TOYOTA SUPPLY CHAIN MANAGEMENT

Presented by: Irma, Robert, Butele & Hallelujah

NGU

JAPAN

Overview

History Supply Chain Management Suppliers Logistics Manufacturing Distribution

History

Toyota comes to existence

Founded:1937

First car: Model AA

Founder: Kiichiro Toyoda

Headquarters: Toyota City, Japan

Supply Chain ManagementObjective

Right Product

+ Right store

+ Right Quantity

+ Right Price

+ Right Customer

+ Right Time

= High Profits

Minimizing supply chain costs but still; • A reasonable service level• Customer satisfaction• Quality• On time delivery…

SUPPLIERS Organized suppliers into functional tiers

First-tier suppliers: worked together in a product-development team

Second-tier: made individual parts Encouraged cooperation and communication

among first-tier suppliers Cross- sharing of personnel through

Toyota sending personnel to suppliers to compensate for greater workload

Toyota transferring senior managers to suppliers for top positions

SUPPLIERS “market price minus” system, not

“supplier cost plus” system Value analysis reduces costs

Production smoothing enables suppliers to maintain a constant volume of business

Focus is on long-term relationships that underscores cooperation, teamwork

Logistics Analyzing supplier location with close

location Packaging : mixed box size, small pallet

size Dedicated transportation service Consistent daily route, period route

revision Good timing at all connection points

Manufacturing Toyota Production System

Best quality Lowest cost Shortest lead time Best safety

Through shortening the production flow by eliminating the waste

Manufacturing Continuous improvement

JIT People and teamwork Jidoka – quality (make problem visible) Waste reduction Leveled production Visual management Kanban – flow of correct information

DISTRIBUTION In Japan, Toyota’s sales and marketing work is

divided into four distribution channels Toyota (large cars), Toyopet (medium size), Toyota Corolla(compact), and Netz Toyota (compact).

The Toyota dealers as a whole have approximately 5,000 outlets worldwide.

DISTRIBUTION Toyota applies the “Toyota Way” to

manage dealers, based on three basic principles: Making dealers proactive Mutual benefit between Toyota and Dealers to prosper

jointly. Accept competition to improve. Toyota works with one distributor in each country

Toyota markets cars in about 170 countries through its overseas network consisting of more than 160 importers/distributors and numerous dealers.

Publication bibliography Toyota Company History from 1867 to 1939: Toyota. Available online at

http://www.toyota.co.jp/en/history/1867.html. 2011 Geneva Motor Show: Scion iQ electric car to debut (2011). In Consumer

Reports. Available online at http://news.consumerreports.org/cars/2011/02/preview-scion-iq-electric-car-to-debut-in-geneva.html.

TOYOTA MOTOR CORP/ 2013 Annual Report Form (20-F) (2013): United States Securities and Exchange Commission. Available online at http://www.sec.gov/Archives/edgar/data/1094517/000119312513268044/0001193125-13-268044-index.htm.

WORLD MOTOR VEHICLE PRODUCTION OICA correspondents survey WITHOUT DOUBLE COUNTS WORLD RANKING OF MANUFACTURERS Year 2011 (2013): OICA. Available online at http://oica.net/wp-content/uploads/ranking-without-china-30-nov-12.pdf.

Abuelsamid, Sam (2008): Toyota tops big company CAFE ratings for 2007 model year with 29.69 mpg – Autoblog: AutoBlog.com. Available online at http://www.autoblog.com/2008/07/25/toyota-tops-big-company-cafe-ratings-for-2007-model-year-with-29/.

Alan Ohnsman and Kae Inoue; Ohnsman, Alan; Inoue, Kae (2009): Toyota Will Shut California Plant in First Closure: Bloomberg. Available online at http://www.bloomberg.com/apps/news?pid=20601087&sid=aJlxuxndoOsM.

Thank you !!!

Moving Forward