This article aims to explore the business vision of Risaburo Toyoda and examine his management of Toyoda Gyoudan [Toyota Industrial Group(TIG)] with emphasis on his entrepreneurial network. Although, Kiichiro Toyoda is well known as the “founder” of Toyota Motor Corporation, in fact, he was not in a position to make final decisions. His brother-in-law, Risaburo, was the president of Toyota Motor Corporation as well as the CEO of TIG. Therefore, the study of TIG including Toyota Motor Corporation must devote special attention to Risaburo. Nevertheless, he has not been judged rightly, and has often been regarded as a hindrance to Toyota's rise in the automobile business. This article aims to reexamine his positive role and the organizational structure of TIG, regarded as a “local Zaibatsu”.
One of the most important facets of Risaburo was why he decided to enter the automobile industry. This article shows that in the 1930s, he had predicted the rise of Japan's heavy industry and the decline of its textile industry, and he managed to convert TIG's basic business from textiles to heavy industries.
It is well known that Zaibatsu and Emerging Corporate groups were disorganized during the wartime economy due to diversification of affiliated companies. On the other hand, TIG, which was a late-comer in the corporate group, was still primarily controlled by the Toyoda family. A lack of external capital needed to enter the automobile business along with wartime corporate controls had threatened its management structure, but Risaburo secured cooperative stakeholders and reorganized TIG, making Toyota Kinyu [Toyota Finance Company] a holding company. Consequently, TIG kept the family-controlled management structure. In this process, Risaburo made the most of his entrepreneurial network and exercised leadership as the CEO.
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