Toyota executives have been faced with the challenge of organizing the activities of their expanding firm. For example, they must decide how to organize the activities of the companys salesforcethe tremendous growth means that the company has more customers. Organizing the sales department should help to ensure success if the activities directly reflect company objectives. Managements specific steps to organize should include the analysis of company sales objectives, the outlining of specific sales activities that must be performed to reach these objectives, the designing of sales jobs by the grouping of similar activities, and the assigning of these sales jobs to company personnel. To supplement these steps, Toyota must be careful not to create overlapping responsibilities, responsibility gaps, or responsibilities for sales activities that do not lead directly to the attainment of Toyotas goals.

In organizing the activities of employees in a growing organization like Toyota, leadership must recognize, for example, that a managers activities within the company, as well as those of subordinates, are a major factor in company success. Because the activity of a department manager can affect all personnel within that department, the activities of the department manager must be well defined. From the viewpoint of company divisions, one department managers activities should be coordinated with those of other departments: For example, the activities in the sales department should be coordinated with activities in the companys marketing department.

Overall, for managers at Toyota to be responsible, they must perform the activities they are obligated to perform. Managers in the sales department, for example, are obligated to monitor the performance of all salespeople and to provide unbiased assessments. Whats more, executives in Toyotas other geographic divisions, such as North America and the United States, must be permitted to use their knowledge and expertise to provide leadership and add value to the companys operations.

Toyota leadership must be sure that any individuals within the company who are delegated job activities are given a commensurate amount of authority to give orders and carry out those activities. Managers throughout the company must recognize, however, that authority must be accepted if obedience is to be exacted. To increase the probability of acceptance, care should be taken to ensure that individuals understand internal orders and see orders as being consistent with the objectives of the department they work in and the company. Employees should perceive the orders they receive as being compatible with their individual interests, and they should see themselves as being mentally and physically able to follow those orders. Management must be careful to delegate jobs only to those organization members who are mentally and physically able to carry them out.

Assuming that one of Toyotas main objectives is to produce and sell the highest quality automobiles possible, company personnel who are directly responsible for achieving this objective should possess line authority to perform their responsibilities. For example, individuals responsible for manufacturing cars must be given the right to do everything necessary to produce the highest-quality vehicles possible.

As in all organizations, the potential for conflict between Toyota line and staff personnel could be significant. Management should be aware of this potential and encourage both line and staff personnel to minimize it.

Functional authority and accountability are two additional factors that Toyota must consider when organizing employee activities. Some employees may have to be delegated functional authority to supplement the line or staff authority they already have. A Toyota human resource manager (staff person), for example, may need to gather information from the companys sales department in order to understand whether the company needs to hire additional salespeople. Functional authority would enable staff individuals to command that this information be channeled to them.

In organizing employee activity, Toyota should also stress the concept of accountabilitythat living up to assigned responsibilities brings rewards and not living up to them brings negative consequence.

To delegate activities effectively, Toyota must assign specific duties to individuals, grant corresponding authority to these individuals, and make sure these individuals are aware that they are obligated to perform these activities.

In encouraging the use of delegation, Toyota must be aware that obstacles to delegation may exist on the part of company managers, their subordinates, or the departments in which they work. Leadership must be sure that managers can meet the delegation challenge by discovering which obstacles exist in their work environments and taking steps to eliminate them. If Toyota managers are to be successful delegators, they also must be willing to consider the ideas of subordinates, allow them the free rein necessary to perform their assigned tasks, trust them, and help them learn from their mistakes without suffering unreasonable penalties.

Centralization implies that few job activities and little authority have been delegated to subordinates; decentralization implies that many job activities and much authority have been delegated. Toyota leadership will have to determine the best degree of delegation for subordinates regarding all job activities. For guidelines, they can rely on certain rules of thumb to determine that greater degrees of delegation will be appropriate for the company (1) as departments become larger, (2) as manufacturing facilities become more geographically dispersed and diversified, and (3) as the needs for quick decision making and creativity increase.

Describe how cultural differences between the U.S. and Japan may have played a role in Toyotas quality problems. ?

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