...Operation Management TOYOTA Team P.A.L Minchul Seo, Altanzul Table of Content 1. Introduction 2. Industries and Company Information 3. Explanation of OM Capabilities 4. How Company Uses OM 5. Identify Problems / SWOT analysis 6. Areas to use for improvements of Critical Business activities in Operations Management 7. Provide Multiple Solutions 8. Conclusion Introduction Toyota Motor Corporation is one of the leading automobile manufacturers in the world by not only its models but also its management. We can say that the principles that Toyota Motor Corporation uses are the way to their success. For instance, they do not only want to be successful by themselves but also they respect their partners and suppliers by challenging them and helping them improve. Toyota wants to be reliable to the customers, suppliers and to the organization. For this reason, they use some operating management technologies such as Just In Time (JIT), Quality Management (QM), Total Quality Management (TQM) and so on. Using these technologies they could reduce to time they spent on manufacturing, shipping, ordering, receiving, forecasting and many others. It also affected to their quality and the overall mission to be succeed. They do not try to hide their weakness and problems in the organization so that they can fix them easily by using simple visual indicators to help people determine their problems immediately whether they are in standard condition deviating from...
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...EXECUTIVE SUMMARY Operations Management plays a vital role in all the forms of organisation. Lack of operations management can lead to the failure of the business. In the following report we discuss the world’s largest automobile industry the Toyota Manufacturing Company and also some of the various principles with description and are useful in the operations management such as Just in Time, kaizen, vertical Integration, Toyota Production system and the Vertical Integration. These principles play a major role in the effective production and operations of Toyota as well as most of the other organisations. Let us now discuss the principles of operations management beginning with the history and background of Toyota. INTRODUCTION Japan is the world’s second largest automobile nation with 73 million vehicles on the road. Toyota is a Japanese company founded and formed by Kiichiro Toyoda in the year 1936. He was given a full strong support by his father Sakichi Toyoda an industrialist who use to invent Toyota Model G automatic loom. In the year 1937 the Toyota Motor Company Ltd was established. Since then it grew rapidly in the recent years. The success of the company was based on the principles of innovation and both for its products and the processes to make the product. At the start of the company the aim was to produce reliable and efficient cars in Japan. The company was very well accepted by the people and since then the company touched the heights...
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...Company's Quality Management Systems GM588 Managing Quality Toyota's Brush with Disaster due to the Breakdown of the Company's Quality Management Systems Introduction Toyota was started early in the 20th century by Sakichi Toyoda. He was a successful inventor and initially raised the money to start the company by selling the design of his automatic loom to a British company. He saw the potential of automobiles and the internal combustion engine and began working on researching and designing small gasoline engines. Here is a timeline of the early Toyota company that is available on their website: • 1929 Automatic-loom patent is sold to a British company. • 1930 Kiichiro Toyoda begins research on small gasoline-powered engine. • 1933 Automobile Department is established at Toyoda Automatic Loom Works, Ltd. • 1935 The Toyoda precepts are compiled. • 1936 The AA Sedan is completed. • 1937 Toyota Motor Co., Ltd. is established. • 1938 Honsha Plant begins production • 1950 Company faces a financial crisis; Toyota Motor Sales Co., Ltd. is established. • 1951 Suggestion System begins. ("History of",n.d.) What is unique about Toyota is how they designed and implemented a system of production known as, The Toyota Way, that not only creates happy empowered employees, but also generates very little waste and has become a quality management model for companies worldwide. Problem Statement Toyota has been an...
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...How Toyota Ought to Organize its Decision Processes to Minimize the Risk of Major Design Flaws that Lead to Massive Recalls and Driver Deaths from the Perspective of Organization Design and Decision-Making Abstract Japanese automaker, Toyota was a quality assurance trademark trusted by consumers worldwide. Though, in recent years, the company has been inundated by numerous vehicle recalls. Toyota’s quality problems surfaced when it was forced to recall nearly 7 million vehicles in the late part of 2009 (Chris, 2010). The recall crisis of 2009-2010 prompted a wave of negative publicity for the company (Chris, 2010). Many issues were discovered that led to the recalls. Sticky gas pedals, pedal entrapment, and software glitches that affected braking in some models were some of the problem areas (Trudell, 2014). Over time, the safety related recalls continued growing. In fact, by May 2011, the automaker had recalled close to 20 million vehicles (Trudell, 2014). Naturally, the numerous recalls and lawsuits that ensued threatened to damage Toyota’s image; thus, to rectify this the company should organize its decision processes more efficiently. Keywords: organizational change, recall, total quality management Introduction For decades, Toyota set the standard for quality and reliability in the automotive industry. In fact, the Toyota brand has been touted as the pinnacle of automotive excellence by rating industries and industry consultants (Piotrowski & Gray, 2010)...
