KP logo

Total items: 0

  • Accounting & Finance
  • Banking & Insurance
  • Personal Finance & Investment
  • Business & Management Skills
  • Business Improvement
  • Business Planning
  • Business Research
  • Business Stories
  • Creating Success
  • Entrepreneurship
  • International Business
  • Management Analytics
  • Professional Services
  • Project Management
  • Strategic Management
  • Work/Life Balance
  • Digital & Technology
  • Change Management
  • Employee Engagement
  • Employment Law & Relations
  • Human Resource Management
  • HR Analytics
  • Learning & Development
  • Organizational Development
  • Performance Management
  • Reward Management
  • Talent Management & Recruitment
  • Kogan Page Inspire
  • Manufacturing & Production
  • Procurement
  • Retail Supply Chain
  • Supply Chain
  • Sustainability
  • Advertising
  • B2B Marketing
  • Consumer Behaviour
  • Digital Marketing
  • Luxury Marketing
  • Market Research
  • Marketing Analytics
  • Marketing Fundamentals
  • Marketing Strategy & Planning
  • Public Relations
  • Sales & Account Management
  • Risk Management
  • Corporate Governance, Ethics & CSR
  • Information, Knowledge & Data Management
  • Compliance & Regulation
  • Career Development
  • Job Seekers
  • Specific Careers
  • 30 Day MBA Series
  • Better Business English
  • Business Myths
  • Business Success
  • Chartered Banker
  • Ebooks for the L5 Studying Learning & Development
  • Elite Student
  • HR Fundamentals
  • John Adair Leadership Library
  • Market Research in Practice
  • Marketing Science
  • New Tools for Business
  • PR in Practice Series
  • Case Studies
  • Ebook Collections
  • HR Toolkits
  • Knowledge Portal
  • Online Courses
  • #EmbraceEquity
  • Empowering Workplace Learning
  • Tackling Economic Uncertainty
  • Data & Analytics
  • Responsible & Sustainable Business
  • Workplace Wellbeing
  • Student Store
  • Off the Page Digital Events
  • Off the Page Masterclasses
  • Accessibility
  • News & Media Enquiries
  • Report Piracy
  • Booksellers
  • Professional Associations
  • Prospective Authors
  • Rights Buyers

Want to start reading immediately? Get a FREE ebook with your print copy when you select the "bundle" option.  T+Cs apply . 

  • Business & Management

Business Operations Models

operations in business model

Becoming a Disruptive Competitor

Key features at a glance.

Ebooks are subject to sales tax in many regions, including all EU countries. Tax will be calculated at the checkout where applicable.

FREE UK and US delivery

Shipping and handling

Cancellations and returns policy

About the book

Most successful companies have operations management at their heart. It enables strategy and should be part of boardroom discussions. However, Cranfield research has shown that business strategy barely recognises the world of operations management. Recognising that operations management needs to be more strategic, Business Operations Models is a revolutionary new title that looks at the interrelationship of operations management and strategy. In Business Operations Models , Martin Christopher and Alan Braithwaite identify the characteristics of market-leading businesses that have transformed their markets and delivered super performance for their stakeholders. It points to the theory gap between strategic thinking and operations and how many high-performing businesses arrive at their new operating models as much by chance as judgement. Unpacking those observations leads to some clearly defined features of winning competitors, including eliminating waste, leveraging technology, and utilising transformative business models. Business Operations Models offers a framework for achieving super performance and understanding when and how a company may be able to leverage its capabilities to outperform. The book provides detailed international case studies that illustrate how the principles work in practice, including Apple, Dell, Amazon, John Lewis, Southwest Airlines, Aldi, Toyota and many others.

About the authors

Alan Braithwaite is Visiting Professor at Cranfield University and specializes in supply chain strategy and operational excellence in the retail, manufacturing and service sectors. He is the founder of LCP Consulting, which collaborates with over 400 companies internationally. Martin Christopher has been at the forefront of the development of new thinking in logistics and supply chain management for over 30 years. He is Emeritus Professor of Marketing and Logistics at Cranfield University, where he helped build the Centre for Logistics and Supply Chain Management into a leading centre of excellence. His published work is widely cited by other scholars and he has been invited to participate in academic and industry events around the world.

operations in business model

Martin Christopher

operations in business model

Alan Braithwaite

Table of contents.

Stefan Stern, Financial Times columnist and Visiting Professor, Cass Business School

Business leaders crave greater simplicity but sometimes end up confusing themselves with an overload of data or 'analysis paralysis'. Braithwaite and Christopher draw on years of experience to cut through the confusion with lucidity and compelling evidence. Their business operations models are based on admirably clear principles. Their approach could help you reinvent your business and set you on a path to greater success.

Chris Jephson, former Director of Learning at Maersk Line and Director, Client Relations, Maersk Logistics

The business operations model framework builds on the extensive theoretical knowledge and deep practical experience residing within these two authors, making it a must-read for those engaged in modern business. From wide-ranging commercial know-how the authors have selected case studies that provide clear insight and learning into what makes today's and tomorrow's super-competitors.

David Wild, CEO, Domino’s Pizza, formerly CEO of Halfords and Walmart and director at Tesco

Alan and Martin have influenced the evolution of Retail Supply Chains over the past 30 years through the advice given to leading companies by LCP and through their work at Cranfield. Today the pace of change is more disruptive than ever and it is timely to reflect on the principles which shape efficiency and effectiveness in this area, which is so critical to sustained business success.

Logistics & Transport Focus

Business Operations Models is a book about winning, about succeeding in business with a particular slant towards supply chain and logistics management encapsulating more than 30 years' experience by prominent supply chain and business operations strategists and practitioners from Cranfield University: Alan Braithwaite and Martin Christopher. Whilst detailed, it never hides behind jargon and sets out a clear methodology for success. Each chapter illustrates the points by case studies of well-known successes such as Apple and Amazon and has useful task-driving checklists.

