The secret of success

During the past few years, the economic recession has enormous effect on businesses. Many big and strongly-financed corporations were suffered severe losses and had to declare bankrupt.

Automakers have also been affected badly by the spreading financial crisis which caused the sharp decrease in demand, and led to the industry’s big losses. While other big corporations like GM or Ford laid off their workers to cut costs, Toyota went the opposite way as what Toyota plans for is long-term development, it does not lay off workers when things go down, and tries to give long-term security jobs for their staff. The estimated costs of keeping their workers when sales is really significant to the company at that time, however, according to Toyota, human resources is their most valuable asset which takes times and money to build up. Instead, in order to survive through this hard time, the company chose to downsize its scale and halt all of the expanding plans. On the other hand, the company also asked their employees to share the difficulty with the company by accepting lower benefits, reduced bonus, and lower other kinds of their current interests at least until the condition get better.
In fact, the negative effect of the financial crisis is just a short-term issue whereas the investment in human resources is a long-term investment which will bring back unimaginable long-term benefits. By keeping the current well trained workforce, Toyota is always ready to return to its full production with all the well trained workers when the crisis is over. Moreover, Toyota’s move also makes its workers feel grateful and be more loyal to the company which did not turn the back on them in their most difficult time. And in return, they will devote more of their time, their skills, and knowledge to the company. With such highly trained and motivated workforce, Toyota can develop more and more.

The key to success of small businesses

Every business has its own problems, and small businesses are not an exception. The issues of small businesses normally come from two main reasons: the lack of capital and credit, as well as the weaknesses in management skills. However, it does not mean that small businesses cannot compete with larger firms. The key point is that small businesses should identify which are their strengths and weaknesses, and then use the strengths to make up for the weaknesses. One golden rule for small businesses is that never try to compete with large firms in their markets because the big corporations often have stronger financial status, have more experiences, and more human resources, moreover, they are often the market dominators in their own market. Instead, small business should focus its limited resources on the niche markets in which it has comparative advantages over large firms.
One other important advantage of small businesses is the close relationship between the firm and the customers whereas the bureaucratic of a large company tends to eliminate the link between management and customers. This kind of relationship helps small businesses have a better awareness of the customers’ needs as well as a more exact prediction of the trends in the market. By having an accurate forecast about the changes in the market, the firm will be more proactive in setting appropriate plans to deal with these fluctuations. Furthermore, the company can take advantage of this connection as an effective way to advertise for their products as mouth-to-mouth advertising is always the best advertising.