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...financials, size, and global presence. Toyota Motor Corporation was founded in 1919 by the famous Japanese inventor, Saki chi Toyoda. Its primary business is manufacturing and selling automobiles. With operations in the U.S. for the past 50 years, Toyota is one of the most well known automobile manufacturers in the world. In fact, it is the largest automobile manufacturer in the world, producing over 7 million units in the last financial year. (Liker, 2008) During this time it reported a profit of over $5 billion dollars. It is a multinational corporation with its corporate office located in Toyota City, Aichi, Japan. Toyota currently employs roughly 310,000 people around the world. (2010) The Toyota Way and the Toyota Production system are what make up Toyota’s DNA. The Toyota Way can be summarized two ways: continuous improvement and respect for people. (Liker & Hoseus, 2008) Continuous improvement is translated as Kaizen which is huge in the Toyota culture where this means challenge everything. (2008) Toyota is also responsible for the invention of the term “lean production” sometimes called the Toyota Production System or TPS. (Liker, 2005, p. 115) This invention has triggered a global transformation in just about every industry to Toyota’s manufacturing and supply chain philosophy and methods for over a decade. The company has won awards for being the best in class by both its peers and competitors throughout the world. Toyota automobiles have consistently been at...
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...(automated error correcting) has enabled the company to pursue lean innovations. Lean manufacturing has enabled Toyota to successfully develop its production systems to include new types of designs. The principles enables Toyota to manage its value stream, identify customer value, implement a “pull” approach that ropes the flow of scarce materials in operations and the overall development of production capability. The success of this ingenious strategy has enabled the company to rise up to global success in the auto industry. While the company still maintains its impressive performance in the application of lean practices, less of its competitive edge can be traced to TPS, more comes from applying lean product development strategies. As a result, lean best practices provide synergy to Toyota Production System. Supply Chain Management Toyota’s Supply chain management is a perfect combination of Porter’s value chain strategy, Kierestsu strategy, and Eliyahu Goldratt’s theory of constraints. Supply chain involves all activities associated with the transformation of raw materials into finished products and flow of products to the consumers as well as the flow of information. Toyota modernized its supply chain management by using information management systems in the 1980’s; suppliers, dealers, body makers, and customers were all linked to the Toyota Network System (TNS). The overall goal of supply chains is to keep all the major components connected. For...
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...from a complex, interlocking set of extraordinary skills. These include working closely with suppliers, continually finding ways to innovate and improve, and constantly challenging itself to cut costs. We shall focus o the following strengths of Toyota, and shall apply the VRIO framework to analyze which amongst these is a potential sustained competitive advantage: 1) Company Culture- The Toyota Way 2) Toyota Production System 3) R&D and focus on “green” cars 4) Diversified product portfolio Production System: The first question of the framework asks if a resource adds value by enabling a firm to exploit opportunities or defend against threats. The Toyota Production System (TPS) is an integrated socio-technical system, developed by Toyota that comprises its management philosophy and practices. This system, more than any other aspect of the company, is responsible for having made Toyota the company it is today. The Toyota production paradigm is a valuable resource as it a major cost reduction driver and at the same time increases the product quality. Next, we come to the question of rarity. Rare and valuable resources grant temporary competitive advantage. Toyota is the innovator of this new production management which is popularly known as TPS. TPS is more a philosophy than a set of rules or guidelines. It's a mind-set that extends into all areas of Toyota's business. It is very deep rooted into the company’s culture. Hence, it is a rare resource. Perhaps...
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...Definition of key terms 1) Corporate Social Responsibility CSR refers to operating a business in a manner that accounts for the social and environmental impact created by the business. CSR means a commitment to developing policies that integrate responsible practices into daily business operations, and to reporting on progress made toward implementing these practices. According to Business for Social Responsibility (BSR), corporate social responsibility is defined as“achieving commercial success in ways that honor ethical values and respect people, communities, and the natural environment.” 2) Lean accounting Lean Accounting is the general term used for the changes required to a company's accounting, control, measurement, and management processes to support lean manufacturing and lean thinking. II. Corporate Social Responsibility The field of corporate social responsibility has grown exponentially in the last decade. More than half of the Fortune 1000 companies issue corporate social responsibility (CSR) reports. A larger number of companies than at any time previous are engaged in a serious effort to define and integrate CSR into all aspects of their businesses. An increasing number of shareholders, analysts, regulators, activists, labor unions, employees, community organizations, and news media are asking companies to be accountable for an ever-changing set of CSR issues. 1. Economy First of all, accountants accurately prepare company’s financial statements...
