The Big Fix at Toyota Motor Sales (Tms)

The Big Fix at Toyota Motor Sales (TMS)

This is a classic case of how an effective CIO can completely upend the structure of the company’s IS department and promote IT within a company as a strategic tool for growth and innovation. It shows us how a CIO is responsible for participating in executive-level decision making and how he/she can bridge business and technology groups to collaborate in planning and execution. This case also highlights the advantages of decentralization and how it can help develop closer partnership between IT and business units.

When Barbara Cooper joined as a CIO at Toyota, she discovered that IS was isolated and primitive – ‘almost 1970s-like’. Cooper was faced with a whole host of problems. She was in charge of an under-performing and isolated IT department that had no support from the senior management. One of the complaints was that even though a lot of money was being spent on IT projects, they were frequently disappointed with the results. An example was a badly delayed PeopleSoft ERP implementation.

The business units were outsourcing their IT systems even though they had an IT department in house. Nobody understood the cost of delivering IT and they did not have any accountable IT teams. Business executives cut deals with IS without considering architecture standards, system integration or business goals. There was no IT personnel to align IS to their business goals.

Also, the IT department was not organized efficiently. The relationship managers had only limited responsibility in the vertical area they served which made it difficult to understand who was to be held accountable. The lack of interaction between business side and IT led to poor alignment between the two groups.

Before Cooper could begin to fix the problems, she was assigned the task of implementing the six enterprise wide projects called the Big Six technology projects. It included an extranet for Toyota dealers, rolling out the delayed PeopleSoft ERP and...