Blog 3: Change Management (693)

Due to the Brexit Referendum, Britain decided to leave the European Union within 3 years which means it might lose the non-tariff and tariff conditions from EU. The related documents and agreements have not announced yet, which triggered Toyota suffered the high risks from distributions and trading issue in the European market (Berg, 2018). It plans to suspend Bernalton factory even relocates outside of the UK because the vast profits lost. This factory has generated 150,000 cars in last year and 90 percent of them are for the purpose of exporting to Europe.

Because of the ‘JUST IN TIME’ principle, Marvin Cooke, managing director at Burnaston and other suppliers who claimed they require definitely continue this very successful supply chain to keep their performances effective which delivered the components only take 37mins from either the United Kingdom or EU countries(Berg, 2018). However, with the high-speed production lines, they can’t stop working due to the warehouse capacity problems, which will increase its costs. Moreover, the plant generates cars worth around 12m pound each day, also needs to spend large amount money and time to process the daily operation due to the potential risks of importing and exporting goods. Besides, increasing the costs of expenditure also make the price raise in the European market, Toyota will reduce part of the market competitiveness. According to the above states, it is hard to achieve the action-centred leadership again, the whole plant could not achieve their common goal- JIT. Due to shutdown makes employees worry about the future, lead to low morale and even complete tasks with negative completion (Adair, 1984).

There is certain potential risks exists for the same industry, many business giants have made their own views on this. Such as Honda started to plan their components storages in UK branches; Jaguar Land Rover indicated if the government cannot take any measures, may cost 1.2bn sterling annual; BMW seeks the stopping place from either boundary.  Britain has to make any further decisions more seriously, otherwise they will be abandoned by considerable income and the automobile industry may go back more than 5 years (Inman, 2018).

Thus, the United Kingdom government should positively intervene caused by the above claimed may conduct the advanced firms exit UK, leading depression of the peripheral industries. From this circumstance, Toyota only chases the UK government to deal with the new trading document is not enough for surviving in the UK market. It should be looking for the new distributions and production line which is the most suitable to current situation. If the organization seeks out how to alive in the current crisis, Toyota will be achieve the height never reached.

In order to make it successfully, I would like to recommend that the top hierarchy leaders could adopt a several actions for Toyota in today’s UK situation in the followings states:

1. keep the high pressure on the UK government; let them deal with EU regulations and trading agreements as soon as possible. And according to these documents, redeploy new UK development directions and policies.
2. If there is no confirmation of the new policy or a policy that is not conducive to development, the company should choose to change JIT strategy to reduce losses, such as: Reduce bonuses, move inventory to cheaper places, actively sell around the UK and so on.
3. Through these measures, reduce the impact of losses on the company. Then, inspecting Europe as a new base in a synchronized manner. Slowly shift the factory caused by UK government would provide the subsidy to the company who solve the employee problems for them.

To summarize this blog, I would like to draw a conclusion leadership is so significant that contemporary companies cannot give up with it. It drives the employees and through different methods to motivate their potential into jobs. However, leadership cannot be used directly through learning, need to improve with the actual situation of the company and the company to become a kind of leadership. These types of leadership are fixed, but as human beings we have unlimited possibilities, we should change ourselves for the social environment and other factors, let ourselves continue to improve.

References

BBC News. (2019) No-deal Brexit ‘would disrupt Toyota plant’. [online] Available from https://www.bbc.co.uk/news/business-45676633> [07 January 2019]

Trade Justice Movement. (2019) Trade, Brexit and the European Union | Trade Justice Movement.

[online]

Available from <https://www.tjm.org.uk/trade-issues/brexit> [07 January 2019]

McCurry, J. (2018) No-deal Brexit must be avoided at all costs, says Toyota president. [online] the Guardian. Available from <https://www.theguardian.com/politics/2018/oct/19/no-deal-brexit-must-be-avoided-at-all-costs-says-toyota-president> [07 January 2019]

Adair, J. (1979) Action- Centred leadership, Gower

Inman, P. (2018) Car industry leaders blame Brexit for UK collapse in investment | Phillip Inman. [online] the Guardian. Available from < https://www.theguardian.com/business/2018/jun/26/car-industry-leaders-blame-brexit-for-uk-collapse-in-investment > [08 January 2019]

Mullins, L.J. (2016) Management and Organisational Behaviour, 11th Edition, Pearson Higher Education