Toyota and GM: a Comparison of its Mission, Values, Social Responsibility and Ethics

Toyota and GM: a Comparison of its Mission, Values, Social Responsibility and Ethics

 

By

Mike Manley

 

Dr. Cyd Coloma

BMGT 364

November 10, 2011

 


Toyota and GM: a Comparison of its Mission, Values, Social Responsibility, and Ethics

Toyota and General Motors are both in the manufacturing and sale of motor vehicles. They each have its own mission, values and conscientious effort to be socially responsible.  A company’s mission, vision and core values define how the corporation functions and interacts with the local and global community. Corporations have a social responsibility and duty to protect the individual, society in which it operates and the corporation itself from harm.  When corporations fail to follow their mission, values, and duty to social responsibility, it may run into problems of an ethical or legal nature.

General Motor mission and value from its 2010 Annual Report:

“The new General Motors has on clear vision: to design, build and sell the world’s best vehicles. Our new business model revolves around this vision, focusing on fewer brands, compelling vehicle design, innovative technology, and improved manufacturing productivity and streamlined, more efficient inventory processes. The end result is products that delight customers and generate higher volumes and margins- and ultimately deliver more cash to invest in our future vehicles.” (General Motors 2010 Annual Report, 2010)

 

Toyota’s slogan of Moving Forward is in keeping with its mission statement and values. Each vision within the organization defines its mission.

“Leading the way to a future of mobility Toy

Toyota's Global Vision not only calls for building better cars, but also expresses our goal of contributing to the creation of better communities. Toyota is developing new products and services for the future of mobility, with the goal of realizing practical, low-carbon mobility; new lifestyles; broad application of environmental technologies and infrastructure for safer mobility.

Building cars that meet the needs of people in every region

Toyota seeks to build ever-better cars that meet the needs of consumers and society, based on our principles of customer first, good quality, and affordable price. We seek to realize this goal by cultivating global personnel who maintain the spirit of Toyota’s culture of craftsmanship and skill proficiency.

Constantly innovation to create new value

We aim to work as hard as we can to exceed expectations. To that end, we seek not only to incorporate leading edge technologies, but also to create new value in vehicles in such areas as design, high-tech communications and quality, so that people can see, touch and feel that value when using our products. Our goal is to build cars that impress by being one step ahead in innovation.

Moving People in the safest and most responsible ways

Toyota takes an integrated approach combining safe vehicle development, traffic-safety awareness and the creation of a safe traffic environment based on our guiding principle of always providing safe products, so that riding in our vehicles will bring smiles. By offering safety and quality that exceed expectations, we are contributing to achieving the goal of next-generation mobility: zero traffic fatalities” (Corporation, 2011)

 

 

Toyota Corporation clearly defines who the corporation serves, why they are there to serve and how it will serve its customers, employees, and investors. Its mission and values guide employees to build safer and environmentally responsible vehicles that are of good quality and affordable to a global customer base. It seeks to constantly exceed consumer expectations by staying ahead on technology.

General Motors on the other hand, states it values and mission is to provide the world’s best vehicles. GM plans to do this by reinvesting its profits back into GM, reducing its product line offerings, and cutting back on discounts and incentives thereby having larger profit margins to reinvest into the company. General Motors mission while not as extensive or customer oriented as Toyota’s mission is focused on larger profit margins.

A corporation’s mission and values provide the organizations climate and culture. General Motors profit based values may instill fear among its employees. Its vision is about reducing product line offerings and creating larger profit margins may lead employees into believing upper management sees its employees and customers as second rate to the bottom line.          But in the long run of the company, reinvested profits mean money spent on building quality products which lead to products exceeding customer expectations and an efficiency in production since quality of products leads to less product breakdowns.  

Social responsibility is a corporation’s duty to protect the individual, society and the corporation itself from harm.  Toyota has a proactive approach toward its duty of social responsibility. It is evidenced by Toyota’s CSR policy and guiding principles. Its CSR mission is “Contribution towards Sustainable Development". (Toyota, 1995)  Toyota also requires its business partners and employees to follow and support Toyota’s CSR Policy. Toyota has 7 guiding principles that also steer CSR activities.

Guiding Principles at Toyota

1.                  Honor the language and spirit of the law of every nation and undertake open and fair corporate activities to be a good corporate citizen of the world.

2.                  Respect the culture and customs of every nation and contribute to economic and social development through corporate activities in the communities.

3.                  Dedicate ourselves to providing clean and safe products and to enhancing the quality of life everywhere through all our activities.

