Toyota Motor Manufacturing, U.S.A. Inc. Case Study Question 1. As Doug Friesen, what would you do to address the seat problem? Where would you focus your attention and solution efforts? As Doug Friesen did, I also would have started with the idea of “let’s go see it” to address the problem. I would visit the cars in the clinic and overflow area and study Exhibit 8, the Group Leader’s Seat Defect Data, and Exhibit 10, Andon Pulls. From this data, we see that most issues stem from missing parts or material flaws. However, Friesen adjourned his meeting after visiting the site of the issue and bouncing around ideas but the study never mentioned him specifically going through the Five Whys as he had been coached by TPS. Some of his whys could have They could stock extra inventory in case of defects but this is a direct violation of the TPS policy of waste and JIT production. Also, it doesn’t solve the problem although it could temporarily alleviate some of the defects in the clinic and overflow areas. Another option would be to hire a second supplier for seats. KFS could specialize in Camry seats while another supplier specializes in the new station wagon model seats. However, this could create additional scheduling conflicts. Toyota has tried to extend the principles of TPS to their suppliers and has had a mutually beneficial relationship with KFS thus far. It would be more costly to find a 2nd supplier that matches (or is willing to learn) TMM’s practices rather than to re-train or modify KFS’s current production line and processes. Another option could be less product customization options. The product proliferation of the seats seems to be the root cause of KFS’s issues. If Toyota were willing to offer fewer choices, this might be another way to boost production back to their former levels. However, with Toyota’s slogan of “better cars for more people”, the company’s focus was to offer more diverse customer Nearly all of the issues relating to the reduced run ratio can be attributed to this issue since these issues were not happening before the shift in interior variety. The increase in variety led to production issues from KFS. The production issues then caused a rise in defective seats and reduced run ratio from 95% to 85%. Most defects were due to material flaw which could’ve been from KFS or from TMM worker’s ineffectively installing the seat (broken hook, cross threading, carelessness with hand tool). The lowered ratio decreased per shift production while increasing overtime to compensate. This will lead to lower profits over time. However, as stated before, meeting diverse preferences is a point of pride for Toyota and is included in their motto. Therefore, if the variety isn’t going to change, the operations processes must be tailored to fit the new “normal” in terms of product
In 1998 and 1999 VMMC lost money for the first time in its existence. They were also faced with morale issues amongst their staff and formidable competition from other hospitals in their area. Dr. Gary Kaplan the CEO of VMMC was looking for a tool to implement a strategy that would address the challenges they were facing. After trying and dismissing QCM and looking at Six Sigma, a chance encounter led them to the Toyota Production System, TPS, a management method that focused on quality and efficiency.
Putting yourself in the shoes of the managers or engineers in the case (Ron Dittemore, Linda Ham, Don McCormack, Rodney Rocha, Pamela Madera, Calvin Schomburg), consider the following questions?
In 2000, Kia continues to sell a wide range of vehicles. They target a wide range of needs by offering less expensive economic ...
-Lack of supply may also become a Goodyear production cannot meet the demand of both the franchised dealers and Sears Auto Centers.
Ford’s production plants rely on very high-tech computers and automated assembly. It takes a significant financial investment and time to reconfigure a production plant after a vehicle model is setup for assembly. Ford has made this mistake in the past and surprisingly hasn’t learned the valuable lesson as evidence from the hybrid revolution their missing out on today. Between 1927 and 1928, Ford set in motion their “1928 Plan” of establishing worldwide operations. Unfortunately, the strategic plan didn’t account for economic factors in Europe driving the demand for smaller vehicles. Henry Ford established plants in Europe for the larger North American model A. Their market share in 1929 was 5.7% in England and 7.2% in France (Dassbach, 1988). Economic changes can wreak havoc on a corporation’s bottom line and profitability as well as their brand.
These issues led to Toyota losing much of its brand equity as a leader in safety. According to an article in Time Magazine from February 2010, the automaker didn't just have safety issues in 2009 that led to the recalls, there had been smaller recalls for similar issues nearly every year since 2002. Historically, Toyota has been an organization that can take problems, root out their cause and turn the solutions into advantages over competitors. In this case, Toyota's complete lack of crisis management led to a major loss for the company both in 2009-2010 sales but something more precious and long-term, brand equity.
Significant production and distribution network Toyota’s CCC21 strategy allows them to see a steady increase in their production and sales. As previously stated, in Fiscal Year 2012, the company produced and sold a combined total of 17.4 million vehicles worldwide. Their opportunities throughout their geographic locations (53 manufacturing locations within 28 countries and regions) in addition to their capabilities reach a plethora of customers (vehicles sold in more than 170 countries and regions), thus increasing their revenue. (Worldwide operations, 2016) Weaknesses Automotive recalls Toyota had a decline in sales from 2008 to 2011, and a portion of that reason was due to recalls.
Just In Time, Toyota Production, and Lean Manufacturing are productions systems intended to reduce costs, and waste associated with inventory and manufacturing.
Toyota’s uses both differentiation and low cost as generic strategies to try and gain a competitive advantage over their competitors in the automotive industry. The market scope that Toyota uses is a broad one that encompasses nearly every type of customer that is in the market to purchase an automobile. Toyota is able to target such a large market because they have something for everyone. Toyota has four wheel drive trucks and SUVs for the outdoor types or those who live in areas that face severe weather conditions, hybrid models like the Prius for the eco-friendly customers that are interested in saving the environment, along with the standard cars for general, everyday use. Additionally, Toyota provides vehicles for all price ranges.
• While making a methodology is challenging, executing it is considerably more troublesome. Numerous organizations comprehend Toyota Production System now, yet at the same time think that it is troublesome to execute and implement.
Toyota Motor Corporation is one of the largest automakers in the world. At its annual conference in Tokyo on May 8, 2008, the company announced that activities through March 2008 generated a sales figure of $252.7 billion, a new record for the company. However, the company is lowering expectations for the coming year due to a stronger yen, a slowing American economy, and the rising cost of raw materials (Rowley, 2008). If Toyota is to continue increasing its revenue, it must examine its business practice and determine on a course of action to maximize its profit.
Toyota- focused differentiation, medium pricing, breadth of product line is low. Company is known for quality products, and nice styling.
(5) Liker, Jeffrey K. The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer. New York: McGraw-Hill, 2004. Print.
Different nations within which Toyota operates have different political, technological, social, and cultural environments. To safeguard the company’s overall image, there must be effective communication between the head office and regional quarters. This is especially important in the area of quality control, as Toyota currently grapples with safety issues facing several of its car models.
The nonmanufacturing companies can learn and apply from Toyota’s philosophy and practices as listed below: