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Supply Chain Management Of Toyota Essay

3385 words - 14 pages

Supply Chain ManagementIntroductionMany researchers have pointed out the importance of Supply Chain ( SC ) and Supply Chain Management ( SCM ) in competitive environment. In this report, we will discuss about ( i ) Toyota Mortor Manufacturing North America ( TMMNA ) which is located in Erlanger, Kentucky, current supply chain position and one of its suppliers, TAC manufacturing, located in Jackson, Michigan, supplies steering wheels and air bags for TMMNA, current supply position by drawing supply chain diagram, ( ii ) the possible operational and supply chain strategies which could be used to enhance TMMNA's future performance to take competitive advantage over other firms and ( iii ) the ...view middle of the document...

Let us discuss TMMNA and TAC current supply chain position and their contracts.( i )Defective partsInbound Operations Outbound Marketing and Logistics Logistics Sales, ServicesP R I M A R Y A C T I V I T I E SFig : TMMNA's SC diagramDefective partsInbound Operations Outbound Marketing and Logistics Logistics Sales, ServicesP R I M A R Y A C T I V I T I E SFig : TAC Manufacturing's SC diagramThe reason why TMMNA and TAC Manufacturing is similar is TAC follows Toyota Production System ( TPS ). TMMNA get raw materials from TAC and then store it in inventory for a few days. Then, it is assembled. After assembling, if defective parts are found by quality control department, it is sent to the assembly and re-assembly again. The qualified parts are stored in inventory and then it is sent to customers by using TLS. TAC also adopt this same process. But the main differences are TMMNA adopt mass assembly line and TAC follows one by one assembly and single piece work flow rather than batches. If defective parts are found, TAC immediately take action within 24 hours. TAC more rely on visual management control but TMMNA more rely on its SIS. TAC prefers team based culture but TMMNA adopts both individual and team based.Fig : Differences between TAC and TMMNA( ii )Let us discuss about operational and SC strategies which could be used to enhance TMMNA's future performance and achieve competitive edge on other firms. " Operations Strategy is the total pattern of decisions which shape the long term capabilities of an operation and their contribution to overall strategy " ( Lowson, ). SC strategy is a long-term plan with goals and objectives. It is about using all of elements involved in the SC to produce better results for the company. Monczka ( 2003 ) describe it consists of improving the use of technology, reducing costs and cycle times. In short, operational strategy is the planning of day-to-day activities and a part of SC strategies. SC strategy is a long term and a part of corporate strategy. Operational strategy supports SC strategies and again SC strategies provide corporate strategy to achieve company's objectives by linking SC strategy and business strategy. Many researchers describe there are many operational and SC strategies. We will discuss all possible operational and SC strategies which is being used by TMMNA.( a ) Material Requirement Planning ( MRP, Push Strategy )MRP is a widely used production scheduling technique in manufacturing industry to plan the requirements of raw materials by using bills of material, inventory, open order data, lead time and master production schedule. Nagendra ( 2001 ) describe it aim is to reduce the inventory cost while demand relationships are met. It supports to plan for effective production and control the materials. One of the useful software which help for MRP is Enterprise Resources Planning ( ERP ). ERP helps manufacturers to better control the time, raw materials and resource requirements to fulfill...

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