Digital in the Driver’s Seat: Accelerating Toyota’s Transformation to Mobility Services
Learning Objectives
- Assess the role of Toyota Connected as a separate, agile organization designed to attract digital talent, experiment with software-enabled offerings, and create value from vehicle data.
- Examine how Toyota Connected and Connected Technologies divided responsibilities while using shared leadership and multi-capping to coordinate innovation, commercialization, and enterprise learning.
- Analyze how Toyota balanced empowered teams with guardrails such as shared services, design standards, common platforms, API governance, and minimum viable policy.
- Analyze how Toyota Connected’s people model, from multi-capped executives to a title-free career ladder, sustained agile work and spread new practices into Toyota Motor North America.
- Evaluate Toyota Connected’s funding system, from a one-time US$5.5 million investment through staged venture-capital rounds to returning most profits to sponsoring Toyota entities.
Abstract
In 2020 Toyota Motor Corporation (TMC) was the world’s top-selling car manufacturer. Despite this, the company was being driven to excel further in response to changing consumer expectations, technological developments, and new kinds of entrants into the automotive industry. Toyota’s leaders sought to accelerate the company’s culture of incremental innovation and realize a bold new future centered on mobility services. They pursued this by launching Toyota Connected, a new organization with its own decision rights and ways of working and a mandate to create new digital offerings for Toyota. In parallel, a new division within Toyota Motor North America called Connected Technologies facilitated the company-wide diffusion and commercialization of the offerings Toyota Connected created. This case describes what it took to empower the small, independent, agile Toyota Connected and how the entity collaborated with Connected Technologies to design and scale new digital offerings and new ways of working for TMC globally.
Appropriate for the Following Course(s)
digital transformation, organizational design, decision rights and governance, organizational agility, and business models
THERE IS NO TEACHING NOTE FOR THIS CASE STUDY.