Kelly Barner, Buyers Meeting Point

Needing to reconfigure your operating model for competitive advantage might be an easy concept to accept, but the execution is likely to be difficult. Valuable assistance is provided in the many case studies and visuals in this book. There are two groups who should read this book: executive leaders that want to transform their operation in a way that will alter their role in a market and managers that have high aspirations and a vision for the true contribution they could make if they were positioned differently.

Related products

The Strategy-Driven Supply Chain (9781398600454)

The Strategy-Driven Supply Chain

Managing International Joint Ventures (9780749434977)

Managing International Joint Ventures

Managing Passenger Logistics (9780749432140)

Managing Passenger Logistics

Cross-cultural Communication (9780749439224)

Cross-cultural Communication

Intercultural Management MBA Masterclass (9780749435820)

Intercultural Management MBA Masterclass

Related content


In conversation with Martin Christopher: Leading Procurement Strategy - Part 3


In conversation with Martin Christopher: Leading Procurement Strategy - Part 2


In conversation with Martin Christopher: Leading Procurement Strategy

Get tailored expertise every week, plus exclusive content and discounts.

Kogan Page logo

Toyota Business Model – Managing Business Operations

' src=

This report analyses and evaluates how well Toyota ( Toyota Motor Corporation ) uses its business operations to create a competitive advantage.

The report focuses on analyzing Toyota’s motor vehicle manufacturing operations. First, a brief profile of Toyota is presented which is followed by an analysis of Toyota’s operations based on the ‘4Vs’ model and in the context of the automobile Industry.

Next, the five performance objectives within the automotive industry are interpreted and the operations of Toyota are then evaluated in line with those performance objectives.

Further, the extent to which lean and/or agile principles are applied in Toyota’s operations, and the company’s supply chain are analysed.

Finally, the report summarizes the effectiveness of Toyota’s operations strategy suggesting recommendations and future challenges.

Brief Profile of Toyota

Toyota is one of the leading automakers in the world that produces and sells motor vehicles. The multinational company, headquartered in Japan has its operations based in North America, Japan, Europe and Asia including sales in more than 170 countries around the world.

Toyota has strong brand recognition and market position with a significant share of the home market (48.4 % in Japan), North America (13.8%), Asia (16.5% excluding Japan and China) and Europe (4.6%) for its products (Toyota SWOT Analysis, 2014).

The company operates 52 manufacturing companies in 27 countries around the world excluding Japan (Toyota UK, 2014) and employs a workforce of 338,875 employees as of March 31, 2014.

Such a strong market position and global production facilities help Toyota deliver sustainable business and achieve a competitive advantage in the long term.

Economic Environment Impact on Automobile Industry and Toyota

The automotive industry is mainly affected by global competition, various laws and government regulations (, 2014).

Toyota competes with other principal manufacturers such as General Motors, Ford, Honda, Volkswagen, and Nissan among others in the globally competitive marketplace.

Increasing competition in the industry can lead to a decrease in unit sales and a large inventory, thus urging manufacturers to decrease their prices. The competition will ultimately affect the financial and operations results of key players such as Toyota and others.

Complying with government laws and regulations is essential for companies within this sector. Toyota had to recall around 8.5 million vehicles worldwide in 2009/2010 to comply with standards of laws and governmental regulations (BBC, 2010) and such recalls affect the brand image of the company in addition to incurring significant costs.

The opportunities for the automotive industry include the recovering US economy and growth in demand from emerging BRIC markets which are expected to dominate the global car market by 2020 (KPMG, 2013). Industry players have benefited from moving their production facilities to India and China to tap into those markets and benefit from low-cost production.

Toyota also sees an opportunity in the growing hybrid and electric car market in the US where the demand has been increasing since 2012, as the economy is getting better and the US government legislation is favouring high-efficiency vehicles (, 2014).

Increasing fuel prices and growing environmental concerns among consumers encourage manufacturers to shift production to hybrid electric automobiles (Global Car & Automobile Manufacturing Market Research, 2013) and Toyota is taking advantage of that focusing on the production of high-efficient and green vehicles (Toyota Annual Report, 2012).

Toyota Business Model Operational Analysis

Analysis of toyota’s operations based on 4vs model.

Slack et al. (2012) defines operations principle as the way in which processes need to be managed and outlines the 4Vs i.e. volume, variety, variation and visibility that influences the operation processes. Toyota’s operation has been analysed based on those 4Vs below.

Volume of Processes

Toyota manufactures a large number of vehicles (8,736.5 thousand units in 2012, Toyota Production figures) and for such high output, there’s greater degree of repeatability in the process.

The high volume of output has allowed Toyota in systemization of activities and Toyota believes in developing deep expertise in specialities among its workforce as an essential requirement to its product-development system (Sobek II and Liker, 1998).

Such high volume process output helps Toyota gain economies of scale and thus reduces the unit cost of its production.

Variety of Processes

Toyota carefully chooses a variety to balance market demands and operational efficiency (Iyer, Seshadri and Vasher, 2009).

The company is present in all the segments of automotive and at least 70 different models of vehicles are sold by Toyota (Automotive, 2014) making the portfolio with a wide range of products and this accounts for a higher variety of processes.

High variety of processes enables Toyota to match a wider range of customer demands and be more flexible in eyes of customers. This, however, accounts for higher unit costs and makes the process relatively complex but Toyota has advanced other productions methods to control such aspects.

Variation of Processes

With predictably constant demand, it’s easier to allocate resources to a level that is capable of meeting the demand Slack et al. (2012).

The variation in demand for Toyota’s products is low in past few years and the company’s production has integrated Just in Time production techniques to fulfill those demands. Low variation enables Toyota to implement stable, routine and predictable operation processes.

