toyota scm
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Supply Chain Management Of Toyota
Presented By
Shruthi.Holla
Sneha.LS
Soujanya.N
Founded 1937
Founder Kiichiro Toyoda
Headquarters Toyota City, Japan
Industry Automotive, Robotics, Financial Services and Biotechnology
Products Economy/mainstream/luxury vehicles
Revenue 18.583 trillion (2012)
Employees 300747 (2012)
INTRODUCTION
Toyota Motor Corporation
History of Toyota Auto Industry
Established in 1937 out of Sakichi Toyota’s weaving machine company
Launched first car (SA Model) in 1947
“Toyota Production System” formed in 1950 based on just in time principal
First global expansion in 1959 at Brazil
In 1972, cumulative production >10M units
Founder: Kiichiro toyoda
CEO : Akio toyoda
MD: Hiroshi nakagawa
Present CEO : Fujio Cho
Founder & CEO
Business segments
Automotive
• Design, manufacture and sales of passenger cars, recreational
vehicles, SUVs and related parts
Financial services
• Provisions of loans to car buyers and car deals.
Others
• Industrial vehicles (forklifts, etc.)
Product line
Electric technology- Toyota pirus, Auris.
Highlander and Camry
Plug- in hybrids
All electric vehicles- RAV4
Cars- 70 different models
SUV’S
Luxury type vehicle
Non- Automotive Activities
AEROSPACE
Toyota is a minority shareholder in Mitsubishi Aircraft
Corporation
invested US$67.2 million
will produce the Mitsubishi Regional jet.
It has also produced aircraft TAA-1 in 2002
Philanthropy
• Toyota Municipal Museum of Art in Aichi helping low-income
community members for education
• United Negro College Fund (40 annual scholarships)
• National Underground Railroad Freedom Centre (US$1 million)
Higher education
Toyota established the Toyota Technological
Institute in 1981, as Sakichi Toyoda
It founded the Toyota Technological Institute at
Chicago in 2003
Supporter of-
• Toyota Youth for Understanding Summer -
Exchange Scholarship Program.
• Toyota Community Scholars.
• contributed to a
number of local education.
Robotics In 2004, Toyota showcased
its trumpet-playing robot.
Developing multi task robots destined
for elderly care, manufacturing, and
entertainment.
Example of Toyota's involvement in
robotics for the elderly is the Brain Machine
interface
SCM
Minimizing supply chain costs
while keeping
a reasonable service level
customer satisfaction
quality
on time delivery, etc.
OBJECTIVE
Right product
Right price
Right store
Right quantity
Right customer
Right time
Supply chain overview
Suppliers Parts
Assembly plant
Inbound logistics
Inspection
Dealers
Outbound logistics
Production
Customers
Suppliers •Suppliers provide thousands of
parts and components that go into he vehicle.
•Parts and components are
received from tier 1 suppliers through inbound
logistics.
•Supplier chain contains several
levels : tier 1, tier 2 ….. And so on.
•Since Toyota relies on JIT it had
fewer but reliable tier 1 suppliers.
Ex: Denso, Bridgestone etc
Production• Vehicles are produced at the final assembly plant from the
parts provided by hundreds of suppliers.
•The plant is sub divided in to shops. The vehicle is born in
the body shop where the frame and body are formed.
•The body parts are stamped in the stamping shop by
presses.
•The body shop is where numerous robots are used to weld
the body parts together.
•After body being assembled, It moves to paint shop.
•After painting, It moves to final line where supplier parts
are installed to make finished vehicle.
•Final Inspection is done and moved to yard
Supply chain Contd….
Inbound Logistics:
• Company establish partnership with third party logistic providers
• Company organizes many of its suppliers into clusters based on geographic location.
• Parts are picked up from those suppliers by trucks on a milk route and delivered to regional cross dock.
• At cross dock, parts are unloaded and staged for each assembly plant and then loaded to trucks which take
parts directly to each plant.
• After the parts are unloaded, the truck is reloaded with the corresponding empty returnable containers.
