Process Improvement – Toyota
Sharron Rose
Capella University
Unit 2 Assignment 1

Problem statement: What exactly is the problem?

With globalization comes an inevitable strain or tension between global and local forces. Toyota grew into such a large company at record speed that it could not transplant its culture to foreign markets readily. Further, because their organizational structure was centralized, key decision-making came only from Japan impairing the company’s ability to prevent the burgeoning safety problems before they reached the crisis stage. Decentralized control must take place for better communication, greater consistency, and ultimately better quality and safety for customers worldwide.
Background of the issue: How long has it been occurring and other relevant historical data (costs, impacts, and implications to the organization)?

Toyota was basically organized the same way it was half-a-century ago when it first began selling cars in the United States. None of its operations are functionally integrated – and all report back to Japan. It’s a caricature of a chimneyed company with vertical structures and no coordination (Taylor, 2010).
While Toyota’s structure may have suited them when they were a much smaller company a generation ago, it no longer does. It’s presence in the U.S. has grown significantly and its regional engineers and executives have endured frustrating amounts of bureaucratic red tape and time-consuming sign-offs and approvals from Japanese executives during all stages of developing products (Ayapana, 2011). Furthermore, if there were specifications that needed to be changed, there was little contact in updating Japan which made things all the more frustrating.
Operating in a globally centralized way may generate greater economies of scale, tighter operational control, and greater consistency. However, the