The PESTEL. Analysis through the example of Toyota Motor

Table of content

Table of content

List of illustrations

1. Introduction

2. The Presentation of the Company Toyota Motor Corporation
2.1 The Company
2.2 The Range of Products
2.3 The Mission
2.4 The Vision

3. The PESTEL- Analysis
3.1 The Fundamentals of PESTEL-Analysis VIII
3.1.1 Political
3.1.2 Economic
3.1.3 Socio- cultural
3.1.4 Technological
3.1.5 Legal
3.1.6 Environment
3.2 Limitation of PESTEL-Analysis

4. The PESTEL-Analysis through the example of Toyota Motor Corporation
4.1 Political
4.2 Economic
4.3 Socio- cultural
4.4 Technological
4.5 Legal
4.6 Environment

5. Overall Evaluation of Toyota Motor Corporation

6. Recommendation for strategic focus of Toyota Motor Corporation

List of references

List of illustrations

Illustration 1: The Tree Metaphor of Toyota

Illustration 2: The six elements of the PESTEL-Analysis

Illustration 3: The influence of the political element on the PESTEL-Analysis

Illustration 4: The influence of the economic element on the PESTEL-Analysis

Illustration 5: The influence of the social- cultural element on the PESTEL-Analysis

Illustration 6: The influence of the technological element on the PESTEL-Analysis

Illustration 7: The influence of the legal element on the PESTEL-Analysis

Illustration 8: The influence of the environmental element on the PESTEL-Analysis

Illustration 9: Data of the usage of motor fuel and CO2 -emission of different editions of the Toyota Yaris

Illustration 10: Quantity of admission of passenger cars in Germany

Illustration 11: Toyota´s market share of new care regulations in the EU from January 2014 to January 2015

Illustration 12: Toyota versus Volkswagen

1. Introduction

The senior adviser and eight president from Toyota, Hiroshi Okuda, said in year 1997: “We wish to make Toyota not only strong, but a universally admired company, winning the trust and respect of the world. We must be a company that is accepted wholeheartedly by people around the world, who would think it natural if Toyota became No.1 in size, since we provide attractive products that excel in environmental protection and in safety.“ (The New York Times 2008).

Do this quotation become reality?

In this coursework, the Toyota Motor Corporation will be present with its presentation of company, mission, vision and also the range of products.

After this, the mnemonic of PESTEL will be explained in chapter three. In addition the limitation of the PESTEL-Analysis will be shown.

In Chapter four, the particular factors of the PESTEL-Analysis will be introduced by relating to Toyota Motor Corporation, but only in Germany, because otherwise it would be too extensive.

The next chapter will deal with an overall evaluation/ assessment followed by recommendations for further strategic orientation which will complete this coursework.

2. The Presentation of the Company Toyota Motor Corporation

2.1 The Company

The Toyota Motor Corporation was founded in August 28, 1937 in Japan by Akio Toyoda, who is the President and Representative Director. The company has about 338,875 employees (March 31, 2014). Its main business activities are the production and sales of motor vehicle (Toyota Global Overview).

The capital amounts to 1.73 billion yen/ 12.33 billion euro (February 2015) (Toyota Media 2015). The company also takes part in Motor Sports like Race Cars, Dakar Rally ad FIA World Endurance Championship (Toyota Motor Sports).

2.2 The Range of Products

Toyota has a large range of products. They produce and sell “normal” cars, MPVs/ Vans, SUVs, Commercials and Hybrids. In the future, Toyota will start producing Plug- in Hybrid, Electric and Fuel Cell cars (Toyota Global Vehicle Gallery).

2.3 The Mission

Toyota´s mission is to provide a safety drive. In future, they want to develop new technologies which should be energy saving and uses heterogeneous sources of energy. Because of that reason, the environment as well as a clean world has a high priority to Toyota (Toyota Indus).

2.4 The Vision

Toyota represent his vision as a tree metaphor:

Illustration 1 : The Tree Metaphor of Toyota

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Source: Toyota Global Vision Philosophy

The tree metaphor will be explained now: One of the most important point is that “Toyota will lead the way to the future of mobility, enriching lives around the world with the safest and most responsible ways of moving people.” (Toyota Global Vision Philosophy). Another vision of them is to commit the quality as well as innovation. The constantly raise of their standards for dependability, reliability and customer satisfaction. The respect for the planet is also a part of their vision like we see at the eco-friendly cars.

“Engaging the talent and passion of people” (Toyota Global Vision Philosophy) is an additionally point. Toyota says that the power of their organisation “comes from the skill and diversity of our team members and business partners […] solving problems and creating new ideas.” (Toyota Global Vision Philosophy). So their goal is to constantly create new innovation and “[a]lways better cars […]” (Toyota Global Vision Philosophy).

3. The PESTEL- Analysis

3.1 The Fundamentals of PESTEL-Analysis

The PESTEL-Analysis is a strategic and qualitative method of an analysis of the macro environment. With it, the further direction of a company can be planned with the aid of strategic planning and decisions (Krupp 2013, page 71). Other examples are, if a company wants to launch a new product or service. Another one: if a company wants to enter a new region or country (Team FME 2013, page 10).

Many influences and factors, particularly from external, act on the companies’ businesses. One can say that the environment changes rapidly, so do the management decisions because uncertainty develop. For being prepared, companies undertake environmental scanning (Jeffs 2008, page 27).

To scan the environment, the activity should “be a continual process”: With this scanning and analysis, opportunities and benefits should be maximised both internally and externally, (Jeffs 2008, page 27), especially against competitors (Kachru 2005, page 84).

Generally, the PESTEL-Analysis identifies six factors:

Illustration 2 : The six elements of the PESTEL-Analysis

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Source: self- provided illustration

These external factors have impact on organisation, irrespective of the time (Kachru 2005, page 84).

The gotten information can be derive in different scenario (Best Case, Worst Case, and Real Case) (Krupp 2013, page 72).

3.1.1 Political

The political factor has many influences which will be list in the following illustration:

Illustration 3 : The influence of the political element on the PESTEL-Analysis

Abbildung in dieser Leseprobe nicht enthalten

Source: Kachru 2005, page 85

With these political factors, the influence of the government on the economy is shown. The government can for example changes the tax policies or trade tariffs (PestelAnalysis).

3.1.2 Economic

Illustration 4 : The influence of the economic element on the PESTEL-Analysis

Abbildung in dieser Leseprobe nicht enthalten

Source: Kachru 2005, page 85

These listed factors are like performance indicators which have impact on a company and its efforts. Examples can be a rise of the inflation rate. This lead to an advance of products and services (PestelAnalysis).

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