Visibility of Processes

Process visibility indicates how much of the processes are exposed to its customers Slack et al. (2012). Toyota has low process visibility, as most of its operation process is ‘factory-like’.

Low process visibility means there’s a time lag between production and consumption of Toyota products but it enables the company for high staff utilization and enjoys low unit cost for its products.

Few of its processes such as those of sales center and test drive facilities, however, have some kind of contact with customers allowing limited visibility.

Analysis of operations in context of Automotive Industry

Volume and Variety of processes are two dimensions that can differ from competitors of Toyota in the automotive industry. Competitors in the industry that compete on price (for example, Ford, Honda) will have a high volume of processes similar to that of Toyota.

In contrast competitors such as BMW that compete on differentiation has a relatively low variety of processes in comparison to Toyota.

It can be argued that variation and visibility of processes remain similar to Toyota for most of the players in this industry. The demand for automobiles is growing at a constant rate with some high growth seen in emerging economies.

Toyota and other industry players can predict the constant demand and thus produce accordingly. Because of factory-like operations, Toyota and all other competitors are low-visibility processes in the automotive industry.

Performance Objectives for Toyota Operations

Slack et al. (2012) identifies five aspects of operations performance that have an impact on business competitiveness and its customer satisfaction. The five performance objectives include Quality, Speed, Dependability, Flexibility, and Cost.

These objectives, although similar for all operations differ in exact meaning for different operations and thus it is necessary to interpret them based on the automotive industry operations.

The operations of Toyota are further evaluated to see how well the operations perform against those objectives.

Five Performance Objectives – Toyota Business

Quality is about being right and in terms of the automotive manufacturing industry, quality refers to making reliable products, assembling it to right specifications, all parts made to specification, and making products attractive and flawless (Slack, Brandon-Jones and Johnston, 2013). Focusing on quality can reduce the cost and increase the dependability of the operations.

Quality in Toyota’s Operation

Toyota has integrated several operations such as development, design, purchasing, production and after-sales service to maintain the highest quality. Several research firms including J.D. Power have consistently rated Toyota among the top automotive brands in terms of reliability, initial quality, and long-term durability (Stewart and Raman, 2007).

Toyota has built a successful reputation of providing quality products and this shows the high importance and successful performance of Toyota in terms of quality.

Speed is about doing fast and in terms of automotive manufacturing industry, Speed refers to minimizing the time between dealers requesting a vehicle of a particular specification, and minimising the time to deliver spares to service centres (Slack, Brandon-Jones and Johnston, 2013). Speed focused operations will help in the faster delivery of products and save costs.

Speed in Toyota’s Operation

Through Lean manufacturing or what Toyota calls Toyota Production System (TPS), it has managed to balance the actual speed of the production line exactly to meet the demands of the customer (Davies, 2009).

Toyota has managed to increase the speed of its operations by rearranging layout and flow and thus enhanced simplicity.


Dependability is about being on time and in terms of automotive manufacturing industry, it refers to on-time delivery of vehicles to dealers, and on-time delivery of spares to service centres (Slack, Brandon-Jones and Johnston, 2013). Dependability focused operations provide the potential for reliable delivery of products and save costs.

Dependability in Toyota’s Operation

With ‘Just-in-time’ production systems, Toyota has focused on its operations to be reliable and thus controlled its costs. Toyota with its labour intensive workforce and a global footprint of production facilities is capable of fulfilling the demand on time.


Flexibility means being able to change the operations and in terms of automotive manufacturing industry, flexibility could mean the introduction of new models, a wide range of options, ability to adjust the number of vehicles manufactured, and the ability to reschedule manufacturing priorities.

Based on customer’s need to change, four types of requirement i.e. product/service flexibility, mix flexibility, volume flexibility, and delivery flexibility can be provided (Slack, Brandon-Jones and Johnston, 2013).

Flexibility in Toyota’s Operation

Toyota’s operations are capable of providing a wide range of products to its customers. The company has been able to achieve the high level of output producing relatively small batches of different Toyota models in the past. Toyota’s operations are currently focused to reconsider production models with changing market needs and thus to establish a flexible and efficient production system (Datamonitor, 2014).

Cost refers to being productive with the operations and in terms automotive manufacturing industry, the cost could mean Bought-in materials and services cost, Technology and facilities costs, and Staff costs (Slack, Brandon-Jones and Johnston, 2013). Keeping operations cost down is an important objective of operations to improve productivity.

Cost of Toyota’s Operation

Toyota has effectively managed to produce high-quality vehicles at reasonable prices. The company has implemented several initiatives such as value Engineering, value analysis, and value improvement programs that have helped to reduce costs from its operations (Smalley, 2010). It has also shifted its focus towards local production capacities to meet the customer demands.

Analysis of Order Qualifiers and Order Winners

Distinguishing between order qualifying and order winning factors help determine the relative importance of the competitive factors (Slack, Chambers and Johnston, 2010).

Qualifying factors may not add to the competitiveness but they are important being the basic level of operations performed to be considered by customers.

In the automotive industry, players such as Honda that compete on low prices consider the cost of high priority among their performance objectives. In contrast, BMW competes on differentiation, quality and dependability will be considered of high importance in terms of their performance objectives.

While for Honda, ‘cost’ can act as an order winner, for BMW it will only act as an order qualifier and other objectives such as ‘quality’ and ‘dependability’ will act as order winners. Order qualifying and order winning factors, however, change according to changing customer demands.

Air conditioning and power steering, for instance, which were considered additional order-winning features in the automotive industry, have now become order-qualifying features (Jones and Robinson, 2012).

Based on the analysis of the performance objectives of Toyota above, it can be seen that cost, quality and flexibility remain order winners for Toyota.

