1. Running head: TOYOTA: STRATEGIC HR ROADMAP 1
Toyota: Strategic HR Roadmap
Aminta K. Seay
Southern New Hampshire University

2. TOYOTA: STRATEGIC HR ROADMAP 2
Abstract
Toyota is a company that has differentiated itself from other vehicle manufacturers. It has a very
specific mission with several important goals – consumer focus, vehicle innovation,
environmental leadership, safety, and philanthropy. Positive public perception of the Toyota
brand supports the competitive success of this mission. HR needs to develop, implement, and
evaluate a strategic plan to support this vision. This plan needs to be as unique as the company
itself. Using SMART objectives will help accomplish goals more effectively. Focusing on the
Toyota mission, recruiting and selection, training, behavior monitoring, performance appraisals,
and compensation are major landmarks on this strategic HR roadmap to success.
Keywords:
Mission and vision
Brand perception
Strategic HR roadmap
SMART objectives
Recruiting and selection
Behavior monitoring
Performance appraisals
Compensation

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Toyota: Strategic HR Roadmap
When developing a strategic HR plan, being mindful of what Michael Porter says about
strategy can assist development. Porter says (Porter, M., 1996, p. 64):
Competitive strategy is about being different. It means deliberately choosing a different
set of activities to deliver a unique mix of value…But the essence of strategy is in the
activities – choosing to perform activities differently or to perform different activities to
rivals. Otherwise, a strategy is nothing more than a marketing slogan that cannot
withstand competition.
What will HR at Toyota do differently than other companies’ HR teams? What actions will
attract more desirable recruits? How will training and performance reviews be implemented to
benefit both company and employees? How will infractions be handled? How will employees be
compensated? These are the types of questions that HR needs to answer to develop their roadmap
to success for Toyota.
Toyota: The Big Picture
When job seekers browse through several companies’ websites one thing becomes
apparent, Toyota is an outstanding company. Toyota is unique in the cars it manufactures, the
respect it gives its customers and the public, and how employees are treated. Toyota’s website
quickly shows the Toyota philosophy – “Let’s Go Places” (Toyota, 2013).
Toyota’s Mission
Vision
Toyota’s mission is clearly defined as “Our Purpose” (Toyota, 2013). This purpose is
broken into five categories: “You Are What Drives Us,” “Built for How You Live,”
“Environmental Leadership,” “Helping Make Roadways Safe,” and “Giving Back” (Toyota,
2013). Toyota is a different kind of company that is proud to put their vision out for the whole
world to see.

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Consumers
Toyota’s motivating force is their customer base -- “You Are What Drives Us” (Toyota,
2013). Toyota strives to get feedback and design cars around the wants, needs, and opinions of
their consumers. In doing so Toyota believes consumers will not only go to different destinations
in their vehicles, but also be transported to a different level of living through what their vehicles
can help them achieve.
Vehicles
Toyota explains their focus on how they build their vehicles -- “Built for How You Live”
(Toyota, 2013). Toyota takes the opinions of its consumers in mind as they incorporate
sustainability and safety into production. There is also an emphasis placed on the fact that
Toyotas are also made in the United States. Toyota wants to improve the world through its
vehicle production today and into the future.
Going Green
Toyota has a vision of showing respect for the environment -- “Environmental
Leadership” (Toyota, 2013). They make it their mission to design vehicles that will cause the
least amount of damage to the environment as possible. Toyota strives to minimize waste and
energy consumption while still maximizing efficiency.
Beacon for Safety
Toyota has a mission to help prevent accidents and lessen damage -- “Helping Make
Roadways Safer” (Toyota, 2013). Toyota researches and makes innovations that promote safe
vehicle operation and transportation. The information Toyota discovers is then turned over to
government and academic officials to help the general public as well.
Philanthropy

