External analysis of Toyota's threats and opportunities for stakeholder value

Toyota Strategic Management Assessment

Toyota's dominance in the global automotive industry is the result of their ability to orchestrate many potentially conflicting priorities into a common strategic direction. The Toyota Production System (TPS) is a case in point, which is one of the most advanced planning, scheduling and supply chain management (SCM) systems and architectures globally (Fane, Vaghefi, Cheryl, Woods, 2003). Despite these strengths however, Toyota struggled with the areas of enterprise quality management and governance of their fast-moving supply chains (Heller, Darling, 2011). This shortfall in quality contributed to the threats mentioned in this analysis. The rejuvenation of the company from these crises led to the opportunities also mentioned here.

Threats

The most significant threat to Toyota's ability to serve its stakeholders and make its mission a reality is the increasingly aggressive nature of competition in their business. This threat is multidimensional in scope, with their distribution and dealer channel affected by increasingly higher levels of competition, in addition to their services business as well (Fane, Vaghefi, Cheryl, Woods, 2003). Toyota has faced significant competitive threats from domestic U.S. And other foreign auto manufacturers for decades, and has found their supply chain to be an effective deterrent to the low-price moves of competitors (Kurihara, 1990). Another threat to the stakeholders of Toyota is the declining sales of their most popular models in their most profitable areas of the world, including the United Sates, through 2011 (Heller, Darling, 2011). The slow-down from the recession continues affect Toyota's ability to compete to their fullest potential using their supply chain, logistics and production systems. This threat to stakeholder performance of reduced sales throughout geographic regions has also contributed to poor allocation of resources relative to peer auto manufacturers in Japan and globally (Boysen, Bock, 2011).

Opportunities

Toyota has found a strong alliances with Ford that has given them the ability to move quickly into new markets, capitalizing on Ford's distribution networks throughout the high growth regions of Brazil, Russia, India and China, the (BRIC) nations (Hatani, 2009). Toyota has used these relationships with Ford to continually build out parts and service throughout the BRIC nations while also creating their own supplier networks in these regions. This is a significant long-term opportunity for stakeholders of Toyota, as the BRIC nations are outpacing the economic growth of many parts of the world today (Hatani, 2009).