4.                  Create and develop advanced technologies and provide outstanding products and services that fulfill the needs of customers worldwide.

5.                  Foster a corporate culture that enhances individual creativity and teamwork value, while honoring mutual trust and respect between labor and management.

6.                  Pursue growth in harmony with the global community through innovative management.

7.                  Work with business partners in research and creation to achieve stable, long term growth and mutual benefits, while keeping ourselves open to new partnerships.

(Guiding Principles at Toyota, 2007)

An example to Toyota’s commitment to ““Contribution towards Sustainable Development”, Toyota planted trees around its manufacturing sites in 2007. In Addition, Toyota installed an auto plants world’s largest solar power system consisting of 2,000 kilowatt of solar power and a special paint that breaks down nitrogen and sulfur oxide coats the exterior walls of the factory.  All of these greening of the Tsutsumi plant are believed to reduce that plant’s CO2 emissions by about 35 percent. (Treece, 2007) These actions fulfill Toyota’s guiding principle number one, three, and six.

Although General Motors does not have a formally drafted guiding principles for it social responsibility as Toyota does, it does its share of making the world better for itself, its customers, employee, stakeholders, and neighbors. In 2005, GM has reduced its green house gases by 12.5 percent and its water usage by 23.3 percent. Even during tough financial times for the company, GM is committed to investing in developing hydrogen powered fuel cell vehicles, and other technologies that provide safety measures in their product line of vehicles. Their approach to social responsibility is proactive (Vasilash, 2006)

General Motors also contributes to the community in other ways. It helps students in the sciences, technology, and engineering by providing classroom lesson plans, mentoring programs, and hands on experimental activities. GM has operations in over 200 countries, it contributes to these communities not only by providing employment, but by improving education, technology, infrastructure and by providing donations and contributing to volunteer activities. (Innovation: Community & Education , 2011)

In 2009, Toyota was faced with a massive ethical, legal and financial problem from the deliberate hiding of mechanical auto problems. Toyota vehicles had mechanical problems that caused vehicles to accelerate and prevented drives from employing the braking system. Toyota was fined 16.4 million dollars for failing to properly notify vehicle owners of the problem. The automakers knew of the dangerous problem for four months and did nothing to protect its customers.  5.4 million Toyota vehicle were recalled as a result of government pressure. (Healey, 2010)

General Motors has had its share of recalls, but none at the level of Toyota’s scandal. The most recent legal headline for General Motors is its acceptance of $9.4 billion dollars from the U.S. government in order for GM to avoid bankruptcy and the laying off of thousands of workers. Within weeks, a new GM structure was formulated and U.S. taxpayers owned 60 percent of GM. (Ikenson, 2009)

In closing, the Toyota recalls and unethical behavior of Toyota management seriously hurt the reputation of the corporation. The mission and values of the corporation were not followed and the duty to act socially responsible was neglected causing serious damage to Toyota’s reputation and bottom line. Also, General Motors has a new mission and vision to build and sell the world’s best vehicles, streamline production and reinvest for the future which will ensure its future survival and avoid another government bailout.

 

 

 

Sources

 

Corporation, T. (2011). Leading the way to the future of mobility. . Retrieved November 2011, from http://www.toyota-global.com/investors/ir_library/annual/pdf/2011/p02_05.pdf

 

General Motors 2010 Annual Report. (2010). Retrieved November 2011, from General Motors: https://materials.proxyvote.com/Approved/37045V/20110408/AR_87685/HTML1/general_motors-ar2010_0008.htm

 

Guiding Principles at Toyota. (2007). Retrieved November 2011, from Toyota : http://www.toyota-global.com/sustainability/csr_initiatives/csr_concepts/pdf/sustainability_e.pdf

 

Healey, J. R. (2010). Toyota faces record $16.4M fine . USA Today.

 

Ikenson, D. J. (2009). Hard Lessons from the Auto Bailouts. CATO Policy Report , 1-8.

 

Innovation: Community & Education . (2011). Retrieved from General Motors: http://www.gm.com/vision/community_education/corporate_citizenship.html

 

Toyota. (1995). Retrieved November 2011, from CSR Policy: http://www.toyota-global.com/sustainability/csr_initiatives/csr_concepts/policy.html

 

Treece, J. B. (2007, July 30). Toyota goes green by planting plants at its plants. Automotive News , p. 45.

 

Vasilash, G. (2006, August). An Inconvenient Truth: GM Cares About the Environment. Automotive Design & Production , pp. 58-60.

 

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