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The final piece in Toyota’s mission is helping communities -- “Giving Back” (Toyota,
2013). Toyota has donates money to support safety, education, and environmental efforts. Toyota
also shares its production knowledge with other organizations to improve efficiency.
Toyota’s Strength: Public Perception
The public appears to have faith in Toyota’s vision as seen in many consumer perception
surveys. Toyota was top in brand perception in the 2013 US consumer survey (Reuters, 2013).
Toyota was first in the 2014 Consumer Reports car brand perception survey (Consumer Reports,
2014). Toyota seems to be winning consumers over with more than their vehicles but also with
their mission. Toyota is driven by consumers’ opinions on vehicle design, uses optimal
production methods, and is concerned for the environment and public safety. Consumers are
behind Toyota’s mission as well. How can Human Resources support Toyota’s mission?
SMART Objectives
One way HR can differentiate itself is by using SMART objectives for every goal that
needs to be accomplished on the roadmap. SMART objectives spell out all requirements which
allow for greater success. First, objectives need to be SPECIFIC. People need to know exactly
what is expected from them. Second, objectives need to be MEASURABLE. Without a means to
gauge progress both success and failure are indeterminable. Third, objectives need to be
ATTAINABLE. People are motivated by a challenge that is achievable even though it takes
effort. Fourth, objectives need to be RELEVANT to Toyota’s mission. Creating objectives that
do not support the vision is like spinning Toyota’s wheels without getting anywhere. Fifth,
objectives need to be TIMELY. People need to know what time frame they are working within to
optimize productivity. If HR uses SMART objectives as a rule, more successful outcomes can be
expected.

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Recruiting and Selection
Recruiting candidates can pose both benefits and challenges for employers. Some
employers focus primarily on recruiting either internally or externally while others appeal to all
candidates. No matter what an employer’s recruiting focus might be, first developing a detailed
job description that follows all employment laws is key (SHRM, 2012). A benefit of recruiting
external candidates is gaining a more diverse work environment. Recruiting external candidates
inspires new ideas. On the other hand, a benefit of recruiting internal candidates is knowing their
past performance. They also have proven themselves as quality candidates. A challenge of
recruiting externally is the expense of finding qualified candidates. Marketing the employment
opportunity is very similar to marketing a company’s product (SHRM, 2012). Conversely, a
challenge of recruiting internally is the possible tension that could arise between competing
candidates or those employees who were overlooked for the position. In the end, the goal is to
hire the most highly qualified candidate for each position.
Training Needs Assessment
Training employees is an important aspect of Toyota Human Resources. However HR
cannot simply jump in and start training on what they believe is important without doing
research. A training needs assessment must be done to find out what employees need to know to
make Toyota profitable. Training needs assessments have several areas that must be analyzed –
organizational aspects, personal aspects, and skills aspects.
Knowledge Requirements
The first component of a training needs assessment is to determine what Toyota’s
employees need to know (SHRM, 2014 April). Organizational needs are what employees need to
be trained on to meet Toyota’s goals (SHRM, 2012). Toyota’s mission and values need to be

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analyzed to determine the five most important organizational aspects to teach. Each position type
needs to be profiled to determine its ten most important personal aspects required. The three
most important skills to complete the tasks of every positional aspect previously determined need
to be defined. Each step in the process gets progressively more detail oriented. In the end Toyota
HR will determine what training items each employee needs.
Starting Point
The second component of a training needs assessment is to analyze what the employees
already know to determine the “gap” (SHRM, 2014 April). HR needs to analyze each employee’s
record to determine their current knowledge and skills using a rubric developed for each position
type. Supervisors need to complete an evaluation of each employee also using a scored rubric.
The administration of an anonymous 25 question employee survey based on position type will be
used to determine what knowledge and skills employees currently use. A series of three one-hour
observations per position type will be made and recorded using a scored rubric. All research will
be analyzed to determine where each position type is in terms of knowledge and skills. Then it
will be possible to determine the gap to where the employees need to be. This gap analysis will
help guide the development of Toyota employee training.
Training Options
The third aspect of a training needs assessment is to analyze training options (SHRM,
2014 April). It is necessary to determine which training needs are critical, which are important,
and which are least important to Toyota’s mission. Three different training levels will be
evaluated: training on all items, training on critical and important items, and training only on
critical items. A breakdown of time, cost, and return on investment is needed for the three

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different training levels. A final evaluation will determine the best training level to choose. This
training options analysis will yield a recommended training plan.
Report
The final component of a training needs assessment is to report the training needs and
training recommendations (SHRM, 2014 April). A concise ten-page report of the findings of
training needs and training recommendations will be written along with an informative ten-slide
PowerPoint presentation. The report and presentation will be given to the Toyota Board of
Directors for their review.
Profitability
A training needs assessment is vital to Toyota’s profitability. Without the proper training
employees cannot complete Toyota’s mission. However, within a short time Toyota can be more
profitable with more effective training.
Encouraging Positive Behavior
Every organization will face issues regarding employee behavior. There are both minor
and major infractions that need to be monitored. Some issues have legal ramifications as well.
HR needs to implement an innovative system that encourages positive outcomes. Retraining,
documenting, and supporting both employees and management will be key functions of HR.
Performance Appraisals
Evaluating performance is important to keep any company running profitably; however
HR needs to strive to differentiate Toyota employee performance appraisals from any other
company. Feedback about strengths and weaknesses is helpful to improve job performance and
outcome quality. Assessment is important not just for individuals, but it is also important for
teams, groups, and divisions. In order for Toyota to provide the best vehicles and service

