Operations play a very important role in the success of every business. This is because it coordinates the daily happenings in the business. It may also lead to improved profitability if it contributes to doing away with the useless processes that lead to more delays and losses. This is a summary of the interview conducted with a Supply Chain Analyst of a Toyota Motor Corporation plant. It begins by describing a brief overview of the company’s industry, organizational structure and number of employees. Thereafter, the interview focuses on the interviewee’s background, the responsibilities then a description of Toyota’s approach to operations and supply chain management.
Toyota Motor Company (TMC) is a Japanese multinational dealing in automotives. It is headquartered in Toyota, Aichi, Japan. The company was started by Sakichi Toyoda who first invented the Toyoda Model G Automatic Loom in 1924. From that time, the company has continued to develop their products to be one of the leading, actually the leading automaker in the world today. However, this has not come without operations and supply chain management ramifications over time. In 1951, the Suggestions System was begun and in 1962, the Joint Declaration of Labor and Management signed. This would greatly help future operations and help in supply chain force. Three years later, TMC won the Deming Application Prize for quality control, which means that it had achieved major strides in quality operations management among others. In 2004, the Toyota Partner Robot was publicly promulgated. In 2011, the Worldwide Hybrid Vehicle Sales reached the 3 million mark.
Toyota Operations and Supply Chain Management
Operations and Supply Chain Management (SCM) have undergone a global evolution. According to Shah (7), Ford Motor Company saw the first evolution of SCM while TMC is acclaimed for having brought about the second wave of SCM; with ramifications. Having existed for long, Toyota began by implementing a system in which all suppliers were located near the production plant. In addition, the operations management implemented a system in which both manufacturing of key parts and their final assembly was done in-house. The next aspect was to reduce set up time from a couple of hours to a few minutes. A collection of all these operations and supply activities have come to be referred to as the Toyota Production System (TPS), a worldly acclaimed system of production, operations management and supply chain management.
Taylor and Brunt (66) acclaim TPS for its role in reducing the time that is taken to convert customer orders into vehicle deliveries. The duos observe that the production is arranged in a sequence of ‘single continuous flow’. Operations at Toyota have been referred to as The Toyota Way. The Toyota management philosophy is comprised on four principles: challenge, improvement, go and see, respect and teamwork. These principles seek to level out any workload, to use visual controls that expose problems, create a continuous flow, making decisions by consensus even if it takes long, using ‘pull’ systems that deal with unnecessary overproduction, stopping to fix problems, becoming a learning organization, forgoing short-term goals for the sake of long-term philosophy and creating standardized duties. The Toyota management system also seeks to work with people who understand their work, motivate employees, respect for networks and enhanced teamwork.
TMC is a global leader in the auto industry. The website describes the company’s industry as ‘motor vehicle production and sales’ (Toyota). As at March 31, 2012, the company had a total of 325,905 consolidates employees and a total of 69,148 non-consolidated employees. The company’s organizational structure is headed by the Chairman of the Board who is assisted by a Vice-chairman. The company also has a president and a Vice-president who are members of the Board. Next, there are directors and corporate auditors followed by senior management officers and finally management officers. The interview was conducted with a manager at the latter level, because they have the first hand information on the day-to-day operations of the company.
According to Hino (167), Toyota supply chain management is perhaps older than most people think. The practice of Toyota connecting all the suppliers was existent as early as 1980’s. However, since the term ‘supply chain management’ did not exist, Toyota used the term Production-Sale Integration. The main aim of the TPS is to provide the best quality at the lowest cost, in the shortest lead time by eliminating waste. The two pillars of TPS are Just-in-Time and Jidoka or ‘autonomation’ which are maintained through a process of continuous improvement.
According to the manager, Toyota faces a myriad of challenges, just like any other multinational. The first one has to do with information system issues. With the ever growing immensity of information, content, employees among others, the company is faced with the challenge of standardization of communication systems across the board. According to Hino (167), the Chief Information Officer of Toyota, Susumu Miyoshi, once said that the biggest challenge with the company’s information system is that all regions have built different ones. Therefore, standardizing them has been a major challenge bearing in mind that technologies are not always compatible.
Supply Chain Analyst Information
The above information was collected not only from the website and books but also from one of the people involved in the process of operations and supply chain management. The interviewee is the supply chain analyst of a Toyota branch. He is trained as a business professional with a specialty in business administration. To enhance his performance, he has also done other professional course in the field of manufacturing. His decade long experience with the company has enabled him learn many things including the fact that Toyota has perhaps the best system in the world. This is true especially in terms of delivery of customer promise, diversification of products as well as effectiveness in production. Having had held previous management positions with other firms such as Dell, the interviewee found Toyota’s supply chain management very interesting thus was attracted with the company’s way of doing things. Although he began at human resource division, he later applied to be transferred to the supply chain management and operation. He is usually answerable to the Human Resources Manager but not as a junior. The human resources manager expects weekly reports on the performance of the supply chain and other related departments. Some of the challenges he faces are work load but it is usually made easier by the Toyota Production System. Moreover, he is confident that Toyota continues to provide the best opportunity for his growth.