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BITS/CM/HHSM ZC471 Management Information Systems Assignment No.

1 Part-1: Case Study: Toyota & Technology (Max Marks: 8) Q1. Explain types of business pressures experienced by Toyota and what are the responses the organization found to be apt and successful. (100 words - 1 Mark) Answer Automobile companies in the new millennium are targeting Gen Y, who are estimated to become the largest customer segment, in the automobile industry. Toyota, which intends to be the number one player in the global automobile industry, also entered the fray. But Toyota which has been extremely popular with the baby boomers is considered to be old-fashioned by Gen Y. Refurbishing its staid image along with maintaining the top line and bottom line was a big pressure in front of Toyota was a big pressure, as it could not live off the boomers forever as by the early 1980s, the Boomers were entering their peak earning period. If Toyota didnt get into the high-end market, they were going to lose a lot of market share. To overcome this building pressure the responses the organization found to be apt and successful were:1. To attract the Gen Y, Scions marketing was carefully planned, avoiding conventional marketing strategies. it came out with a new brand, designed exclusively for the Gen Y. Two models xA and xB were launched under the brand named Scion. 2. Toyota launched a website and also redesigned showrooms for Scion, to facilitate information search and customisation. 3. Focus on Online Communication environment like live person solution and virtual night club scion 4. The LivePerson solution which enabled online businesses to communicate with Internet users in real time, thereby enhancing the online experience Through live chat, Scion Customer Advocates help potential buyers understand the differences between Scion and other car models and find a dealership in their locality 5. Focussing on changing Needs of Customers and Agents Q2. Elaborate on the following points: (each 100 words) (each 1 Mark) a. Toyota is known for its innovations in manufacturing. Elaborate on their innovations in the use of information technologies. i.e. Explain IT innovation in Toyota. Answer IT has significant implications for the quality of life. At Toyota IT plays a very major role at every sphere right from the manufacturing of the vehicle to the customer safety both active and passive. Toyota's philosophy for Active Safety is to "help guarantee the safety of cars" and to "help support drivers to prevent accidents." And IT has played a pivotal role in fulfilling the objectives. Some of the points displaying the innovation at Toyota are stated below:-

1. Development of onboard GIS-GPS picture-map technology and Navigation System for easier driving 2. JIT resulting in reduction of production cycle time and reduction in cost and achieving these cost savings while increasing quality. 3. Emergency Dispatch Service for promptly notifying of traffic accidents emergency number automatically 4. Pre-crash Safety System, Passive Safety Technology & GOA for driver safety 5. Technology that Supports Parking 6. Live chats on internet to attract young audience and thus helped them in segmented marketing.

b. Role of IT in Collaboration within the organization and with other players/partners in the industry. Answer Information Technology can today offer solutions that can help organizations in their transition towards evolved quality management practices. The focus would be to enable cross-functional and cross-organizational teams to work together in an environment that enables partner visibility and real-time responses. In the new global economy, multiple entities collaborate to deliver a product to the end-customer. In such a scenario, the quality of a product is a determinant of the quality of the work done across the supply chain by myriad entities. The imperative today is to eliminate all non-value adding quality activities through innovative process or technological means. Information technology can play a huge role in ensuring that end quality is achieved through collaboration in quality assurance and quality management activities across the manufacturing supply chain. Organizations use IT to provide for fast, accurate, reliable and inexpensive communication resulting in collaboration within and between organizations any time and any place. In addition, quality problems in automobiles eg.( Huge recall by Toyota) come in various sizes and shapes from the most mundane to the most complicated. On the simpler side, a quality service request could be a product rejection on attributes or on dimensions due to logistical mishandling. On the more complicated side could be a field failure of equipment whose components come from hundreds of vendors and undergo multiple process steps. For example, a defective gear could result from the process and materials used by anyone or more of the steel supplier, the forging vendor, and the gear cutting plant, the surface coating plant or the assembly shop. And what if an entire batch of gears is found defective? How do we manage recalls and initiate the proper service action even before more field failure reports come in? Traceability and issue resolution in such environments could be long arduous tasks. IT can play a crucial role in such complex scenarios. c. Green initiatives and Corporate Social Responsibility activities of Toyota.