Taking competitor Mercedes in comparison of order qualifiers and order winning factors, a polar diagram (see Figure 1) summarises the importance of performance objectives.

The performance objectives for Toyota, however, could change according to the product model and target market.

Overview of Business Operations Strategy issues of Toyota

Calling Toyota as one of the most storied companies in the world, Spear (2004) has pointed out that the capabilities of Toyota have repeatedly outperformed its competitors in terms of quality, reliability, productivity, cost reduction, sales and market share growth, and market capitalization.

Toyota with its focus on different operation objectives over time has significantly improved its operation methods to outperform its competitors. Its operations strategy focuses on superior quality at a lower cost than its competitors. Toyota’s low-cost operations not only produce products at low cost but also make higher profits being competitive in the market.

All such positive aspects are derived from the achievement of its performance objectives.

On the other hand, in light of the order-winners that Toyota is required to deliver, Toyota faced a few challenges in the area of maintaining the quality and standards of its variety of products in past.

Although Toyota is considered as a leader in setting quality standards in the industry, its recall of 3.8 million U.S. vehicles in 2009 (Bunkley, 2014) shows that the company struggled to maintain the quality of its products.

With a high variety of products, operations become rather complex and Toyota’s quality problem can be linked to its product complexity (Cole, 2011).

Toyota uses a unique process called ‘Toyota Production System’ that makes use of Just-in-time manufacturing techniques and this works really well for Toyota.

Lean Principles applied within Toyota’s Operation

Lean principles aim to fulfil demand instantaneously, with perfect quality and no waste. Toyota itself is considered the initiator of the lean approach.

The company developed a set of practices called Toyota Production System (TPS) and those set of practices has hugely shaped what we call ‘lean’ today (Slack, Chambers and Johnston, 2010).

To analyse the extent to of lean principles have been applied to the operations of Toyota, two frameworks are considered in detail –

TPS as ‘Just-in-time’ and ‘Jidoka’

Spear (2004) in his HBR article “Learning to Lead at Toyota,” emphasises that TPS is a system of nested experiments that enable constantly improving operations, and Toyota has a structure where those principles are practised at all levels.

Toyota (2014) lists outcomes of TPS as providing customers with the highest quality vehicles, at the lowest possible cost, providing members with work satisfaction, and giving the company the flexibility to respond to the market.

According to Toyota (2014), Just-in-time within TPS allows the production process to be regulated by the natural laws of supply and demand, removing non-value-added activities in operations and eliminating waste.

No activity is carried out until there’s demand for the product and demand stimulates the production of a vehicle and this production stimulates other parts of the value chain.

Just in time within Toyota’s operations are carried out by means of steps involving heijunka (leveling and smoothing the flow of items), kanban – Sign to the earlier process that more parts are needed (See figure below) and nagare (laying out processes to achieve smoother flow of parts throughout the production process) (Slack, Chambers and Johnston, 2010).

‘Jikoda’ in TPS means ‘automation with a human touch’. The process is operated within Toyota production by means of fail-safeing, line-stop authority and visual control (Slack, Chambers and Johnston, 2010).

Toyota encourages its employees within operations to identify opportunities that can be improved and implement those improvements (Power, 2011).

Toyota’s production system uses both Just-in-time and Jidoka techniques to eliminate waste from its production. Toyota has identified seven types of waste that need to be eliminated from its operations process: overproduction; unnecessary transportation, inventory, worker motion; defects; over- processing; and waiting (Staats and Upton, 2011).

Illustration of the Toyota Production System Toyota Business Model Operations

Toyota within TPS also includes ‘Kaizen’ that allows continuous improvement in the operation processes (Alves, Dinis-Carvalho and Sousa, 2012).

The 4P model of the Toyota Way

Liker (2004) discusses 14 management principals Toyota applied for its ‘lean’ methods using a 4P model:

The model (see figure below) shows the lean principles applied within Toyota. Authorities within Toyota claim that it’s not just processes and tools of management operations that make Toyota lean, its strength rather lies in the overall philosophy of their approach to lean (Slack, Chambers and Johnston, 2010).

4P ModelThe Toyota Way Toyota Business Model

The 4p model of the Toyota way indeed explores more of that philosophy.

Analysis of Toyota’s Supply Chain

Modern operations are concerned with making supply chains more efficient. Improving supply chains will ultimately improve the performance of the whole chain by reducing costs, shortening lead times and reducing inventory (Hill and Hill, 2012). With global sourcing, however, management of supply chains have rather become more complex (Slack, Chambers and Johnston, 2010).

Toyota’s supply chain management uses unique processes mostly based on its operational strategy called Toyota Production System (TPS). The TPS has been benchmarked and at Toyota, the practices and principles of TPS spread over the entire supply chain to ensure efficiency (Iyer, Seshadri and Vasher, 2009).

Toyota’s competitive advantage, in fact, comes from its knowledge shared with its supply chain (Halpern, 1999).

The 4VL Framework of Toyota Supply Chain

Iyer, Seshadri and Vasher (2009) in the book “Toyota Supply Chain Management” introduce v4L framework to describe the Toyota’s supply chain processes. The v4L framework links variety, velocity, variability, and visibility (4v’s) with learning (L) principles used by Toyota.

Toyota considers both processes and results achieved in its operations (Toyota, 2014). The authors observe that Toyota, to balance the key supply chain parameters, considers ‘variety’ by balancing market demands with operational efficiency; ‘velocity’ by continuing a steady flow throughout the system through synchronised capacity planning; ‘variability’ by reducing to enable all of the supply chain flows to operate with low levels of inventory, and ‘visibility’ of processes to enable learning and promotes continuous improvement (Iyer, Seshadri and Vasher, 2009).

Three essential parts of Toyota’s supply chain operation (See Appendix D for stages) are analyzed below.