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possible, it is necessary to develop an outstanding performance appraisal system unlike any
other.
Performance evaluations are valuable if done properly, but devastating if done poorly.
Human Resources expert Susan Heathfield calls for the end of performance appraisals as we
know them in favor of a more positive feedback system (Heathfield, S., n.d.). On the other end of
the spectrum organizations like the Department of Defense are moving to evaluation systems that
base employee compensation on assessed contribution (Department of Defense, n.d.). With such
differing opinions about performance evaluations, it is a difficult task to decide which way to go.
Performance appraisals can focus on behaviors (performance-based evaluations), on
outcomes (contribution-based evaluations), or a combination of the two. Different people will
argue about which is more important taking the journey or reaching the destination. For Toyota,
both the journey and the destination are equally important. Therefore Toyota’s appraisal system
should reflect the importance of both performance and contribution. Ultimately, if a task is
organized properly good performance is going to lead to worthy contributions.
The use of an assessment scale is important in evaluating performance. Just like in school
a student’s performance is evaluated using a letter scale: A, B, C, D, or F. However in a work
situation this letter scale is usually not as well received by individuals. Yet, using a letter grade
can be effective when grading a large division of the company. Toyota would benefit from
refraining from using letter scales to assess individual performance, but use them to evaluate
large group performance.
Graphical scales such as a traffic light can also be used: green is positive; yellow is
borderline; and red is negative. Again this is a scale that does not work well for individuals, yet
has merit for smaller groups. For instance, on the production line it could be helpful to the team

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to see how they are performing as a group. This would be a good feedback mechanism to inspire
quality and motivate performance.
At Toyota, the goal for individual performance evaluation should be a positive experience
for all involved. A number scale could be an effective assessment scale for individuals.
Performance and contribution standards could be evaluated on a five point scale: 5/ mostly
exceeds expectations, 4/ sometimes exceeds expectations, 3/ meets expectations, 2/ sometimes
below expectations, and 1/ usually below expectations. This is a simple scale to understand, and
it produces a quantifiable outcome that is easy to compare. Elaine Pulakos suggests that
narratives also be used to both humanize the process and give better feedback (Pulakos, E., 2004,
p. 15). Toyota would benefit by implementing a system that uses both a numerical scale paired
with an individualized narrative about an employee’s performance and contribution.
Performance appraisals in many companies are stressful and feared. Striving to be
different, Toyota should encourage employees to look forward to both the journey and the
destination. Assessing company, division, team, and individual performance and contributions
will make this possible. The feedback that each and every employee receives will keep Toyota on
the right track.
Compensation
Toyota can have all the vision in the world, but without proper financing to back the
journey the destination will never be reached. Good employees require the adequate
compensation to devote their lives to the Toyota mission. Toyota needs to pay the right amount.
A wage that is too low will not attract the kind of candidates needed; however, a wage that is too
high can drain resources. Finding the “just right” amount is top priority. Salary surveys must be
done for each position in each geographical location to determine the correct pay rate.

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HR Program Evaluation
In the end, Toyota has to give this strategic HR plan a try. The plan could be worked for a
specified length of time, and then the results could be evaluated. Has employee selection and
training improved? Have performance appraisals been more beneficial to employees and Toyota?
Are more good workers staying? Have performance issues been handled appropriately? What
needs to be improved in the HR plan? How should it be changed? When will it be re-evaluated?
Conclusion
Toyota is a unique company that has a very specific vision to improve the lives of people
one vehicle at a time. Through innovative production methods, environmentally minded
practices, safety research, and programs for giving back Toyota has set itself apart from other car
manufacturers. Public perception puts the Toyota brand as one of the best in the world. Having a
strategic HR plan is vital to support Toyota’s succeeding mission. Developing objectives using
SMART guidelines will make reaching goals more effective. Recruiting and selection, training,
behavior monitoring, performance appraisal, and compensation are major aspects that HR must
plan for on the roadmap for Toyota success. Doing things differently as a car maker has gotten
Toyota where it is today. Taking it into the future will require HR to do things differently than
other companies. Let’s go places!

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perception-2013-2

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