4857734__Financial_Controls_within_Toyota_ - Financial...

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Financial Controls 1 Running head: FINANCIAL CONTROLS WITHIN TOYOTA Financial Controls within Toyota [Author’s Name] [Institution’s Name]
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Financial Controls 2 Financial Controls within Toyota Businesses are constantly looking to cut costs to maintain profitability as per their financial control mechanisms. One approach to aid in cost reduction is to establish what functions are ‘core’ and, hence, need to be managed in-house, and what may be managed externally from the unit. Toyota is trying to find new ways of organizing their work, and tasks that are not seen as ‘core’ can be contracted out to a third party. Outsourcing has become a feasible alternative as a result of improvements in technology in recent years, with many basic tasks now becoming automated and able to be performed by non-expert staff off-site within the Toyota Company. The danger is, however, that only short-term gains are considered, and a range of authors have stressed that the Toyota Company needs to consider its strategic objectives before a decision is made. (Kahai et al., 2001) Companies under pressure to control costs regard outsourcing as offering significant immediate benefits, whereas those with less cost pressures are more likely to look at longer-term financial and other impacts. Other factors such as efficiency, the need to
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4857734__Financial_Controls_within_Toyota_ - Financial...

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