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...Automotive-Toyota 30-11-2012 Contents Introduction Lean Manufacturing 1) Creating continuous process flow, 2) The pull system, 3) Leveling out the workload. Toyota Production System 1) Just In Time 2) Jidoka Long term relationship with suppliers Risk and Challenge 1) Toyota Vehicle Recalls 2) Environmental sensitivity Conclusion Introduction Toyota is one of the world's largest automobile manufacturers, selling over 9 million models in 2006¹on all five continents. A Top 10 Fortune Global 500²enterprise, Toyota ranks among the world's leading global corporations and is proud to be the most admired automaker³ an achievement the company believes stems from its , dedication to customer satisfaction. In early twentieth century, the three big motor companies (the Big 3) – General Motors (GM), Ford & Chrysler almost dominated the global market. In 1994, Toyota replaced Chrysler, and it became the global No. 2 motor manufacturer by squeezing out Ford in 2003. Since 2008, Toyota has replaced GM to be the largest automaker globally. Toyota is a successful corporation and has a very good performance in automotive industry, but it also has some troubles and challenges to face, like the problem of Toyota vehicle recall in the last three years. So we have to ask how did Toyota achieve its success? How Toyota face to the challenge? Toyota is known for its reliable cars among the general public, but it has also been known in manufacturing, management and relationship...
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...technology. Mission of Toyota is to provide safe & sound journey. Toyota is developing various newtechnologies from the perspective of energy saving and diversifying energy sources.Environment has been first and most important issue in priorities of Toyota and workingtoward creating a prosperous society and clean world History Indus Motor Company (IMC) is a joint venture between the House of Habib, Toyota Motor Corporation Japan (TMC), and Toyota Tsusho Corporation Japan (TTC) for assembling, progressive manufacturing and marketing of Toyota vehicles in Pakistansince July 01, 1990. IMC is engaged in sole distributorship of Toyota and Daihatsu Motor Company Ltd. vehicles in Pakistan through its dealership network.The company was incorporated in Pakistan as a public limited company in December 1989 and started commercial production in May 1993. The shares of company are quotedon the stock exchanges of Pakistan. Toyota Motor Corporation and Toyota TsushoCorporation have 25 % stake in the company equity. The majority shareholder is theHouse of Habib. IMC's production facilities are located at Port Bin Qasim IndustrialZone near Karachi in an area measuring over 105 acres.Indus Motor company's plant isthe only manufacturing site in the world where both Toyota and Daihatsu brands are being manufactured. Heavy investment was made to build its production facilities based on state of art IMC's Product line includes 6 variants of the newly introduced Toyota Corolla, ToyotaHilux...
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...Table of Contents Q1. Tata steel has taken various strategies in the SCM to improve the performance of the organization. With reference to the Internet based information, discuss various strategic actions taken by this organization with regards to SCM to improve the finance and non- finance performance. 3 Introduction 3 Basic component Supply Chain Management 3 Plan 4 Source 4 Make 4 Deliver 4 Return 4 Supply chain management for logistic 5 Supply chain management for downstream 6 Tata Steel Strategic 6 Tata Steel supply chain logistic strategy 7 Tata Steel Supply Chain downstream strategy 8 Tata Steel finance improvement 9 Tata Steel non-finance improvement 9 Conclusion 11 Q2. Discuss various Supply chain activities (in relation to Lean Management) in a Toyota company in Danish Industries can learn and use for improved performance. 12 Introduction 12 What is Lean 13 Lean supply chain 14 Lean supply chain for Toyota Production System in Denmark 14 Value stream mapping 16 The VSM process 17 Performance improvement with implementation of VSM 17 Conclusion 19 Q1. Tata steel has taken various strategies in the SCM to improve the performance of the organization. With reference to the Internet based information, discuss various strategic actions taken by this organization with regards to SCM to improve the finance and non- finance performance. Introduction The Tata Group...
