1. LEXUS STORY
By Group 7
Afiz Aboo, Deepa M.K, Rafsal Abdullah, Shalu Mani

2. TOYOTA
• Slow and incremental improvement
• Study every detail from every angle
• Innovation, Strategic thinking and Operational
excellence
• Bottom up leadership (Employees are empowered.
They don’t wait for managers to direct them)
• Lean organizational structure (To remain profitable
and sustain growth. They innovate with a focus on
customer)

3. Lexus
• Lexus - strategic thinking, innovation and operational
excellence- competitive advantage
• Lexus arose out of a blend of eastern and western
culture.
• Strategic motivation behind innovation was to attract
younger people into value stream

4. • Difficult to compete with established brands (BMW
and Mercedes)
• It was not a company, that customers associated with
high end luxury vehicles
• They were a major hit in their first year

5. Why Lexus
• More expensive features
• Status
• Right to be treated like a VIP

6. Reasons for success
• It was well engineered and manufactured -a car of
remarkable quality
• Exceptional service at dealership
• Investment in quality people which led to innovation
and competitive advantage
• Life time relationship with customers
• Lean consumption (understanding what adds value,
elimination waste to inc. efficiency and dec. waiting
time
• Reduced waiting time

7. Features of Lexus dealership
• Car is picked up from customers house
• Replacement car
• Well furnished waiting room with plasma TV,
Refrigerator with complimentary beverages, Wireless
internet
• Window to repair bay (Clean service areas)
• Car is cleaned each time its in shop, even for oil
change
• Special services such as manicure or massage.

8. Attracting the dealers
• Open recruitment process to competition from top
dealerships in market (whether they sold Toyotas or
Volvos)
• Gave them realistic purview of what is expected
(capital investment, customer first, intensive training)

9. • Capitalization (satellite connection, specific
requirements that cost money, service window etc.)
• Customer satisfaction levels (top 2% of whatever
brand they represented)
• Management team (experience in selling luxury
products, connections and authenticity to wealthy
people)

10. Developing the dealers
• Toyota invested in teaching them how to be Lexus
dealer
• Selected dealerships with owners who were willing to
examine entire business from ground up, who were
passionate about the business
• Flew them to Japan and trained everyone in
dealerships
• Specific training programs for every role (how to
answer phone or put on hold professionally etc.)

11. • Lexus vocabulary (customers as guests)
• Developed certification programs and online tests (if
someone is master certified he gets a subsidized lease
to drive a Lexus even if he’s a technician)
• Made everyone feel important (invited everyone to
store during events etc.)
• Identified Key points for each job and developed high
level standardized work for each job (everyone were
very clear about what they had to do