HOW TOYOTA FINANCIAL SERVICES MANAGED CHANGE WHILE UNDERGOING THEIR CORPORATE RELOCATION

On April 28, 2014, Toyota Financial Services (TFS) announced that it would be moving its headquarters from Torrance, CA to Plano, TX to join its partner, Toyota Motor North America, at a single, shared, state-of-the-art headquarters designed to better position all of Toyota for sustainable, long-term growth. TFS chose to leverage the relocation of its headquarters to further strengthen its overall business. The effort was named “Our Next Chapter”. Its purpose was to position the company for the next 50 years of success.

TFS made the decision to join the other divisions of Toyota (manufacturing, engineering, and sales) at the new headquarters in Plano in part to help create greater efficiencies and opportunities for team members by optimizing such things as relocation and retention packages, benefits and policies, job titles and pay scales, diversity and inclusion initiatives, talent acquisition efforts and even new cultural priorities. The call to work with a “One Toyota” mindset as “One Team. One Toyota. Team Toyota!” was issued and a new employer brand to “Challenge What’s Possible” was launched.

Today, three and a half years later, the transition to Texas is nearly complete. TFS engagement and satisfaction scores registered in annual team member surveys have improved and are nearly three times higher than industry-average take rates. TFS has recruited and onboarded more than 300 new team members, and successfully relocated nearly one thousand team members onto the new headquarters campus.

This case study represents one of Toyota Financial Services' submissions for i4cp's Next Practice Awards. The winners will be announced in March and will share more detail on stage at the i4cp 2018 Conference: Next Practices Now (March 26 - 29 in Scottsdale, Arizona).

Business Challenge

The TFS HR Team faced several challenges as it began its transition:

  • How to keep team member engagement high through a three-year transition period so that the ability to run the business, meet financial targets and serve customers was not disrupted?
  • With a goal to have as many headquarters team members make the move as possible, what needed to be done to ensure the highest possible acceptance rate to relocate?
  • How to motivate team members who know they won’t be making the move to Plano to stay with the company through their designated release date?
  • Once moved into the new headquarters campus, how to inspire team members to think and work differently and “Challenge What’s Possible”?
  • With an historically long-tenured workforce with very little turnover, how to attract, hire and successfully onboard more than 300 new team members and leverage their new ways of thinking to blend and evolve the culture?
  • How to give team members tools and resources they need to manage their change, and assist leaders in helping others successfully navigate the change personally and professionally? 

Solution

From the start, the Toyota Way twin pillars of Respect for People and Continuous Improvement guided all efforts and were the foundation for a commitment to transparency and supporting team members with timely, factual information and communications. From a change management perspective, it was critical to develop a convincing case that would help team members with their decision, make them feel valued regardless of what they decided to do, and keep them engaged throughout their personal transition—whether to Texas or leaving TFS. This included the following types of activities:

  • Comprehensive Relocation & Benefits: Using industry benchmarks, programs and packages were created to support all team members through the decision-making and transition processes. Constant feedback from team members was sought to ensure benefits and program components were well-received and responsive to their needs. For instance, spousal benefits and career counseling were increased in response to feedback.
  • Dedicated Staff to Support Change Initiatives: Leading the effort was a dedicated team called the Project Management Office (PMO) that worked across the entire business to strategize each piece of the complicated move. It had representatives from key work streams including HR, IT, risk and communications. In addition, each business group had a dedicated team member, a Functional Transition Lead (FTL), responsible for helping with their transition strategy and coordinating with the PMO. This enabled customization within business groups to meet their individual needs. These dedicated team members also reinforced messaging throughout the company.
  • Change Central Website: A dedicated website with tools, tips and resources for managing change was created for team members. The site contained video vignettes, reading lists, coping skills, activities, self-assessments, and audio progressive relaxation techniques. It also cited team member assistance programs, and reminded them of business affinity groups for connection points so that they would not feel like they were going through the change alone. These resources were also helpful for leaders and HRCs to utilize individually or with intact teams.
  • Site Visits: All team members were given an expenses-paid three-day trip to visit Plano and the surrounding area to explore neighborhoods, schools, and other community offerings.
  • Plano Pioneer “Roadshows” and Virtual Meetings: Peer-to-peer advice and perspectives were an incredibly valuable way to provide team members and their families with the information they needed to make decisions. A series of roadshows helped connect team members who had already moved with those still deciding to give them insights on everything from neighborhoods, spousal concerns, the weather and schools.

To support the change management initiatives, a strong framework of communications tools were employed:

  • Strong Messaging: Central to the communications approach was a commitment to provide information quickly and with the greatest transparency possible. TFS made certain guarantees that were consistent throughout: team members were guaranteed a job at their same level and pay–and ensured that they would have the time they needed to make an informed decision. The aim was for team members to always feel that they came first and that their decision, whatever it might be, would be respected.
  • Structure of Cascading Communications/Leader Engagement Strategy: A cascade of communications was developed to alert executives, leaders and the HR team of upcoming broader communications to provide critical information they would need so that they were prepared to answer team member questions. This included quarterly in-person and virtual leader briefings, leader alerts, and resources such as talking points and FAQs. All of this was reinforced with an incredibly engaged CEO who had a clear vision and provided inspiration at every step along the way.
  • Regular Communication Channels: A series of communication channels were developed with a combination of CEO-driven emails and videos, leader alerts and team member alerts to share new information and drive team members to a dedicated website that had detailed information.
  • Dedicated Transition Website and Comprehensive Materials: A dedicated website was created to provide one central location where all information was kept–including retention package information, information and resources available on the new location, FAQs, construction updates and more. It was designed to inform, engage and build excitement for the move. In addition, around each major decision point for team members, individual, customized packages were provided that included compensation and benefit information as well as background information on the decision. Checklists were also provided to remind team members of each step they needed to take.
  • Events & Activities: A steady stream of activities was designed to inform and engage team members as they prepared to make their decision as to whether to move with TFS. Examples include information sessions, expos with vendors from the new campus, information about services and features available at the new location, and thank you events for those team members who were not moving.
  • Dedicated Move Office: An on-campus, dedicated move office was established and staffed with move experts where team members could go to ask questions and get more information.
  • Shifting Gears: Utilizing TFS’ Shifting Gears off-boarding program, they provided team members that could not make the journey to Plano with a roadmap to help them understand what they could expect and what actions they would need to take as they began to plan their departure from TFS. The action items at each milestone of the roadmap were intended to help team members smoothly shift to what’s next—professionally, financially, and personally. Program offerings included things such as benefit overviews, resume writing and interview skill building sessions, as well as outplacement services to help team members get a jumpstart on their next chapter outside of Toyota.

Results

There was an unprecedented industry yield of nearly 60% of team members who made the decision to move to Texas. In addition, 34% of team members who chose not to make the move still stayed through their designated departure date, demonstrating an ongoing commitment to TFS even as they were leaving the company. 

The annual team member survey results also reflected the strong communication efforts. With a 91% response rate, 81% of team members reported that they felt “TFS does an excellent job of keeping me informed about matters affecting me.”

Conclusion

Today, just three-and-a-half years after announcing its plans, TFS has almost one thousand team members working side-by-side at the new campus in Plano. Along with thousands of team members at their other offices, they are working differently and more effectively than ever before, passionate about the company’s purpose, unified by the One Toyota mindset, fully engaged in making TFS better and inspired by the call to “ Challenge What’s Possible.”