Resources and Capibilities of Toyota

Resources and Capabilities

The purpose of this essay is to apply the resource based view to critically analyse how Toyota use their resources and capabilities to establish core competences, sustain competitive advantage and achieve their corporate strategy.
Toyota Industries Corporation was established on November 18th 1926. Their business industries include; Manufacture and sales of textile machinery, automobiles, materials handling equipment and logistics (www.Toyotaindustries.com). For the purpose of this essay however, the automobile industry is the key focus with specific attention given to the vehicle market segment (see figure 1 below).
Fig 1.

Source: (www.Toyotaindustries.com)

Toyota Motor Company was established on August 28th 1937. Within the vehicle industry, Toyota has become the world’s largest automotive manufacturer, overtaking General Motors in 2008 and produces sports and luxury vehicles, SUV’s, trucks, minivans and buses. Additionally Toyota’s subsidiaries manufacture Daihatsu mini-vehicles, with Hino motors producing trucks and buses. Vehicle parts are also produced by Toyota for its own use and to sell around the world, with Asia generating near 40% of vehicle and vehicle parts sales (www.Hoovers.com). Toyota Motor Corporation’s top competitors are; Ford Motor Company, General Motor Company and Honda Motors Co., Ltd (www.uk.finance.yahoo.com).
The resource based view identifies that a firm is a set of resources and capabilities that determines strategy and performance (Grant 2005) (See fig.2 below). This view is a development from Porter’s (1980) structural perspective of strategy where emphasis is on the competitive environment rather than the resources and capabilities firms have, develop and evolve to compete (Miller et al 1996).
Broadly speaking, a resource can be defined as: “An economic or productive factor required to accomplish an activity, or as means to undertake an enterprise and achieve a desired

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