Module 5 Assignment: Strategic Pivot Plan(A Case Study of Toyota)

Olatunde Daniel Obadaye

MBA, Nexford University

BUS6140

Dr. Michael Rodriguez

8th March 2025

INTRODUCTION

In today’s dynamic business landscape, a strategic pivot is essential for ensuring ongoing viability

and profitability. When a company pivots, it strategically alters key elements of its core products or

services to better align with evolving customer demands and market conditions. This approach may

involve redefining target demographics or enhancing product offerings, ultimately fostering sales

growth. By embracing a pivot strategy, businesses not only adapt to emerging challenges but also

enhance their competitive edge, positioning themselves for long-term success in an ever-changing

environment(Theo Moret 2024)

STRATEGIC PIVOT PLAN DEVELOPMENT

Definition of the Objectives of Toyota Pivot Initiative (Market Share and Innovation)

As the automobile industry undergoes a significant transformation driven by advancements

in digital technology and the growing demand for electric vehicles, it is imperative for Toyota to

pivot its strategies to remain competitive in the Market share and Innovation land scape of the

automobile industry. With key rivals such as Tesla and Volkswagen capitalizing on this shift, the

urgency for Toyota to embrace innovative technologies and enhance its electric vehicle offerings

cannot be overstated. By proactively adapting to these industry trends, Toyota can secure a

substantial share of the burgeoning electric vehicle market, ensuring its continued relevance and

leadership in the automotive sector. Toyota is poised to invest significantly in digital technology,

focusing on artificial intelligence and cutting-edge automotive frameworks. This strategic initiative

underscores the company's commitment to innovation and its ambition to remain a leader in the

rapidly evolving automotive landscape. The investment aims to

 Enhance vehicle performance,

 Optimize operational efficiency

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  Deliver advanced functionalities to consumers

1. Market trends

 The global shift towards electric vehicle (EV) adoption

 Potential of autonomous vehicles (AVs).

 Enhanced connectivity through 5G and the Internet of Things (IoT)

 Consumer online channels for vehicle purchasing and research.

2. Competitive landscape

 Developing cutting-edge features and solutions that surpass offerings from

competitors like Volkswagen and Tesla.

 By consistently delivering state-of-the-art technology and exceptional value,

Toyota can solidify its market dominance and attract a broader customer base.

3. Internal Capabilities

Leveraging Toyota's technological expertise, our progress focuses on enhancing

 Transportation processes and safety protocols.

 Serve our established customer base, by broadening offerings to adapt to their

changing needs.

 Strategic partnerships are essential for expanding our consumer reach and

augmenting the value of our services.

SCOPE OF THE PIVOT

Areas of the business that will be impacted

 Creation of novel products leveraging a on digital technology

 Robust technological framework, ensuring alignment with Customer satisfaction

objectives.

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  Marketing strategy

 Strategic business acquisitions and partnerships that expand the market reach and

capabilities.

Desirable outcomes.

 Local and International Trade

 Technological Advancements.
 Environmental Aspects
 Consumer Access to Diverse Models
 Regional Development
 Improved safety measures and theft prevention.

Timeline Toyota pivot

Key milestones and Deadlines.

Toyota Strategic Pivot Plan Development states that the deadline is set for two year.

1st Half (1 – 6 months)

 Analysis of the market and competitors

 Measure Key performance indicators (KPIs) and objectives established for Pivot

 Building of Team for marketing tactics, tech infrastructure, and product development.

 Specialized teams established to manage marketing tactics, technology infrastructure, and

product development.

2nd Half (6 – 12 months)

 Development of ideas and automobile products.

 Ensuring improvements in infrastructure that are automobile tech inclined

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  Launching of marketing tactics and building collaborations.

2nd Year 1st Half (13 – 18 months)

 Consistent evaluation of progress

 Necessitating agile adjustments to strategic pivots.

 Continuous improvement in product development and technological

 Actively explore and establish strategic alliances and carefully consider potential

acquisitions to foster growth and market dominance.

4th Last Half (19 – 24 months)

 Immediate execution of the revised plan is paramount.

 Establishment and diligent implementation of key performance indicators (KPIs for

objectively evaluating the efficacy of the pivot.

