New mobility for Toyota

An epoch-making, anthropological revolution. A Kaikaku - a Japanese word that denotes a “radical transformation,” aptly applied to the entire organizational model and driven by new technologies. Toyota has been realizing this very concept for some years now, with the support of the SDA Bocconi School of Management, through the Mobility and Digital Innovation Program.

In 2019, Toyota decided to transform from an automotive company to a mobility company, following a profound path of strategic change which entailed transitioning from “selling automobiles” to “selling mobility services,” and from envisioning a car as a “vehicle for people” to a “vehicle of information.” To rise to this ambitious challenge, the country managers for Italy and the entire front line management team took part in an intense innovation management program.

This program wrapped up in early 2020 with the innovation labs going live. These labs are actual worksites that led to the development of a strategic plan for mobility.

In the words of Mauro Caruccio, former Toyota CEO and current CEO of Toyota Financial Services Italy and President and CEO di Kinto SpA: “At Toyota we set up a plan for radical transformation, the Kaikaku Change Management Model, based on four pillars: the people, the organization, the processes and the technologies. To give substance to this important process of change we turned to SDA Bocconi, a strategic partner we’ve been working with for many years.”

The automotive industry has been undergoing an evolutionary process in recent years, a direct consequence of the new way of thinking about mobility and mobility-related technologies. This evolution called for a radical rethinking of “traditional” corporate strategies, in turn reshaping a number of different organizational areas: the product-service mix, the relationship with the customer/user, and the operational processes that fuel this relationship.

In this changing context, Toyota recognized the need to capture the contextual evolutions, interpret them in a creative way, give them concrete form, and make them “profitable” on the market.

In light of all this, a training path was created that was at once experiential, practical, flexible, and concrete. The ambition here was to achieve a strong positioning for Toyota in the mobility sector by imagining the implications and practical consequences of the evolution of an entire industry.

Considering the high level of seniority of program participants, the training program was structured in four stages. Beginning with a study of cases of innovation in various economic sectors, the next stage was to take the suggestions and methods tested in other contexts and apply them to the mobility sector. Then an Innovation Plan was drawn up and finally an Action Plan was formulated specifically for Toyota Italy.

What is needed to set the process of strategic innovation in motion? What are the methodologies underpinning this process and how can they be applied in the mobility sector? What mistakes must be avoided? Understanding all this was the first step in assessing the evolution of mobility from the perspective of demand (the new needs of end users, the new purchase and use behaviors) and supply (the response of traditional players and the emergence of new ones).

Today’s technologies represent powerful vectors of innovation (Machine Learning, Intelligent Vision, Natural Language Processing, Digital Infrastructure Technologies, IoT Technologies). Mapping them was a fundamental step in studying the implications for the mobility sector and the possible advantage that Toyota can gain from utilizing these technologies.

At the end of a day of debate and discussion among the participants (Innovation Day), an Innovation Plan was drawn up, a vital roadmap providing an overview of the possible paths of innovation that Toyota intended to embark on in relation to the evolutions in the mobility sector.

Lastly, to operationalize the Innovation Plan, an Action Plan was activated for innovation and mobility, engaging the entire Toyota Italy management team.

• After Innovation Day, a work group was established with the aim of executing the innovation ideas and verifying both their feasibility and concrete effects. Also in the works is a training course dedicated to middle management, which serves to foster the innovation process as a whole, ensuring that it will cascade down throughout the entire organization.
• The Mobility and Digital Innovation Program represents the first step in profound and long-lasting change. As Mauro Caruccio says, “The ongoing transformations in our sector are so radical that we decided not to put a time limit on the Mobility and Digital Innovation Program, but instead to continue moving forward on this path, without setting a deadline. Actually, our intention is to open up the program to everyone in the company.”
• SDA Bocconi has served as mentor and advisor in recent years. The interaction between these two roles sparked the idea of the Toyota Digital Company Project in early 2020, a more organic corporate digital transformation project linked to mobility.
• The collaboration between Toyota and SDA Bocconi School of Management is moving forward on other fronts involving both training and research. In fact, Toyota is partnering with DEVO Lab, SDA Bocconi’s innovation lab, and thesis topics are being developed that Bocconi students will tackle in the coming months.

New mobility for Toyota