Toyota Suppliers

Toyota has transformed automotive supply-chain management by building close relationships with its long-term partners and a sense of mutual benefit (The Economist, 2010). The company has a remarkable trustworthy partnership with most of its suppliers and the suppliers appreciate the communication and concern Toyota shows for their profitability, often ranking Toyota higher than other manufacturers (Liker and Choi, 2004).

Toyota’s focus is on building a stronger foundation at every stage of the supply chain, from product development to after-sales service (Stewart and Raman, 2007). It has been successful with its goal of minimizing a number of suppliers and creating long-term partnerships with its suppliers to achieve cooperation in innovations, cost reduction and quick response to demand fluctuations (Iyer, Seshadri and Vasher, 2009).

Toyota Logistics

Toyota uses ‘network logistics model’ for an efficient inbound logistics that enables it to receive materials from its suppliers on daily basis and reduce its logistics costs (Iyer, Seshadri and Vasher, 2009). With its TPS approach to just-in-time processes (known as heijunka), Toyota minimizes the inventory costs by having the parts required arrive at their point of use only as they are needed (Toyota, 2014).

Toyota Dealers and Clients

Client satisfaction is one of the main priorities of Toyota and its dealers have an important role in delivering that satisfaction to its customers. Toyota has built an efficient supply network to support its dealers and interact directly with its customers.

The company enables its dealers to directly serve the customers even for their after-sales service needs (Iyer, Seshadri and Vasher, 2009).

Toyota’s Evaluation of Demand-side and Supply-side issues

Operating in different markets with different characteristics, and a wide range of products requires different supply chain configurations and makes the process more complex. Toyota’s focus on heijunka (the smoothing of the production flow) and just-in-time assembly requires strictly scheduled and frequent deliveries (Ludwig, 2013). Controlling the supply chain means Toyota can address the supplier and market changes with higher speed.

On adverse aspects, Toyota rapid growth and increased product complexity have affected its supplier management system and overall performance as its existing supplier base couldn’t keep up with demands (Cole, 2011). Also in the advent of Toyota’s rapid growth, the company couldn’t maintain the “Toyota way” and failed to evaluate its outside suppliers resulting in quality problems of its products (Cole, 2011).

Additionally, Toyota’s lean and just in time supply chain structures couldn’t withstand its demand during natural disasters when its production facilities had to be closed. Toyota has addressed that issue by effectively “un-leaning” its supply chain and broadening its supply chain’s scope to temporarily include its major competitors (Blanchard, 2011).

Toyota has also asked its suppliers to spread their production across multiple locations and hold extra stock to build its contingency plan that will ensure a production recovery within two weeks (Automotive Logistics, 2012).

Summary of Findings

Effectiveness of the operations strategy.

Based on the operational analysis, it can be summarized that Toyota is one of the best automakers with high-quality products, high productivity, manufacturing speed and flexibility.

Its competitive advantage undoubtedly comes from its efficient “Toyota Production System” that lies at the heart of Toyota’s operation, practised and continually improved for years and become a benchmark for other manufacturing companies to follow.

Recommendations for Change and Future Challenges

Toyota needs to continue focusing on its quality and try to decrease recall incidents of its vehicles. The company has built a reputation of the strong desirable brand and such recall incidents can a serious impact on its brand image. Toyota also needs to focus on developing alternative strategies in order to fulfil its demand during disasters.

Customers lost during such incidents might find other brands more reliable than Toyota. The principles of just-in-time inventory control and other methods that helped Toyota maintain a competitive advantage in past are no longer adequate, Toyota should focus more on innovation to retain its leadership position.

Another future challenge for Toyota will be retaining its dominance in the hybrid and electric car market and again to achieve this, Toyota needs to needs to continue innovating its alternative fuel offerings.

The growing demand in emerging countries such as China and India brings new opportunities for growth in the automotive sector but if Toyota really excels the homegrown brands are a bigger challenge. KPMG (2013) report predicts demand shift to China will reach unprecedented levels by 2020 and the China market will be responsible for nearly one-third of annual new vehicle sales worldwide.

Toyota should be aware of this increasing demand seen in China’s and other emerging countries’ markets and thus increase its operations focused on those markets for its sustainability.

To summarize, Toyota embodies state of art in manufacturing operations. The company needs to retain its existing competencies and build on its strengths to overcome future challenges.

' src=

Hi, welcome to my blog! I am a marketer, blogger and an internet entrepreneur. I help startups, marketers, and entrepreneurs succeed with content and commerce. Join me on Twitter or connect with me on LinkedIn and Facebook.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Business Operation in Application Model

Table of contents:

Business Operations are represented in the Application Model. They are listed in the Xafari|BusinessOperations node.

Business Operations may be added to the Application Business Model. The Xafari BC Model module ( Xafari.BC.Model.dll ) provides such a scenario. If this module is added to the application, then the BO services use the Business Model instead of the Application Model. The Business Model data is stored in separate files out of the main Application Model. The special Project.xafml.Editor.exe tool provides all interactions to the Business Model. To learn more about these features, refer to the Support Center .

The image below shows the non-context BO node:


This node exposes the following properties:

- Asynchronous . In the asynchronous mode, the BO is executed in the background. The application does not wait for the result of the execution.

- Synchronous . In the synchronous mode, the progress window is displayed to visualize the execution progress. The application stops and waits until the execution ends.

For the most of the above properties, the values can be set through the corresponding attributes in the code.

The nodes representing the context-dependent BO have the same properties as the ordinary (context-agnostic) Business Operations, plus 7 additional properties described below:


AutoRefreshView specifies the mode of data refreshing. Xafari.BC.BusinessOperations.Controllers.BORefreshController provides the feature to refresh the View data after executing a context BO. Available values are listed below.