 Concurrent efforts on developing comprehensive plans that facilitate future growth and

foster continued innovation.

RESOURCES AND ALLOCATION FOR TOYOTA PIVOT PLAN

 Financial aspects

Toyota has committed to a significant investment of $17 billion aimed at enhancing its U.S.

manufacturing operations, a strategic initiative designed to bolster the company's

electrification efforts(Kim Ogle 2024)

 Human aspects

Toyota will invest nearly $14 billion, creating about 5,000 jobs as its new “epicenter” of

North American.

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  Technological aspects.

Innovation being emphasised by Toyota is its self-propelled production lines, where EVs are

guided by sensors through the assembly line. The technology removes the need for conveyor

equipment, a major expense in the car assembly process, and allows for greater flexibility in

production lines. (David Dolan 2025)

CRITERIA FOR SELECTION

Criteria for departments, functions, or positions to be affected by Toyota pivot.

According to Dr. Dieter Veldsman, AIHR’s Chief HR Scientist, a successful organizational design

initiative must incorporate several critical factors to ensure effectiveness and sustainability.

 Clear strategic intent that aligns with the organization’s long-term goals.

 Guiding principles must be established to navigate decision-making processes.

 Creating capability maps

 Comprehensive operating model blueprint

 Work design and a robust workforce plan

 Performance measures will be defined to assess progress and outcomes effectively.

 Prioritize divisions that directly engage with customers or significantly influence their

experiences to enhance customer engagement.

 Utilizing cutting-edge technologies, Toyota can streamline operations, boost efficiency, and

foster innovation, thereby creating a more responsive customer service framework.

 Assess the necessary skills and expertise required advancements, ensuring that investments

remain cost-effective while maximizing the potential for improved customer satisfaction and

loyalty.

Roles and Departments to be Impacted

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  Product Development Department.( Chassis, cab, suspension, Engine team etc)

 Procurement9 Forging, Casting, Plastic , Rubber and Supplier Designed parts)

 Supply Chain Department(Quality, Delivery, Cost and right features required as per the

customers and accordingly work to achieve the objectives(Dhirendra Srivastava)

Positions that may be impacted.

 Engineering Department (Product Engineering, Manufacturing Engineering, Quality

Engineering)

 Research and Development (R&D):

 Production and Manufacturing:(Assembly Line Operations, Machining and Fabrication,

Paint and Finishing)

 Supply Chain Management

 Quality Assurance and Control

 Sales and Marketing

 After-Sales Service

 Human Resources (HR)

 Finance and Accounting

 Information Technology (IT)

 Environmental Health and Safety (EHS)

OPTIMAL SIZE AND STRUCTURE DETERMINATION

Current organizational structure at Toyota

Toyota's divisional organizational structure, evolved significantly since 2013, plays a crucial

role in shaping the firm's resources and processes. This global hierarchy, characterized by both

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geographic and product-based divisions, effectively streamlines operations and enhances

communication across its diverse markets. The alignment of these competencies, as outlined in the

SWOT analysis, not only fortifies Toyota’s operational efficiencies but also yields competitive

advantages over industry rivals such as Tesla, Ford, General Motors, BMW, and Nissan. Ultimately,

this strategic framework underpins Toyota's ability to maintain its leadership position in the

automotive sector. (Lawrence Gregory, 2024)

SWOT analysis for Toyota Pivot

Toyota’s Strengths (Internal Factors)

Toyota's enduring position as a leading global automaker is underpinned by several key

internal strengths. These strategic capabilities, integral to the company's SWOT analysis, enable it

to maintain a competitive advantage and navigate the dynamic automotive landscape effectively.