Green initiatives: Toyota globally is actively involved in a wide variety of programmes to improve the environment. The company aims at "establishing a low-carbon society," "establishing a recycling-based society," and "environmental protection and establishing a society in harmony with nature" to contribute to sustainable growth of society and the planet. To realize the above stated aims Toyota aims to reduce the environmental impact at all stages of vehicle life cycle. Not only Toyota even its affiliates in co-operation of Toyota are actively involved in its initiatives. Apart from the agendas Toyota is involved in Philanthropic activity to support environmental revitalization and conservation through the medium of Toyota Environmental Activities Grant Program, Environmentally Conservation Initiatives, and Increasing Employee Environmental Awareness etc. Some initiatives towards the attainment of Green goals are:a) b) c) d) e) f) g) h) i) Proactive Energy-saving Initiatives in North America Toyota Motor Manufacturing UK Installs Large-scale Solar Panel Array Verification Tests of Plug-in Hybrid Electric Vehicle in Tianjin City, China Promoting Energy-saving Initiatives in Collaboration with Toyota Motor Corporation to Address National Power Shortage Toyota South Africa Motors (Pty) Ltd. Initiatives on Zero Waste to Landfill, Coolant Recycling Toyota Motor Engineering & Manufacturing North America, Inc. Achieving More than 30% Water Saving by Reuse of Rain Water Toyota Motor Manufacturing France S.A.S. Ongoing Water-saving Activities in Production and Sales in Taiwan Environmental Protection and Contribution to a Society in Harmony with Nature With the Goal of Zero Landfill Waste, Toyota Kirloskar Motor Installs Solar Sludge Drying Facility

The CSR activities at Toyota are based on the seven guiding principles at Toyota which has separate duties and responsibilities for Customers, Shareholders, Employees, Society, Environment and Business Partners. The guiding principles aim at Contribution towards Sustainable Development. With a view to fulfil the above policies some of the step facilitated by Toyota is:i. ii. iii. iv. v. Pedestrian safety campaign Development of vehicle environmental technologies and reduction of CO2 emissions Support for volunteer activities For personnel development setting up of Toyota Technological Institute, Toyota Technology College and Toyota Grant Programme Afforestation and promoting recycling culture.

Q3. Summarize the case under following headings: (600 words - excluding list of references - 4 Marks) 1. Introduction and case background Toyota was embraced by Baby Boomers, who fueled the companys rise. But as these consumers grew older and their incomes increased, they moved on to luxury brands such as BMW and Mercedes. Automobile companies in the new millennium target Gen Y, who are estimated to become the largest customer segment, in the automobile industry. Toyota, which intends to be the number one player in the global automobile industry, also entered the fray. But Toyota which has been extremely popular with the baby boomers is considered to be old-fashioned by Gen Y. Refurbishing its staid image was a big pressure along with maintaining the top and the bottom line in front of Toyota was a big pressure, as it could not live off the boomers forever as by the early 1980s, the Boomers were entering their peak earning period. If Toyota didnt get into the high-end market, they were going to lose a lot of market share. Toyota was having trouble penetrating two key demographic groups: the young and the wealthy. The case focuses on the way Toyota successfully implemented guerrilla marketing strategies to regain the top slot. 2. Problems encountered i. Increasing global competition: Consumer markets are no longer fragmented and localized, supply bases have expanded and manufacturing is done based on costeconomics. The consequent impact on managing quality cannot be understated. Change in perceptions: Toyota which has been extremely popular with the baby boomers is considered to be old-fashioned by Gen Y. Refurbishing its staid image along with maintaining the top line and bottom line was a big pressure in front of Toyota Fear of losing market share: Toyota was having trouble penetrating two key demographic groups: the young and the wealthy. If Toyota didnt get into the high-end market, they were going to lose a lot of market share

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3. Solutions arrived at and implementation Toyota made effective use of the Internet web technologies to target young people who could be the potential buyers of its product Scion. The solution includes Toyota Scion attacked the youth segment with a base car that could be customised through 40-plus accessories. The car was priced low and the dealer and Toyota made their margins through accessories. Toyota Scion's approach to media and targeting of the youth with digital activity Toyota launched a website and also redesigned showrooms for Scion, to facilitate information search and customisation. Focus on Online Communication environment like virtual night club scion

The LivePerson solution which enabled online businesses to communicate with Internet users in real time, thereby enhancing the online experience Through live chat, Scion Customer Advocates help potential buyers understand the differences between Scion and other car models and find a dealership in their locality Focus on Online Communication: To facilitate further contact with their customers, Scion focused on communication through their website and contact center.

4. Results of implementation i. Improved Brand recognition: As per marketingvox.com Toyota was able to achieve the objective of brand recognition (80%) of Scion successfully. Toyota Scion's approach to media and targeting of the youth with digital activity is excellent. Young people believe they are more tech savvy and trust the opinions of others in social media Increase in sales: In the first quarter of 2005, Toyota had sold 32,972 Scions - more than Volvo or Suzuki and only slightly less than Mitsubishi, all erstwhile established players in the relevant vehicle classes. Gained top slot: Due to usage of interactive cutting edge web technologies which includes community oriented nature, Scion was ranked no. 1 website in 2007 a significant progress as compared to previous year. Allowed customizing the vehicle online: Toyota Scion attacked the youth segment with a base car that could be customised through 40-plus accessories.

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5. Complete set of references (including web site references) 1. 2. 3. 4. 5. 6. http://www.curbsideclassic.com/ http://www.thetruthaboutcars.com/ http://businesstoday.intoday.in/ http://som.yale.edu http://blogs.motortrend.com/ Information Technology for Management: by Efraim Turban, Linda Volonino