It is possible to set the AutoRefreshView property in the code via the ModelDefaultAttribute :

[ ModelDefault ( "AutoRefreshView" , "DetailView" ) ] public class MyBusinessOperation : BusinessOperationBase { }

< ModelDefault ( "AutoRefreshView" , "DetailView" ) > _ Public Class MyBusinessOperation    Inherits BusinessOperationBase End Class

BORefreshController exposes three events: CustomRefreshBeforeExecute , CustomRefreshAfterExecute , and CustomMatch . The events allow the developer to complement or replace the entire logic of updating data after executing the BO. To learn more, refer to the following classes:

ContextDataType specifies the type of data providing the context (e.g., the type of the business object for which the Business Operation is intended). It is a read-only value.

ContextProperty specifies the reference to the BO context property (see the BO class section). It is a read-only value.

ContextViewType specifies the type of View in which the BO can be used. Three options are possible: DetailView, ListView, and Any.

ContextTypeMatchMode specifies the mode to check the correspondences between a context-dependent BO and the type of objects to which the operation can apply. It may possess the following values:

The developer can set the value of this property using ContextPropertyAttribute in the application's source code.

ContextObjectsCriteria specifies the criteria string; the criterion is calculated based on an instance of the selected (current) business object. If the calculation result is False, the BO in the Actions list becomes inactive.

ContextObjectsCriteriaMode specifies how to apply the criterion to a group of previously selected objects. It may possess the following values:

The node of any BO includes the following child nodes:


The deeper description of these nodes follows below.

Categories .

In the UI, the list of Business Operations displays a one-tier grouping by categories (see the Business Operation Class Attributes topic). One BO can belong to a number of categories. The Categories node contains the list of categories which the BO belongs to. There is a Default category that displays the BO in the root. It is possible to add, delete, and edit categories.

Implementations .

The node contains the list of all available Implementations . It is possible to change the Caption and the Description of the Implementation. The Id property is similar to the BO Id property and contains a unique identifier of the Implementation class. The Type property refers to the Implementation class.

Parameters .

It contains the list of the BO parameters. As mentioned above, any public property of the BO class is a BO parameter.


Each BO parameter in the Model exposes the following properties:

To display a context-dependent BO in the Actions list, the framework uses a special SingleChoiceAction . It is named BOExecuteAction and can be configured in the ActionDesign|Actions node of the Application Model.

Context-agnostic BO are displayed using BusinessOperationsTreeNode_ListView . It is available in the Views node of the Application Model. There is also a respective NavigationItem element.

BusinessOperationsTreeNode_ListView requires to add the NonPersistentObjectSpaceProvider to the application. If you have created an app using the Xafari template, this provider already exists.


Operations of Innovative Business Models


The last decade has witnessed the rapid growth of many innovative and disruptive business models. This dissertation identifies a few of the unique inefficiencies and challenges that these new business models bring for small entrepreneurs and recommends ways to solve them.

The second and third chapters of this dissertation focus on rewards-based crowdfunding platforms such as Kickstarter and Indiegogo, where entrepreneurs designing new and innovative products solicit monetary pledges from a population of potential contributors. If total pledges exceed a pre-specified funding target, the entrepreneur distributes non-monetary rewards—typically, units of the new product—to these contributors. Otherwise, the contributors are refunded their pledges.

The second chapter explores how an entrepreneur might overcome one of the most significant challenges in crowdfunding: credibly signaling information about the quality of the new product to a pool of small, uninformed contributors. We find that the entrepreneur should signal high quality by setting a high target that is distorted above the full information optimal level. While a separating equilibrium always exists, a pooling equilibrium can only occur under very specific circumstances. We show that the high target affects the quality choice of entrepreneurs and may deter unique, high quality projects. In addition, we discuss how the entrepreneur should modify the signaling strategy when a high target potentially deters backers from pledging due to the cost of participating in a failed campaign.

The third chapter explores how to design such crowdfunding campaigns when contributors choose not just whether to contribute, but also when to contribute. We show that strategic contribution behavior—when contributors intentionally delay their pledges until campaign success is likely—can arise from the combination of non-refundable (potentially very small) hassle costs and the risk of campaign failure, and can explain pledging patterns commonly observed in crowdfunding. Furthermore, such delays hurt the entrepreneur if contributors are distracted, i.e., if they may fail to return to the campaign after an intentional delay. To mitigate this, an entrepreneur can use a simple menu of two rewards with a fixed number of units sold at a low price, and an unlimited number sold at a higher price; this segments contributors over time based on the information they observe upon arrival. Despite its simplicity, such a menu performs well compared to a theoretically optimal menu consisting of an infinite number of different rewards and price levels under many conditions.

The fourth chapter focuses on another business model: subscription box services that deliver shipments of products to consumers at regular intervals for a fixed, per-box fee. Two challenges for providers of such services are acquiring new subscribers and retaining existing ones. We show that providers can respond to these challenges by managing the content of their subscription boxes over time when selling to customers that are heterogeneous along two dimensions: their utility for the contents of each box, and their utility for the service of content curation and delivery. The provider faces a budget for the total value (i.e., the quality) of box contents over a finite time horizon, and must allocate that budget over time to maximize total demand. Allocating more budget to a particular period increases consumer utility for the box—and hence the subscription rate—in that period, but at the expense of reducing the remaining budget for other periods. We show that it is generally not optimal for the service provider to allocate her budget equally and maintain consistent quality over time. If consumer heterogeneity is low, the optimal content strategy is to increase quality over time, which prioritizes retention over initial acquisition (i.e., quality starts low, acquiring few consumers, but increases to induce consumers to continue subscribing). On the other hand, if heterogeneity is high, the optimal strategy is to decrease quality over time, prioritizing acquisition over retention (i.e., quality starts high, acquiring many consumers, but decreases over time, retaining only consumers who highly value the service).