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...Yamile Macklin Course Project Week 7 Toyota Motor Company Managing Quality BSOP588 Managing Quality 02/03/14 Toyota Motor Company Quality Management Toyota Motor Corporation (TMC), is commonly known as Toyota in the stock markets was founded in 1933 By Kiichiro Toyoda. Toyota has enjoyed continuous growth in the automotive industry for decades as the largest automobile manufacturer and multinational automaker with an excess of five million vehicles per year, employing over 320,000 employees, and 14 plants in North America. After years of success in the auto industry as a credible and quality driven automaker, near the end of 2009 a horrifying car crash in Southern California led to the discovery of a major issue. With the assistance of the National Highway Traffic Safety Administration Toyota began recalling vehicles after reports that various vehicles experienced unintended acceleration. This 2009 recall was diagnosed as a possible incursion or incorrect or out-of-place front driver’s side floor mat, which can cause pedal entrapment. In October of 2009 Toyota begins sending out letters to owner notifying them of an unspecified upcoming recall to fix an unintended acceleration issue (Eugene). This recall was quickly followed by two massive recalls in early 2010 for related issues. The second recall occurred January 21, 2010 and was enacted after several vehicle accidents were declared to have no relation to the floor mat issue, but instead a new and more complex...
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...Citation: Netland, T. H. & Aspelund, A. (2013) Company-specific production systems and competitive advantage: A resource-based view on the Volvo Production System. International Journal of Operations & Production Management, Vol. 33, Iss. 11/12 Post-print. This is an Author's Original Manuscript of an article accepted for publication in the International Journal of Operations & Production Management, Vol. 33, Iss. 12. Forthcoming. Company-specific Production Systems and Competitive Advantage: A resource-based view on the Volvo Production System Torbjørn H. Netland1, 2 and Arild Aspelund1 1 Department of Industrial Economics and Technology Management, NTNU 2 McDonough School of Business, Georgetown University Abstract Purpose: In order to improve competitiveness on a global scale, multinational enterprises increasingly develop a company-specific Production System (XPS) and deploy it in their worldwide operations. An XPS is synonymous with a tailored corporate-wide improvement programme. The purpose of this paper is to explore the circumstances under which an XPS can provide a competitive advantage. Methodology: We use an explorative case study methodology to investigate the link between the establishment of an XPS and competitive advantage. Specifically we investigate the part of the Volvo Group’s globally implemented Volvo Production System (VPS) that aim to improve the manufacturing processes worldwide. Due to its historical trajectories, Volvo ...
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...Introduction Toyota Motor Corporation is one of the world largest automobile manufacturing. They have manufacturing plant throughout the world. Toyota has thirteen manufacturing plants in North American alone. One of its largest plants is here in the Georgetown, Kentucky where they produce the new Camry. Toyota is poised to overtake General Motors and become the largest car manufacturer in the world. Much of this success can be attributed to the renowned Toyota Production System (TPS). This system is one of the most admired lean manufacturing systems in existence and is constantly used in operational management text books as an example of how important operational management is to an organization. The main objectives to the TPS are to design out overburden and inconsistence, and to eliminate waste. Toyota has spent millions of dollars to bring over this system and implement here in its North American manufacturing plants. In our case we focus on the breakdown of this system that allows a small issue in seat installation to turn into a large problem that is slowing down production. Car production has dropped from run ratio of 85% to a run ratio of 95% in only one month. The run ratio measures the number of cars actually assembled in proportion to the number of cars that could have been assembled with no line stoppages. Along with the slowdown in production no one can put their finger on what is causing this and why there is a breakdown in the otherwise efficient TPS that usually...
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...Toyota in North America Donald L. Woolridge, Sr. Indiana Wesleyan University February 20, 2013 Course ADM537A Toyota in North America This paper will provide an overview and history of Toyota in general and the company’s operations in North America and its product lines specifically; share comments on the company’s organizational structure and senior management leadership style; discuss its nearest competitors – Ford, GM and Chrysler, known as the Detroit 3; share the weighted average cost of capital; provide insight in the company’s rationale/methodology for evaluating capital budgeting opportunities in North America; review the economic forecast for the industry; show the characteristics of common stock and bonds, share key financial ratios for three years, comparing to industry and nearest competitors; and in conclusion share a strong, fact-based summary of why or why not a person should make an investment in the common stock of Toyota. Historical Overview Toyota is a family-owned and operated company with very humble beginnings. Sakichi Toyoda, his son, Kiichiro Toyoda and Taiichi Ohno all played an important role in not only laying the foundation for what would become the automotive giant Toyota, but also in the development of the system that has revolutionized lean manufacturing; the Toyota Production System (TPS) (ToyotaGeorgetown.com, 2006-2013). Sakichi Toyoda invented the automated loom which ensured quality of product by stopping when threads...
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