of Management Journal, 18(1), 1-17.
Scarborough, N. M. (2012). Essential of entrepreneurship and small business management. Instructor.
Shendage, R. N. (2012). Entrepreneurship And Innovation.
Shim, W. S., & Steers, R. M. (2012). Symmetric and asymmetric leadership cultures: A comparative study of leadership and organizational culture at Hyundai and Toyota. Journal of World Business, 47(4), 581-591.
Sundberg, K., & Sjödahl, E. (2012). Middle Managements perception of the change in competitiveness: A study of the strategic merger between Toyota and BT in Germnay.
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