Creative Commons License

Rights for Collection: Duke Dissertations

Works are deposited here by their authors, and represent their research and opinions, not that of Duke University. Some materials and descriptions may include offensive content. More info

Make Your Work Available Here

Book cover

Business Model Management pp 217–225 Cite as

Business Model Operation

5956 Accesses

Part of the Springer Texts in Business and Economics book series (STBE)

The term business model operation describes the operation of a business that is based on an integrated business model. It is the phase between the complete implementation of the business model and the beginning of the adaptation or modification of the underlying business model. The business model prototype emerged from implementation is backed up with core processes and transferred to the operational business.

This is a preview of subscription content, access via your institution .

Buying options

operations in business model

See also for the following chapter Wirtz ( 2010a , 2018a , 2019a ).

Afuah, A. (2004). Business models – A strategic management approach . New York: McGraw-Hill.

Google Scholar  

Chase, R. B., Jacobs, F. R., & Aquilano, N. J. (2006). Operations management for competitive advantage (11th ed.). New York: McGraw-Hill.

Gleich, R. (2008). Das Konzept der operational excellence. In R. Gleich (Ed.), Operational excellence: innovative Ansätze und best practices in der in der produzierenden Industrie (pp. 16–31). München: Rudolf Haufe.

Heizer, J., & Render, B. (2004). Operations management . Upper Saddle River, NJ: Pearson Education.

Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing your business model. Harvard Business Review, 89 (12), 50–59.

Krajewski, L. J., Ritzman, L. P., & Malhotra, M. K. (2007). Operations management. Processes and value chains (8th ed.). Upper Saddle River, NJ: Prentice Hall.

Linder, J. C., & Cantrell, S. (2000). Changing business models: Surveying the landscape. Hamilton.

Oakland, J. (2012). Oakland on quality management . Philadelphia, PA: Taylor and Francis.

CrossRef   Google Scholar  

Osterwalder, A., & Pigneur, Y. (2002). An e-business model ontology for modeling e-business. In 15th Bled Electronic Commerce Conference, e-Reality: Constructing the e-Economy, Bled .

Pyzdek, T. (2003). Six sigma handbook . New York: McGraw-Hill.

Taylor, B. W., & Russel, R. S. (2006). Operations management: Quality and competitiveness in a global environment . Hoboken: Wiley.

Toutenburg, H., & Knöfel, P. (2009). Six Sigma: Methoden und Statistik für die Praxis (2nd ed.). Berlin: Springer.

van Iwaarden, J., Dale, B., & van der Wiele, T. (2013). Managing quality (5th ed.). Oxford: Blackwell.

Wirtz, B. W. (2010a). Business model management: Design – Instrumente – Erfolgsfaktoren von Geschäftsmodellen (1st ed.). Wiesbaden: Gabler.

Wirtz, B. W. (2011). Business model management: Design – instruments – success factors . Wiesbaden: Gabler.

Wirtz, B. W. (2018a). Business model management: Design – Instrumente – Erfolgsfaktoren von Geschäftsmodellen (4th ed.). Wiesbaden: Springer Gabler.

Wirtz, B. W. (2019a). Digital business models: Concepts, models, and the alphabet case study. Progress in IS . Cham: Springer.

Download references

Author information

Authors and affiliations.

Chair for Information and Communication Management, German University of Administrative Sciences, Speyer, Germany

Bernd W. Wirtz

You can also search for this author in PubMed   Google Scholar

Rights and permissions

Reprints and Permissions

Copyright information

© 2020 The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG

About this chapter

Cite this chapter.

Wirtz, B.W. (2020). Business Model Operation. In: Business Model Management. Springer Texts in Business and Economics. Springer, Cham.

Download citation


Published : 01 October 2020

Publisher Name : Springer, Cham

Print ISBN : 978-3-030-48016-5

Online ISBN : 978-3-030-48017-2

eBook Packages : Business and Management Business and Management (R0)

Share this chapter

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative


Lifespring Hospitals' Business Operations Model

Ambulatory surgery centers.

Ambulatory Surgery Centers are becoming more popular not only in United States but in the entire world. Provision of health care services outside the hospital is an aspect which is reducing

Life Renewal Inc Case Study

1. Per the Minton’s Evidence Code and the Daubert Standard, does Alice Dillworth’s educational and practical background, knowledge of ice hockey injuries, and research on prosthetics qualify her as admissible to assist Life Renewal Inc. in determining a fact at issue?

CPT1 Task 1

The first edition helped reassure the use of customary terms and clarifications to record procedures in the medical documents; delivered the foundation for a computer based system to assess and evaluate operational procedures; facilitated effective communication as precisely as possible for the data related to procedures and services to organizations connected with insurance claims and conveyed uncomplicated data for analyzation and statistical commitments. This first edition focused on procedures for surgeries and touched on some degree of laboratory, radiology, and prescription techniques. These restrictions encouraged the delivery of the second edition of CPT just four years later in 1970. With this subsequent publication there was a heightened

Hlsc 122 Assessment Task 1 - Essay

Sam is a recently graduated health professional and has observed that clinical practices vary in the different health care facilities. Sam is confused about which practice is the most effective to give patients better health outcomes according to the latest research literature.

Evaluating Nursing Codes

An accurate and specific documentation of universally accepted set of codes are important for the protection of healthcare providers as well as increased reimbursement for services received. These codes are for the validation of which services the patient received from their health care provider ( (Page, 2009). Having the correct codes in place insures the provider with the information needed by the health insurance carrier. Maintained by the AMA (American Medical Association), this universal numeric assignment is also used for developing guidelines for medical care review as well as data collection for medical education and research (Scott, 2013).