Specific examples of these strengths are discussed subsequently

• Strong brand image

• Control of an expansive global supply chain
• Rapid innovation capabilities

Toyota’s Weaknesses (Internal Factors)

Toyota's identified weaknesses present significant internal impediments to sustained growth

within the competitive automotive sector. These shortcomings, revealed through the SWOT

analysis, represent strategic factors that could hinder the company's ability to capitalize on

opportunities and mitigate external threats. Addressing these internal challenges is crucial for

Toyota to maintain its market position and ensure future success. (Edward Ferguson 2024)

 Rigidity of the hierarchical organizational structure

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  Secrecy in the organizational culture
 Effects of product recalls

Opportunities for Toyota (External Factors)

Toyota's strategic opportunities are primarily dictated by prevailing technological and economic

trends within the automotive industry and broader transportation market. This facet of the SWOT

analysis highlights external factors that can be leveraged to enhance the company's competitive

position and overall business performance. Examining these opportunities is crucial for

understanding Toyota's potential for growth and innovation in the evolving landscape. (Edward

Ferguson 2024)

 Growing markets in developing countries

 Rising demand for fuel-efficient and electric automobiles
 Growing interest in advanced electronics in vehicles
 Advantages based on the weak Japanese Yen vs. U.S. Dollar.

Threats to Toyota (External Factors)

Toyota's car manufacturing business faces significant threats stemming from the competitive
landscape. These external strategic factors, critical to SWOT analysis, possess the potential to
negatively impact the firm's performance. The primary threats to Toyota's operations arise from
the intense rivalry within the automotive industry. (Edward Ferguson 2024)

 Growing market presence of low-cost competitors

 Rapid innovation of competitors

OPTIMAL SIZE AND STRUCTURE OF TOYOTA AFTER THE PIVOT

Long-term viability.

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 Toyota will prioritize expanding its electric vehicle (EV) offerings and autonomous driving

technology. Strategic global market expansion is also crucial, necessitating the development of

localized product strategies tailored to regional consumer preferences, as highlighted by Dave

(2020). This multi-faceted approach will be essential for sustained growth and market leadership

Competitiveness.

To maintain its competitive edge, Toyota must uphold its commitment to continuous

improvement principles in lean manufacturing

This necessitates continued investment in hybrid and electric vehicle technologies, alongside

emission reduction efforts in manufacturing and the incorporation of renewable energy sources,

as highlighted by Knop (2020), to secure a long-term sustainable advantage.

Factors in organizational structure redesign

Efficiency

A well-defined structure facilitates clear communication and decision-making, while streamlined

processes enhance operational effectiveness.

Agility

The accelerated pace of technological advancement necessitates a proactive approach to product

development, enabling the swift introduction of diversified offerings to maintain competitiveness.

Such agility is paramount to securing future prosperity for both shareholders and the organization's

workforce (Shahzad et al., 2020)

Alignment

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Organizational design, when meticulously aligned with strategic objectives, cultivates workforce

cohesion and a unified sense of purpose. This alignment streamlines operational workflows,

promotes agility in dynamic environments, and ultimately strengthens the organization's competitive

positioning within the marketplace.( Orgvue,2023)

REFERENCES

https://augment.org/blog/pivot-strategy

What’s a Business Pivot Strategy?(Business Tips 2023)

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https://pursuitlending.com/resources/whats-a-business-pivot/#:~:text=When%20a%20business%20pivots
%2C%20it,business%20remains%20viable%20and%20profitable.

7 Essential Elements of a Strategic Plan(Admin 2024)

https://planwriters.com/blog/7-essential-elements-of-a-strategic-plan

10 Important Auto Industry Trends (2024-2026)(Josh Howarth 2025)

https://explodingtopics.com/blog/auto-industry-trends

In EV battle, Toyota bets on new technology and old-school thinking(David Dolan 2025)

https://www.reuters.com/business/autos-transportation/ev-battle-toyota-bets-new-technology-old-school-
thinking-2023-09-18/#:~:text=One%20innovation%20being%20emphasised%20by,greater%20flexibility
%20in%20production%20lines.

Overview of Different Departments in the Automotive Industry(Dhirendra Srivastava)

Toyota SWOT Analysis & Recommendations(Edward Ferguson 2024)

https://panmore.com/toyota-swot-analysis-recommendations

Toyota’s Organizational Structure: An Analysis( Lawrence Gregory,2024)

https://panmore.com/toyota-organizational-structure-analysis

Factors Shaping Organizational Agility(Tolga Dikici,2024)

https://www.diva-portal.org/smash/get/diva2:1863241/FULLTEXT01.pdf

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