1. TOYOTA MOTOR
MANUFACTURING,
U.S.A
Case Analysis
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2. Toyota Motors Manufacturing (TMM) faces
increasing problems with its seat supply.
TMM’s single seat supplier, Kentucky Framed
Seat (KFS), is responsible for the majority of
the problems with material flaws and missing
parts as the major encountered defects.
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3. These problems are increasingly occurring
with an increase in varieties of and demand for
the seats. Toyota currently addresses these
problems offline; however, this is a deviation
from the policies and procedures under the
Toyota Production System (TPS). Now, as
TMM ramps up for the production of the
Camry Wagon, it must address the seat issue
before seriously impacting production
performance.
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4. THIS IS CAUSED BY THREE
FACTORS
• 1) Seats need to match each particular car,
therefore stock parts cannot be used
• 2) The supplier process operates under Just In
Time (JIT)
• 3) KFS cannot readily supply replacements for
defective seats
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5. PURCHASE DEPARTMENT
SUGGESTIONS TO TOP
LEVEL MANAGEMENT
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6. Q1.BUYING QUALITY MATERIAL AT LOW PRICES:
SOLUTION:
• Purchase Department has suggested following ways to
procure material at low price and with best quality:
• Downward Integration: As Toyota is huge industry and
requires large no of stock so if it can go for downward
integration it would be a good idea as than it can very well
control the inventory for JIT and it will also have a total
quality control and will save the cost.
• Quality Control : Quality check Teams can be formed which
would work in close collaboration with suppliers so to check
on quality of materials supplied by them and suggest them
measures to overcome any defect in their manufacturing
process
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7. • Build a Supplier Chain Development Program: This
program would help in providing suppliers training and
development for their existing staff and manufacturing process
by providing them technological aid and at the same time
management expertise.
It can include development of techniques like
• 1. Six Sigma
• 2. JIT
• 3. KAIZEN
All this will reduce their cost of production which in turn will
help Toyota to acquire raw materials and low price without
actually lowering profit margin of suppliers and gaining their
confidence.
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8. Problem 2: Providing Data having Cost of
Production to TOP LEVEL MANAGEMENT
Solution: This would be tough deal to crack as nobody
will like to share their cost of production with other
company but this can be done by entering into contract
with them to share their cost of production so that
without lowering their profit margin we can help them
to reduce their cost of production and providing them
aid in management as well as production process so that
they can work up to their full efficiency.
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9. QUALITY CONTROL
DEPARTMENT
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10. 1.Procurement schedule should match with
production schedule.
2. Seat material would be provided at the time
of procurement of seats.
3. When the cars would be finally made, a
quality check would be done.
4 . Direct link between production and
operation department.
5. Scheduling process= production schedule
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11. MANUFACTURING AND
INSTALLATION
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12. Q. How do we reduce the manufacturing and installation
time?
Ans. The manufacturing and installation time can be reduced by
following the following options:
1. As Toyota can use combined seat installation technique, as
they have made two separate systems in a divided order, in
order to install two seats, so these systems can be combined so
that the seats are installed in a car simultaneously, and the time
would be saved.
2. We can use a better robot, which is much efficient and quick.
As when the robot will be quick enough to cope up with faster
production , painting system would receive the car sooner,
thereby increasing the manufacturing speed.
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13. INVENTORY
MANAGEMENT
DEPARTMENT
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14. Q1-Provide all information on Kanban cards for inventory
movement?
Ans.- A Kanban Card include a part code number, its batch
size, its delivery address and other related information. Every
part container sitting on the flow rack along the assembly line
held one batch & had its own card. The card would physically
travel between this part -use point & the supplier, whether in
house or outside to signal the actual parts needed. When the
supplier receive the Kanban, it began making that part in the
stated quantity, & shipped a container full of that part to the
proper address on the assembly line. Assembly group leaders
adjust the number of circulating kanbans for each part within
the set range to avoid having team runs out of every parts.
Kanban cards are used by PC department to determine
appropriate kanban range & to feed information back to parts
ordering for even better inventory control.
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15. Q2- Feed necessary parts into TMM operating that are
needed and write the no. of cars that could be delivered to
sale with JUST IN TIME.
Ans.- To feed necessary parts into TMM operating PC relied on the extensive
forecasting and planning that TMC performed for worldwide markets. To
prepare for May production, for example, PC first received, in January, a
Production Planning Order (PPO) for key specifications from the sales
company. This PPO was revised in February and, after one more update,
was fixed as a Total Vehicle Order (TVO) by the end of March. While total
volume was fixed in the late March, the PPO was generally accurate only
within "20%" of the TVO for most specification categories at that
point. Next, the TVO was broken down weekly: by the end of the second
week of April it was done for the first week of May. During the third week
of April, the initial May week's information was translated into final part
orders for local suppliers as well as a daily production sequence for TMM
operations. This procedure left one full week for production preparation.
The number of cars would call for 500 base models and 500 luxury models
every single day and also demand that a base model and a luxury model be
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16. Q3- Need to balance out the total order in daily production
sequence Hijunka practice?
Ans.- By balancing of the total order in daily production
sequence Hijunka practice, the same supplier could stick to a
uniform cycle time throughout the month without creating the
waste of inventory. Similarly, offsetting cars that required a
particular operation against those that did not prevented any
particular work station from becoming a severe bottleneck or
remaining unreasonably idle. Hijunka also synchronized the
assembly line with the ultimate sales of the cars.
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17. SUPPLIERS
HANDLING
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18. CONTRACT BETWEEN TOYOTA AND
COMPONENT SUPPLIERS
Based on the principle of “long-term stable transaction”,
Toyota makes an unique “basic control of component
transaction” with a component supplier. On this contract
Toyota confirms to promote long lasting prosperity for both
parties and an ideal quality assurance for customers. Hoping
that, perfect quality control is carried but by every component
manufacturer, Toyota includes in the contract the basic rules of
quality control, the steps to be followed when defective goods
come out and etc.
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19. UPBRINGING OF COMPONENT
SUPPLIERS
• In order to develop the component suppliers Toyota
assists them in improving management as well as
quality control. Various means are available for
assisting suppliers in improving systems of
management such as:
• Toyota quality Control Reward
• Guidance of Toyota Production system (Kanban
System)
• Mutual development by supplier’s organization and
etc.
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21. COMPILED BY-
 AAMUKTA MURTI
 DEVENDRAN S.P
 GAURAV KHATRI
 PUSHPAM SHREE
 SIDDHARTH TRIPATHI
 TIMSI LUTHRA
 VANDANA MADHURI SINGH
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