Hcs/533 - Definition of Terms Essay

Technology today has revolutionized the health care realm, as technology evolves so does the environment promoting quality care for that in need. This presentation will explain multiple abbreviations needed to translate and describe AMR, CMR, CMS, along with CMS – 1500, and CPT. Also, explore the meaning of DRG, EPR, HL7, ICD – 9 codes, and UB – 92.

Business Practices Of The West Houston Medical Center Organization

Business practices, in addition to guidelines on the matter of probable controversial impediments are a component of organizational ethics. This type of ethics is frequently motivated by the law; a copious amount of organizations practice ethics in order to be accepted by the community, not to mention in order to ensure a successful business. Ethical values can have a focal point on organizational concerns which assist the company in adhere to respectable practices within their establishment or corporation.

Malabar Service Model

This paper reviews the Malabar Service, a new model of care providing midwifery continuity of care and child health services, to see if the needs of the women accessing this model were being met.

Unacceptable Care Guidelines

Protocols and guidelines have been used for many years and has many advantages in ensuring unacceptable care is kept to a low if followed .One of the main advantages is patient saftey if protocols are put in place there is little room for error which is just as ressuring for the care giver to know

History of Medical Coding and Billing

Medical coding after 1976 became the standard for health care providers to set cost and bill for procedures based on the ICD codes. The ICD codes are taken from the different sources within patients’ health care record, physician notes, lab results, x-rays. Procedures performed on body parts are all taken into consideration when assessing a value for services rendered. The fees associated with each procedure are regulated by the U.S. Department of Health and Human Services and by state governments. Before this system of billing, physicians charged whatever they thought was appropriate and in many instances bartered for their services. (Department Health and Human Services, 1998)

Global Health Care Challenges Essays

The WHO report (3) estimates there are slightly more than 59 million health care workers in the world. Of the 4.3 million shortages, India appears as one of the dozens of countries with a critical shortage of health care providers (4-6). A Critical shortage of health care providers means for every given birth, less than 80 percent have skilled birth attendants present. The data further suggests that a country must have between 2.02 and 2.54 skilled birth attendants (doctors, nurses, or midwives) per 1000 population to support growth and maintain a strong health care system. Estimates place India at 1.87 skilled birth attendants per 1000 population (7).

Care Management Business Model Paper

The type of Care Management business model I choose to pursue for my assignment is solo practices. The reason I chose this option is that I am the kind of person who likes to be in control when it comes to getting work done. When I have control of everything from finances to customer service, I know that things are done with the highest professionalism possible. I would have the option to choose areas for me to manage personally and areas to outsource. I would need to secure finances or investors since it is harder for solo practices and I would need to have someone who can work PRN during my absence. I also chose this option because I have seen many partnership business fail due to indifferences between partners and the start up for a corporation

Massachusetts General Hospital Business Analysis

The Massachusetts General Hospital is a healthcare hospital located in the West End neighborhood of Boston, Massachusetts and is proclaimed to be one of the leading healthcare providers in the nation, with it having the prestige of being the original and largest teaching hospital of Harvard Medical School and a biomedical research facility and the largest healthcare provider in Massachusetts. When first observing the website, one of the main things that is stated on the first page and is clearly stated in big bold letters is the proclamation of the achievement that the hospital holds. It is stated that the Massachusetts General Hospital has been named among the top hospitals in America and it has been ranked among the top three of hospitals

Managerial Epidemiology Case Study

In-house clinic visits have dropped by 10%, so therefore the in-house clinics should be down-sized and decreased in staff. The prenatal clinic visits, which account for over 60% of the clinic’s visits, had been declining for the last sixteen months.

Health Of India Essay

The current death rate is 29 per 1,000 live births and of the 2.8 million newborns dying at birth worldwide, India accounts for 700,000 children dying at birth or shortly after. The National Health Policy to improve care children and women. Poor neonatal health conditions, widespread illiteracy, poverty, poor sanitation and nutrition have also been identified and India’s hopes to tackle these issues by passing this policy.

Related Topics


  1. Business Operation Model

    operations in business model

  2. Transitioning to as-a-service business model

    operations in business model

  3. Die besten 25+ Operating model Ideen auf Pinterest

    operations in business model

  4. Business Operations and Process Management Proof Reading Services

    operations in business model

  5. Notional diagram of the Business Operations model and associated...

    operations in business model

  6. Business Operations

    operations in business model


  1. Day#2

  2. Business Process Model

  3. Business Model Lecture 4

  4. Business Models Overview

  5. How to Maintain A Budget in Your Business

  6. Developing an Effective Business Model


  1. Business Operations Models

    In Business Operations Models, Martin Christopher and Alan Braithwaite identify the characteristics of market-leading businesses that have transformed their markets and delivered super performance for their stakeholders

  2. Toyota Business Model

    This report looks at the Toyota Business Model to analyse and evaluate how well Toyota uses its business operations to create competitive advantage

  3. Circular Economy Business Models and Operations Management

    Request PDF | Circular Economy Business Models and Operations Management | This article examines and conceptualizes the implications of the adoption of circular economy (CE) business models on operations management (OM)

  4. Business Operation in Application Model

    Business Operations are represented in the Application Model. Business Operations may be added to the Application Business Model. The Business Model data is stored in separate files out of the main Application Model

  5. Operations of Innovative Business Models

    The last decade has witnessed the rapid growth of many innovative and disruptive business models. This dissertation identifies a few of the unique inefficiencies and challenges that these new business models

  6. Business Model Operation

    The term business model operation describes the operation of a business that is based on an integrated business model. It is the phase between the complete implementation of the business model and the beginning

  7. Lifespring Hospitals' Business Operations Model

    ... with access to maternal and child health care services, joined the Business Call to Action with its commitment to provide an estimated 82,000 Indian women and their families with access to quality health care