• Returnable containers flow in reverse route.
Network design to analyse locations of suppliers
Determine which cross dock is located nearest to suppliers
Transport parts to cross docs and stage them for each assembly
Transport to plants and containers travel in reverse route.
Procurement Policy
Toyota procures the necessary parts, materials, and equipment for these many different business fields from
suppliers all over the world.
Toyota also cooperates with their Suppliers to promote environmental preservation and meet the other demands of
society.
They take a long term view toward our relationships with suppliers with an aim to realize an amicable relationship
of mutual prosperity based on fair business practices.
• Fair Competition Based on an Open Door Policy
• Amicable Relationship of Mutual Benefit Based on Mutual Trust
• Environmentally-Friendly Products Based on ”Green Procurement”
• Localization of Business Based on Good Corporate Citizenship
• Obeying the Law
Vehicles at marshalling yard Accessories installation Final quality assurance Transport to dealers
Outbound Logistics
Dealers:• Responsible For selling the vehicles produced by the manufacturer to there tail customers.
•Toyotas sales model is designed so that a high percent age of vehicles is sold from a relatively low level of dealer stock.
Toyota Distribution model:
Distribution Model
Local Distribution Model
Over seas Distribution Model
European Distribution Model
Overseas Network
Components Supplier Group Raw Material
Suppliers
Warehouse
Distributor
Assembly Plant
Dealer
CustomerParts/ Service Centers
TOYOTA SUPPLY CHAIN
FEATURES OF TPS
TPS
Technical Related
JIT
Kanban
People RelatedWorkers
Suppliers Revolutionized manufacturing industry
At its core is “lean”
a relentless drive to improve efficiency and eliminate waste
Beginnings of TPS were born out of necessity due to lack of resources in post-war Japan.
SMED
• Single Minute Exchange of Dies
• Promoted flexibility of production runs
JIT
• Just In Time manufacturing
• Small batches which reduced inventory costs,
tightened relationship with suppliers and improved
quality control
JIDOKA
• One of the two main pillars of TPS.
• It refers to the ability to stop production, by man or
machine.(equip malfunction).
Heijunka
• Where ever possible evenly distributed workload
made at any time, Without this, just in time cannot
be applied, because it will happen stacking and
queuing at peak level.
Total Productive Maintenance
• A comprehensive equipment maintenance process
so that the tools are always in good condition to
wear to work.
Key Main Concepts Of TPS
Toyota’s Strategy
Increase competitive strength through advanced technology
Environmental technology
fuel consumption, emission, recoverability
Increased emphasis on financial services and information communication system
Hybrid vehicles and next generation fuel cells
Cost-reduction efforts
discontinuation, integration of older models
Establish Goals and Objectives
Develop a Strategy to meet your needs
Make RecommendationImplement Recommendation
Review your goals and current situation
Financia
l Plan
ning Process
Financial Planning Process
Drivers of Supply chain
Facility:
• Vehicles coming out of assembly line are moved into
warehouse called “Marshaling yard” .
• Fitting accessories, price tag and final quality assurance
takes place here.
Inventory:
• Just-in – time based inventory method.
• Pull based system and kanban methods are followed.
Transport:
• Majority of transport of raw material through truck , since
suppliers stay close to plant.
• Finished products transported through truck or rail for
transport within the country and ships for export.
• Road transport is provided by third party logistic
providers.
Information:
• Parts and master database is maintained for part name,
supplier, lot size information.
• 13 week forecasting is given to suppliers to provide them
with guidance.
Sourcing
Pricing
• Toyota is a great company with an integrated supply chain management as well.
• Toyota has an integrated system in its production, namely TPS (Toyota Production System).
• Toyota has a wide range of advantages ranging from human resources to its products, it is evidenced by the wide range
of awards
• Toyota have 14 principles which refers to the quality of service, product quality and efficiency
• Toyota including Indonesia's largest company automotive in the world.
• Toyota lead because his concept of lean management.
Conclusions
Any Questions…!!!
Thank You…!!!
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